It's The Economy, Stupid

Off Topic Politics and World Issues
21

[quote]rainjack wrote:
orion wrote:

The unemployment is actually measured by telephone polls and if someone answers that he has even workd a few hours that week he is not counted as unemployed. This does not even take into cosideration that this is a sensitive issue and people lie.

I’m pretty sure unemployment figures are a function of the number of people filing for unemployment.

Self-Employed sole proprietors, such as myself, don’t show up on the numbers. We are not counted as being employed, or unemployed since we have no right to claim unemployment benefits.

You have the numbers you want to believe, I have the numbers I want to believe. Who is right? I know I am doing exponentially better now than I was doing in 2000.

You can argue the economy all day, but the amount of new construction going on even in my hick-assed corner of the world tells me that there is money to spend, and people are spending it.

Now if you want to factor in unsecured consumer debt - we might not be doing as well as some report. But until that sort of debt is viewed as a bad thing by more than a handful of people, it will never be reflected in the numbers.

My original point was, however, that there is going to be a $700 billion increase in revenues to the treasury.

Trickle down works.

[/quote]

I never questioned your original point, though I think it is to to simply put, because it depends where you are on a Laffer curve and nobody knows if that curve even is a curve.

The broader point was that the US government uses BS statistics which makes it increasingly harder to judge the state of the economy. I actually have no numbers to believe in.

I do not doubt what you see around you, but maybe your neighborhood profits from high oil prizes which at the same time stunt growth in the rest of the US? You never know.

22

[quote]rainjack wrote:
Trickle down works.
[/quote]
No, it is flawed. Money doesn’t always trickle all the way down. How does construction in Texas help jobless people in MN? Money only spreads out so much before the ripple subsides. But yes, more money in individuals pockets it a good thing for the individual and production in general. I still wouldn’t tout “trickle-down” economics as valid–as it assumes the source is only the super-rich.

I always think of the “trickle” as rich people pissing on poor people. If it was so great why wouldn’t they just call it “pour-down” economics. Imagine dying of thirst waiting for that “trickle” to come–“mmmmmm, that was the tastiest trickle, ever!”

23

[quote]LIFTICVSMAXIMVS wrote:
Zap Branigan wrote:
People have such a better standard of living today than in 1980 it is amazing.

But it is slipping. The disparity between the uber-wealthy and the poor grows by leaps and bounds. This is bad for overall quality of life as it creates inflation.[/quote]

Just because the super rich are growing so fast. The poor are improving too.

24

[quote]LIFTICVSMAXIMVS wrote:
Zap Branigan wrote:
People have such a better standard of living today than in 1980 it is amazing.

But it is slipping. The disparity between the uber-wealthy and the poor grows by leaps and bounds. This is bad for overall quality of life as it creates inflation.[/quote]

Actually the standard of living for the poor is growing.

Why do you feel that the economy is inelastic and that an improvement in one’s lot can only come at the expense of others. If the economy grows, both can prosper. Those assuming more risk profit the most.

Why do you feel a would a gap in income between economic classes would create inflation?

25

[quote]rainjack wrote:
People that think the economy is a zero sum game will never share their pie.

Those that understand that the pie will always grow if the climate is right - build wealth as a direct result of tax cuts.

Does it make the economy better? You be the judge.
[/quote]
The economy in a free market ensures that every party benefits from exchange–you’re right it isn’t zero sum. But this does not mean the economy is good. Your personal finances are good because you have a surplus and have made correct decisions.

The economy can never be good or bad. Some people make bad decisions and others benefit from those bad decisions which is good.

For example, the sub-prime market sucks right now, but for people with good credit who make good financial decisions who can afford to refinance their home will benefit. Your finances are a reflection of you only and not the entire environment. The economy cannot be been measured like that.

More money is only beneficial if it isn’t followed by inflation–which it always has been since the inception of the Fed and even more so since the abolishment of the gold standard in 1971.

You’re profits are up–that is good but it isn’t a “measure of the economy”. Now, what would destroy your profits? That is really the only question that matters.

26

[quote]Zap Branigan wrote:
People have such a better standard of living today than in 1980 it is amazing. [/quote]

Offtopic:

What I have seen, I has been mostly useless. Necessary and unavoidable, maybe, but what do I have now that I didn’t have 1980? What I truly value, it is made out of flesh.

I say this to point out, that what makes people happy does not directly correlate with the standard of living.

