American Economy

[Right of Center]

The Unemployment rate in America is wonderful...

1st link:
U.S. Department of Labor-Bureau of Labor Statistics
and to follow up:
CARPE DIEM

Why I wonder...could you say capitalism?

[G. Adams]

Quote by: Right of Center The Unemployment rate in America is wonderful... 1st link: U.S. Department of Labor-Bureau of Labor Statistics and to follow up: CARPE DIEM Why I wonder...could you say capitalism?

And how about a debate question?

[bishop]

i can think of a scarce few countries that don't practice capitalism in one of its many varieties/forms..

it'd be nice if RoC could give us something more substantive next time, cuz the initial post was worthless.

[Gods_Mercenary]

How about "the reason the economy is so good is because of Bush's economic policies"?

[Osborn F Enready]

How about that the economy isn't really even close to as good as those reports show.

How many people know people who are unemployed and NOT on unemployment?

[bishop]

Quote by: godsmercenary How about "the reason the economy is so good is because of Bush's economic policies"?

that's just an invitation for all sorts of uninformed banter... but, in case someone does want to take that goofy route, i'd preface it by saying that all these glorious "tax cuts" actually are not tax cuts.. they're nothing more than loans by foreign governments/banks.

we'll be paying off these loans, with interest, for quite a long time. not sure what they bought us either.

i've always argued that the fed's rate cuts were what lifted the country out of recession and caused a major boom in the market. plus, there's strong, historical evidence that this is, in fact, the case. you'll rarely ever find an economist who argues differently - or that bush's "tax cuts" had a remotely proportional effect compared to the fed's rate cuts. these "tax cuts" compared to the rate cuts is like a drop of water vs. a river.

[Gods_Mercenary]

Well, then they aren't a drain on the system, so they aren't a problem:)

[bishop]

Quote by: Osborn F Enready How about that the economy isn't really even close to as good as those reports show. How many people know people who are unemployed and NOT on unemployment?

you have to be looking for a job to be considered unemployed.

[G. Adams]

If you want to see how good the US economy is doing, take a look at the exchange rate a year ago to today. It's gone from (i'm going by memory here) about $1.65 to the £1, to almost $2 to the £. The marketplace is being flooded with dollars. Your pennies are worth more as copper than as units of currency. Just take a wild guess as to why that is.

[Osborn F Enready]

Bishop said: you have to be looking for a job to be considered unemployed.

I take it that was an insult, and I assume directed at me?

I have been looking for work since I became unemployed, I simply refuse to sacrifice my rights for employment or flip burgers for a living since I can do better than THAT on my own with part time side-work.

Here in Ohio, we are losing another 440 factory jobs, to other states in the US due to my states backwards ass policy making, and discouragement to business.

I could have a job tomorrow if I wanted to earn nothing, have no future of progression and be a corporate patsy, but boot licker is not my field.

[Autolykos]

Quote by: bishop i've always argued that the fed's rate cuts were what lifted the country out of recession and caused a major boom in the market. plus, there's strong, historical evidence that this is, in fact, the case. you'll rarely ever find an economist who argues differently - or that bush's "tax cuts" had a remotely proportional effect compared to the fed's rate cuts. these "tax cuts" compared to the rate cuts is like a drop of water vs. a river.

You are more right than you know, Bishop. Both the boom and the inevitable bust are due to the central bank's (i.e. the Fed's) rate cuts. Of course, "rate cuts" is just another way of saying "artificial expansion of the money supply".

- Rob

[deedee]

Quote by: Gods_Mercenary How about "the reason the economy is so good is because of Bush's economic policies"?

Hell yeah! I agree! ^^^^^^




^^^^^^^ Any questions?


.

[bishop]

Quote by: Osborn F Enready I take it that was an insult, and I assume directed at me?

heh... actually, it's the definition of being counted as unemployed by the BLS.

BLS Glossary

Unemployed persons (Current Population Survey) Persons aged 16 years and older who had no employment during the reference week, were available for work, except for temporary illness, and had made specific efforts to find employment sometime during the 4-week period ending with the reference week. Persons who were waiting to be recalled to a job from which they had been laid off need not have been looking for work to be classified as unemployed. Unemployment rate The unemployment rate represents the number unemployed as a percent of the labor force.

[bishop]

Quote by: Autolykos You are more right than you know, Bishop. Both the boom and the inevitable bust are due to the central bank's (i.e. the Fed's) rate cuts. Of course, "rate cuts" is just another way of saying "artificial expansion of the money supply". - Rob

all adjustments to money supply can be construed as artificial.. be it hording commodities, or adjusting lending rates..

i'm not sure, however, that the rate cuts must inevitably produce a bust - although they were kept in place way too long for my liking and certainly were (at least partially) responsible for creating the housing bubble as well as global inflation (notwithstanding the effect of oil prices).

that said, rates are still low compared to historical norms. the true problem seems to lay in our fiscal deficit - visualized by the continuing slide of the dollar versus competing currencies.

