Jobs Bill: 5 Reasons Why the U.S. Economy Needs More Fiscal Stimulus

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The major problem with the first $786 billion stimulus was that is was too small: given the amount wealth and income taken out of the U.S. economy by the financial crisis, the fiscal stimulus should have been at least $1.2 trillion to $1.3 trillion. In fact, about a third of fiscal stimulus was tax credits -- not actual spending injected in to the economy.

The reason it was too small? Conservatives in the Republican Party and selected moderates in the Democratic Party prevented a sufficient stimulus from being passed, and that, as Keynesian economics predicted, limited the economic recovery. But given the problems in Europe, low employment in the U.S., and the current economic slow-down, there's no time like the present to pass a large fiscal stimulus package, and here are 5 other statistics -- tell-tale signs why Congress should do so:

1 Gold. Investors/readers should note that the price of gold is falling. Gold went from being the classic inflation hedge, to becoming the so-called "no-lose investment" - good to hold if inflation intensifies or if asset prices for stocks and bonds plunged. But a cardinal rule of investing is that there are no "no-lose investments" and the moment that talk started marked the beginning of what is likley a gold bubble.

Gold is up more than 200 percent since December 2008 and technically its chart looks overheated, if not bubble-ish. Gold plunged another $81.80 Friday to $1.659 per ounce. Conclusion: Gold's price is signaling a slowing economy ahead. Further, gold price continues to decline along with other commodities, that would be a very bad sign for the U.S. and global economies.

2 Oil. The price of oil, the world's most vital commodity, is also signaling that the U.S. economy and much of the global economy are losing momentum. Oil hit a 2011 high at/near $115 per barrel in the spring, but has since stair-cased down to about $80, including a 66-cent decline Friday to $79.85.

The key level for investors to watch regarding oil? The $70 level. For several reasons, the price of oil cannot remain below $70 per barrel if the U.S. and global economies are growing at a healthy rate. Hence, if oil falls below $70 and stays below it over one, two, three months, that's a sign of very low demand for crude -- the lifeblood of commerce -- and most likely a U.S./global economic slowdown, or recession.

3 Stocks. Most investors do not need to be educated about this metric. The wealth effect -- or how wealthy American and global investors feel and their propensity to spend -- declines as stock markets decline. And lately, U.S. and global stock markets have not done too well: the Dow has plunged about 16 percent since pushing the 13,000-level in May.

Investors should also remember that the Dow Jones Industrial Average is a lead indicator -- not a current indicator. By lead indicator, that means the Dow is always projecting conditions out six to nine months, and by extension, the recent Dow swoon is forecasting an economic slowdown.

4. Housing. Another economic statistic that most U.S. investors (and home owners) are aware of: the U.S housing sector remains sluggish at best, with many major cities still in a housing recession. Existing home sales are running at a decent 5.03-million-unit annual pace, but there's still an 8.5-month supply of new homes on the market. Meanwhile, new homes are running at horribly-low 298,000-unit annual pace, with a 6.6.-month supply of homes on the market.