No wonder both presidential candidates are promising change. Even the stupid don't need to be reminded that, yet again, it really is the economy that will dominate voters' concerns.
Especially the last couple of days. After a fortnight of diverting political froth in Denver and St. Paul, the economy has yanked our attention back to the world as it is.
There are bright spots, and I'll get to those below. But many (including Wall Street economists, who are unlikely to be Democratic shills seeking regime change) believe the U.S. financial system faces its gravest challenge since the 1970s or maybe even the 1930s.
Doesn't that deserve our attention more than John McCain's military service or Barack Obama's community organizing?
Yesterday's August employment news brings 2008's unblemished string of monthly job losses to a total of 605,000. The last time unemployment was as high as August's 6.1 percent was almost five years ago.
By historical standards, those figures aren't especially scary. The nation lost four times as many jobs, as a percentage of the economy, in the slump that began in 2001. At this point in the 1992 election timetable, when the economy was topic No. 1 and there wasn't a No. 2, unemployment was 7.6 percent.
Given that the Dow Jones stock average has fallen by a fifth since October and Wall Street has lost half a trillion dollars on defaulted mortgages, the job situation could be worse.
The worry is that it soon will be.
On Thursday, Bill Gross, the respected PIMCO bond manager, helped send the Dow down 345 points by warning of "a financial tsunami" if Washington doesn't step in soon with a huge mortgage bailout.
Evidence to back him up arrived as soon as yesterday morning, when the Mortgage Bankers Association reported miserable foreclosure results for the three months ending in June.
Levels of late mortgage payments, homes entering foreclosure and homes in foreclosure all set records. Nearly one in 10 Americans with a mortgage was either behind or in foreclosure at the end of June. Don't forget: This doesn't count people who have already lost their houses.
Gross thinks we're only halfway through the pain. He predicted a trillion dollars in total mortgage losses before the guys with the green eyeshades and the red Sharpie pens finish their work.
That'll cause a further cascade of stock, bond and home sales that will amplify defaults and bankruptcies all across the economy, he said.
