Say Anything Blog

Outside the struggling financial and consumer discretionary sectors, the economy is firing on all cylinders.

And those sections are only “struggling” because there is a small market correction going on among those who are irresponsible lenders and the irresponsible spenders. The market correction is punishing this bad behavior. Money flees from these areas. If the market (aka free people making free choices) is allowed to work its wonders, the corrections end up benefiting both the market and the individual.

Now here’s where a leftie will chime in and tell you that a nation of big screen TV owners can’t afford health care and our economy is really shit because of that. This big sector of our economy could be helped by the market, but they won’t allow it.

As usual, subjective statements about the economy are just that, subjective.  As usual, this post is filled with gobblygook cooked numbers.  For every “statistic” stated, I could show 3 that countered or clarified the slanted premise.
How many times in recent months have employment numbers been inflated on the front page only to be drastically deflated on page 12?
Was it not this administration who attempted to reclassify fast food “McJobs” as manufacturing jobs (they “manufacture” burgers!).

We have approximately $9,000 Billion in debt, 70% of which was generated under Reagan, Bush #1 and Bush #2 since 1981.
This has permanently damaged our economy and it’s ability to compete through investing in, among other thing, an educated population.
We graduate 25,000 American engineers annually.  China graduates 500,000 engineers annually (for the math challenged American, that’s 20 to our 1). 

You are entitles to your own opinions, but not your own facts.  You can cherry pick some numbers but the truth is clear:  Inflation adjusted hourly wages for the middle class and working poor have been spiraling downward under “Trickle Down” Voodoo economics.  We work more and, in spite of increased productivity, receive less for those hours worked.

The state of the stock market hardly concerns the service worker making $6.95 per hour.

In reality, what does matter to anyone who subjectively evaluates the economy is this:  How hard do you work to receive the basic necessities of life like food, health-care, housing and clothing.  If you need 10% of your income to purchase these critical services then of course, in your view, the economy is fantastic.
If you work all hours available yet, after you purchase basic housing and food, you cannot afford a doctor when ill, to have an abscessed tooth pulled, to have glasses for reading (let alone the moronic idea that $14,000 per year buys Large Screen TVs), then the economy obviously isn’t “sizzling.”

Using IRS numbers to show how our economy distributes income shows the following:
Compare how our economy distributed $10 Million of GDP in 1980 compared to 2004.
1980: top 1% = $896,000.  Bottom 50% ave $32,500.
2004: top 1% = $1,947,000. Bottom 50% ave $26,000

Therefore: 
Top 1% saw a 217% increase in income distribution.
Bottom 50% saw a 25% decrease in income distribution.

Clearly, voodoo economics has redistributed income out of the hands of the working poor and dumped it into the hands of the ultra-rich.
While inflation adjusted higher education and health-care cost have skyrocketed, our wonderful new economy takes money from families who would primarily have spent these funds on basic needs like their children’s health-care and education, and puts in the hands of those who hire servants and fly around in personal aircraft.

I’ll bet that top 1% thinks the economy is “sizzling” too.

Time2Act:

Clearly, voodoo economics has redistributed income out of the hands of the working poor and dumped it into the hands of the ultra-rich.

Let me be the first to say that you’re completely full of shit.
.

Time 2 Act, meet reality:

Rob’s recently listened-to songs:

The liberal media wants people who don’t want jobs to be forced to take them.
Like the foreign diplomats.

Where is Mark D?  Did he leave the building?  Wasn’t he just saying that almost all of August’s job growth numbers were “government jobs”?

Please come back and help time2asshat debate how jobs numbers and hourly earnings and GDP growth aren’t numbers that matter, but that the relative distribution of incomes are.  We would rather have an economy that doesn’t produce any jobs but that through taxation ensures that all folks are treated “equally” in income distribution. 

Wasn’t there a political system that did exactly that that was experimented with for most of last century?  Time2Act probably is wearing his Che shirt right now.

Of course the rich get richer as our economy gets.  The poor who don’t do a damn thing to get rich stay pretty much at the same place.

The solution of course is not to hold the achievers back which makes us all poorer.  The right thing to do is give a kick in the ass to all of the slackers like Time2act.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

To “Rob” I would say this:

Your chart helps make my point:
Ultra-high income earners, while benefiting from huge increases in income distribution, have seen steep decreases in taxation.
While school teachers pay a 28% marginal tax rate, IRS numbers show the top 1% pay a marginal tax rate of 14.7% on this 217% increase in income (see earlier post for IRS numbers).
To limit the effects of economic policy to taxation rates is simple minded.