[deedee]

Quote by: bishop all adjustments to money supply can be construed as artificial.. be it hording commodities, or adjusting lending rates.. i'm not sure, however, that the rate cuts must inevitably produce a bust - although they were kept in place way too long for my liking and certainly were (at least partially) responsible for creating the housing bubble as well as global inflation (notwithstanding the effect of oil prices). that said, rates are still low compared to historical norms. the true problem seems to lay in our fiscal deficit - visualized by the continuing slide of the dollar versus competing currencies.

In a nutshell:

1. Personal Finances are solid.
2. Household employement is going up....
3. Average hourly earnings are going up.....
4. Unemployment rate is going down....
5. Consumer confidence is on the rise....
6. Real net worth to personal disposable income is going up....
7. Core PCE Inflation is between 2.0 - 2.5 % on average and Ben Bernanke wants to drop it between 1 - 2 %....

^^^^^^^^^^ Any questions?

[Fonceai]

Oh I have questions...

Then how do you explain the steady rise in college costs, the slower-than-inflation increase in pay for jobs that are salary and not hourly, the increase in taxes for purchasing a home, which all combines to give you young couples, fresh out of college, making not much more money than people in the same starter jobs 20 years ago, but they are unable to afford a decent starter home in a good neighborhood?

[Autolykos]

Quote by: bishop all adjustments to money supply can be construed as artificial.. be it hording commodities, or adjusting lending rates..

I meant "artificial" in the sense of not being a result of emergent market phenomena -- not in the sense of being merely human-produced.

i'm not sure, however, that the rate cuts must inevitably produce a bust - although they were kept in place way too long for my liking and certainly were (at least partially) responsible for creating the housing bubble as well as global inflation (notwithstanding the effect of oil prices).

Read here and here for more information on what I'm talking about.

that said, rates are still low compared to historical norms. the true problem seems to lay in our fiscal deficit - visualized by the continuing slide of the dollar versus competing currencies.

Expansion of credit through artificially manipulating interest rates (i.e. doing so via extra-market, or political, forces) is effectively the same as simply printing more money, albeit more subtle. The continuing slide of the dollar vs. "competing" currencies (which itself implies the fallacy of mercantilism) is a direct result of an increase in the supply of money, also known as inflation.

- Rob

[Autolykos]

Quote by: deedee ^^^^^^^^^^ Any questions?

Yes. Here are two:

1. Why drop "Core PCE Inflation" to 1-2%? Why not drop it to zero, or a negative number (i.e. deflation)?
2. What the hell is "consumer confidence", anyways?

- Rob

[bishop]

links to the austrian school don't exactly show how recent rate manipulation will "inevitably" produce a bust. financial markets do, in fact, have an ability to absorb a certain degree of imbalance - what austrian economists believe is akin to poisoning the water supply.

Quote by: rob Expansion of credit through artificially manipulating interest rates (i.e. doing so via extra-market, or political, forces) is effectively the same as simply printing more money, albeit more subtle. The continuing slide of the dollar vs. "competing" currencies (which itself implies the fallacy of mercantilism) is a direct result of an increase in the supply of money, also known as inflation.

yet, despite increasing rates, the dollar has continued to fall.

U.S. Dollar to Euro Exchange Rate - Yahoo! Finance

there's MUCH more to our currency's decline than interest rates.

as a country with a current account deficit, having our currency fall versus competing currencies causes our imports to cost more - and is a factor influencing inflation.. the one kink in that, however, is that china fixes its exchange rate in order to shield itself from any fluctuation in the dollar - which is why we've seen chinese imports grow even faster in recent years.

[Autolykos]

Quote by: bishop links to the austrian school don't exactly show how recent rate manipulation will "inevitably" produce a bust. financial markets do, in fact, have an ability to absorb a certain degree of imbalance - what austrian economists believe is akin to poisoning the water supply.

You're going to have to explain what you mean by "absorb... imbalance" before I can respond.

yet, despite increasing rates, the dollar has continued to fall.

There's still inflation despite increasing rates too, isn't there? The Fed is still creating new money out of thin air, right?

there's MUCH more to our currency's decline than interest rates.

You're right, but you misunderstand me. I never claimed that this was strictly an interest-rate issue. Rather, the Fed creates new money out of nowhere through its "open-market operations". It does so in order to keep the federal funds rate as close to the target rate as possible. The federal funds rate, in turn, has a significant influence on other interest rates (particularly the so-called "prime rate").

as a country with a current account deficit, having our currency fall versus competing currencies causes our imports to cost more - and is a factor influencing inflation.. the one kink in that, however, is that china fixes its exchange rate in order to shield itself from any fluctuation in the dollar - which is why we've seen chinese imports grow even faster in recent years.

I define "inflation" as "an increase in the money supply". How do you define it?

On the other hand, I'm aware of what China is doing. It can't keep that up forever, though, and once it stops, the bottom will probably fall out from under us.

- Rob