High prices and unemployment

As various writers have pointed out, the high unemployment of the Great Depression was ameliorated somewhat by low prices. Government and the Fed have been at war with falling prices ever since, and so far they're winning gloriously. They've succeeded in depreciating the dollar so much that, with the exception of the computer industry, not even the ingenuity of market participants can keep prices from rising.

As Bill Bergman at Morningstar reports:

In the Fed's overall "beige book" review of economic conditions, price pressures were reported as "elevated or increasing" by all 12 of the Federal Reserve's district banks in the latest survey. This may be one of the bleaker inflation assessments in the beige book in recent years.

And meanwhile,

The only "official" report directly relating to U.S. labor markets released last week was the weekly unemployment insurance claims report, released Thursday. Initial claims were up significantly, to 400,000. The four-week moving average has climbed steadily higher in the past year, and at an accelerating pace lately.