The AP’s Matt Apuzzo yesterday examined Vice President Joe Biden’s first quarterly report of the Stimulus plan and found the picture to a bit more cloudy than the White House claims:
Capturing the full effect of the stimulus at this early stage is difficult, but the administration has set high bars for success. In championing those successes, however, the White House plays a little loose with the facts.
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BIDEN SAID: First-time home buyers are “driving increased activity in the home sales market,” while mortgage and title companies are hiring more workers because of the first-time home buyer tax credit included in the stimulus bill.
THE FACTS: The report cites anecdotes from a New Orleans business journal to back up the claim. It’s true, buyers are taking advantage of the $8,000 first-time home buyer tax credits. The IRS said more than 567,000 tax returns claimed the credit in just the first weeks of the program. But that hasn’t provided an immediate turnaround in the market.
Since February, sales of existing homes have fallen 3 percent and new home sales are down .6 percent.
And the number of jobs in the real estate industry has declined by about 20,500, according to the Department of Labor.
There are signs that the housing market is improving. But the numbers suggest that if the market bottomed out, it did so in January, before the stimulus was passed.
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BIDEN SAID: Employment agencies are placing more workers in jobs, and demand is up since February.
THE FACTS: The report cites an interview with an employment service manager quoted in the same New Orleans business article. The anecdote may be true, but it’s impossible to extrapolate that any further, even just to New Orleans. The city has lost more than 200 jobs since February. Overall, Louisiana lost 16,085 jobs over the same span, according to the Department of Labor.
Alright first off the White House has to make optimistic statements on the economy for valid political reasons… Simply put if they strike to pessimistic a tone it could undermine public confidence and further weaken the economy.
Anyway with that in mind Biden’s report stikes me as being overly optimistic particarly in light of 637,000 new jobsless claims, a rise in wholesale prices and a drop in oil prices based in part on the increasing U.S. unemployment numbers.