Dr. Doom - The Worse is Yet to Come on Unemployment

The calls for a direct jobs program are growing. Nouriel Roubini has written The Worst is yet to Come: Unemployed Americans Should Hunker Down for More Job Losses.

Based on my best judgment, it is most likely that the unemployment rate will peak close to 11% and will remain at a very high level for two years or more.

Some economists are predicting a unemployment rate peak of 13%.

Roubini is calling for bold action.

There's really just one hope for our leaders to turn things around: a bold prescription that increases the fiscal stimulus with another round of labor-intensive, shovel-ready infrastructure projects, helps fiscally strapped state and local governments and provides a temporary tax credit to the private sector to hire more workers.

Roubini also mentions the "O" word, offshore outsourcing. It's about time major economists start talking about global labor arbitrage and in no uncertain terms of what it is doing to this country.

At least 25% of U.S. jobs are offshoreable and note, often when they cannot offshore outsource the jobs, corporations want to bring in labor via guest workers instead. It's a crisis where U.S. labor is almost seen as a last resort.

Roubini also is saying the unemployment rate is so great, it increases risk for a double-dip recession.

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Dr. Not-So-Doom

In late 2008 Roubini predicted unemployment to peak at 9%.
Now, at 10.2% he's predicting a peak at 11%.

I think Roubini is about to be proven to be an optimist again.