27

[quote]LIFTICVSMAXIMVS wrote:
Zap Branigan wrote:
People have such a better standard of living today than in 1980 it is amazing.

But it is slipping. The disparity between the uber-wealthy and the poor grows by leaps and bounds. This is bad for overall quality of life as it creates inflation.[/quote]

How is it slipping? By what standards?

When a person with cable tv, a pc, and cell phones is considered poor, I think someone needs to take a look at exactly what the definition of poor is.

People in the US, by and large have no fucking clue about real poverty.

Go to Juarez, or TJ. Walk around the back streets, or dare to visit a colonia.

28

[quote]hedo wrote:
Actually the standard of living for the poor is growing.

Why do you feel that the economy is inelastic and that an improvement in one’s lot can only come at the expense of others. If the economy grows, both can prosper. Those assuming more risk profit the most.

Why do you feel a would a gap in income between economic classes would create inflation?
[/quote]
I agree with you somewhat. The economy is a nonentity. It is just a set of natural laws brought about in our environment. Wealth on the other hand is a real and viable measurement–Production v. consumption, for example. Really what people mean when they say “economy” is just a positive cash balance.

I feel that the wealth being created by these tax-cuts is not real because it will be followed by inflation–it always is because government (and consumers) cannot control spending which causes us to just print more money. More money does not equal more wealth. In the short term those with first access will benefit because its purchasing power has not been diluted.

If we just keep taking out loans to pay for tax-cuts (which is what is happening) it doesn’t do anything positive for the people at the lower end of the chain–people with last access to new money–because it will be deflated in value by time it gets to them. So low income people get back $300 from Uncle Sam…what does that do in the long run?

We need to learn restraint. We are too comfortable with debt. The thing that really makes me scratch my head is that the average person is fine with being in debt for more than he or she can possibly payback in 10 years (not including home loans). Our government sets the example though–go figure.

We need a positive production to consumption ratio to grow wealth so we can pay back our debts. Then we can have real wealth and own our own property. If a bank holds a loan for your home and that bank happens to be in China (or any other nation that holds debt for us) what does that mean for our sovereignty when they recall their loans?

It is an extremely slippery slope.

29

[quote]kaaleppi wrote:
Zap Branigan wrote:
People have such a better standard of living today than in 1980 it is amazing.

Offtopic:

What I have seen, I has been mostly useless. Necessary and unavoidable, maybe, but what do I have now that I didn’t have 1980? What I truly value, it is made out of flesh.

I say this to point out, that what makes people happy does not directly correlate with the standard of living. [/quote]

Money does not buy happiness but it may rent it for a while.

There is a book I am meaning to read by Gregg Easterbrook The Progress Paradox that discussed how materially we may be wealthier but people are generally less happy.

Has anyone read this?

30

[quote]kaaleppi wrote:
What I have seen, I has been mostly useless. Necessary and unavoidable, maybe, but what do I have now that I didn’t have 1980?[/quote]

Cell phone? GPS? Laptop computer? iPod? A car that starts up even when it’s cold? The internet?

Me too. Mmmmm, steak.

Yeah, but wouldn’t you rather be miserable in front of a 62" HDTV, rather than a 10" black and white TV?

31

[quote]rainjack wrote:
When a person with cable tv, a pc, and cell phones is considered poor, I think someone needs to take a look at exactly what the definition of poor is.
[/quote]
How much debt was taken on to acquire these niceties? Most people do not own the stuff in their house along with the house itself. This would be okay if the actual debt was backed by real money–but its not–its just electromagnetic signals residing on banks databases. Oh, the liquidity!

32

[quote]pookie wrote:
kaaleppi wrote:
What I have seen, I has been mostly useless. Necessary and unavoidable, maybe, but what do I have now that I didn’t have 1980?

Cell phone? GPS? Laptop computer? iPod? A car that starts up even when it’s cold? The internet?

What I truly value, it is made out of flesh.

Me too. Mmmmm, steak.

I say this to point out, that what makes people happy does not directly correlate with the standard of living.

Yeah, but wouldn’t you rather be miserable in front of a 62" HDTV, rather than a 10" black and white TV?
[/quote]

I have spent many good moments watching a 10" black and white tv. It’s not the tv that makes the experience satisfying.
Cell phones, internet, iPod, they are all nice, but they have their drawbacks too. I’m not entirely satisfied with the convenience they have brought.
You know what my point was. It was the sentence that made you think about steaks.

