What Recovery?

[Decus]

It's just hard numbers. It either is or it isn't its not an opinion.

FRED® Civilian Employment-Population Ratio

You speak of percentages in much of what you post, but not what presently underlines those numbers. Part-time and low paying jobs are the growing trend. I won't get into what has already been discussed - the number of people who are no longer looking for work.

Here is a different view of employment in America from Federal Reserve governor Sarah Bloom Raskin:

"She found half of all those hired received low pay jobs, but two-thirds of the jobs lost in the recession were middle income jobs like factory and construction workers.

Ms. Raskin said she is concerned about “the quality of jobs available,” while speaking on a panel at a conference on joblessness hosted by the Roosevelt Institute, a self-described progressive policy organization."

Fed?s Raskin Bemoans Quality of New Jobs - Real Time Economics - WSJ

The OP was about GDP growth and the general term "recovery".

Yes, I agree, wage index growth fell (did this somewhere else) miserably.

That's the thing, isn't it. We were expecting this in '04. The combining economies on a global level with China was going to drive standard of living in the US down as it raised china up, or that was our thought about it.

That isn't going to change. Happened quick to, just all in a few months. Nowll growth is all tepid. And, it's not going to change until the whole
globe comes up. You think US wages are slowly falling to meet China wages?

If 'recovery' were meant to denote GDP and little else, you have presented a a credible argument. Recovery for most however has a far more tangible meaning and one that is measured at a household level. Recovery at this level is not evident to many people.

 

[itfitzme]

Evul racist conservatives have been telling people for years that the growth has not kept up with the population and has therefore been a loss.

But liberals are well trained to over act any good looking news.

It's just hard numbers. It either is or it isn't its not an opinion.

FRED® Civilian Employment-Population Ratio

You speak of percentages in much of what you post, but not what presently underlines those numbers. Part-time and low paying jobs are the growing trend. I won't get into what has already been discussed - the number of people who are no longer looking for work.

Here is a different view of employment in America from Federal Reserve governor Sarah Bloom Raskin:

"She found half of all those hired received low pay jobs, but two-thirds of the jobs lost in the recession were middle income jobs like factory and construction workers.

Ms. Raskin said she is concerned about “the quality of jobs available,” while speaking on a panel at a conference on joblessness hosted by the Roosevelt Institute, a self-described progressive policy organization."

Fed?s Raskin Bemoans Quality of New Jobs - Real Time Economics - WSJ

Again, the OP was "normal recovery" and GDP. I didn't pick the topic. I added emratio and u-3.

Like the March Hair said, "Say what you mean and mean what you say." You might have responded to the OP if you want to change directions, there's your man in charge.

As for the wage index, a good indicator of the bottom quintile

FRED® Employment Cost Index: Wages & Salaries: Private Industry Workers

It has been falling since at least 2000. But then we have been talking about this for years. The lower middle quintiles were always losing ground. And every recession, they lost more.

The recession and its effect were long over due. It was all propped up on an asset bubble.

Now, its not coming back. There is no comparing what is to some "what it should be" based on "what it was".

What it is now is low paying shit jobs. And its that way because that's the free market. That's what consumers bought thenselves. That's what theabor force accepted. That's what we were willing to live with. The middle class was happily accepting lower wages, buying on credit to fill their their house, then taking a second mortgage. If people are willing buy into poor quality, then they get poor quality.

So what is the plan now, now that we all agree we are stuck with low paying jobs for the next decade?

 

[itfitzme]

You speak of percentages in much of what you post, but not what presently underlines those numbers. Part-time and low paying jobs are the growing trend. I won't get into what has already been discussed - the number of people who are no longer looking for work.

Here is a different view of employment in America from Federal Reserve governor Sarah Bloom Raskin:

"She found half of all those hired received low pay jobs, but two-thirds of the jobs lost in the recession were middle income jobs like factory and construction workers.

Ms. Raskin said she is concerned about “the quality of jobs available,” while speaking on a panel at a conference on joblessness hosted by the Roosevelt Institute, a self-described progressive policy organization."

Fed?s Raskin Bemoans Quality of New Jobs - Real Time Economics - WSJ

The OP was about GDP growth and the general term "recovery".

Yes, I agree, wage index growth fell (did this somewhere else) miserably.

That's the thing, isn't it. We were expecting this in '04. The combining economies on a global level with China was going to drive standard of living in the US down as it raised china up, or that was our thought about it.

That isn't going to change. Happened quick to, just all in a few months. Nowll growth is all tepid. And, it's not going to change until the whole
globe comes up. You think US wages are slowly falling to meet China wages?

If 'recovery' were meant to denote GDP and little else, you have presented a a credible argument. Recovery for most however has a far more tangible meaning and one that is measured at a household level. Recovery at this level is not evident to many people.

