Author Topic: Political Economics  (Read 876365 times)

Body-by-Guinness

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Commercial Real Estate’s Looming Defaults
« Reply #2400 on: January 24, 2024, 09:40:13 PM »
2nd post, which contemplates the commercial real estate vacancies in blue cities, quantitive tightening, the Fed’s interest rate gaming, and their possible impacts on inflation et al. It ain’t a pretty picture:

https://pjmedia.com/vodkapundit/2024/01/24/bidenflation-ii-fiscal-boogaloo-another-sequel-nobody-asked-for-n4925789


Crafty_Dog

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Re: Political Economics
« Reply #2402 on: January 26, 2024, 04:54:48 AM »
Another one in the same vein, this one from the WSJ:

It mentions govt. spending, but as we have seen here (spending 40% over revenues IIRC?!?) this is a really big fg deal and deserves far more mention.

That said , , ,

===================

America’s Remarkably Resilient Economy
Spending by consumers and governments keeps powering growth. Can it last?
By
The Editorial Board
Follow
Jan. 25, 2024 6:31 pm ET


Thursday’s fourth-quarter GDP report no doubt elated the White House and Federal Reserve. The economy grew at a solid 3.3% clip last quarter and 3.1% over the past year while inflation is now nearing the central bank’s 2% target. The question is whether—and for how long—consumers and government can sustain the expansion.

Maybe the best news in the report is that the personal consumption expenditures (PCE) price index—the Fed’s preferred inflation gauge—rose by only 1.7% in the fourth quarter, down from 2.6% in the third. Excluding food and energy, the PCE rose 3.2% year-over-year. Declining inflation helped lift real disposable personal income by 2.5% in the fourth quarter.

A buoyant labor market and rising real wages (at long last) are also boosting purchasing power while Americans continue to spend down their pandemic savings. Consumer spending continues to drive GDP growth, contributing 1.91 percentage points of the 3.3% in the fourth quarter. Net exports added 0.43 points while government spending chipped in 0.56.

States and localities are blowing through federal pandemic and infrastructure money. Over the last two years, state and local government spending has contributed more than twice as much to GDP than from 2017 to 2021. Increased government spending is partly compensating for a slowdown in business investment.

Non-residential investment contributed a mere 0.26 points to fourth-quarter GDP. Research and development spending has been essentially flat for 18 months. The surprise is that business investment is so weak despite the Administration’s gusher of subsidies.

One explanation could be that the Administration’s regulatory avalanche is magnifying the business uncertainty from Fed tightening and growing geopolitical risks. Its flirtation with a ban on new liquefied natural gas export projects is a case in point. Nearly every day businesses wake up to a new proposed rule.

It’s a testament to America’s economic resilience that the economy keeps chugging despite a regulatory fusillade. President Biden has a growing economy, but can he keep it?
« Last Edit: January 26, 2024, 10:18:44 AM by Crafty_Dog »

DougMacG

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Re: Political Economics
« Reply #2403 on: January 26, 2024, 08:29:51 AM »
Still reopening from covid closures, artificially injecting trillions of printed dollars, have millions upon millions coming in across no border, and getting 2% growth.  Can it last?  No.  Are we smart enough to recognize that?  Doubt it.

The policies of Venezuela and Argentina here can't have the results they had there because why?

We are the world's reserve currency. We are?  The rest of the world can't even trade with each other without using the US$.  They can't??

The party of spoken "sustainability" is giving us none.

The party of "put the adults back in charge" is behaving like economic infants.
« Last Edit: January 26, 2024, 08:33:49 AM by DougMacG »

Body-by-Guinness

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Adam Smith would be Pleased by the Mark this Leaves Behind
« Reply #2404 on: January 26, 2024, 09:03:24 AM »
The stuff of Statist nightmares:

Samizdata quote of the day – economic dynamism
Samizdata Illuminatus (Arkham, Massachusetts) · Economics, Business & Globalization · Slogans & Quotations

Ah! A testable proposition. So, currently the UK government takes 45% of everything, 45% of all economic effort and GDP.

The US government – at all levels – consumes about 28% of GDP, the Indonesian about 11% (yes, 11%) and Singapore’s some 17% or so.

So it would seem that economic dynamism is indeed associated with less than the UK’s confiscatory tax rates. Even, that fructifying idea has some empirical legs.

As ever, all economics is either footnotes to Adam Smith or wrong.

– Tim Worstall

January 25th, 2024 |

https://www.samizdata.net/2024/01/samizdata-quote-of-the-day-economic-dynamism/

DougMacG

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Re: Adam Smith would be Pleased by the Mark this Leaves Behind
« Reply #2405 on: January 26, 2024, 09:22:31 AM »
"As ever, all economics is either footnotes to Adam Smith or wrong."
– BBG  (Tim Worstall)

Love it!

And, "1984" was written as a warning, not a how-to guide.

Crafty_Dog

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Re: Political Economics
« Reply #2406 on: January 26, 2024, 10:24:20 AM »
I would note that had the $5T "Build Back Better" program gone through we would be seriously fuct right now.

Senators Manchin and Sinema made the difference in a key moment.

I think this a pithy good point to use in conversation.

Also to be noted here is that advancing the Bidenomics sales pitch can now point to Kudlow and the WSJ in support.

DougMacG

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About that 3% growth...
« Reply #2407 on: January 26, 2024, 01:05:14 PM »
About that 3% growth...

Government expenditures have increased faster than consumer spending for the last 6 quarters in a row.
  - economist EJ Antoni, Heritage, CTUP
https://www.heritage.org/staff/ej-antoni
 
Sustainable?

Democrats used to (falsely) tout the multiplier effect of their spending. Now what do they call it, subtraction effect?

Body-by-Guinness

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Need a Job? Get a Gov Gig or Become a Health Administrator
« Reply #2408 on: February 06, 2024, 05:51:19 PM »
Digging into the jobs report. The big winners? Gigs that consume rather than produce, just what the economy needs:

The Black Cloud in Jobs Growth’s Silver Lining
The Beacon by William F. Shughart II / Feb 6, 2024 at 2:22 PM//keep unread//hide
“Jobs Growth Defies Expectations” blares a WSJ headline on the front page of the paper’s first-weekend edition of February 2024.