33

[quote]LIFTICVSMAXIMVS wrote:
rainjack wrote:
When a person with cable tv, a pc, and cell phones is considered poor, I think someone needs to take a look at exactly what the definition of poor is.

How much debt was taken on to acquire these niceties? Most people do not own the stuff in their house along with the house itself. This would be okay if the actual debt was backed by real money–but its not–its just electromagnetic signals residing on banks databases. Oh, the liquidity![/quote]

Then money doesn’t exist, either.

You are the one that said the gap is widening, and that conditions are worsening. Define poverty, and explain how the poor are having a harder time.

Based on what you are saying, it would seem that the widening gap is a choice made by the “poor” to leverage the future in order to gain creature comforts now.

I don’t disagree that consumer debt is a cancer, but to assume that all poor are their because of debt is not entirely honest. Sure - it fits everything in your box, but you need to define poor, and uber-rich, and stick with what you say.

34

[quote]Zap Branigan wrote:

Money does not buy happiness but it may rent it for a while.

There is a book I am meaning to read by Gregg Easterbrook The Progress Paradox that discussed how materially we may be wealthier but people are generally less happy.

Has anyone read this?[/quote]

Financial security, that I don’t have to worry about the basics, that’s the key, in my opinion. After that, happiness is achieved with other means than materia. The sheer amount of gadgets that a modern day household (my household) is filled with, it is somehow depressing.

35

[quote]rainjack wrote:

BushII cut taxes, and it is working The economy is not nearly as bad as some would have you believe. You can’t have statistical full employment, single digit inflation, low interest rates, and think the economy is in the tank.

The situation is definitely worse than the official pictures.

How bad is it, Orion? How do you substantiate this worse-than-being-reported situation?

Try harder.

[/quote]

It’s bad. The US Comptroller has been preaching this for years because of social security and medicare alone. We have been borrowing money from China and Japan to fund the war in Iraq and we will not be able to pay all of our debt back. China could ruin our economy and even claimed to have more control over our interest rates than the Federal Reserve. I’m a little worried.

http://www.usatoday.com/news/washington/2005-11-14-fiscal-hurricane-cover_x.htm

http://www.theconservativevoice.com/article/27340.html

36

[quote]rainjack wrote:
Ruggerlife wrote:
As for the potential Democrats raising taxes. If they are in power why would they, they’re spin will be a to claim a balanced budget and a strong economy…something the Republicans were unable to deliver.

Democrats raise taxes. They play the class envy card and get all the McJobbers to thinking that everything will be berries and cream if the rich are punished.

Name the last real tax cut offered by the left.

Reagan cut taxes and the economy took off.

Bush I raised taxes and it cost him the election.

Clinton offered the “middle class tax cut” which raised taxes on everyone making over 32K - But no one cared because we were riding the tech bubble.

BushII cut taxes, and it is working The economy is not nearly as bad as some would have you believe. You can’t have statistical full employment, single digit inflation, low interest rates, and think the economy is in the tank.

One would only have had to live through the 70’s to know that however bad we think the economy is now - it is a freaking money machine compared to Ford/Carter’s 70’s.

The war is draining us - and but for that, we would have a budget surplus. Them left smells the money and would love to get us out of Iraq so they could spend the surplus on themselves.

Notice how I am not making a distinction between rep and dem - lest vroom think I am cheerleading.

[/quote]

Reagan cut, then promptly raised and raised and raised…(class envy?)
Bush raised (class envy?)
Clinton raised and cut (class envy?) economy soars deficit shrinks (good)
Bush 2 cut, cut and cut and deficit spends to counter. (bad)

and of course nobody spends like Republicans (historically and currently)
and obviously surplus spending better than deficit spending.

37

[quote]100meters wrote:
Reagan cut, then promptly raised and raised and raised…(class envy?)
Bush raised (class envy?)
Clinton raised and cut (class envy?) economy soars deficit shrinks (good)
Bush 2 cut, cut and cut and deficit spends to counter. (bad)

and of course nobody spends like Republicans (historically and currently)
and obviously surplus spending better than deficit spending.
[/quote]

Regan cut. The dems forced a raise because of THEIR spending.

Clinton never cut. The middle class tax cut was nothing of the kind. His boom was because the economy recovered by the time he was sworn in. He tried to get a $16billion “economic stimulus package” passed but even the dems couldn’t go along with him and his idiocy. The best thing that ever happened to him was the revolution of 1994.

