What happened to all of the doom and gloom economic threads?

[Frisco_Slug_Esq]

So it's a bad thing people are being employed?



"You guys?" Who are you talking about? And right now, all jobs are needed, don't be an idiot.

Look at you. Someone points out to you the meaning of the numbers you quote and you then jump to the most negative attack you can think of, "SO, I GUESS YOU JUST HATE JOBS!!!"

Jobs ARE needed, but won't be created as long as people with resource are not worried about the next governmental edict or confiscation.

Now, the Administration is dicking with the CAFE standards again, so along with higher taxes coming in January, spiraling health care costs due to Obamacare, and now a capital investment in their fleet, business is not exactly inclined to go out and hire, best to squeeze more productivity out of that which you already have. You'd like to slash your prices, but your inventory costs are starting to creep up because your suppliers are under the same damned pressures.

 

[Frisco_Slug_Esq]

Now, American Thinker is telling me not to be worried about deflation...

Interesting...



With money in ample supply, why, then, are consumer prices subdued? Money is one of many variables determining consumer prices: productivity, supply and demand for goods and services, changes in product quality, and technology matter as well. Money demand is particularly randy these days because of soaring uncertainty related to the ugly reality: cap & trade, Dodd & Frank, ObamaCare, swelling deficits, and new taxes. We can only imagine what ugliness lurks over the horizon.* **

The Federal Reserve has created a tremendous amount of money, to be sure, but the money has disproportionately flowed into financial markets (particularly equity markets) instead of into the real economy. By deflating government bond yields (and pushing up prices) through open-market operations, the Federal Reserve has created capital gains for government bondholders. Concurrently, the Federal Reserve has made equities appear more attractive compared to bonds (based on earning yields and bond yields), thus producing a surge in equity investment.

The rally in equity prices is really an extrapolation of a longer-term trend. Over the past eighty years, the stock market value as a percentage of GDP has averaged 62 percent. For the first sixty of those years, the stock market traded mostly within a 30-percent-to-50-percent band. It first plotted above 100 percent of GDP in 1996. It's been below that level only twice since, following the internet and housing busts of 2000 and 2009, respectively. After dropping to a low of 71 percent of March 2009, stocks have returned to the contemporary norm of over 100 percent of GDP.*

So much money flowing into the stock market has produced persistently high stock-market valuations. The ratio of stock prices to stock earnings (P/E ratio) for S&P 500 members now averages about 20, whereas it used to average around 12. What is more, because so much money exists, the P/E ratio of S&P 500 stocks no longer bottoms to single digits when the extent of the previous boom's malinvestment is realized, with 1984 being the most recent year the S&P 500's P/E ratio dipped to single digits.*

Cavalierly interpreting correlations as causations can deceive, but deductive reasoning suggests a causative relationship between money supply and asset prices. If the quantity of money were static, the overall level of asset prices should remain static as well. (Stock market indexes owe their persistent appreciation to inflation.) In a static-money world, capital gains could be achieved only through asset selection -- by investing in promising companies to the detriment of lagging companies. In our inflation-centric world, most stocks -- good and bad -- rise during inflation-fueled binges.

Of course, there are consequences to asset-price inflation. New money funneled into assets means less money funneled into GDP, which further frustrates and emboldens the Federal Reserve to inflate even more. When money is created via bank loans to business, the money further distorts the pattern of productive investments, producing even more malinvestment that will invariably lead to an even more painful correction down the road.*

So we have both monetary inflation and asset-price inflation at this juncture. Consumer-price inflation is in the waiting (which, anecdotally, we all know has arrived). If the Federal Reserve persists in inflating the money supply to the point where assets no longer soak up the overrun, the excess supply will flood consumer-goods markets as the public attempts to recoup its command of economic resources by raising prices to the speed of new money creation. Should that occur, consumer-price inflation will tip from a "desirable" pursuit into a viral pandemic; then we'll really have something to be anxious about.*

Stephen Mauzy

 

[Frisco_Slug_Esq]

Good think Barack's talking about more stimulus spending, eh Luke?

Songs that are “golden oldies” have much less pleasant counterparts in politics — namely, ideas and policies that have failed disastrously in the past but still keep coming back to be advocated and imposed by government. Some people may think these ideas are as good as gold, but brass has often been mistaken for gold by people who don’t look closely enough.

One of these brass oldies is the idea that the government can and must reduce unemployment by “creating jobs.” Some people point to the history of the Great Depression of the 1930s, when unemployment peaked at 25 percent, as proof that the government cannot simply stand by and do nothing when so many millions of people are out of work.

If we are going to look back at history, we need to make sure the history we look at is accurate. First of all, unemployment never hit 25 percent until after — repeat, after — the federal government intervened in the economy.

What was unemployment like when the federal government first intervened in the economy after the stock-market crash of 1929? It was 6.3 percent when that first intervention took place in June 1930 — down from a peak of 9 percent in December 1929, two months after the stock-market crash.