The story by reporter Sam Goldfarb goes on to say that “hiring is booming, defying [economists’] expectations [that] the economy would cool after going gangbusters last year.” Last month’s employment numbers, showing a gain of 353,000 jobs economywide (revised upwards from an initial estimate of 216,000), kept the U.S. unemployment rate “steady at 3.7%,” were correlated with a 4.5% seasonally adjusted increase in (presumably nominal) wages of 4.5% year over year, and generally signal that the economy is on track to avoid a once widely predicted recession (either a “soft” or “hard” landing).

The only flies in the ointment are that the rise in wages “may have reflected a big drop in hours worked—a possible result of bad winter weather, according to some analysts.” Moreover, the apparently strong U.S. labor market may justify the Fed deferring interest rate cuts to continue its “fight” against the inflation for which it is solely responsible. And the labor force participation rate remains at a miserably low 62.5%, meaning that many Americans live on the dole.

But is an economy that Fed Chair Jerome Powell characterizes as “good” something to cheer about? Turn to p. A2, on which the jobs growth numbers are disaggregated by sector. As has been true over the recent past, #1 on the list is health care, which is predictable with an aging U.S. population and substantial taxpayer-financed subsidies that lower patients’ out-of-pocket costs of seeking treatment.

Number 2 is (federal, state, and local) government, likewise a major contributor to jobs growth for years. Perhaps that is good news for the people who are hired by the public sector, but not for the rest of us. Most government “workers” do not produce anything of value; they shuffle paper (or electrons) from desk to desk, rob Peter’s pocket to pay Paul, rarely show up at their offices, and impose significant costs on private sector actors forced to comply with their mandates.

Increases in governmental employment frequently persist over the long run. Once a bureaucrat serves a brief probationary period (usually six months for a federal “civil servant”), he or she has a job for life. Compared to the private sector, total compensation, including health insurance options and pension benefits, is generous. Annual cost-of-living adjustments (“step” increases in pay) are built into the system, and it nearly is impossible for a tenured federal employee, even a grossly incompetent one, to be fired.

Do not be fooled by the rosy scenario painted by recent jobs growth numbers. Large increases in the number of Americans employed by government are nothing to celebrate. Just the reverse is true: more bureaucrats (and the spending necessary to finance their hiring and retention) are drags on, not boosts to economic growth, liberty, and prosperity.

The post The Black Cloud in Jobs Growth’s Silver Lining appeared first on The Beacon.

https://blog.independent.org/2024/02/06/black-cloud-in-jobs-growths-silver-lining/?utm_source=feedly&utm_medium=rss&utm_campaign=black-cloud-in-jobs-growths-silver-lining

DougMacG

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Political Economics, Inflation is never "transitory"
« Reply #2409 on: February 07, 2024, 08:51:38 AM »
Recessions are tough but affect some more than others and generally have endings to them.  Inflation OTOH confronts  evveryone eryday, from now until election day and beyond. 

[Yes we conflate "inflation" with prices and general price level.]

Jerome Powell said it to the nation Sunday, prices are not coming down [except for specific products that defy general trend].

This piece makes good political economic points,
Sean Trende: 'Why is Joe So Unpopular': https://www.realclearpolitics.com/articles/2024/02/07/why_is_joe_biden_so_unpopular_150455.html

First, inflation is never “transitory.” Even after it is over, price levels rarely fall appreciably (indeed, deflation has its own problems). Consumers don’t automatically reset their baseline. So even if prices are level (and there is still inflation in the U.S.; it is just the rate that has slowed), people are still surprised when they pay $2 per pound for chicken, comparing it to when chicken was $1.44 for a pound in 2021.

Second, inflation is constantly in our face. Every time a consumer goes to the store and makes a purchase, they’re reminded of the impact. This is true for gasoline, food, clothing – every commodity an individual consumes. That’s not to say other indicators don’t hurt; it’s just to say they are not felt as often.

-------------------------------------------------------
Third, the Biden inflation led to higher interest rates to fight it which also give us higher costs.  There's no escaping it.

It can be measured different ways but generally prices are up 20% under Joe and wages are up 15%.  A good test of that is credit card debt (and national debt).

Credit card debt passes a trillion:
https://www.washingtonpost.com/business/2024/02/07/credit-card-debt-new-record-pay-off/

Nobody runs up credit card debt with 20+% interest rates on purpose.

For a lot of people, we buy with credit cards and earn through direct deposit.  There is a disconnect that catches up, especially if you only pay the minimum a couple of times.  Expenses keep rising and income not so much.

Car insurance up is 26% and the law says you have to pay it or stop driving.  The car needs gas and the fridge needs groceries so you keep buying.  You keep the old  car to avoid new debt and the repair costs go up and so on.

More people are working second jobs. 
https://www.cbsnews.com/news/inflation-american-workers-are-taking-on-second-jobs/
Does Biden team think people don't notice losing the freedom of having an evening or weekend where you don't have to work to make ends meet?  If they were 'getting ahead' with the second job, why the spiking credit card debt?

Why people don't see this is a great economy is because it isn't.

Here's another price level indicator not coming back down.  Lumber price is indictor of the cost to build or remodel.  It tripled under covid and came back down after interest rates jumped, but the new level is more than 40% higher than the pre-covid Trump level:
https://tradingeconomics.com/commodity/lumber  Click 5 year chart and do the math.  Window cost etc. are similarly not coming back down.

People are stuck in their homes because new ones, even old ones, are out of reach.  But the cost of staying put includes homeowner insurance rising at double digit rates:  https://money.com/home-insurance-rates-predictions-2024/

Biden intervening in the energy has only pushed prices up:
https://www.forbes.com/sites/adammillsap/2023/03/09/high-electricity-prices-will-go-even-higher-unless-we-change-course/?sh=598ed7a16a8b

Try putting lipstick on THAT pig.
« Last Edit: February 07, 2024, 09:16:32 AM by DougMacG »

ccp

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Re: Political Economics
« Reply #2410 on: February 07, 2024, 09:47:44 AM »
good post!

"Car insurance up is 26%"

I haven''t gotten my new insurance bill yet  :cry:

Crafty_Dog

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Re: Political Economics
« Reply #2411 on: February 07, 2024, 10:42:29 AM »
Yes.

I like the articulation that prices rarely come back down, hence the world "transitory" is inapplicable.   I will be using this point.

