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How to reduce unemployment without growth

For the French economy creates jobs, it must grow by at least 2%. Unattainable at present. However, there are solutions to reduce unemployment. Here's why. Agency employment center in Nice

After four months of slight decline earlier this year, unemployment in France has increased considerably and the. In July, the number of unemployed rose by 36,100. It is the largest monthly increase since October 2009. It is particularly disturbing that this is the third consecutive month of increases. "Predictably, with growth at 0%," Xavier Bertrand has responded in an interview with Le Figaro on Friday. "But that does not detract from my belief that unemployment will go back down," he added.

It appears optimistic, our Minister of Labour. As rising unemployment reflects a depressed economic conditions.As recalled by Xavier Bertrand growth lights made the place the second quarter. And the second half does not look better, the two engines of growth – business investment and household consumption – being seized. The government also revised down its growth forecasts for 2011 and 2012 – to 1.75% against 2.25% and 2 before. Some analysts are even more pessimistic: they expect a growth of only 1.5% this year and 1% next year.

Or to create jobs, the French economy should grow by at least 1.5%. And to reduce unemployment is to say, create enough jobs to absorb the growth of the labor force, growth must be at least 1.8%. And that's in normal times. The problem is that the French economy out of two years of zero productivity and a year of recession – in 2009.The catch must be more important. To reduce unemployment, it would now grow by at least 2.3% per year. We are far. "In order to reduce unemployment without growth, there are only two treatments, said Eric Heyer, deputy director of analysis and forecasting department of the French Office of Economic conjectures (OFCE).

Administrative treatment of unemployment

France has the chance – or luck – to have a dynamic workforce, due to a high birth rate (more than two children per woman). According to INSEE, the labor force, which stood at 28.35 million people in 2010, is expected to grow by an average of 110,000 people a year by 2025. More than 9000 people a month who register for employment center. To reduce the workforce, just out lists of people registered as unemployed.How? "In the radiant, by offering internships, apprenticeships and training, or putting them into early retirement and by providing job search," Eric Heyer lists.

Radiation administrative job seekers jumped unusual in July (25.1% over the month and 7% year on year). The SNU FSU, the majority union at employment center, sees the consequence of the recent computerization of letters sent to the unemployed. Some economists also point out that past governments in pre-election period, have used an administrative treatment of unemployment.

The current government is not immune to this temptation. Last February, Nicolas Sarkozy announced the release of 500 million euros to encourage the use of long-term unemployed and young people. On the menu: skills training and learning.Or people in learning or training out of lists of employment center. However, the government has no intention of using the subterfuge of early retirement, on the contrary, the exemption from job search (DRE), which allows the unemployed aged 60 and over not to look employment and reach retirement, will be removed in 2012. As for the pension reform passed in 2010, it extends the legal age of retirement and the age of full retirement. Which penalizes the elderly first. Since January 2008, unemployment of over 50 jumped 57%.

Social treatment of unemployment

"The alternative to reduce unemployment when growth is not the appointment is that the public sector taking the baton in the market sector," said Eric Heyer. This includes all forms of assisted contracts, that is to say, employment contracts mainly funded by the state.This is called the social treatment of unemployment. It is a great classic from the left. Martine Aubry, the Socialist candidate in the primary, has already announced that its first action as president, if elected in 2012, will be to remove the tax exemption of overtime to fund the creation of 300,000 "jobs of the future "- the little brothers of youth employment in 1997.

But this solution is also widely used on the right. The government is not talking about jobs for young people but CAE (support contracts in employment in the public sector) and ICE (employment initiative contracts in the private sector). 440 000 of these subsidized contracts to be financed by the state this year.

"While it is not sustainable contracts is not a panacea, recognizes Eric Heyer.But these subsidized contracts have two advantages: one is to target audiences that have the most difficulty in finding employment [the young and long-term unemployed for example], the second is to provide purchasing power to more, which is likely to boost consumption so the country's economic machine. "

German consumer confidence declined as expected

German consumer confidence is expected to slightly deteriorate in September, reaching a low of ten months in the context of the debt crisis in the eurozone and fears of a recession in the U.S. shows Thursday the monthly survey institute GfK.