To “Justin B.” who counters my point with the STRAW-MAN argument:

We would rather have an economy that doesn’t produce any jobs but that through taxation ensures that all folks are treated “equally” in income distribution.

I mention(ed) the following:

Under the current administration, monthly “Job Numbers” are extremely suspect.  They have been repeatedly deflated after their initial posting. I question all short-term numbers and focus on the long term effects of “Trickle-Down” economics.

It is a simple-minded and ridiculous to state that we have 2 choices: 

Current policy OR an economy that doesn’t produce jobs.
I did not suggest we improve equality in income distribution through simplistic changes in taxation rates.  To improve income distribution equality, the investment (taxation) needs to be used appropriately.

Supply Side or “Trickle-Down” economic policy has a certain allure, especially from a Macro-economic standpoint, if you ignore the detrimental Micro-economic impact on individuals. 
Supply-side economics is always touted by those receiving the majority of benefits.  If you are wealthy and do not depend on job security and a fair working wage for your survival but instead generate your wealth from increased corporate profits and stock options, it isn’t surprising you are not concerned when American software engineers loose their jobs through increased H1-B visas.
When wages are “Trickling Down” and profits “Tsunami UP”, then of course you like the system.

Profit is great, when the proceeds maximize benefit for the many, not only the few.

If you believe the function of the nations economy is to produce lavish riches for the few, while providing a lowering standard of living for the many, then you believe our long-term policy is fine.

Supply-side economics has its place and time.  Reagan’s first tax cut was most likely wise IF it had been temporary. There is a time to stimulate (borrow)and a time to repay and invest.

Repeated decreases in the feedback loop of national investment (Investment in infrastructure, education, research.. etc.) to give the ultra-wealthy unnecessary and non-productive incentives to invest, while borrowing back this revenue to repeatedly increase non-productive military spending, has had a stifling effect on the middle class and our ability to compete.

If Johnny’s parents can’t afford his engineering degree because the wealthy are given cuts in their contribution to the education infrastructure, and Uncle Sam borrows back these cuts to produce BOMBS not BUTTER, the people suffer.

Mr. Joe Warbucks doesn’t suffer because his stock options increase, when profits increase, by virtue of hiring lower wage H1-B visa holders with software engineering degrees, not JOHNNY.

Predatory economic policy is good for the predator but not so great for the PREY

We have borrowed to much, and invested too little.

When the Middle Class and the Working Poor have sufficient resources to procure their common needs, the domestic industry to supply those needs flourish and become more efficient.

If we give all our resources to the ultra-wealthy in too large a quantity, for too long a time, we either become great at producing luxury goods or they spend our resources elsewhere.

These are hardly “Communistic” concepts, as weak minded partisans would have you believe.

Unregulated, PREDATORY economic policy was the order of the day leading into the 1920s and the eventual crash.
Ponzi schemes worked, until they DIDN’T

We pay the Chinese more in INTEREST on what we have borrowed from them (to build bombs and give the wealthy tax cuts) than we invest in higher education.

Short-term statistical blips mean little.  All things are a matter of degree.

What have we accomplished if we loose 100,000 $25/hr jobs and replace them with 200,000 $7/hr jobs?

Economic policy is NOT some simple “either, OR” proposition. 

Short-term trends tell little.  Long-term trends show how we distribute our resources. 
If you believe continued upward distribution of income is the correct policy, in spite of evidence showing it is damaging to the working class and the long-term health of our economy, then you will likely believe we are on the right track.

If you believe, as I do, that totally unregulated capitalism and long-term one-sided economic policy has shown itself to be detrimental, then you may agree that change is needed.

Ultra-high income earners, while benefiting from huge increases in income distribution…

The successful people in our system, far from benefiting from any other income distribution than that stemming from merit, benefit from their own actions.  This isn’t a centrally-planned economy, it’s a demand economy.  Those who are best at supplying the demand prosper; those that don’t, don’t.  It’s survival of the fittest; I thought all you lefties believed in Darwin.

If you don’t know by now, don’t mess with it.

When wages are “Trickling Down” and profits “Tsunami UP”, then of course you like the system.

