The two Congressmen in the U.S. House of Representatives that represent Collin County residents, Sam Johnson (R) and Ralph Hall (R) and both Texas’ Senators Kay Bailey Hutchison (R) and John Cornyn (R) voted against President Obama’s economic Recovery and Reinvestment Act.
Texas Gov. Rick Perry too waged a weeks long aggressive campaign and
co-wrote an op-ed piece with South Carolina Gov. Mark Sanford opposing the stimulus bill. Several days after Pres. Obama signed the Reinvestment Act into law Gov. Perry grudgingly informed the White House that
he'll accept the money, but left the door open to not taking
all of the money allocated to Texas. Gov. Perry is considering rejecting part of the money because he, and presumably other Texas conservative Republicans, do not want to accept money that would fund social programs, like unemployment insurance, to which they are opposed.
Are our conservative Republican representatives in Washington DC and here in Texas really concerned about the best interests of our citizens, or are they playing politics as increasing numbers of Texans loose their jobs and their homes and the Texas economy sinks?
February is shaping up to be another brutal month of job losses pushing the number of laid-off workers receiving unemployment benefits to an all-time high of nearly 5 million, and new jobless claims to levels not seen since the early 1980s. A report released Thursday by the U.S. Labor Department shows that the number of people receiving regular unemployment benefits rose again by a record 170,000 pushing the number of unemployed workers to 4.99 million for the week ending Feb. 7. Continuing claims have hit record marks for the last the fourth straight week according to U.S. data.
Based on current trends, net job losses for February could exceed 700,000, a number that would surpass the 598,000 jobs lost in January, which had been the biggest total since 1974. That's after the U.S. economy lost 524,000 jobs in December, the 12th straight month of decline. Nearly 2.6 million jobs were lost in 2008, with 1.9 million destroyed in the last four months of 2008, the biggest job losses in any calendar year since 1945.
By December 2008 the unemployment rate rose to 7.2 percent, the highest since early 1993 — just after the last Pres. G.H.W. Bush left office. USA Today charts the 2008 U.S. job losses, which may look good compared to the chart we may see by December 2009.
The unemployment rate in the Dallas/Fort Worth metropolitan area jumped slightly in December, according to a new report from the Texas Workforce Commission. According to the report, the submarket of Dallas-Fort Worth-Arlington saw its unemployment rate jump slightly from 5.7 percent in November to 5.8 percent in December. Another breakout of the Dallas-Plano-Irving submarket shows the unemployment rate jumping from 5.8 percent in November to 6 percent in December.
The worst U.S. housing slump since the Great Depression is draining home value as a record 19 million U.S. homes were foreclosed and stood empty at the end of 2008 and banks continue to seize homes faster than they can sell them. The share of empty U.S. homes that are for sale rose to 2.9 percent, the most since the year 1956.
In Collin County the 2008 foreclosure postings were up 18 percent from 2007 and overall more than 50,000 D-FW area homes were posted for foreclosure in 2008, a record and a 17 percent increase over 2007.
According to a new report from Foreclosure Listing Service (FLS) Inc., foreclosure postings filed for auction at North Texas' four primary counties — Dallas, Tarrant, Collin and Denton — courthouses reached an all-time high during the first quarter of 2009. (Although the first quarter will technically end on March 31, foreclosure auction filings must be filed at the courthouse the previous month before the auctions take effect.)
FLS statistics show that 13,259 foreclosure auction postings will be filed at Dallas-Fort Worth area courthouses by the end of February in advance of the "first quarter 2009 foreclosure auction," a record high according to FLS. And, for the upcoming month of March alone, FLS data shows 4,276 foreclosure postings will likely be filed. Over the last year, quarterly posting activity in Collin County climbed 11 percent, according George Roddy Sr., president of Foreclosure Listing Service Inc. (click to go to an interactive foreclosure listing and map)
As foreclosure continue to increase North Texas pre-owned home sales plunged 27 percent in January – one of the sharpest percentage declines on record. January's total 3,399 sales of pre-owned single-family homes represents a 63 percent decline from the market peak in June 2007.
