A couple of OMG stories from this morning almost take my breath away, and indicate just how bad the economy is tanking, despite a market run up in the past couple of weeks. And baby, it’s not going to get any better anytime soon. It’s getting scary.

First up: the unemployment rate jumped to 5.5% in May. Earlier this morning, when I was listening to the news, economists were expecting the number to come in at 5.1% (still a rise over April). A half percent in one month. That’s nearly unprecedented, and gives us an idea of just how deeply the current economic situation is impacting companies. No doubt that oil / gas prices have a great deal to do with this extreme jump in people looking for work. Which leads us to…

Next up: after price drops due to significantly decreased demand and rising inventories, oil prices have rebounded dramatically in the past couple of days. I previously opined that there’s an “oil bubble” in the works, and when it crashes, it’s going to crash hard. But not yet. There are predictions that oil will be at around $150 / barrel by 7/4/08.

Let’s just take one slice of the economy. High oil prices are invoking a major crisis in the airline industry, and honestly, just about any industry that relies on tourism or transportation is going to be suffering dramatically in the coming months. By fall, the U.S. airline industry could literally be shut down to most all travel except business. Flying on an airplane, or getting anywhere distant by any means of transportation is going to become a luxury for the well-heeled, or reserved for absolutely necessary business travel or immediate family emergencies.

Listen, I’m just an ordinary guy, not an economist or commodities trader. And without much exaggeration, I can honestly say that I’m scared to death. I can’t help but feel that there’s a terribly hard crash coming. The GOP pyramid scheme of the last 8 years is about to collapse, and it’s not going to be pretty.

Update: The stock market is responding by going into pure panic mode this afternoon. I’m not sure what took so long for the pain to take hold inside of the hermetically sealed economic bubble that seems to insulate those who make their fortunes on Wall Street. Many of us regular folk have been feeling the pain for a long time. Did someone on the Street just figure out that stratospherically expensive oil might not be a good thing in the long run for their own deep pockets, and they might be personally affected sooner than later? The sad thing is, we’re not yet anywhere close to the bottom of the economic cycle.