This leading indicator of consumer sentiment, calculated on the basis of a survey of about 2,000 people, spring down to 5.2 in September against 5.3 in August, but in line with the expectations of the analysts interviewed by Reuters.

The component of macroeconomic expectations fell to 13.4 against 44.6 the previous month.But the purchase intentions were up, supported by a strong labor market.

"The deterioration of the debt crisis and the sharp fall in stock markets around the world at the moment weighs only slightly on consumer sentiment," said the institute GfK said in a statement.

"The domestic setting extremely positive, unemployment down and wages up offset these negative factors."

The unemployment rate in Germany came out in May and June to 7.0%, its lowest since the reunification of the country.

But recent statistics have fueled doubts about the ability to Berlin to continue playing its role as a locomotive of the euro zone, amid debt crisis and fears of a global economic slowdown.

In the second quarter, Germany posted a slower growth to just 0.1%, weighed down by a lowered consumption and low investment in construction.

German business morale has meanwhile posted a dip in August marked the most since the 2008 crisis, according to figures released Wednesday.

In this context morose, German households now fear being asked to contribute to increasing attempts to resolve the budget crisis European, is the institute GfK.

Largest economy in the euro zone, Germany pays more than a quarter of the invoice bailouts granted by the region to try to stem the debt crisis.

European shares fall further, fear of a recession

European shares ended down Friday, concluding a third straight week against a background of restless fears of a relapse into recession in major developed and sovereign debt crisis.

The CAC 40 index dropped 1.92% to 3016.99 points, but varied between a low of 2947.91 points (-4.2%) and a high of 3078.28 points (0.07% ).

For the week the index lost 6.13%, after falling 5.48% Thursday, bringing its slide to 17.82% since the beginning of the month.

"Above all, the anticipation of 'double dip' recession in the double way early 1980s, which haunted investors.This contraction is somehow accepted and caused by the austerity budget set up by European politicians, "said Eric Galiegue, president of Valquant.

Other major European markets, London has sold 1.01% 2.19% Frankfurt and Milan 2.46%. The European indices EuroStoxx 50 and 300 respectively Eurofirst fell 2.15% and 1.66%.Since the beginning of the month, the EuroStoxx 50 loose 19.15%, 13.32% and the London Stock Exchange German 23.45%.

On Wall Street, the S & P 500 fell by 0.15% and the Dow Jones 0.33% at midday in New York.

"The second quarter growth was well below expectations on many aspects: sluggish domestic demand, external demand risk and a clear concern about the financial variables, crystallized by market volatility," recalls Erick Muller Chief Investment Officer of Fidelity bond range.

The situation remains very FRAGILE

The implied volatility of the Eurostoxx 50 has remained virtually unchanged Friday (0.29%) but jumped 71.29% in three weeks.

"The month of August will bring real improvement on any of these points.The overall situation remains very fragile for the second half and the markets have adjusted the valuation of assets as a result, but suddenly long term, "said Erick Muller.

In this context, cyclical stocks and banks have once again suffered, Renault (-4.69%) showing the greatest decline in the CAC 40 lost 4.27% BNP Paribas in Paris.

Elsewhere in Europe, banks Unicredit and Lloyds fell 4.8% and 5.8%, while car manufacturers Porsche and Fiat gave up 4.45% and 4.3%.Their respective sector indices ended lower by 1.81% and 2.86%, the car even accusing the largest decrease sector.

Since the beginning of the month, European banks have unscrewed from 21.85% and 27.74% of the car.

The same causes leading to the same effect, investors fled to the assets with the least risk, such as gold, which recorded a new record of 1,877 dollars an ounce and earns nearly 14% since late July, or Yields on government bonds rated.

The rate of the 10-year Bund and of the French OAT maturing well remain virtually unchanged in late afternoon around by 2.1% and 2.77%, after falling in the morning at 2.031% and 2.713%.