At the same time sales were falling, median prices were down 6 percent compared with January 2008, according to statistics released Wednesday by North Texas Real Estate Information Systems and Texas A&M University's Real Estate Center.
(Read President Bush's and the GOP's Blind Faith In Unregulated Markets And Unregulated Mortgage Lending Stoked The Economic Crisis in the NYTimes.)
Over the three months ending in December, the Texas Leading Index experienced its sharpest decline since its inception in January 1981 (Chart-1). All eight of the indicators gave negative signals, with the steepest drops coming from the increase in the Texas export-weighted value of the dollar and declines in the stock index of Texas-based companies. In addition, the Texas Business-Cycle Index was revised downward, indicating Texas likely entered a recession sometime in the second half of 2008.
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| Chart 1: Texas Leading Index signals recession |
Texas employment growth was revised downward [1], showing a sharply negative turn in September, and then proceeded to fall further in both November and December (Chart-2).
In December the unemployment rate reached 6 percent, up 1.9 percentage points from its bottom in April 2008. Given the sharp fall in the Texas Leading Index and the negative outlook of Beige Book respondents, further increases in the unemployment rate are expected.
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| Chart 2: Texas job growth beginning to sink |
In December, Beige Book contacts across a wide range of industries reported further weakening in economic activity. The majority of respondents now expect a recession through midyear, with some contacts not expecting a recovery until early 2010.
Texas exports have dropped over 17 percent from the high reached in July 2008 (Chart-3). Contributing to the decline was a sharp slowing of the world economy and an appreciation of the dollar against the currencies of primary trade partners. For example, the dollar appreciated significantly against the Mexican peso, which has a powerful impact on Texas exports, as Mexico is Texas’ largest export destination.
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| Chart 3: Texas exports drop sharply |
The Texas housing market continues to weaken, although home inventories and rates of mortgage delinquencies and foreclosures suggest that markets are in better shape than the national average.
According to industry contacts, a growing concern in Texas is that commercial construction will drop sharply due to restrictive financing for the industry. While residential construction values have been in decline for some time now, nonresidential construction values are yet to show a significant drop off. This is due in part to the expansion of the Port Arthur refinery, which began in 2008. The public sector continued to add space, while private construction of hotels, stores, offices and restaurants began to decline in the closing months of 2008 (Chart-4).
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| Chart 4: Public sector contract values increasing,but private sector shows declines |
Energy prices have stabilized at levels far below those seen in 2008, with oil prices fluctuating around $40 for the past month. The rig count has responded sharply—228 rigs have been removed from service since the end of November (Chart-5). Most of the decline has come from land-based natural gas rigs. Employment cutbacks are expected to hit the industry in 2009 as energy prices languish.
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| Chart 5: Drilling activity declines following rapid fall in energy prices |
Of Texas’ major metros, Austin and Dallas have been hit the hardest in recent months, while Houston has fared the best (Chart-6). However, the decline in energy prices makes it likely that all major Texas metros will experience a recession in 2009.
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| Chart 6: Most major Texas metros weakening |
One way to analyze the different metros’ exposure to the national downturn is by computing their job-share location quotients. The location quotient quantifies the relative concentration of a specific industry as compared with the concentration of that industry nationwide. A location quotient value greater than one represents a higher concentration in that industry than the nation as a whole, and values less than one imply a lower concentration. Dallas and Austin are more heavily concentrated in cyclically sensitive industries like information services and simultaneously less represented in the more cyclically stable industries like education and health services. Houston is heavily weighted in the energy sector, and much of its fate this year likely rests with energy prices.
Al Franken (D-Minn.) has started using the title “senator-elect,” despite the fact that a Minnesota court is currently hearing Norm Coleman's (R-Minn.) challenge to the November election recount. Since taking the lead in the recount, Franken has insisted that he is the rightful winner of the Minnesota Senate race. Franken gave his first national media interview since November to Air America's Mark Green Friday.
