Best case scenario: U3: 14-17%; U6: 26-31%

And here is what Bernanke, and everyone else who wonders where we are headed, should be looking at:

“If the job market does not turn around by late summer or early fall of 2009, the projections easily exceed the Great Depression. At that point the only way to prevent catastrophic economic conditions would be through massive inflation of the US dollar achieved by either congress allowing the Federal Reserve to issue its own debt, or by accelerating the rate at which the Federal Reserve monetizes US debt while funneling the newly printed dollars into wages so that the money can circulate within the economy.”

Yes, wage inflation is wonderful, however recent data indicate that just the opposite is happening, and the only people who have seen their base pay increase are, ironically, Wall Street bankers, however, at the expense of losing their bonuses. Which is why bank excess reserves are likely to continue skyrocketing as literally boxes full of cash continue gathering dust, while a deleveraging consumer spends his money on guns and ammo.

And here, for some more data on why the unemployment number, is for the most part, rubbish.

Hat tip Distressed Lookout

As of May 26, 2009, Bank of Lincolnwood had total assets of approximately $214 million and total deposits of $202 million. Republic Bank of Chicago agreed to purchase approximately $162 million in assets. The FDIC will retain the remaining assets for later disposition.

The FDIC estimates that the cost to the Deposit Insurance Fund will be $83 million. Republic Bank of Chicago’s acquisition of all the deposits was the “least costly” resolution for the DIF compared to alternatives. Bank of Lincolnwood is the 37th FDIC-insured institution to fail in the nation this year and the sixth in Illinois. The last bank to fail in the state was Citizens National Bank, Macomb, on May 22, 2009.

Does anyone even care about this data anymore? There obviously isnt one bank in the US which, on a long enough timeline, won’t fail.

We have to put the data into perspective. Before the Lehman collapse, when equities were in a moderate bear market and bonds in a moderate bull market, the worst nonfarm payroll result we saw was -175,000. We don’t seem to recall too many pundits rejoicing over employment declines at that time, which were basically half of what was just posted in May. Moreover, the worst nonfarm payroll number in the 2001 recession — right after 9-11 — was -325,000; and before that, at the depths of the 1990-91 recession, the worst report showed a -306,000 print. So basically, what we saw today was a number consistent with a deep recession — just not quite as deep as the near-6% at an annual rate contraction we saw in the first quarter. It is difficult to rejoice over an employment data that is consistent with real GDP still declining anywhere from a 2% to 4% at an annual rate. Now here we are, close to nine months after the Lehman collapse, and we are still printing employment numbers that are double what they were before pre-Lehman. That is the bigger picture.

Moreover, the internals of today’s report, in a word, were awful. Not only are businesses still cutting jobs but they are also reducing the hours that their employees are working; the private workweek hit a new record low of 33.1 hours (from 33.2 hours in April). So, total labour input was much weaker than the headline payroll suggests and this is vividly illustrated in the aggregate-hours worked index, which fell 0.7% MoM and something ‘green shoot’ advocates will not like discuss since this was actually worse than the 0.3% MoM drop in April; this takes the three-month trend to a -8.6% annual rate. Think about that for a moment because what goes into GDP is total hours worked and productivity — so the latter better continue to hang in there or else we are going to be seeing some nasty output data going forward that may well take Mr. Market by surprise. Put another way, if companies had held hours worked constant in May instead of cutting them, to achieve the total labour input they achieved last month would have required — get…

Update: Just as the SPY is about to drop, guess who start gobbling up 5-10k blocks of SPY. $10 in TARP money to the first who guesses.

JPM making sure that no Dow dip goes unpunished.

Update 2: And just in case there is ANY CONFUSION AT ALL LEFT, here is who gunned the last ramp up.

Someone tell that house of dimon SPY permabid that consumer credit down -> savings up -> economy bad.