Body-by-Guinness

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Income Inequality: It's the Yardstick, Stupid
« Reply #2412 on: February 08, 2024, 12:01:37 PM »
Book review re The Myth of American Inequality: How Government Biases Policy Debate that argues the War on Poverty has been won and asks why the left/Great Society types haven't taken a victory lap (Wait! I know! If they take that lap they can no longer claim wicked people using nefarious means to scoop up more of some zero sum pie are to blame for the plight of the poor as it poops all over their very simple formula: proclaim gross unfairness hurts poor people bigly hence The Feds need to ride to the rescue with regressive regulations they call "Progressive" approaches).

Setting the Record Straight on Income Inequality
Book Review of The Myth of American Inequality: How Government Biases Policy Debate by Phil Gramm, Robert Ekelund, and John Early.
February 8, 2024
By ART CARDEN

Also published in The Library of Economics and Liberty Mon. February 5, 2024
Everyone knows inequality is growing. As a trio of economists consisting of former senator Phil Gramm, economics professor Robert Ekelund, and economist and former assistant commissioner of the Bureau of Labor Statistics John Early demonstrate, however, everyone is wrong. The supposed rise in American inequality to unacceptable levels has been greatly overstated. Gramm, Ekelund, and Early help us get the facts straight.

In The Myth of American Inequality: How Government Biases Policy Debate by Gramm, Ekelund, and Early, their methodological message is simple: “The Census Bureau is accurately measuring what it has chosen to measure, but it is not measuring the right things” (p. 3). Their empirical message is also simple but a lot more controversial:

There are certainly people who are physically or mentally unable to care for themselves and have fallen through the cracks in the system that delivers transfer payments, but, for all practical purposes, poverty due to a lack of public or private support has been virtually eliminated in America. (p. 4)

The post-tax, post-transfer poverty rate, they argue, is not the 12.3% the Census Bureau reported in 2017, but about 3%. The enormous difference is because the Census Bureau is not measuring the right things.

As Gramm, Ekelund, and Early make their argument, they kick the legs out from under the conventional wisdom about inequality. Taxes in the United States are extremely progressive, and the rich pay a higher share of taxes than they earn in income. Income mobility is alive and well. “Tax cuts for the rich” made “the rich” reorganize their affairs so that, as they quote JFK, they spent less time and money on “avoidance of taxes” and more on “production of goods” (pp. 115-116). “Tax cuts for the rich,” they argue, in 1962 and 1986 actually led to the top 1 percent and the top 10 percent paying higher percentages of their incomes in taxes.

One of their most striking findings compares the real income distribution today to the real income distribution of the 1960s. After accounting for taxes and transfers, Gramm, Ekelund, and Early argue that the top three quintiles in the 2017 income distribution and two-thirds of the households in the second quintile from the bottom have incomes that would put them in the top quintile of the 1967 income distribution. They recount a series of facts that we take for granted about the diffusion of indoor plumbing, air conditioning, cars, and televisions. Half of households in the bottom two quintiles own homes (p. 28). Restaurant meals used to be the privilege of the rich, but in 2017, “the average bottom-quintile household spent 34 percent of its food budget away from home,” much more than the 27% of top-quintile households in 1967 (p. 146). For the modern rich, cooking is a hobby, not a necessity.

To get an idea of what this means, watch an episode from the first season of The Wonder Years, which ran from 1988-1993 and was set in 1968-1973. Would we call the solidly middle-class Arnold family of the late 1960s and early 1970s “poor”? Would we say they hadn’t achieved the American Dream? Their standard of living would have put them in the bottom 40% and maybe even the bottom 20% of the 2017 income distribution. To the extent that the American Dream is harder to achieve today, it is because we have redefined it to mean two (or three) cars rather than one, central heating and air conditioning, a microwave, a programmable coffee pot, multiple streaming subscriptions feeding to multiple giant flat-screen TVs, computers, mobile devices for everyone in the family, an Xbox, and multiple bathrooms (with toilets that would flush and showerheads that would work if they weren’t regulated to reduce water use).

In his book The Vision of the Anointed: Self-Congratulation as a Basis for Social Policy, Thomas Sowell referred to what he called “A-ha!” statistics that support left-wing narratives, at least superficially. A bit of further examination, however, causes things to come apart. Talking about what has happened to “the poor,” “the rich,” or “the middle class” across long periods is dangerous because the people at the bottom of the income distribution in 2023 are not the same people who were in the bottom of the income distribution in 1983.

First, there is the fact that income distribution statistics are comparing people at different life stages. I was at the bottom of the income distribution as a graduate student in 2002, but it would have been silly to say I was “poor.” I moved up after my wife and I married and created a new household that merged her income with mine. I was in another place in the income distribution in 2012 as an Assistant Professor with three young children, and I occupied yet another place in the income distribution as the Margaret Gage Bush Distinguished Professor of Economics in 2022. I will likely fall down into a lower income quintile should I ever decide to retire (not likely).

Second, there is the fact that the population is always changing. Suppose you have five people. One earns $25,000; one earns $48,000; one earns $50,000; one earns $90,000; one earns $100,000. Then two things happen simultaneously: everyone’s income rises by $1000 and four people enter the labor market. One earns $24,000, two earn $30,000, and another earns $200,000. This means we now have one person earning $24,000, one person earning $26,000, two earning $30,000, one earning $49,000, one earning $51,000, one earning $91,000, one earning $101,000, and one earning $200,000. You can expect a flood of headlines about how median earnings have fallen to $49,000 even as the average income in the t​​op quintile has risen by about 50%. The ratio of top to median income has risen from 2:1 to about 4:1, the ratio of top to bottom income has risen from 4:1 to more than 8:1, and people with high incomes are “capturing” a larger share of the total income. The headlines paint a picture of an economy that is working for only the few at the top while everyone else suffers stagnation or decline even though everyone is better off. The real story—that people are earning higher incomes—disappears under the non-story that the median income has fallen not because any actual person’s income has fallen but because the population has changed.

The Myth of American Inequality answers the “what’s the point?” question people have about the arcane, minute details of academic research. Measurement is a lot harder than it appears at first. There are well-known problems of technological improvement—a car in 2023 and a car in 1993 or 1973 are very different things—and then there are questions about what to count as “income.” There are wages and salaries, but what about benefits? Should transfers like Medicaid and food stamps be counted as “income”? One of the book’s critics has pointed out that the payments Medicaid makes go to doctors rather than patients and therefore complicate the story, but the patients receive medical services that are, we hope, at least as valuable as what the doctors are being paid for them. Food stamps are not cash, but they spend like cash—at least on approved items (the political economy of how something gets and stays on that list is a dissertation waiting to be written). Do official measures overstate inflation? The answers change how we make policy, write op-eds, argue at the dinner table, and write textbooks.