"Despite the deterioration in the rating of the United States by Standard and Poor's, despite concerns in general about the astronomical amounts of public debt, interest rates on government bonds with very broad market fall," Valquant said in a weekly strategy note.

"This is a sign that investors are in full 'flight to quality', and they seek refuge in government debt," says the company.

Starbucks boss wants to cut donations to political

The CEO of Starbucks garnered supporters after his call for a suspension of donating money to American politicians until an agreement "fair" be struck between Democrats and Republicans on the debt and the budget.

In a letter made public Monday, Howard Schultz, who led a painful restructuring of the first global chain of coffee shops, also called on U.S. contractors to support the economy by hiring.

The head of NYSE Euronext Niedrauer Duncan and his counterpart Robert Greifeld Nasdaq OMX has already expressed support for this initiative.

"I think the idea of ​​Howard is good and I told him he could count on me," writes Robert Greifeld in a letter to executives of Nasdaq.

The call of the CEO of Starbucks is in addition to other interventions of senior private sector leaders who have moved strife torn with Republicans and Democrats in the debate over raising the ceiling of U.S. debt.

These divisions have contributed to plummeting consumer confidence to lowest in more than 30 years and have been cited by Standard & Poor's among the reasons which led to lower sovereign rating of the United States.

This weekend, the New York Times published a paper in its pages of one of its editorial on the call to Howard Schultz, in addition to an editorial in the American billionaire Warren Buffett for a higher taxes on the wealthy, including himself.

"These are highly respected leaders and they want something," said Todd Morgan, director and founder of Bel Air Investment Advisers in Los Angeles, whose company manages the portfolio of households with assets exceeding $ 20 million.

"I think other business leaders will follow suit and require Washington ambitious decisions, which could restore confidence in the economy of our country," he adds.

In his letter, Howard Schultz invites business leaders to engage with him "to suspend any further campaign contributions to the attention of the president and all members of Congress until a fair and bipartisan agreement be concluded that puts our country on more solid fiscal foundation for the long term. "

Howard Schultz CEO also urged his colleagues to invest in new projects or products that will draw up the economy at a time when the fears and uncertainties discourage companies from investing, consumer spending and banks to lend.

"Record levels of cash piling up in business, unused," said the head of Starbucks. "The only way to stop this circle of fear is to break it."

U.S. consumer confidence to a low of 30 in August

U.S. consumer sentiment fell in August to its lowest level in more than 30 years, amid fears for economic recovery and disillusionment over government policies.

Preliminary estimates of the survey Thomson Reuters / University of Michigan released Friday, the index fell to 54.9, the highest since May 1980, after 63.7 in July. Analysts on average expected 63.0.

After this publication, the major indices on Wall Street erased some of their gains and the Nasdaq fell even in the red, before resuming their advance.In Paris the CAC 40 also briefly reduced his earnings.

The high unemployment, stagnant wages and the interminable debate between Democrats and Republicans over raising the debt ceiling weighed on consumer sentiment, who were interviewed before the downgrade of sovereign states United by Standard & Poor's.

"In the history of this survey, we have never had so many consumers who spontaneously mentioned the negative role of government," said in a statement the director Richard Curtin of the investigation.

"It's more than just the recognition that traditional monetary and fiscal measures are exhausted in large part, it is the realization that the government was unable or unwilling to act to do so."

Bitterness and CONCERNS

The Obama administration is reaping the negative opinions of 61% of respondents, the worst score among all the previous presidents.Two thirds of respondents felt that the economy had deteriorated recently.

And 75% are expected in early August in difficult times for the economy, a ratio approaching the historic peak of pessimism hit 82% in 1980.

The component of current conditions index fell more sharply than expected to 69.3, its lowest level since November 2009, after 75.8 in July and while the market awaited 74.3.

The expectations fell to 45.7, also unheard of since May 1980 against 56.0 in July to 55.3 and consensus.

Inflation expectations one year were flat in August to 3.4% last month compared with July, as well as expectations to five years, to 2.9%.