Unemployment never hit double digits in any of the twelve months following the stock-market crash of 1929. But it hit double digits within six months after government intervention — and unemployment stayed in double digits for the entire remainder of the decade, as the government went in for one intervention after another.

...

Similarly, the whole idea of the government itself “creating jobs” is based on regarding the particular jobs created by government as being a net increase in the total number of jobs in the economy. But, since the government does not create wealth to pay for these jobs, but only transfers wealth from the private sector, that leaves less wealth for private employers to create jobs.

Songs that are golden oldies bring enjoyment when they return. But brass oldies in politics just repeat the original disasters.

A statistical analysis by economists, published in 2004, concluded that federal interventions had prolonged the Great Depression of the 1930s by several years. How long will future research show that current government interventions prolonged the economic crisis we are living through now?

Thomas Sowell
NRO
__________________
"The Great Depression, like most other periods of severe unemployment, was produced by government mismanagement rather than by any inherent instability of the private economy."
Milton Friedman

You loot the private sector, strip every dollar of 40¢ for overhead, and then give the other 60¢ to your political base in order to revitalize the looted.

What's not to like about that plan?
A_J, the Stupid

 

[unregistered]

 

[pete]

Only the rich got richer, which is what the rising stock market is telling us, Wall Street, unlike Main street is back to high salaries and big bonuses, and why wouldn't they, they have friends in very high places, just like BP had...

no, actually everybody got richer. incomes on all levels showed increases prior to the current recession, see the graph

when wall street prospers, the rest of the country usually prospers too. it's folly to think otherwise, since the people democrats love to excoriate (the evil rich white man) are the ones who create wealth and use that wealth to start businesses, expand businesses, and therefore create jobs.

i wish there were more knowledge, and less fear & loathing

 

[Frisco_Slug_Esq]

Which party rails against the rich?

Which party has proven itself to be in bed with "the rich?"

Remember, Bush's "guy," Paulson, was another big-time rich white Democrat from a Wall Street dominated by rich, white, Democrat backers, who, btw, got bailed out because they were too big too fail and because they're too big to fail, they didn't really have to make any corrections, now did they? Hell, like BP or Countrywide, they even got to help write their own new "regulation."


__________________
When Government gets so powerful that its purchase price is cost effective, even imperative, to business, then business will purchase government indulgences.
A_J, the Stupid

 

[Frisco_Slug_Esq]

And of course some business won't be inclined to stay in business either.

Well, we'll write anti-dog-eat-dog rules and make it illegal for them to go out of business!

 

[Frisco_Slug_Esq]

The really good news, for Luke and U_D, is that California is going to elect Leftists to their important state positions to go with their Democrat legislature, and they will show those stupid tea-baggers how to bring an economy out of recession and into a Golden Age by continuing to follow up on Obama's policies and deficit spending, enjoying the multipliers of government largess to an economy.

 

[pete]

the problem IMO is that both sides have it wrong when it comes to big businesss & corporations:
republicans practically deify them, and democrats demonize them.

big businesses and corporations are a huge part of america's economy, to paint them as the enemy and to give them a hard time about doing their business is hurtful to the economy and therefore the country.
at the same time, we can't let them get away with everything they want to the detriment of competition or consumers.

obama's openly anti-business policies are the sorts of things that are popular on college campuses but not so good when it comes to stoking the economic fires

 

[Frisco_Slug_Esq]

Republicans are too busy trying to be Democrats to deify anything other than power.

But, they should deify business and the individual; they would be right to do that.

This "we can't let them get away with it" is standard collectivist socialist pap. There are courts and there are competitors to keep them in line, at least, there were before the socialist-collectivist-moderate Republicanist "too big to fail" mantra...

Nobody, including the President, is too fucking big to fail or the Republican and Capitalism fail. If they fail, it's back to tyranny. The only question becomes, what form will it take.

 

[Frisco_Slug_Esq]

*chuckle* Even U_D will et a laugh out of this...

In his October 24 column ("Falling Into the Chasm"), Krugman deftly modifies his rhetoric, now contending that the increase in federal spending "was barely enough to offset cutbacks at the state and local level." Hence, he paints another picture -- namely, that overall government spending has been flat.

A glaring void in Krugman's articles (and Klein's) is the absence of any numbers on total government spending, which are exactly what he needs to prove his point. This omission is particularly brazen given that Krugman avows that there is "a widespread perception that government spending has surged" because of "a disinformation campaign from the right, based on the usual combination of fact-free assertions and cooked numbers."

So let's test these assertions against the only comprehensive and reliable source of data on this topic, which is the federal Bureau of Economic Analysis. Citing the latest figures, total combined federal, state, and local government spending rose from $5,020 billion in 2008 to $5,345 billion in 2009 -- to a seasonally adjusted average of $5,532 billion in the first half of 2010, which is the most recent available data point.

This constitutes a 10% increase over a 1.5-year period with 3% inflation. In other words, the data flat-out contradict Krugman's and Klein's stories.

