The Fed's Forecast on Unemployment, Inflation, and GDP

Fed data released Tuesday (2/24/09):

Delinquency rates on home mortgages in 4th quarter 2008: Almost 7% of outstanding mortgages

Unemployment rate in 4th quarter 2008: 7.6%, expected to rise to 8.8% this year

The Consumer Board's Consumer Confidence Index: 25, lowest level since data were first collected in 1967

February 2009 views on the job market:

"Jobs are hard to get": 48% of people surveyed, highest since Feruary 1992

"Expect jobs to decrease in the months ahead": 47%, highest percentage since December 1973

The Fed's Economic Forecast for the Next Few Years:

Unemployment, Inflation, GDP

Defense Spending as a Percent of GDP, 1940-2009

After reaching 38% of GDP during World War II, defense spending dropped below 5% of GDP in the years immediately following the war, rose to nearly 15% at the start of the cold war as the US rearmed and built up its stock pile of atomic weapons, declined through the late '50s and early '60s to 7%, jumped again during the Vietnam War to 10%, declined throughout the '70s and early '80s, headed up again during the Reagan era of rearmament as we spent the Russians into state failure, droped again in the late '80s and early '90s until Desert Storm, declined until the beginning of the millennium until 9/11 when it rose steadily to almost 5% of GDP in 2008.

Defense Spending as a Percentage of GDP, 1940-2009

Bulgaria - GDP Growth and Contract Killings

Memorable lines from Casablanca:

[Annina is contemplating Renault's offer of exit visas for sex]

Rick: How long have you been married?

Annina: Eight weeks. We come from Bulgaria. Oh, things are very bad there, Monsieur. A devil has the people by the throat. So, Jan and I, we, we do not want our children to grow up in such a country.

Rick (wearily): So you decided to go to America...

Annina: Oh, monsieur, you are a man. If someone loved you very much, so that your happiness was the only thing that she wanted in the world, but she did a bad thing to make certain of it, could you forgive her?

Rick: Nobody ever loved me that much.

Annina: And he never knew, and the girl kept this bad thing locked in her heart? That would be all right, wouldn't it?

Rick: You want my advice?

Annina: Oh, yes, please.

Rick: Go back to Bulgaria.

Bulgaria is one of the European Union's newest and most troubled countries. While Bulgaria is the EU's poorest economy, GDP has been growing at at more than 6% since 2004. Nevertheless, the country is plagued by organized crime, corruption, drug trafficking, theft of economic assets, and an ineffectual judiciary. Opinions polls show that Bulgarians view the judiciary as the country's second most corrupt profession, after customs officials. Bulgaria's 7.7 million people face the EU's lowest wages, averaging around £150 a month. The country's per capita gross domestic product in 2005 was $3,328, compared with a European average of $29,207.

Source: IndexMundi

The country is struggling to cope with organized crime with a wave of unsolved contract killings and allegations of official collusion in mafia networks this year. There have been more than 150 contract killings since 1997 with not a single conviction, and according to the March report by the United Nations Office on Drugs and Crime, the majority of heroin on Europe's streets come via Bulgaria from Afghanistan.