President Barack Obama said this week that the U.S. economy is in good shape for the long term thanks to “core strengths,” but he noted that 2009 has been a sobering year for millions of newly unemployed people. The president is walking a tightrope. The unemployment rate stands at a 26-year high of 10.2 percent, overshadowing more upbeat indicators such as a return to growth in the overall economy. For African-Americans, the jobless rate stands at 15 percent.
There’s quite a bit of good news about the economy. Economic growth was up 3.5 percent in the third quarter, for example, and the consumer delinquency rate is down, with credit reporting agency TransUnion saying that cardholders making late payments on bank-issued cards fell to 1.1 percent for the July-to-September period, down from 1.17 percent in the previous three months. TransUnion’s figures showed the average balance on outstanding bank cards fell to $5,612 from the previous quarter’s $5,719 and from $5,710 in the 2008 third quarter.
The housing market also appears to have pulled back from the brink. First-time buyers taking advantage of an $8,000 special tax credit gave sales of existing homes their biggest surge in a decade, raising hopes for a turnaround in the housing market and pleasing. While rising foreclosures and disappearing jobs still threaten the comeback, there are now bidding wars for houses in some cities, and home sales are nearly 36 percent above their low point in January. Investors have also joined the party, flipping foreclosed houses in places like Florida.
Most of the foreclosed houses belong to African-Americans who lost jobs and could no longer afford to keep their property without income and help from the government. Last week, Rep. Maxim Waters, D-Calif., and 12 other members of the Congressional Black Caucus blocked the financial reform bill from being voted out of the committee until the government does something about the high Black unemployment and foreclosure rates.
She said the Treasury and the Federal Reserve are putting Wall Street ahead of Main Street and that hurts Blacks more than the rest of the population. Analysts said the gains in the October housing data mainly reflected the tax credit for new homeowners, which was due to expire this month before Congress extended it until spring and expanded it to more buyers. Sales figures on Monday from the National Association of Realtors provided the juice for a rally on Wall Street. The Dow Jones industrial average, also lifted by a weak dollar, rose more than 130 points. Analysts said the extension of the homebuyer tax credit should help sustain the housing market next year.