Why income inequality is America’s biggest (and most difficult) problem

[KingOrfeo]

More makers vs. Takers from the King of Oreo's

N.B.: You'll find the Takers in the Hamptons, not in the 'hood.

 

[toubab]

Is Charles Daniels a wealthy Democrat or a wealthy Republican?

http://www.youtube.com/watch?v=MEb_epsuLqA

 

[Amberchgo]

Interesting article in today's WSJ.


Points out that a big contributor to this was investor behavior. The low information investors panicked and sold in 2008/09 and never got back into the market. Either thru personal funds or 401(k) funds.

Knowledgable investors rode it out and are up today.

Thus the smart ones have the appreciated assets; the less sophisticated have the reduced values they sold at.

 

[Amberchgo]

To the extent that this has happened, it has happened because of the growth
in political contributions by rich people and corporations. This is a problem
Democrats would like to solve with restrictions on political contributions.

I would like to remove the importance of money in politics by prohibiting all
contributions to politicians, and by instituting government financing of political
campaigns. This is used in many democracies. It works well.

Have the Dems been complaining about George Soros? I've missd it if they did. ( you know .... Trying so solve that nasty problem. )

 

[unregistered]

 

[KingOrfeo]

Interesting article in today's WSJ.


Points out that a big contributor to this was investor behavior. The low information investors panicked and sold in 2008/09 and never got back into the market. Either thru personal funds or 401(k) funds.

Knowledgable investors rode it out and are up today.

Thus the smart ones have the appreciated assets; the less sophisticated have the reduced values they sold at.

A marginal element of the inequality problem, to be sure. Most Americans live from paycheck to paycheck and don't play the market at all (unless whoever runs their company retirement fund plays it for them, and that often ends badly -- if they're even lucky enough to have such thing as a company retirement fund, any more).

 

[Amberchgo]

A marginal element of the inequality problem, to be sure. Most Americans live from paycheck to paycheck and don't play the market at all (unless whoever runs their company retirement fund plays it for them, and that often ends badly -- if they're even lucky enough to have such thing as a company retirement fund, any more).

If people wish to be treated like an adult and control their own destiny , they participate in a 401k.

If they wish to be children, then they let the Govt make the decisions for them and hand out whatever the politician wishes.

America .. The land of opportunities and free choice.

 

[NeverEndingMe]

the problem with kingofAssPopTards is he's too fucking lazy to do anything

 

[NeverEndingMe]

A marginal element of the inequality problem, to be sure. Most Americans live from paycheck to paycheck and don't play the market at all (unless whoever runs their company retirement fund plays it for them, and that often ends badly -- if they're even lucky enough to have such thing as a company retirement fund, any more).

get a job, KingOfAssPopTarts

 

[4est_4est_Gump]

There have been three major reasons for the increase in economic inequality.
The only one liberals want to discuss is the first. Since the inauguration of
Ronald Reagan in 1981 the tax system has become flatter, the minimum wage
and unemployment compensation have lost value to inflation, and labor unions
have become weaker.

The Republican Party, of course, is responsible for each of these reasons.
Nevertheless, most white blue collar workers vote Republican. This is because,
with good reason, they do not trust the Democratic Party on racial issues. They
are harmed by the Democratic policies of affirmative action and forced school
busing. They are also harmed by black crime. Blacks have a rate of violent crime
that is over seven times the white rate.

White blue collar workers are also harmed by the Democratic support for
easing restrictions on immigration. Immigrants compete with white blue collar
workers for jobs. Hispanics have lower crime rates than blacks, but higher
rates than whites. Even Orientals, with their lower crime rates, compete for
jobs. They do so effectively with their higher average IQ's and educational
levels.

This brings me to the second reason for the increase in economic inequality.
Computer technology increases the rewards for superior intelligence, while
reducing the economic value of job skills that those of below average
intelligence, or even average intelligence are able to learn.

Liberals do not like to think about this. They would rather pretend that IQ
tests do not measure anything of value, that intelligence can be increased by
the right environment, that there are no innate average racial intelligence
differences, and so on.

I have already touched on the third reason for income inequality. A high rate of
immigration has an inflationary effect on prices, and a deflationary effect on
wages. Consequently, it raises profits.

Liberals do not want to think about this either. They like to think about the
following poem on the Statue of Liberty:

“Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tossed, to me:
I lift my lamp beside the golden door.”

― Emma Lazarus

Until Democrats realize that white blue collar workers have had good reasons
to leave the Democratic Party, Democrats will not be able to address the
growing income gap.

Fallacy of false cause.

Government interventionism cause economic inequality because government interventions introduce political desires and thus inefficiencies into the economy. Foe example, when the government recently tried to use macroeconomic measure to stimulate microeconomic activity, it did no one any good not at the top of the pyramid.

The other fallacy employed in the core belief of the Socialist/Academic opinion class that the top and bottom ends of the wealth spectrum are static classes. They are not. People are always moving on and out of them.

The true inequality falls upon the Middle Class who must finance the macroeconomic adventures of the ivory-tower thinkers intended to help them in an ancillary fashion by empowering the lower classes to 'spend' more because more money is being introduced into the marketplace. The problem, the fallacy employed here, is that money is the same as Capital investment.

You cannot change the economic dynamic by revenge moves upon the wealthy.

They had political friends who protect them.

Keep pickin' those cherries...

 

[richard_daily]

More makers vs. Takers from the King of Oreo's

Compound interest and usury make one a taker, not a maker. I wouldn't expect you to understand though, ken.

 

[The_Trouvere]

Keep pickin' those cherries...

Why do you enjoy talking to yourself?

 

[The_Trouvere]

Fallacy of false cause.

