SmartMoney:

But, according to some portfolio managers and financial advisors, persistently high — even devastatingly high — unemployment could easily derail the recovery and cause stocks to plunge.
"We are looking at the situation as the next Great Depression at our doorsteps," says Michael Rubino, chief executive of Rubino Financial Group, a wealth management firm in Troy, Mich.

"We expect unemployment to reach Great Depression levels [of 25% at the peak] by 2011 or 2012. Boy, we hope we’re wrong."

Let it sink in for a moment: 25% unemployment.

Rubino’s view may be extreme, but there’s no question that unemployment appears poised to remain very bad for quite some time. The Federal Reserve said last week it expects unemployment to hit 10% by the end of this year and edge down to only 9.7% for 2010. The most recent survey by The Wall Street Journal found that economists expect unemployment to hit 10% by year-end and stay there until June 2010.

My comment: I do not think the headline number will be 25% but I do think that the U-6 number which is discouraged workers and people that are underemployed will reach 25%. This will be bad for politicians, a good thing in my mind, as they will be on the receiving end of the blame. Expect talk of more stimulus and expect the Fed to start monetizing again. High unemployment means tearing of the social fabric with civil unrest to be expected. Remember "freedoms just another word for nothin left to lose".

John Polomny
The Real Deal