Profit is great, when the proceeds maximize benefit for the many, not only the few.

Well over half of Americans are vested in the current stock market system through 401k holdings.  Stock market rises benefit almost all Americans, not just the top earning Americans, though the benefit is directly proportionate to the amount of income one has chosen to invest in the market.

American home ownership is at an all time high.  Minority unemployment is at historic lows, faring better for blacks and hispanics than under Clinton.  Wage growth has continued to outpace inflation.

The crisises that we have to solve are centered around Social Security and Medicare entitlement spending, Social Security insolvency, healthcare costs, and college education costs.  The path that you describe seems to center around expanding the amount of funds that are available to low income families to pay for college and expanding redistribution to the poor through either earned income tax credits or some other form of redistribution scheme.  Simply increasing the marginal tax rates for the wealthy earners does little to decrease the gap between rich and poor, even if you lower the marginal tax rates on low income earners because the lowest 50% of wage earning households do not pay taxes under the current marginal tax rates as it is.  They cannot pay less than nothing, unless the government expands either welfare benefits, subsidies for healthcare or education, or the earned income tax credit.

The changes you describe will do nothing to fix the problem that you describe of a disparity between haves and have nots.  Higher marginal tax rates on investment earnings without a redistribution system will simply result in a stagnant economy and a decrease in available investment capital.  It cannot provide any benefit to the poor unless the government spends the money on the programs I have described above.  Programs that have been proven to be ineffective at curing long term economic issues as demonstrated by the Great Society.

I don’t believe the gap between rich and poor is the problem.  I believe the solution is to ensure that even the poorest Americans have access to jobs, which is only possible through expansion and growth.  If the new jobs being created were low paying service jobs, the average hourly earnings would not be going up.  And if you take a look around the country, you will see that despite the alleged “middle class squeeze” and subprime mortgage problems, Americans are doing very well.  We have warts including foreclosures, rising college tuition and healthcare costs, a trade deficit, and so forth, but those problems are clearly the ones our economic policies should be focused on, not on “fairness” of income distribution.

Justin
Manufacturing shed another 21,000 jobs and continues to lose jobs every month.
Government added 36,000 useless workers.
Leisure and hospitality added 56,000 jobs, which are mostly low paying jobs.

And the Birth/Death Model adjustment was 103,000.
it showed 25,000 of those jobs were created in Financial Activities and 14,000 in Construction.

And GDP.......give me a break. No one bought that crap except you guys.

Well fist off, the 3.9% GDP was due to the .8% deflator, the difference between current dollar GDP and real GDP. Do you really think inflation in the 3Q2007 was at a 40 year low? Too bad no one mention that when jumping up and down how robust the economy grew.
The real GDP should be more like 2%
Todays reports (PCE, Auto Sales etc) show how things have slowed and is not what the GDP numbers showed.

The deflator is a measure of inflation

GDP

MarketWatch on The GDP

“We have a dollar that’s adjusting and I am for a strong dollar.....
Our dollar doesn’t buy as many barrels of oil as it used to and so therefore it’s more expensive for the American people”..... Bush 3/12/08

Manufacturing shed another 21,000 jobs and continues to lose jobs every month.

Moaning the loss of manufacturing jobs always sounds funny coming from the Left! If you want to preserve the prey, you need to thin the predators! Thin the herds of environmentalists and trial lawyers in the US and more manufacturing jobs survive!!

A troll is someone who only wants to stir up trouble, not have an honest debate.  Some signs that a poster is a troll:
* Dodges questions from other posters * Refuses to give sources
* When one of its arguments is shown to be false, either ignores the proof or moves the goalposts.  Heh. (From the LGF faq)

Justin

Well over half of Americans are vested in the current stock market system through 401k holdings.  Stock market rises benefit almost all Americans

So what happens to the value of those holdings when the stock market goes down?

The dollar is also sizzling....so hot no one wants it.

“We have a dollar that’s adjusting and I am for a strong dollar.....
Our dollar doesn’t buy as many barrels of oil as it used to and so therefore it’s more expensive for the American people”..... Bush 3/12/08

The employment to population ratio fell from 62.9% in September to 62.7% in October as the household survey recorded an employment decline of 250,000. The labor force participation rate also feel from 66% in September to 65.9% in October.