Since the Census Bureau (and economists) are not measuring the right things, it’s hardly clear we are going to make the right policies. So what should we do in light of this new story about postwar inequality? First, Gramm, Ekelund, and Early argue, we must get the theory straight and do the math right. It is one thing to look at pre-tax, pre-transfer inequality and be horrified. It is something else to think you can get less pre-tax, pre-transfer inequality with taxes and transfers: you cannot, by definition. If we want to know the real story about actual, on-the-ground inequality for living, breathing people, we need to look at measures that account for those taxes and transfers. Once we do so, we get a very different story from what we read in the New York Times.

All this makes me wonder why the left does not embrace this book and take a victory lap on behalf of Lyndon Johnson’s Great Society. It seems like, “even Phil Gramm admits we won the war on poverty” would be cause for celebration. All I have seen from the left, however, is breathless indignation about how the authors are heartless because they say poverty has fallen and extol Ebenezer Scrooge’s thrift, and wrong because their approach jars with the claims of economists like Thomas Piketty that ignited the “Occupy” movement in the Great Recession’s aftermath.

Second, Gramm, Ekelund, and Early propose changes to how we do welfare with special attention to the work disincentives very high implicit marginal tax rates create. If the 70% marginal tax rates Alexandria Ocasio-Cortez proposed a few years ago would be disincentives to produce at the top of the income distribution, then surely similar implicit rates are disincentives to produce at the bottom of the income distribution. If slashing top marginal tax rates in the 1960s and 1980s unleashed forces of production, then slashing implicit marginal tax rates in 2023 would have a similar effect.

Third, the authors go after occupational licensing. When I teach about licensing in my classes, I talk about the medieval guilds and South African apartheid. The logic is the same in all these cases: an interest group enlists the state to protect itself and its members’ incomes from potential competitors. Lest one think these rules are about public safety, they write,

New York State recently added a new requirement that entry-level shampoo assistants in beauty parlors and barber shops must complete a five-hundred-hour training course at an average cost of $13,240 before they can practice this complex art that most of us perform daily without mishap. Of course, three of the four regulators issuing this requirement have economic interests in companies that sell the required training. (pp. 181-182)

Fortunately, occupational licensing has gotten at least some bipartisan attention—and perhaps more people will come to understand that the poor and downtrodden wouldn’t need so much of our “help” if we weren’t spending so much on trying to “protect” them.

I would add another, though I admit it is a pipe dream: we should stop caring so much about inequality per se. It’s reasonable to care about poverty. Having enough food, clothing, and shelter to lead a meaningful life matters, and I am pleased to see people’s possibilities expanding year after year. It’s unreasonable to care about inequality per se. In a commercial society, whether your neighbor has more does not mean you don’t have enough. The qualifier “in a commercial society” is very important. Capitalism is the greatest positive-sum game in history. Competition for admission to elite universities is fierce, but have you been robbed if the kids whose parents read to them every night and hired math tutors get into Stanford, Harvard, and Penn while your kids have to settle for Samford, Haverford, and Penn State? If the extra effort these families put into getting their children into an elite school means they have more skills and higher earnings capacity, then everyone wins. These kids have only been able to get into an elite school by equipping themselves with the tools they need to serve people better. It only becomes a problem when people use those tools to rule rather than serve—by, say, establishing licensing boards and commissions to micromanage the lives of the unshampooed masses.

“As a nation,” Gramm, Ekelund, and Early write, “we need to get our facts straight.” I agree, and I hope this book moves the policy needle. Resistance will be fierce, of course, given that many people’s careers, incomes, and self-images are inseparable from the “rising poverty and inequality” story and the welfare state we have built to deal with it. The Myth of American Inequality is an important contribution, however, that shows how the story is built on a foundation of theoretical and empirical sand.

 
ART CARDEN is a Research Fellow at the Independent Institute and an Associate Professor of Economics at Samford University.

https://www.independent.org/news/article.asp?id=14823

DougMacG

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Oops, highest inflation since April 2022
« Reply #2413 on: February 14, 2024, 06:29:40 AM »
https://finance.yahoo.com/news/us-inflation-tops-forecasts-likely-134729393.html

Let's see if they can put lipstick on this pig.

Same policy, expecting a different result. Insane.

My view, the "2% target" should be lowered to 0.2%. 2% inflation is theft. Above that is reckless criminal endangerment.
« Last Edit: February 14, 2024, 06:34:37 AM by DougMacG »

ccp

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Re: Political Economics
« Reply #2414 on: February 14, 2024, 06:38:37 AM »
PauL Krugman already did on MSLSD 2 nights ago.
Biden's memory not an issue. 
He has accomplished SO many things to prove it.

Brought us out of a terrible economic mess more and yada yada.


DougMacG

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How many jobs?
« Reply #2415 on: February 14, 2024, 07:02:53 AM »
Household survey is the more accurate of the two main methods.

"According to that survey, employment actually fell by 31,000 workers from December to January, and by some 700,000 over the two-month period from November to January, compared to the 353,000 and the 686,000 increases respectively reported in the payroll survey. That adds up to a difference between the two surveys of some 1.4 million jobs between November and January. Over the past year, the household survey reported that the economy added 1 million new jobs—2 million fewer than the payroll survey’s estimate."

https://www.city-journal.org/article/employments-hidden-figures

Krugman can't read or is he lying to his faithful followers?

Crafty_Dog

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DougMacG

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« Last Edit: February 17, 2024, 09:28:25 AM by Crafty_Dog »

DougMacG

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100% of net new jobs went to two groups
« Reply #2418 on: February 20, 2024, 12:53:05 PM »
100% of net new jobs went to two groups:

Immigrants and illegals.

Further, the decline in full-time jobs with benefits in December and January was the largest decline since the pandemic.

The reported 'jobs growth' is in part-time jobs and since many hold two or more of those, 'jobs growth' doesn't mean more people working.

Similarly, with 5 million out of the workforce, the unemployment rate does not reflect the number of people out of work.

