Spain Has Highest Unemployment In Euro Area: 20.4% Versus 9.9%
The euro area (EA17) seasonally-adjusted unemployment rate was 9.9% in January 2011, compared with 10.0% in December 2010. It was 10.0% in January 2010.
The EU27 unemployment rate was 9.5% in January 2011, compared with 9.6% in December 2010. It was 9.5% in January 2010.
Eurostat estimates that 23.048 million men and women in the EU27, of whom 15.775 million were in the euro area, were unemployed in January 2011. Compared with December 2010, the number of persons unemployed fell by 43,000 in the EU27 and by 72,000 in the euro area.
Compared with January 2010, unemployment rose by 99,000 in the EU27 and remained nearly stable in the euro area. These figures are published by Eurostat, the statistical office of the European Union.
Among the Member States, the lowest unemployment rates were recorded in the Netherlands and Austria (both 4.3%) and Luxembourg (4.7%), and the highest in Spain (20.4%), Latvia (18.3% in the third quarter of 2010) and Lithuania (17.4% in the fourth quarter of 2010).
Compared with a year ago, the unemployment rate fell in eleven Member States, remained stable in two and increased in fourteen. The largest falls were observed in Estonia (16.1% to 14.3% between the fourth quarters of 2009 and 2010), Malta (7.2% to 6.1%) and Sweden (8.9% to 7.9%). The highest increases were registered in Greece (9.7% to 12.9% between the third quarters of 2009 and 2010), Hungary (11.0% to 12.6%) and Lithuania (15.9% to 17.4% between the fourth quarters of 2009 and 2010).
Between January 2010 and January 2011, the unemployment rate for males fell from 9.9% to 9.8% in the euro area and from 9.7% to 9.6% in the EU27. The female unemployment rate increased from 10.0% to 10.1% in the euro area and from 9.3% to 9.5% in the EU27.
In January 2011, the youth unemployment rate (under-25s) was 19.9% in the euro area and 20.6% in the EU27. In January 2010 it was 20.2% and 20.7% respectively. The lowest rates were observed in the Netherlands (7.8%), Austria (8.0%) and Germany (8.3%), and the highest in Spain (43.1%), Slovakia (37.7%) and Lithuania (34.4% in the fourth quarter of 2010).
In January 2011, the unemployment rate was 9.0% in the USA. In December 2010 it was 4.9% in Japan.
I am a conservative who supported deregulation of the banking industry. Now I think deregulation was a huge mistake and the Glass-Steagall Act should be restored and hedge funds should be more regulated or even banned. Glass-Steagall prevented banks from owning securities firms and expanding to multiple states. While I once thought this law was anti-business and outdated, I now realize regulation is necessary to keep the banking industry safe by keeping banks from growing too big. Glass-Steagall is a proven law that protected the American financial industry well for 70 years and needs to be brought back immediately.
The financial crisis of 2008 and the current economic problems are partly due to the repeal of Glass-Steagall and the failure to regulate hedge funds. I am certain the world economy cannot risk another meltdown now. There is simply not enough money to bail out governments and banks of the world again.
The Dodd-Frank Act was enacted as replacement for Glass-Stegall, but I believe this new law is weak and doesn’t go far enough to prevent banks from owning investment companies, controlling banks from growing too big, and regulating derivatives enough. Bank of America, a bank, now owns Merrill Lynch, a brokerage firm, for example. Merrill Lynch recently moved $75 trillion of derivatives to the FDIC insured Bank of America side. If these derivatives
fail, Bank of America will be affected, and how will the US government bail them out? The
derivatives market is $600 trillion, but the economy of the ENTIRE world is only $74 trillion.
http://www.bloomberg.com/news/2011-10-18/bofa-said-to-split-regulators-over-moving-merrill-derivatives-to-bank-unit.html
http://articles.boston.com/2010-03-12/business/29329389_1_derivatives-gary-gensler-regulator
https://www.cia.gov/library/publications/the-world-factbook/geos/countrytemplate_xx.html
Billionaire Warren Buffet called derivatives “weapons of mass destruction” and Newt Gingrich thinks repealing Glass-Steagall was a big mistake.
http://www.economist.com/node/12274112
http://news.yahoo.com/newts-15-seconds-sun-094500280.html
Normally I am an optimist who doesn’t go around saying the sky is falling like a paranoid Chicken Little, but from my reading from trusted mainstream sources I have become quite worried about the economy. If I understood the risks of derivatives and debt in 2007 and said something, no one would have believed me. Now I hope people will listen when experts say the government needs to better regulate the financial industry.
Businesses and banks may say that regulation slows the economy, but I think that if the Glass-Steagall Act is not restored and hedge funds are not more closely regulated, there will soon be no economy at all. While I realize restoring Glass-Steagall and regulating derivatives is complex and difficult, I believe making a law is easier than repealing one.
I suggest reading “The Big Short” by Michael Lewis for a readable introduction to the financial crisis and why the banking industry needs to be regulated.
Restoring Glass-Steagall and regulating derivatives is a urgent problem and is not a issue that can wait to be fixed. I cannot stress this enough. Write to your elected officials, talk with your friends, and contact the media urging the government to make Glass-Steagall a law again and ask legislators to better regulate hedge funds.
“Too big to fail” is simply too big.