Payrolls grew at a pace more than twice what analysts had predicted, led by a sharp increase in the service sector. But a survey of consumers showed that fewer Americans were employed last month over all. The labor force shrank by 211,000 jobs, and 465,000 Americans said they were no longer working.

So what happens to the value of those holdings when the stock market goes
down?

The same thing that happened in 1999-2002.
The cure was to continue cutting taxes, especially on capital gains and dividends which Bill Clinton started, but didn’t go far enough.

So what happens to the value of those holdings when the stock market goes down?

You must not have any investments in the market to be showing your ignorance of this subject.  Like anything else you do in life, there is an element of risk and like anything else, the risk is proportional to the reward.  And like anything else, you can’t learn about it by sitting on the sidelines carping about it.

The Supreme Court is a bunch of black robed tyrants

Kevin
Yup, cutting taxes will bring the dollar from the dumps and save the banks, and fix housing....etc.
Cramer and Kudlow whined for the fed to lower rates but I never heard them whine that dubya should lower taxes. Could it be coz lower interest rates do more for the economy?

Doc
Are most Americans with 401Ks aware of the risk? I think not. They think of it more as a savings account not realizing it may drop in value.

The dollar is also sizzling....so hot no one wants it.

Nov. 5 (Bloomberg)—Gisele Bundchen wants to remain the world’s richest model and is insisting that she be paid in almost any currency but the U.S. dollar.

Even after the dollar lost 34 percent since 2001, the biggest investors and most accurate forecasters say it will weaken further as home sales fall and the Federal Reserve cuts interest rates. The dollar plummeted to its lowest ever last week against the euro, Canadian dollar, Chinese yuan and the cheapest in 26 years against the British pound.

“We have a dollar that’s adjusting and I am for a strong dollar.....
Our dollar doesn’t buy as many barrels of oil as it used to and so therefore it’s more expensive for the American people”..... Bush 3/12/08

I know when I want sound economic advice, I go to a Brazilian supermodel.  /sarcasm
As the good economic news keeps coming in, hate-filled lefties like Mark become ever more desperate to find any fearmongering they can.  Pathetic.

Good news for America is bad news for the lefties.

If you don’t know by now, don’t mess with it.

"Time2Act” (about what?) says, We pay the Chinese more in INTEREST on what we have borrowed from them (to build bombs and give the wealthy tax cuts)...

If “we” are giving the wealthy tax cuts, then how come they pay more than they ever have before?

Unrelated question: why are you putting scare quotes around people’s names? Rob, Justin B., and others need no quotes around their names. Yours, however,..just begs the question.

“Time2Act” (about what?)

Probably an Alinskyite, like Hillary.

If you don’t know by now, don’t mess with it.

r108

As the good economic news keeps coming in

?????Where?????
Nothing but smoke and mirrors.

Next reality for WallStreet: Level 3 Assets.

Fearmongering or reality?

“We have a dollar that’s adjusting and I am for a strong dollar.....
Our dollar doesn’t buy as many barrels of oil as it used to and so therefore it’s more expensive for the American people”..... Bush 3/12/08

Nothing but smoke and mirrors.

That would be your hateful attempts at scaremongering.  Like all lefties, you seek to snatch defeat from the jaws of victory.

What’s good for America is bad for the lefties.  You seek to destroy the American Dream, so that you can replace it with your ideology of mediocrity and slavery:  Marxism.

If you don’t know by now, don’t mess with it.

MarkD:

Fearmongering or reality?

Just ignorance.

Fearmongering or reality?

Just ignorance.

There’s more opportunity today than ever.  The workers in the Soviet Union were guaranteed a job. 

I think our system is more better.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

Whistler:

I think our system is more better.

Given that their’s blew chunks and collapsed, I would definitely agree.

Unfortunately apologists for socialism are still looking for the imminent collapse of our free market system, as some weird type of “see I told you so” validation.

Unfortunately for them, and to the benefit of all thinking people, it ain’t going to happen.

Unfortunately apologists for socialism are still looking for the imminent collapse of our free market system, as some weird type of “see I told you
so” validation.

They do more than simply “look” for it; they actively work to try to destroy it.  Despite their efforts in this area, we just go merrily along, getting richer and richer.  Lenin realized this a long time ago, that it would be necessary to actively work to undermine our system.  If it were really inferior, no effort would be necessary.

If you don’t know by now, don’t mess with it.