I did not make up the connection between people coming across our border and the bragging of "new jobs created".

Real wages for people already employed have dropped under Biden.

https://www.washingtontimes.com/news/2024/feb/20/bidens-low-marks-on-economy-reflect-reality/

Crafty_Dog

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Re: Political Economics
« Reply #2419 on: February 20, 2024, 01:17:00 PM »
Yes, key points we need to hammer made there!

Crafty_Dog

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WSJ: Nvidia, AI and US Innovation
« Reply #2420 on: February 23, 2024, 11:10:33 AM »
Nvidia, AI and U.S. Innovation
The government didn’t build that $2 trillion share valuation.
By
The Editorial Board
Follow
Feb. 22, 2024 6:26 pm ET

What a wild ride. Nvidia’s stock price soared another 16% on Thursday after a blowout earnings report, giving the Silicon Valley chip maker a $1.9 trillion market valuation. Markets can get over-exuberant, but Nvidia’s surge may reflect a rational optimism in the vast potential of artificial intelligence.

Five years ago Nvidia was mostly known as a graphics and video-game chip maker. Its roughly $100 billion market valuation was less than half as much as integrated chip-maker Intel’s. Few investors foresaw Nvidia’s transformation into the world’s leading chip firm—or the way artificial intelligence would emerge.

Nvidia designs about 80% of the chips that power a growing array of advanced AI applications—from chatbots to deep neural networks that can discern subtle patterns from data. OpenAI pioneered the technology with ChatGPT, and Microsoft, Amazon and Google rank among Nvidia’s biggest customers. But hardly an industry won’t be changed by AI.

Retailers are using AI to make logistics more efficient and improve the customer experience. Drug makers are using the technology to develop new treatments and determine which patients would benefit most from medicines. Healthcare systems are putting AI assistants to work filling out health records so doctors can focus on patients.


The AI boom may partly explain why business investment and economic growth haven’t crumbled under the Biden regulatory fusillade. President Biden loves to flog federally funded factories and public works, but software investment has contributed more to GDP growth in the last three years than structures or equipment—no thanks to government.

Some worry about AI’s impact on workers, and jobs will be lost. But others will be created and the U.S. has some nine million job openings. As the workforce ages, bigger productivity improvements will be needed to boost living standards. In any case, white-collar employees will probably face more disruption than workers who use their hands.

Mr. Biden is lucky that the AI revolution accelerated under his watch, just as Barack Obama was fortunate with the shale fracking boom. But AI advances are happening despite government, not because of it. Mr. Biden’s executive order last autumn has created new uncertainty about whether and how regulators will permit AI.

Silicon Valley startup accelerator Y Combinator is instructing founders in health care to “take the conservative approach” and “document everything, and know [evolving regulations are] a risk, and anyone who invests in you should know it’s a risk,” as StatNews reported this week. Regulatory risk is something ebullient Nvidia investors might keep in mind too.

Some Democrats are already threatening to suffocate AI with—what else?—climate regulation. Democratic Senators this month introduced a bill that would direct the National Institute of Standards and Technology to recommend administrative actions to mitigate AI’s environmental impact. Will ChatGPT soon need an Environmental Protection Agency permit?

Progressives fret that AI systems will generate as much CO2 emissions as entire countries. Possibly. An AI-driven web search consumes four to five times as much energy as a conventional one. Can the U.S. electric grid, already creaking under the force-fed green energy transition, handle the increasing demand? Is anyone in government thinking about this?

Nvidia’s nearly $2 trillion valuation is essentially a giant bet on U.S. private innovation. China has spent tens of billions of dollars trying to create a national chip-making champion to no avail. Note to Congress and President Biden: Industrial policy doesn’t make countries or businesses great.

DougMacG

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Political Economics, Dems abandon term Bidenomics
« Reply #2421 on: March 27, 2024, 08:16:13 AM »
https://www.axios.com/2024/03/27/biden-democrats-ditch-bidenomics

Sorry that isn't their term to ditch. We started it, and there never was anything positive about it.  The most neutral description you could give it is " cluelessness". But it is far worse than that.

Build back broker is the description that stuck.

But of course the term isn't neutral, it's negative, it's hurting people. What does it really mean?

No one knows how Democrats economic theories really work.  They are designed to win elections, not grow , or make people better off. The common thread is that it is government-centric.

My question is, what is the name for the opposite? What's a new name for supply-side economics that can be used in the current political environment?

I'm going to name it private-sector-nomics.

Sounds cumbersome, but Trump has a way of slowing down and enunciating, what he wants to and it's time to put the focus on the private sector, not the government. It's as simple as that.

Recall the recent post about government workers making 40% more than private sector workers, and benefits 80% more than private sector workers , or didn't I post that? It won't be easy to turn that around, but that's an example of where things have gone astray.

Exhibit B is all the rich counties around Washington DC. That ties in very closely with Trump's war on the swamp. We don't want any harm to these people or to the incomes of their families.  We just want those not needed in government to go out and get productive sector jobs with all their great talents.

Marco Rubio had a great line when he was running for president. I can't remember it verbatim but he said something like, I'm going to look at every bill comes across my desk and ask whether it helps to grow jobs and incomes or not.

Trump or someone needs to diffuse this politics of envy and now is the time. Biden is once again trying to punish the rich. Jack Kemp was questioned on that in the 1980s and said, what we need in America is more people rich.

Every tax on the rich, every tax on the corporations, every tax on the employers, every tax on the people, is a tax on the economy, a tax on everyone. We need taxes, and we need lots of them because we're falling further and further in debt. But the main problem is spending. We need our tax code to raisee the the most money and do the least damage as possible.

The central Focus must always be the health of the private sector economy.  Driving a wedge between employers and employees or the rich and the poor isn't how you do that.

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« Last Edit: March 27, 2024, 12:25:13 PM by DougMacG »

Crafty_Dog

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Re: Political Economics
« Reply #2423 on: March 27, 2024, 03:16:03 PM »
Here in the South that is going to be one helluva talking point.

DougMacG

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Political Economics, Rigged Labor Market Data
« Reply #2424 on: March 29, 2024, 12:38:28 PM »
Shocking.  They otherwise seem so honest.

