Chicago, IL – June 9, 2010 – Zacks.com Analyst Blog features: BP (BP), Ingram Micro Inc. (IM), Rackspace Holdings (RAX), Amazon (AMZN) and salesforce.com (CRM).

What are we to conclude from this data? First, it is apparent to me that the economic stimulus package has done a much better job on the save side of “save or create millions of jobs". The second thing I would conclude is that given the still huge imbalance between the number of job openings and the number of people looking for work, extended unemployment benefits are still needed. Saying “get a job" to someone who has no income is not really productive when there are no jobs to get. The problem is not really a lot of people getting pink slips, it is a dearth of handshakes saying “welcome aboard". The decline in both hiring and firing could be pointing to something much more fundamental, sort of a hardening of the arteries of the U.S. economy.

Historically, one of the great strengths of the US economy has been its flexibility, particularly relative to Europe. An out-of-work American is, or at least was, much more likely to move from Detroit to Denver to find a new job than an out-of-work European was to move from Athens to Amsterdam. Language certainly plays a role, but even within European countries, migration from say Berlin to Bonn is much rarer than in the U.S. It is not clear if this is a permanent change, or something that happens only during recessions (another reason why it is unfortunate that the data series is not much longer).

We need steps to increase the number of jobs available. If that means running a budget deficit, then so be it. People without income do not pay any income tax, and require automatic stabilizer payments (unemployment insurance, food stamps etc). Thus, the cost of job creation is on balance much less than the “sticker price" of the program. If Congress appropriates $100 billion for job creation, the real cost is not going to be $100 billion, but more like $50 billion. As long as the jobs are not just digging ditches and filling them back up again, the economy will get something of value for the $50 billion net cost as well. The cost of financing for the government is at generational lows, so the burden it will put on the future is extremely modest.

Personally I would favor creating a “son (grandson?)" of the Civilian Conservation Corps. Those jobs would target teenage unemployment, which was running at 26.4% in May. If they were put to work cleaning up the Gulf Coast, the eventual cost to the government would be nothing, since the government could send an invoice to BP (BP) for the cost. Beyond that, there is plenty of productive work that could be done. Our infrastructure is crumbling and we need to replace water and sewage systems across the country (many of which were built during the great depression). It was not that long ago that a bridge over the Mississippi River collapsed, and there are still thousands of dangerous bridges in the country. If we are not going to fix them now, when will we fix them?. The disaster in the Gulf reminds us, as if we really needed to be reminded, that we need to move to a new renewable energy future.

In its inaugural Cloud Summit yesterday in Dallas, Texas, the largest information technology (IT) product distributor, Ingram Micro Inc. (IM), announced a new services initiative named Cloud Conduit, which connects its North American channel partners with leading and emerging cloud computing providers including Independent Software Vendors (ISVs), cloud hosting companies and system integrators.

Moreover, as a part of the program, IM will join with Rackspace Holdings (RAX), Amazon Web Services (AMZN) and salesforce.com (CRM) in an initiative to blend the managed IT services model and cloud computing for greater industry adoption and understanding of cloud computing and better IT services.

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