Did you read the OP article? Or are you just trying to make up an arguement by using your own personal definitions because you don't have anything specific that you can come up with?

 

[itfitzme]

You speak of percentages in much of what you post, but not what presently underlines those numbers. Part-time and low paying jobs are the growing trend. I won't get into what has already been discussed - the number of people who are no longer looking for work.

Here is a different view of employment in America from Federal Reserve governor Sarah Bloom Raskin:

"She found half of all those hired received low pay jobs, but two-thirds of the jobs lost in the recession were middle income jobs like factory and construction workers.

Ms. Raskin said she is concerned about “the quality of jobs available,” while speaking on a panel at a conference on joblessness hosted by the Roosevelt Institute, a self-described progressive policy organization."

Fed?s Raskin Bemoans Quality of New Jobs - Real Time Economics - WSJ

The OP was about GDP growth and the general term "recovery".

Yes, I agree, wage index growth fell (did this somewhere else) miserably.

That's the thing, isn't it. We were expecting this in '04. The combining economies on a global level with China was going to drive standard of living in the US down as it raised china up, or that was our thought about it.

That isn't going to change. Happened quick to, just all in a few months. Nowll growth is all tepid. And, it's not going to change until the whole
globe comes up. You think US wages are slowly falling to meet China wages?

If 'recovery' were meant to denote GDP and little else, you have presented a a credible argument. Recovery for most however has a far more tangible meaning and one that is measured at a household level. Recovery at this level is not evident to many people.

You might consider adding this to the Costco and WalMart threads. There is a discussion about how lucky WalMart and Costco employees are going on.

 

[itfitzme]

I read that every dollar in the stock market adds 2 cents to the consumer economy. It read like it justifies the stock market. Does it seem like a good thing?

 

[editec]

According to this article...there hasn't been ANY recovery. We can't even maintain normal growth.

News from The Associated Press

LOS ANGELES (AP) -- The expected U.S. "Great Recovery" hasn't materialized and the economy has fallen short of even normal growth, according to a forecast released Wednesday.

The second-quarter UCLA Anderson Forecast said the growth of real gross domestic product - meaning the inflation-adjusted value of goods and services produced - is too small to help the nation climb out of its slump.

The figure was 15.4 percent below a "normal" growth trend, forecast director Edward Leamer wrote.

"To get back to that 3 percent trend, we would need 4 percent growth for 15 years, or 5 percent growth for eight years, or 6 percent growth for five years, not the disappointing twos and threes we have been racking up recently," he said.

"It's not a recovery. It's not even normal growth. It's bad," he wrote.




What say ye, Obamabots?

Can't speak on behalf of the "Obamabots" but the "recovery" is lame.

 

[itfitzme]

According to this article...there hasn't been ANY recovery. We can't even maintain normal growth.

News from The Associated Press

LOS ANGELES (AP) -- The expected U.S. "Great Recovery" hasn't materialized and the economy has fallen short of even normal growth, according to a forecast released Wednesday.

The second-quarter UCLA Anderson Forecast said the growth of real gross domestic product - meaning the inflation-adjusted value of goods and services produced - is too small to help the nation climb out of its slump.

The figure was 15.4 percent below a "normal" growth trend, forecast director Edward Leamer wrote.

"To get back to that 3 percent trend, we would need 4 percent growth for 15 years, or 5 percent growth for eight years, or 6 percent growth for five years, not the disappointing twos and threes we have been racking up recently," he said.

"It's not a recovery. It's not even normal growth. It's bad," he wrote.

What say ye, Obamabots?

Can't speak on behalf of the "Obamabots" but the "recovery" is lame.

Apparently, "recovery" means something different to different people.

Specifically, its the wage index and the employment to population ratio. Jobs and wages. And until everyone is on the same page, its gonna all be a bunch of noise.

And nothing ever happens when its all just noise.

 

[Decus]

The OP was about GDP growth and the general term "recovery".

Yes, I agree, wage index growth fell (did this somewhere else) miserably.

That's the thing, isn't it. We were expecting this in '04. The combining economies on a global level with China was going to drive standard of living in the US down as it raised china up, or that was our thought about it.

That isn't going to change. Happened quick to, just all in a few months. Nowll growth is all tepid. And, it's not going to change until the whole
globe comes up. You think US wages are slowly falling to meet China wages?

If 'recovery' were meant to denote GDP and little else, you have presented a a credible argument. Recovery for most however has a far more tangible meaning and one that is measured at a household level. Recovery at this level is not evident to many people.

Did you read the OP article? Or are you just trying to make up an arguement by using your own personal definitions because you don't have anything specific that you can come up with?