The jobs market is much worse than Biden and his mouthpieces claim.
----------------
In February 2024, the US had 132.9 million full-time jobs and 27.9 million part-time jobs. Which is great… until you look back one year and find that in February 2023 the US had 133.2 million full-time jobs, or more than it does one year later! And yes, all the job growth since then has been in part-time jobs, which have increased by 921K since February 2023 (from 27.020 million to 27.941 million).

All the new jobs in the past year have been part-time jobs!

Not only has all job creation in the past 6 years – since May 2018 – has been exclusively for foreign-born workers, but there has been zero job-creation for native born workers since June 2018!

https://confoundedinterest.net/2024/03/29/the-cold-reality-of-bidenomics-and-the-jobs-market-philadelphia-fed-admits-us-payrolls-overstated-by-at-least-800000-all-new-jobs-over-past-year-were-part-time-jobs/

https://www.philadelphiafed.org/-/media/frbp/assets/surveys-and-data/benchmark-revisions/2023/early-benchmark-2023-q3-report.pdf?la=en&hash=47BC6E4331A5DDB9953B8E912C8B9B8E
-----------------
Data analysis of the “more comprehensive, accurate job estimates released by the BLS as part of its Quarterly Census of Employment and Wages (QCEW) program“, the Philadelphia Fed found that the BLS had overstated jobs to the tune of 1.1 million!

In the aggregate, 10,500 net new jobs were added during the period rather than the 1,121,500 jobs estimated by the sum of the states; the U.S. CES estimated net growth of 1,047,000 jobs for the period.
-----------------
For 2023 Q3, payroll jobs in the 50 states and the District of Columbia rose 0.5 percent, after adjusting for QCEW data.

Based on both the prebenchmark CES sum of states and the U.S. CES, payroll jobs grew 1.7 percent.
The revised CES sum-of-states growth rate is 0.5 percent
----------------
a little over a year after we, or rather the Philly Fed, found that the BLS had overstated payrolls in 2022 by 1.1 million, here we go again, only this time the BLS had overstated payrolls by 800,000 through Dec 2023 (and more if one were to extend the data series into 2024). It’s truly statistically remarkable how every time the data error is in favor of a stronger, if fake, economy.

Which is also why nobody in the mainstream media – which is now nothing more than the PR smokescreen for the Biden puppetmasters, the government and the deep state – will ever mention this report.

Anthony B. Sanders is Distinguished Professor of Real Estate Finance in the School of Business at George Mason University. He has previously taught at University of Chicago (Graduate School of Business), University of Texas at Austin (McCombs School of Business) and The Ohio State University (Fisher College of Business).






DougMacG

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Which party's policies lead to wider income inequality?
« Reply #2425 on: March 29, 2024, 01:18:14 PM »
The wealthiest one percent in President Joe Biden’s America set a record with a net worth of $44 trillion at the end of the fourth quarter, U.S. Federal Reserve data revealed.

https://www.breitbart.com/politics/2024/03/29/joe-bidens-america-wealthiest-1-set-record-44-trillion-total-net-worth/

Meanwhile, A majority of voters are “worse off financially” under Biden, up 25 points since he assumed office in 2021, a Fox News poll found Wednesday.
----------------------

A friend was trying to make the point Jay Powell at the Fed is doing an amazing job.
 A short time ago we seemed headed into a recession and he seems to have navigated our way around that.

Doctored data tells us the jobs market is fine.  We know the rich are getting richer and targeting them doesn't stop that. 

We also see declining real wages and skyrocketing credit card debt, interest costs and bankruptcies.

Now imagine reversing the parties that are in and out of power with these data.  What would the 'mainstream' take on this be?
« Last Edit: March 29, 2024, 01:20:30 PM by DougMacG »

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The amount people believe they need to retire is up 53% in 4 years
« Reply #2426 on: April 03, 2024, 07:33:00 AM »
https://www.cbsnews.com/news/retirement-savings-how-much-americans-need-1-46-million/

Kitchen table issues.

If your savings is up 53% under Biden, you broke even.
« Last Edit: April 03, 2024, 07:36:44 AM by DougMacG »

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Job growth more than expected
« Reply #2427 on: April 05, 2024, 05:52:33 AM »
let them in - get them a job as soon as possible then add to the total job growth numbers!

nothing self serving or corrupt to see ( :roll: :wink:)

not to mention notice the image in the picture - full time and *part time*

https://www.cnbc.com/2024/04/05/job-growth-totaled-303000-in-march-better-than-expected-and-unemployment-was-3point8percent.html

we will see this blasted all over the msm airwaves now including C*NBC*
with Joe coming out and making a statement congratulating himself

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Re: Political Economics
« Reply #2428 on: April 05, 2024, 07:36:43 AM »
For Trump to deport large numbers of hard-working illegals (mostly Latinos) whom Biden has ill granted working papers is going to be a very explosive political fight.

I am reminded of a ballot initiative that Gov Wilson (R) of CA put through and won, and which then played a major role in turning CA into a one-party state (Dem of course).

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Re: Political Economics
« Reply #2429 on: April 05, 2024, 07:41:14 AM »
Seems the job growth has been smoke and mirrors.

More real world measures show that as interest rates have gone up, credit card debt has gone up, 3rd quarter in a row over a trillion and still going up.  As credit card interest rates hit 29.99% (30%!) no one would choose more debt unless they were intending to default.
https://www.lendingtree.com/credit-cards/credit-card-debt-statistics/

Bankruptcies up double digits under Joe as well.
https://www.reuters.com/markets/us/us-bankruptcies-surged-18-2023-seen-rising-again-2024-report-2024-01-03/

Yet the rich are getting richer.  Imagine this scenario happening under Trump or Republicans and hearing the MSM, MSNBC uproar!

The jobs reports CORRECTIONS don't get the same big headlines as the initial story.  And the corrections are ALL DOWNWARD.
https://www.foxbusiness.com/economy/initial-us-employment-reports-overstated-jobs
« Last Edit: April 05, 2024, 08:04:53 AM by DougMacG »

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Re: Political Economics
« Reply #2430 on: April 05, 2024, 08:02:17 AM »
"For Trump to deport large numbers of hard-working illegals (mostly Latinos) whom Biden has ill granted working papers is going to be a very explosive political fight."


  - Right, by design.  Their intent is to make their policies irreversible, opposite of governing by 'we the people' with checks and balances.  Obamacare, Social security, Medicare all woven into the fabric, like the National Health Service in Britain, not things the next Congress or Parliament can repeal.