Also, contrary to Krugman's claim that cities and states experienced "drastic spending cuts," the reality is that state and local governments slightly increased their spending from $2,186 billion in 2008 to $2,189 billion in 2009 to a seasonally adjusted average of $2,224 for the first half of 2010. This equates to a 2% rise during a period with 3% inflation.

Could it be that Krugman has access to another source of data that is more reliable? According to the Bureau of Economic Analysis, the data published by this agency are the "only comprehensive estimates of state and local government activity available on a timely basis."

Furthermore, since Krugman's central premise in these articles is that government spending is a salve that heals unhealthy economies, why does he limit this question to spending "under Obama"? The recession officially began in December 2007, when total combined government spending was $4,637 billion. Thus, from the outset of the recession through the second quarter of 2010, spending has risen 19% in a period with 4% inflation.

On top of this, in the four years leading up to the recession, total combined government expenditures grew by 21% with 13% inflation.

The bottom line is that rising government spending has been a defining attribute of the current economic debacle. And when all is said and done, we are left with a 9.6% unemployment rate and a crushing national debt that will ultimately sink our nation if we continue with the current profligacy.

James D. Agresti
The American Thinker

Of course, just under 10% is not bad news, not doom and gloom, it's just the normative, but it's a norm we cal live with because of all the increased government benefits that we will have access to...

So, let's all pretend we're at Cheers, the door opens and...

"NORM!"

 

[unregistered]

 

[Frisco_Slug_Esq]

They won't be allowed to buy Chinese!




Smoot-Hawley to the rescue...

Most likely in the form of Reid-Boehner.

Compromise the Elites can work with.

 

[unregistered]

 

[busybody..]

Hopefully Reid will be gone, and we can kick the tan off of Boner if he starts with the weasel act.

Reid will win

the machines are rigged

the techs doing the "repairs" are SEIU thugs

dont YOU read MY threads?

 

[Frisco_Slug_Esq]

Hopefully Reid will be gone, and we can kick the tan off of Boner if he starts with the weasel act.

Republicans vote FOR O'Donnell West?




Don't make me laugh...

 

[Frisco_Slug_Esq]

And the beat goes on, the beat goes on...

Shortly after Labor Day, as polls continued to sink, the Democratic National Committee (DNC) realized it needed a cash infusion for the upcoming midterm elections. Its chairman, former Virginia Governor Tom Kaine, turned to the Bank of America to secure a $15 million revolving credit line. Then, in the middle of this month, the Democratic Congressional Campaign Committee (DCCC) got another loan from BofA for an additional $17 million.

What was their collateral? It turns out, not much.

The DNC claims their collateral was an intangible piece of property — its donor mailing list. The DCCC only cites unnamed “assets.” Neither party organization possesses real estate even close to cover the $32 million. The DNC’s headquarters is owned by another entity. Even it was put up as collateral, its market value was last estimated at only $13.7 million.

Were the Bank of America deals legitimate, arms-length transactions, or were they cozy sweetheart deals in which nothing was really put up to secure a $32 million loan?

And if it was the latter, could it be considered an illegal campaign contribution from the largest bank holding company in America?

There also is troubling evidence that two days before closing on the loan transaction, the DNC changed its own privacy provisions to allow the selling or sharing of private donor data.

BofA has been a longtime friend of Democrats. In the 2008 election cycle, BofA gave its largest single campaign contribution to then-Senator Barack Obama. According to Bloomberg News, BofA’s new CEO, Brian Moynihan, is considered Obama’s top political ally on Wall Street.

http://pajamasmedia.com/blog/did-th...aign-loan-from-bank-of-america-pjm-exclusive/
__________________
When Government gets so powerful that its purchase price is cost effective, even imperative, to business, then business will purchase government indulgences.
A_J, the Stupid

 

[unregistered]

 

[busybody..]

Polls, schmolls

Reid by 4

The machines have been rigged

 

[koalabear]

Polls, schmolls

Reid by 4

The machines have been rigged

Plus you get free gift cards if you vote for Reid.

 

[hogjack]

...Vegas yesterday. The cabbies were all complaining about the 15% unemployment. I told them to remember the Democrat inspired unemployment problem on election day.

Are these cabbies American citizens with a right to vote?

 

[IrezumiKiss]

Are these cabbies American citizens with a right to vote?

I haven't seen an American ("American" in this case meaning, White, Anglo-Saxon, blonde and blue-eyed) cab driver in eons. I don't know about Vegas, but if Vette had come to NYC, he'd tell the cabbies that they deserve to be unemployed because they (look like) illegals taking up space for the Real Americans® and to fuck off back to Mexico or the Middle East or China or wherever it is they came from.

 

[Luk]

I see that but it seems she has pulled ahead in the polls, there may be a glimmer of hope. Just got back from Vegas yesterday. The cabbies were all complaining about the 15% unemployment. I told them to remember the Democrat inspired unemployment problem on election day.

You're full of shit. You didn't say a word to a cab driver other than telling him where you were going let alone get into a political conversation with any of them.

 

[unregistered]

 

[unregistered]