Wow. You focused on economic statistics and I went to what was somewhat understated but central to the reason for the article and the term recovery. Look to the last few paragraphs of the article:

"In addition, the jobs being created may not provide workers with a secure future and the education system is failing to provide skills such as analytical thinking that will be crucial for future workers, he wrote."

Your definition of recovery doesn't address the human condition. By human standards (and not the numbers) - no recovery.

 

[jwoodie]

The OP overlooks the larger question about whether our economy has the capacity to provide full employment. Even the "good" years before the crash were artificially bolstered by unsustainable increases in housing equity due to the real estate bubble. We need fundamental changes in tax policy and other employment costs if we ever expect to restore a self supporting majority of our population. Most of these costs (e.g., social security and health insurance) are based on the number of employees, thus discouraging the hiring of new entry level employees. Instead, these costs should be assessed on the basis of overall payroll, which would lessen the financial impact and risk of hiring new employees.

 

[itfitzme]

If 'recovery' were meant to denote GDP and little else, you have presented a a credible argument. Recovery for most however has a far more tangible meaning and one that is measured at a household level. Recovery at this level is not evident to many people.

Did you read the OP article? Or are you just trying to make up an arguement by using your own personal definitions because you don't have anything specific that you can come up with?

Wow. You focused on economic statistics and I went to what was somewhat understated but central to the reason for the article and the term recovery. Look to the last few paragraphs of the article:

"In addition, the jobs being created may not provide workers with a secure future and the education system is failing to provide skills such as analytical thinking that will be crucial for future workers, he wrote."

Your definition of recovery doesn't address the human condition. By human standards (and not the numbers) - no recovery.

YOU just can't help but use the second person pronoun, can YOU.

 

[OnePercenter]

Raise the livable wage to $23.50/hr and double Social Security payments.

Allow employers to deduct employee expenses dollar-for-dollar from Federal, State, and local taxes and fees. This will boost the GDP by $175 Billion.

I don't think the math is going to work out there.

Please explain.

 

[OnePercenter]

Raise the livable wage to $23.50/hr and double Social Security payments.

Allow employers to deduct employee expenses dollar-for-dollar from Federal, State, and local taxes and fees. This will boost the GDP by $175 Billion.

lol....

Next do you plan to intact martial law and fix prices by locking them for all products?

bloviating

I know currently I'd have to fire 3/4th my staff just to keep above water.

Let's see some numbers.

 

[itfitzme]

Raise the livable wage to $23.50/hr and double Social Security payments.

Allow employers to deduct employee expenses dollar-for-dollar from Federal, State, and local taxes and fees. This will boost the GDP by $175 Billion.

I don't think the math is going to work out there.

Please explain.

So you haven't already done the math?

I've already surpassed my weekly required allotment for mathematics.

My general impression was that the plan would lower corporate taxes while increasing government expences. So, all other things being equal, this would increase the deficit.

It was late and you didn't specifically mention personal income taxes so I wasn't thinking about the loop. You could do some rough estimate on the increase given the average effective tax rates for those tax brackets. I think it would be necessary to increase FICA taxes. Frankly, they aren't all that much as it stands.

 

[TemplarKormac]

Simply put, there can't be a recovery when we continue to borrow and spend trillions of dollars each year. When the creditors come home calling, there won't be a recovery, there will be a day of mourning. The day the US finally collapsed under the weight of it's own debt.

 

[itfitzme]

Simply put, there can't be a recovery when we continue to borrow and spend trillions of dollars each year. When the creditors come home calling, there won't be a recovery, there will be a day of mourning. The day the US finally collapsed under the weight of it's own debt.

Which debt, commercial, consumer, or public? It's an important distinction because the money supply is created by loans. No loans, no money in circulation.

My contention is that, as consumers, we should resrict our borrowing to cars and houses. Beyond that, we should be saving for other purchases. The rest should be left to business investment in capitol expansion. A major contributor to this last recession was the decline in consumer debt. As the accumulation of conumer debt begab to receed, demand fell. With that the economy when directly into recession.

 

[oldfart]

Simply put, there can't be a recovery when we continue to borrow and spend trillions of dollars each year.

And at exactly what level of borrowing does recovery become possible?

When the creditors come home calling, there won't be a recovery, there will be a day of mourning. The day the US finally collapsed under the weight of it's own debt.

We have been hearing this for more than five years. When exactly will this event occur?

The reason you can't answer these questions is because there is no economic model that predicts these events. None. Zip. Nada. Like other people making these unfounded predictions you are basing everything on moralistic feelings rather than history, facts, or economic theory. And it always seems that the folks putting out this stuff consider themselves to be blameless and recommend the pain for someone else.

But perhaps this is not true of you. Would you care to confess what behavior of yours has contributed to this debacle and what financial pain would be "your fair share"?