"The surprise is the sharp decline" of consumer sentiment, said Stephen Stanley, Pierpont Securities.

"Some numbers are even lower than what was seen during the recession and financial crisis. The fall in expectations appears to be due to the bitterness of the people on the political situation and their concerns about the financial markets. "

However, this study concern was partly minimized markets after the release of a 0.5% increase in retail sales in July in the United States, or their biggest increase since March.

"The expenses of people do not always match their mood. I doubt that things are as bad as what is suggested by the index of consumer sentiment," said Stephen Stanley.

Direct: The Paris Stock Exchange returns in the green

After the plunge in Asian stock markets, European markets seem to have avoided a crash. And Paris, the first trading fro even positive. The world leaders are mobilized to prevent a global crash. Monitoring minute by minute. European stock markets limit the damage on Monday.

9:41: The main European stock markets have not collapsed Monday in the opening. The interventions of the G7 finance leaders and the European Central Bank appear to have prevented a panic. After opening lower, most European markets are ironed in the green a few minutes after the first exchanges. Shortly before 9:30 (7:30 GMT), Paris was up slightly (0.15%), London climbed 0.35% and Frankfurt did not lose more than 0.20%.Madrid (2.6%) and Milan (3%) were very relieved by the announcement of an intervention by the European Central Bank (ECB) on the bond market.

9:36: rebound in financial stocks. Bank stocks offered a strong rebound on Monday in early trade on the Paris stock exchange, through the redemption of bonds of fragile by the European Central Bank (ECB). There are some over 6%, after losing considerable ground in recent sessions because of the debt crisis. At 9:32 (7:32), BNP Paribas gained 5.85% to 42.99 euros and Societe Generale 5.47% to 28.93 euros, totally ignoring the loss of triple-A by the United States.

[See also: The United States lost their triple A, what consequences?]

9:21: Shanghai ended down.The composite index of Shanghai Stock Exchange lost 3.79% Monday, giving up 99.6 points to 2526.82 points to fall, due to the loss of triple A U.S. revives fears of global crisis dealers said.

9:18: The Paris Stock Exchange returns in the green in early trade Monday, taking 0.15%, ignoring the loss of the triple A of the United States for a rebound s'offir careful after ten days of declines.At 9:14, the CAC 40 gained 4.77 points to 3283.33 points.

9:17: The London Stock Exchange opens down, the FTSE-100 index lost 24.09 of the key values ​​points, or 0.46%, about 10 minutes before the start of trading at 5422.90 points.

[See also our file: What you should remember the debt crisis of the U.S.]

9:06: The index of the star Dax Frankfurt Stock Exchange at the opening down 1% to 6170.69 points against 6236.16 points at the close Friday, limiting losses after a week where he lost over 13% of its value.

9:03: The ECB is willing to buy the Spanish and Italian debt, announced the French minister of Economy Baroin.

9:00: Paris opens down. The Paris Bourse opens a moderate decrease of 0.74% to 3254.36 points. The CAC 40 index 24.20 points to 3254.36 let loose points. It is a historical series of 10 sessions of consecutive decline, unheard of.

In London, the FTSE-100 opened down 1.15%. Madrid opens up 0.63%, Milan 0.09%.

8:50: The G7 to preach a "strong international financial Systel." Before the opening of the Tokyo Stock Exchange, the finance ministers and central bankers from the G7 issued a statement in which they pledged to take "all necessary measures" to support financial stability and growth. They reaffirm "our common interest in a strong and stable international financial and [reaffirm] our support for the exchange rate determined by the markets." They point out that excessive volatility and disorderly movements in exchange rates has negative implications for economic and financial stability.

8:38: Moscow down. Moscow stock exchanges are down over 2.5% at the opening.

8:30: Sharp drop expected in Paris. The Paris Bourse is expected to open sharply down Monday.The futures contract on the CAC 40 lost 2.53% forty minutes before the opening of the session.

8:28: Relaxing expected in Spain and Italy. The 10-year rate Spanish and Italian relax strongly Monday in the bond market after the announcement by the European Central Bank that it would buy back bonds in the euro area.