Government interventionism cause economic inequality because government interventions introduce political desires and thus inefficiencies into the economy.

If what you say is true, why did economic inequality decline during the New Deal when government intervention in the economy increased? Why did economic inequality increase during the administration of Ronald Reagan when government intervention decreased.

 

[The_Trouvere]

the problem with kingofAssPopTards is he's too fucking lazy to do anything

get a job, KingOfAssPopTarts

I think King Orfeo is a lawyer. What have you done for a living?

 

[PoppingTom]

If you had to which one would you choose? (D) syphilis? OR (R)...AIDS

You know, that's what I envy on Americans: they have a real choice! Between fucked up or doomed (and I leave it to you to decide who's who) or perfect mistrust of everything political (who needs government? I've got my gun!)

We only have the choice between boring with neolibs or boring with environmental activists. Or don't give a fuck.

 

[4est_4est_Gump]

It didn't.

Our economy accelerated after WWII.

Why don't you put as much effort into a post as I do.

Why don't you put form to your economics rather than spouting random "moments" that you think makes a sound argument.

http://www.ushistory.org/us/49g.asp

 

[Amberchgo]

Compound interest and usury make one a taker, not a maker. I wouldn't expect you to understand though, ken.

Please explain how Buffett and Gates and Tepper and Dalio and Bloomberg committed usury?

 

[NeverEndingMe]

I think King Orfeo is a lawyer. What have you done for a living?

Please he's only a KingOfAssPopTards

 

[NeverEndingMe]

You know, that's what I envy on Americans: they have a real choice! Between fucked up or doomed (and I leave it to you to decide who's who) or perfect mistrust of everything political (who needs government? I've got my gun!)

We only have the choice between boring with neolibs or boring with environmental activists. Or don't give a fuck.

you have a choice but you chose to be stupid

 

[KingOrfeo]

Meanwhile the Democrats and Obama spend most of their time at fundraisers. The president has attended 400 since gaining office. This is a product of a government without virtue. They swear their allegiance to their benefactors, not the Constitution.

Then, you agree with Trouvere that private political funding should be eliminated?

 

[4est_4est_Gump]

We have bigger problems.

"Will These Central Bank Morons Ever Learn?" asks Albert Edwards at Societe General


Central Banks and the Business Cycle

I like it when someone besides a few financial bloggers takes the gloves off and starts asking some hard-hitting questions.

In Cross Asset Research last week, Albert Edwards at Societe General did just that. Emphasis in italics is mine.

Fragile and vulnerable in itself, the US recovery now battles against the rest of the world, which like a horror movie is dragging it down into a hellish Ice Age underworld. The problem is that at these stratospheric valuations, the market does not need to suffer an ACTUAL recession to see a crash. Like October 1987, just the fear of recession will be enough to trigger a massive market move.

On these pages we have a very simple thesis as to what will bring an end to this grotesque, QE-fueled market overvaluation. Simply put, the central banks for all their huffing and puffing cannot eliminate the business cycle. And they should have realised after the 2008 Great Recession that the longer they suppress volatility, both economic and market, the greater the subsequent crash. Will these morons ever learn?

The problem is that most risk assets, and especially equities and corporate bonds, are very expensive and priced for a long cycle. Meanwhile, this recovery has failed to generate any cyclical upward pressure to inflation – indeed quite the reverse. The global economy resembles a knackered old V8 engine which is now only firing on one cylinder (US). Hence, any data suggesting that the US economy is now also flagging were always likely to cause a meltdown as investors feared the imminent arrival of Japanese-style outright deflation. We note with interest that US 5-year inflation expectations in 5 years’ time have not fallen anything like as quickly as 5y expectations (see chart below). This suggests to me a continued misplaced market (over)-confidence about central banks’ ability to control events.

[chart at link below]

Only one day before last Wednesday’s flash crash, Guy Debelle, head of the BIS market committee, said investors had become far too complacent, wrongly believing that central banks can protect them, and many staking bets that are bound to “blow up” at the first sign of stress. A market loss of confidence in policy makers’ ability to control events has always been part of our Ice Age thesis. US inflation expectations in particular will fall an awful long way if investors fear the US cycle is about to fail.

I have always thought that this would all end the way Christopher Wood explained in his GREED and fear publication last November: “The key issue is what might trigger a market correction . The market consensus continues to focus on the tightening in financial conditions triggered by “tapering”. Still such a hypothetical correction is not so big a deal to GREED & fear, since any real equity decline caused by tapering is likely to lead, under a Fed run by Janet Yellen, to renewed easing. The real threat to US equities is when the American economy fails to re-accelerate as forecast”. Certainly, in my view , at these elevated valuations, it will not take much to bring down the entire ‘pyramid of piffle’.

Read more at http://globaleconomicanalysis.blogspot.com/#AlFMdEer8DCUMZAO.99

 

[NeverEndingMe]

Compound interest and usury make one a taker, not a maker. I wouldn't expect you to understand though, ken.

oh dude, just come out of the closet. you are in love with RubDownSouth


and you find KingofAssPopTards to be too stupid for team obama slaves.

 

[richard_daily]

Please explain how Buffett and Gates and Tepper and Dalio and Bloomberg committed usury?

As soon as you explain what they've "made".

 

[RobDownSouth]

Then, you agree with Trouvere that private political funding should be eliminated?

His Sacred Marine Corps Honor (which he uses to wipe his ass each morning) prohibits him from agreeing with his political enemies. Strangely, though, it once permitted him to give aid 'n comfort to the enemy (trading cans of PX corn in exchange for underage Vietcong pussy).

 

[Amberchgo]

As soon as you explain what they've "made".

LOL. nice straw man


Appreciate you explaining to everyone here that you have no clue what you're talking abut.