John Williams continues:

“Systemic-solvency and liquidity issues continue to plague the Fed and to restrain U.S. economic activity.  Bank lending remains impaired, while household income has taken a new hit, as indicated in recent reporting.  Separately, as detailed in the Hyperinflation Watch, annual and monthly growth in the broad money supply appears to be stalling, again.  That likely is a further indication of mounting difficulties in the systemic-solvency crisis.

As with January, the February labor numbers involved massive seasonal adjustments...The reporting pattern in recent monthly payroll changes has been running in parallel with the trend forecast (200,000 for February, 215,000 is the trend forecast for March) generated by the Bureau of Labor Statistics’ (BLS) seasonal-adjustment model.  That indicates that payroll activity is behaving as the BLS expects, but such “stability” in these unusual times is not likely to survive for long in the real world.

The headline February unemployment rate held at 8.3%.  The broader U.6 and SGS-Alternate Unemployment measures came in at 14.9% and 22.4%, respectively.  Again, the stability indicated by the headline number is not likely to continue in real-world reporting.

...As discussed in previous writings, an unemployment rate above 22% might raise questions in terms of a comparison with the purported peak unemployment in the Great Depression (1933) of 25%.  The SGS level likely is about as bad as the peak unemployment seen in the 1973 to 1975 recession. 

The Great Depression unemployment rate was estimated well after the fact, with 27% of those employed working on farms.  Today, less that 2% work on farms.  Accordingly, for purposes of Great Depression comparison, I would look at the estimated peak nonfarm unemployment rate in 1933 of 34% to 35%.”

Williams also had this to say regarding the US trade deficit:  “Generally, a deteriorating U.S. trade deficit is bad news for the U.S. dollar and U.S. GDP growth, and the January 2012 trade deficit widened sharply to a multi-year high of $52.6 billion, up from an upwardly revised $50.2 billion in December.”

Williams also issued this warning:  “Constrained broad money supply growth in an environment of massive Federal Reserve accommodation remains suggestive of an intensifying systemic-solvency crisis.

...Recognition of an intensifying double-dip recession as well as an escalating inflation problem remains sporadic.  The political system would like to see the issues disappear until after the election; the media does its best to avoid publicizing unhappy economic news; and the financial markets will do their best to avoid recognition of the problems for as long as possible, problems that have horrendous implications for the markets and for systemic stability.”