8:21: The euro rose. The euro firmed on Monday morning in Tokyo against the dollar after the shock wave over the weekend by the downgrade of U.S. sovereign debt. Around 6:00 GMT, the European currency was worth 1.4337 dollars, after falling to 1.4055 dollars in Asia Wednesday – its lowest for three and a half weeks.

8:20: The plan of the European Central Bank BCE.La announces that it wants to calm the fire in the markets by buying more government debt of countries in the Eurozone in trouble on the secondary market.She did not say which country the debt it had redeemed, but markets expect it to intervene on the obligations of Italy and Spain, which bond yields are at record levels both recent weeks.

7:30: China accuses Europe and the United States. The United States and Europe are endangering the economic recovery in the world "does not assume responsibility" in the sovereign debt crisis, on Monday accused the People's Daily, official organ of the Chinese Communist Party. The newspaper called the West "to take their courage to cut the ties that bind their policies and strengthen coordination with developing countries."

7:05: The gold through the roof. Gold recorded a new record Monday on the market in Hong Kong. It through the roof of 1700 U.S. dollars per ounce for the first time, because of its safe haven status."People withdraw their money (in other markets: ie), including the dollar and euro, to put it in gold and the Japanese yen," he told Dow Jones Newswires the agency broker based in Tokyo .

7:00: Asian stock markets down. They also suffer the blow. Asian stock markets started falling Monday morning, the first markets to open after the downgrade of the United States. The leaders of major economies in the world have mobilized until the last moment to prevent a global crash. The Tokyo Stock Exchange lost 2.18%, for example at the end. The Seoul stock exchange closed down about 3.82%, 2.56% of Sydney. Hong Kong widened its losses, with -4.04% and Shanghai lost in the morning to more than 4%. Bombay lost 3.08% one hour after opening.

The Paris Bourse is close to its lowest in 2011

The Paris Stock Exchange declined sharply and approaches the lowest of the year in early trade Friday after four consecutive sessions of decline against a background of political stalemate in the United States on the ceiling of debt and doubt resolution the debt crisis in the eurozone.

Around 9:30, the CAC 40 index lost 1.02% to 3674.92 points after a low of 3649.96 points, or five dots above the lower end of the year reached on July 18th (3645 points) .

The results of large groups is not likely to improve the climate created by the sovereign debt crises in Europe and the United States, investors punish poor performers.

Veolia (-6.58%) shows the largest drop in the CAC 40 after being forced to lower its 2011 targets.

Schneider fall of 4.3%, Japan and commodity prices have had a negative impact on the first half.

Vallourec gained 1.76% and is the subject of buying on the cheap after a fall of almost 17% following the announcement of a drop in its second quarter results.

London and Frankfurt lost 0.46% 0.81%. Of the European indices, the EuroStoxx 50 yields 1.07% and 0.69% Eurofirst 300.

The euro declined and traded around 1.4290 dollars against 1.4330 on Thursday.

The Tokyo Stock Exchange gained 1.22% at closing

The Tokyo Stock Exchange ended up 1.22% on Friday, supported by its financials in the wake of satisfactory results delivered Thursday by Morgan Stanley while exports have benefited from the strengthening of the euro against the yen.

The Nikkei gained 121.72 points to 10,132.11 and the Topix, broader, took 1.01% to 868.81.

Analysts said the path to be taken by Japanese values ​​in the near future will largely depend on the evolution of the dollar / yen, but also the developments of the situation on the front of the European debt.

For now, the financial markets have focused on after Morgan Stanley has reassured investors by reporting a quarterly loss less than expected.

The Japanese banking stocks index closed up 2.33%, signing a fourth consecutive session progress.

Mitsubishi UFJ Financial Group, the first Japanese bank by assets and shareholder of Morgan Stanley in 22%, took 3.3%, while Sumitomo Mitsui gained 3.6%.