These 5 year budgets, 10 year budgets, mandates that take effect in 2030, regulations that kick in after their term, it's all anti-democratic.

Laws passed by the 118th Congress should not be binding on the 119th Congress. 

Same goes for debt.  Borrow all you plan to pay back before your term ends.  What gives you the power to put $36T debt and $2T/yr. interest on the next generation?

Government can only get bigger and bigger and bigger until everyone is riding and no one is pulling the wagon.

To the topic at hand, Trump needs to be creative.  To those who produce and other than breaking our laws to come in, abide by our laws and invest in our country, maybe he can be the most generous president in history with citizenship.  And for those who came for the free ride and or to wreak havoc, out they go on their asses, free ride home.

Simple test, in the time you've been here, did you (your family) pay in more than you took from us?

We always say THIS is the biggest election ever.  But if we can't figure it out this time, when will we?  And what will the country and the world look like when that happens?

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Re: Political Economics
« Reply #2431 on: April 05, 2024, 04:16:04 PM »
"Simple test, in the time you've been here, did you (your family) pay in more than you took from us?"

This intrigues me.

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Why they don't call it a recession, the top 1% getting richer under Biden
« Reply #2432 on: April 06, 2024, 10:50:08 PM »
https://www.breitbart.com/politics/2024/03/29/joe-bidens-america-wealthiest-1-set-record-44-trillion-total-net-worth/

Data from Federal Reserve, just documenting what I posted in other rants.

Real wages down for workers.  Wealth up for the wealthy.  Imagine if these results were from Republican policies.

Projection.  They say these results will happen under R policies.  And it's exactly ass-backwards.
« Last Edit: April 07, 2024, 07:33:55 AM by DougMacG »

ccp

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Re: Political Economics
« Reply #2433 on: April 07, 2024, 02:18:09 AM »

right.
The wealthy donors are needed by Dems to save Democracy so they will keep a blind eye for now.
Starting Jan 15th the theme will change if R wins.

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Political Economics, Bidenflation = 20%
« Reply #2434 on: April 13, 2024, 10:21:12 AM »
https://tippinsights.com/bidenflation-soars-to-18-8-squeezing-americans/

18.8% already rounds to 20% and we still have the rest of the year, still going up at twice the criminal theft targeted rate.

Inflation compounding trivia question, if every 4 year Dem President takes 24% of your wealth, how much do you have left in 10 years, 20 years, 30 years, etc.?

My answer, stop electing Dem Presidents and Dem policies.

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question
« Reply #2435 on: April 13, 2024, 10:57:01 AM »
would people more economically knowledgeable than me agree that this inflation was due to bad Fed money policy?

too much spending and interest rates were kept too low for way too long?

that is my read.

We should hammer that home !!!!! if I have it understood correctly.

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Re: question
« Reply #2436 on: April 13, 2024, 11:11:02 AM »
True but to simplify, it's the excessive spending.

There is no possible Fed policy that accommodates this level of excess spending without doing damage.

Both parties spend too much, but Democrats in our lifetime are always on the side of spending more, way more, no matter how far past reasonable or affordable we have already gone.

To make things worse,  their spending is harming the people it's allegedly intended to help.  Small things called dependency and disincentives to work.

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Re: Political Economics
« Reply #2437 on: April 14, 2024, 10:37:58 AM »
Under current policies, government debt outstanding will grow from 100% to 200% of GDP.
https://www.gao.gov/americas-fiscal-future

Not mentioned in short term, rear view mirror reports of debt to gdp decreasing is that interest rates on the debt tripled.

Federal government spending $2 billion per day - on interest.
https://confoundedinterest.net/2023/08/12/bidenomics-the-good-the-bad-and-the-ugly-atlanta-fed-gdp-at-4-12-for-q2-bank-credit-growth-goes-negative-confernce-board-leading-indicator-goes-negative-real-gross-domestic-income-growth-0-82

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whack a mole and jawboning inflation policies
« Reply #2438 on: April 14, 2024, 10:53:03 AM »
Policies that don't work.

This is deficit fueled inflation.

It's the spending stupid.

Anything that doesn't go after the excess spending is BS, counterproductive.

EVERYTHING Biden does involves more excess spending.
-----------------------
https://www.grumpy-economist.com/p/inflation-confusion

   " Biden’s advisers have reviewed polling that shows criticism of Republicans for cutting taxes on wealthy Americans and corporations resonates with voters, and they intend to step up such an attack in the coming days and weeks."

"Aha, now we see the central problem. Economic policy is being driven by what polling suggests “resonates with voters.” Not, for example, what basic economics suggests might actually work."

-----
Literally,  they think we are small children and the policy is to hand out candy.
« Last Edit: April 15, 2024, 07:22:40 AM by DougMacG »

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Bidenflation
« Reply #2439 on: April 15, 2024, 11:24:18 AM »
    https://tippinsights.com/bidenflation-soars-to-18-8-squeezing-americans/

Despite a decrease from the highs of mid-2022, many families continue to face significant inflationary pressures. Prices have increased by 18.8%, while real wages have declined by 2.5%. Average hourly earnings for all employees dropped 2.5% to $11.11 in March 2024 from $11.39 in January 2021 when Biden assumed office. According to Mark Zandi, the chief economist at Moody’s Analytics, the typical U.S. household now requires $1,069 more each month (equivalent to $12,828 annually) compared to three years ago, $784 more per month compared to two years ago, and an additional $227 per month compared to last year. The Allianz Life study found 67% are more concerned about paying bills now than their financial future.

    Bidenflation and the Fed’s eleven rate hikes to reduce inflation have made housing unaffordable for many people and caused displacements. According to CBRE data, the average monthly payments on a new home soared to $3,322 in the third quarter of 2023. This marks a sharp 90% increase from late 2020, when it stood at just $1,746 before Biden took office. Rising rent and the end of pandemic-era protections are contributing to the homelessness crisis.

    Therefore, it is unsurprising that inflation and food prices emerged as top economic issues among Americans in a recent nationwide TIPP Poll.
« Last Edit: April 16, 2024, 06:41:56 AM by Crafty_Dog »

DougMacG

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Re: Political Economics
« Reply #2440 on: April 20, 2024, 05:30:15 AM »
Paraphrasing a meme:

'I've never understood why it is greed to want to keep more of your own money and not greed to want to take more from someone else.'