Every president you have mentioned was a deficit spender.

Show a little integrity.

Trickle down works.

38

First of all the article says we won’t be in Iraq forever [quote](“But of course, we won’t be in Iraq forever, so the fiscal picture is suddenly looking a lot better for after we leave”)[/quote] thats a giant fucking lie - or is the 104 acre US Baghdad embassy a giant circus tent we’ll be bringing back to the states?

Of course not only will we STILL be in Iraq, but we’ll also be in Iran almost for sure.

I’m just curious, has National Review published anything that’s turned out to be true in at least the last seven years? Seriously.

The dollar’s crashing, foreclosures are skyrocketing, we’ve lost millions of manufacturing jobs, the number of uninsured is at a record high, China’s dumping the dollar and the Fed just created 200 billion dollars of liquidity out of thin air to prop up the markets and then will charge us interest on it - but NRO assures us the economy isn’t so bad.

Fortune cookies give more reliable news than NRO.

Fed injects 31.25 billion dollars into markets
The Fed has injected some 200 billion dollars into the financial system since August 9 in a bid to boost credit flows which have seized up due to problems linked to the distressed US mortgage market.

Bear Stearns Fat Cats Cashed Out at the Top
http://www.thestreet.com/s/bear-stearns-fat-cats-cashed-out-at-the-top/funds/followmoney/10372963.html

Is China quietly dumping US Treasuries?
Data released by the New York Federal Reserve shows that foreign central banks have cut their stash of US Treasuries by $48bn since late July, with falls of $32bn in the last two weeks alone.

39

Let’s see, what else…

Study: U.S. Infrastructure Eroding - Report Says Roads, Bridges, Drinking Water Systems Are Crumbling
A report by the American Society of Civil Engineers released Wednesday assessed the four-year trend in the condition of 12 categories of infrastructure, including roadways, bridges, drinking water systems, public parks, railroads and the power grid.

The overall grade slipped from the D-plus given to the infrastructure in 2001 and 2003.
http://www.cbsnews.com/stories/2005/03/09/national/main678939.shtml

U.S. First Responders Underfunded by $100 Billion by 2008
http://www.firstresponsecoalition.org/release-03-23-2005.shtml

Two Years After Katrina, Billions in Relief Funds Are Missing
http://www.alternet.org/module/printversion/60494

U.S.: No strings attached to new defense package for Israel
The new $30 billion American defense package for Israel is not conditioned on diplomatic progress or concessions to the Palestinians, a top U.S. aide said
http://www.haaretz.com/hasen/spages/894644.html

What the? How’d that get in there?

40

[quote]rainjack wrote:
Then money doesn’t exist, either.

You are the one that said the gap is widening, and that conditions are worsening. Define poverty, and explain how the poor are having a harder time.

Based on what you are saying, it would seem that the widening gap is a choice made by the “poor” to leverage the future in order to gain creature comforts now.

I don’t disagree that consumer debt is a cancer, but to assume that all poor are their because of debt is not entirely honest. Sure - it fits everything in your box, but you need to define poor, and uber-rich, and stick with what you say.
[/quote]
Poor–someone who struggles with making ends meet regularly and has no assets.

Uber-wealthy–doesn’t know how much money is currently in his or her many accounts around the world.

Money backed by a hard currency does exist. If gold is sitting in the vault then there is a real insoluble substance that represents the paper being passed around. We need a hard monetary standard or else we just deflate our actual wealth. The purchasing power of the dollar has been slipping consistently since 1971–the same time we went off the gold standard–and has slipped more than 2000% since 1925.

What I am saying is that money is too available–and if it weren’t just printed out of thin air I wouldn’t care. Because the banks aren’t required to keep actual reserves in their bank (the federal reserve makes that possible) it affects the purchasing power of the money I do happen to have left over at the end of the month–retirement is just a dream for my wife and I at this point. I am a responsible individual but I don’t benefit from it because my left over money will be worth less next year than it is now–and that isn’t taking into account taxes when I finally do get to spend what inflation didn’t kill.

Banks are protected from insolvency by the taxpayer and that is not good. They should be expected to compete like any other industry with an actual product. It should be considered fraud to loan out money you don’t actually have.

I’m sure you can remember back to the days when $1 seem worth more than a 12oz soda-pop…do you think the uber-rich care about the cost of a soda-pop?