Exports in turn benefited from the strengthening of the euro, which climbed to a high of two weeks on the platform EBS, after leaders of the eurozone announced Thursday night to have reached an agreement aimed at alleviating Greece.

Canon has gained 1.39% and Sony Corp. was awarded 1.11%.

U.S. debt: the Senate is working on a "plan B"

To avoid a failure to pay the United States, U.S. senators plan to allow President Obama to decide one of raising the debt ceiling to 2.5 trillion dollars in three installments. Capitol

Trench warfare on raising the U.S. debt ceiling continues this week in Congress, where elected officials are working on a "plan B" to bypass the blockage and prevent a failure to pay the United States after August 2.

The political impasse remained Monday despite warnings last week of rating agencies, pressure from China, warning the administration against an Apocalypse if unpaid bills by the federal government. Monday morning, U.S. treasury secretary, Timothy Geithner, has nevertheless ensured that an agreement would be signed."Nobody is going to play stupid on this issue," he said on CNBC, saying again that default would be "catastrophic" for the country.

In the Senate, Majority Leader Democrat Harry Reid, took the issue seriously Monday by declaring that the upper house would remain in session "every day, including Saturdays and Sundays until (…) Congress passes a bill that prevents the United States to shirk its obligations. "

Faced with deadlock, Mr. Reid and his fellow Republican Mitch McConnell of attempting an operation last chance to reach a formula acceptable to both sides. This "plan B" would give the president the power to rise three times the maximum debt of 2,500 billion dollars by next year.But it would leave only the responsibility-and risk-policy of raising the debt ceiling.

The Senate plan could also include spending cuts of up to 1,500 billion over 10 years, measures on which both sides agree. The ultra-conservative movement of the "tea party" very influential in the House, however, condemned the plan of withdrawal.

For its part, the spokesman for the White House, Jay Carney, assured that the president continued to "call the broadest possible agreement". But according to Carney, the president wants to ensure that there is "a backup plan" such as that of Senator McConnell, even if this plan is not his preference. This could be examined by the middle of the week.

But before that, Tuesday, the House of Representatives will vote on the latest proposal of the Republicans, entitled "Reduce, cap, balance."The symbolic text, which should be rejected by the Senate to Democratic majority, would require such an amendment to the Constitution to the federal budget is in balance, as well as strong cuts.

The inevitable failure of this plan will only emphasize the gap between Democrats, who demand a policy of deficit reduction focus on more tax revenue, and the Republicans, who do not want to hear about tax increases but only draconian budget cuts. The White House pressed the point home Monday warning that Obama would veto the text, in the highly unlikely event that the Senate would approve.

Republican John Boehner said he was "disappointed" in a statement Monday about the threat of the president, accusing the White House to lack "serious" and to avoid difficult decisions."We're making progress," but Obama said Monday during a brief interview with the press.

CBS News poll released Monday, 71% of Americans disapprove of the way Republicans in Congress led the negotiations. Democrats register them a negative score of 58%. Since mid-May, the U.S. federal debt, to 14.294 billion dollars, has reached the maximum allowed, an issue that the Treasury is unable to circumvent that through hocus-pocus of short duration.

Wall Street achieves its best week in two years

U.S. stock indexes began the month of July ended with a bang in Friday's session on strong increases, reaching unprecedented weekly performance since July 2009.

The Dow Jones closed up 1.36% or 168.43 points to 12,582.77, while the S & P 500 rose 1.44% or 19.03 points at 1339.67.

The Nasdaq meanwhile gained 1.53% (42.51 points) to 2816.03.

After one week during which each session ended up, the three indices gained 5.4%, respectively, 5.6% and 6.2%.

In addition to signs of healing on the Greek debt crisis, which supported all of the week, Friday's session took advantage of good numbers of manufacturing production, to reassure the state of the U.S. economy.

The ISM manufacturing index in June stood at 55.3 after 53.5 in May. The rebound in the first four months left to hope that the recent slowdown in U.S. growth is only temporary.

Ford and General Motors, which announced sales up though below expectations for the month of June, saw their shares rose by 1.67% and 0.72%.