I wrote the other day that “Happy Days Are Here Again, For Florida.”  Well, Florida may be doing well, but today’s economic news paints a somber picture for the rest of the USA and the World.   Economic news in the USA shatters the hope that we are on a slow climb to better employment rates.  We only added half the new jobs we expected in May.  Adding the fact that many more have reentered the labor force, which had dropped to historic lows, we find the unemployment rate  inching up again. 

Most investment advisors are urging clients to pull out of  equities and go back to bonds.  They believe we are headed for a repeat of the slump we suffered last spring.  Not a happy turn of events for President Obama.

Meanwhile I am sitting in the midst of the economic maelstrom, Spain.  I hear staccato warnings that Spain will not be able to secure the funds it needs to restore its banking sector to good health.  The European Central Bank (ECB) has the funds but not the conviction to shore up Spain once more. 

The Spanish government made an appeal to allow banks to borrow directly from the ECB.  It was rebuffed.  Any funds from the ECB must go to the government and then to banks and, as I said, the ECB is not sanguine about pumping more funds into Spain. 

The most likely outcome will be for the whole European Union (EU) to be dragged kicking and screaming into closer economic cooperation beginning with a EuroBond issued by the entire EU, not individual states, and ending with a new EU Economic Ministry.