And since you are the one claiming that we will have no economic recovery until "we" stop spending and borrowing, what spending do you propose to cut? Or do you raise taxes instead?

I look forward to your choices and the reasoning behind them.

 

[itfitzme]

Simply put, there can't be a recovery when we continue to borrow and spend trillions of dollars each year.

And at exactly what level of borrowing does recovery become possible?

When the creditors come home calling, there won't be a recovery, there will be a day of mourning. The day the US finally collapsed under the weight of it's own debt.

We have been hearing this for more than five years. When exactly will this event occur?

The reason you can't answer these questions is because there is no economic model that predicts these events. None. Zip. Nada. Like other people making these unfounded predictions you are basing everything on moralistic feelings rather than history, facts, or economic theory. And it always seems that the folks putting out this stuff consider themselves to be blameless and recommend the pain for someone else.

But perhaps this is not true of you. Would you care to confess what behavior of yours has contributed to this debacle and what financial pain would be "your fair share"?

And since you are the one claiming that we will have no economic recovery until "we" stop spending and borrowing, what spending do you propose to cut? Or do you raise taxes instead?

I look forward to your choices and the reasoning behind them.

Not to mention home economics vs macro economics and the fundamentals of the money supply.

Truth is, no debt, no economy.

 

[oldfart]

My contention is that, as consumers, we should resrict our borrowing to cars and houses. Beyond that, we should be saving for other purchases. The rest should be left to business investment in capitol expansion. A major contributor to this last recession was the decline in consumer debt. As the accumulation of conumer debt begab to receed, demand fell. With that the economy when directly into recession.

The problem here is that if consumers reduce debt and demand falls, there is no reason for business to invest in capital goods. With government spending restricted, this leads to a downward spiral until a new equilibrium is reached. The problem is that the new equilibrium may well be at a standard of living for the average American of 20% or more below what it is today.

I am not arguing for reckless spending by consumers. With interest rates at the zero bound the only way out of this is sufficient sustained government spending. We are at the practical limits of monetary policy, so fiscal policy is all that remains. If the necessary demand does not come from government, it will not come from anywhere and we could stay in the present circumstances for decades.

In late 2008 I had some private conversations with some friends who make a living as econometricians and we talked about their models. The scary thing was they were getting probabilities for no recovery within five years. This was the first time this result had ever had a statistically significant probability. At one point three of the top models had this outcome at over 40%. My point is simply that a recovery is not inevitable. We have fallen into the trap of assuming that somehow a recovery will emerge no matter what we do. That is simply not true today.

 

[itfitzme]

My contention is that, as consumers, we should resrict our borrowing to cars and houses. Beyond that, we should be saving for other purchases. The rest should be left to business investment in capitol expansion. A major contributor to this last recession was the decline in consumer debt. As the accumulation of conumer debt begab to receed, demand fell. With that the economy when directly into recession.

The problem here is that if consumers reduce debt and demand falls, there is no reason for business to invest in capital goods. With government spending restricted, this leads to a downward spiral until a new equilibrium is reached. The problem is that the new equilibrium may well be at a standard of living for the average American of 20% or more below what it is today.

I am not arguing for reckless spending by consumers. With interest rates at the zero bound the only way out of this is sufficient sustained government spending. We are at the practical limits of monetary policy, so fiscal policy is all that remains. If the necessary demand does not come from government, it will not come from anywhere and we could stay in the present circumstances for decades.

In late 2008 I had some private conversations with some friends who make a living as econometricians and we talked about their models. The scary thing was they were getting probabilities for no recovery within five years. This was the first time this result had ever had a statistically significant probability. At one point three of the top models had this outcome at over 40%. My point is simply that a recovery is not inevitable. We have fallen into the trap of assuming that somehow a recovery will emerge no matter what we do. That is simply not true today.

Well, I have been under the impression that consumers have incomes and purchase with cash. I could be mistaken there.

And, of course, the real per capita revolving consumer credit has been a substantial part of the economy since ... forever... so it's a bit of a mute point.

besides...


Consumer Credit in U.S. Climbed in April on Non-Revolving Loans

Consumer borrowing in the U.S. accelerated in April as Americans took out more education and automobile loans.
The $11.1 billion increase in credit followed a revised $8.37 billion increase the previous month that was more than initially reported, Federal Reserve figures showed today in Washington. The median forecast in a Bloomberg survey called for a $12.9 billion gain in April.

Consumer Credit in U.S. Climbed in April on Non-Revolving Loans - Bloomberg

 

[Papageorgio]

What's really great is we are borrowing from China, so we can subsidize China, so they can compete with American businesses, put Americans out of work, with cheap inferior products from a country that doesn't have any environmental standards.

I wonder what we are thinking.