DougMacG

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Growth Slows
« Reply #2441 on: April 25, 2024, 06:42:13 AM »
https://www.wsj.com/economy/central-banking/us-gdp-economy-first-quarter-2024-1675df05

3+ years of chopping away at the foundations of growth and growth slows.

Did ANYONE see this coming.

Slow growth (or none) but inflation lives on, eating up all gains.  65% say we're on the wrong track.  Majority prefer the challenger to better handle the economy.

Reminds me of another one term President.

Policies have consequences.  EVERY policy of this administration is a hindrance to private sector growth. They choose policies that poll well, but the resulting stagflation does not poll well at all.

------------

https://www.cnbc.com/2024/04/25/gdp-q1-2024-increased-at-a-1point6percent-rate.html

The 'experts estimate for growth was 50% higher.

BIG disappointment.
« Last Edit: April 25, 2024, 07:54:49 AM by DougMacG »

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Political Economics, Southwest in meltdown
« Reply #2443 on: April 25, 2024, 12:16:13 PM »
ccp (paraphrase)  They're telling us the economy is great.

Cut rate airline is dropping 4 airports, reducing its fleet, canceling flights and firing 2000 employees.

My rich friends don't fly Southwest.  How does Biden get away with saying his policies, his taxes, his war on energy, his fascism level regulations will only hurt the rich, those making over 400k.

Wait.  He didn't say that?

Do airlines shrink in a growing economy?  And what did our Department of Transportation Secretary with parking meter experience say about airplane parts falling out of the sky?  I haven't heard a report.

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Re: Political Economics
« Reply #2444 on: April 25, 2024, 01:07:51 PM »
ccp (paraphrase)  They're telling us the economy is great

GDP at minuscule 1.6%

Biden :

we are doing better then all other countries in the world

no mentioned no we are not:

https://www.weforum.org/agenda/2022/01/oecd-gdp-growth-bounceback/

Ya,

Should I be buying India ETF
Wisdom Tree?

or one of these:

https://money.usnews.com/funds/etfs/rankings/india-equity

DougMacG

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Re: Political Economics
« Reply #2445 on: April 25, 2024, 04:15:04 PM »
ccp:  we are doing better then all other countries in the world
not mentioned no we are not:
https://www.weforum.org/agenda/2022/01/oecd-gdp-growth-bounceback/
--------------------

Plus, that wasn't the bar.  We're supposed to be leader of the free world.

Where are we leading them?

Global Debt was 226 trillion in Biden's first year, 2021.
https://www.imf.org/en/Blogs/Articles/2021/12/15/blog-global-debt-reaches-a-record-226-trillion

Global Debt hits record 307 trillion in Biden's 3rd year, Sept 2023.
https://www.reuters.com/markets/global-debt-hits-record-307-trillion-debt-ratios-climb-iif-2023-09-19/

This is while the world is climbing out of Covid shutdowns.

Global debt hits new record high of 313 trillion, Feb 2024.
https://www.reuters.com/business/global-debt-hits-new-record-high-313-trillion-iif-2024-02-21/

If we are leading the world, it is downward. 

Bidenomics  =  Debt -onomics

Biden's going to pay off student loans?  No he's not.  He's not paying off anything.  He's taking us further and further down a debt hole.  Why do young people let him lie to them?

We used to joke the motto on our business card was: 'We're no worse than our competitors', to see if that would sell.

Biden's line is, 'you may be screwed by real wages falling for 4 years, but we're no worse than the rest of the world, Zimbabwe, Haiti and so on'.

'We're willing to pay out trillions of dollars of your future years' wages for your vote today.'



https://www.weforum.org/agenda/2023/12/what-is-global-debt-why-high/



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Re: Political Economics, Mohamed El-Erian
« Reply #2446 on: April 28, 2024, 07:38:06 AM »
Mohamed El-Erian is economist for Allianz, the world's largest insurance company and writes for major publications.  I think he tries to analyze without bias but being a centrist puts him a ways to the Left.  For the most part he sees and acknowledges both sides.

https://www.interest.co.nz/economy/127470/mohamed-elerian-explains-how-recalibrate-expectations-face-yet-another-forecasting

He comments here on blown forecasts and factors affecting outlooks for the near term.

I hate to excerpt because there are other important point, but...

" It is easy to imagine how today’s “stable disequilibrium” could give way to a more volatile disequilibrium, which would then fuel financial instability."
...
"I put the chance of a US soft landing at around 50%; the probability of a (misleadingly named) “no landing” – higher growth with no additional inflationary pressures and genuine financial stability – at around 15%; and the chance of recession and new threats of financial instability at 35%."

...
(From earlier in the article)
"Sticky inflation combined with slower growth will put the Fed between a rock and a hard place. Faced with growth uncertainties and the new global paradigm of insufficiently flexible aggregate supply, the Fed will need to decide whether to stick with its 2% inflation target or allow for a slightly higher one, at least for now."

  - He's right but a higher inflation target is not acceptable.

"Many advanced economies have embarked on a transition from a world of deregulation, liberalisation, and fiscal prudence to one oriented around industrial policy, renewed regulation, and sustained budget deficits on a scale that would have been unthinkable previously."

  - (Doug) There's the problem.

(Doug continued)  Inflation (price level) has to do with the ratio of the supply of money to the amount of goods and services produced.  The emphasis goes to the tools of the Fed like interest rates but not to the other side of the equation, the anti-growth policies stifling production of goods and services.
« Last Edit: April 28, 2024, 08:35:24 AM by DougMacG »

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CNBC looks at Biden Stagflation
« Reply #2447 on: April 29, 2024, 02:18:02 PM »
https://www.cnbc.com/2024/04/26/all-the-data-shows-inflation-isnt-going-away-making-things-tough-on-fed.html
-------------------------------
[Doug]  If the Fed tries to stimulate the economy for the election with rate cuts in the middle of way over target inflation, they will lose what little credibility they have left.

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Re: Political Economics
« Reply #2448 on: April 30, 2024, 07:18:56 AM »


Scott Grannis chart, March 11/2024
-------------------------------------------

[Doug]  Strange that with all these new people coming across the border to work(?) that job growth is slowing.

Largest growth sector is now Soros funded campus protesters.

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Federal government job growth
« Reply #2449 on: April 30, 2024, 11:14:58 AM »
The curve looks the opposite and up:

The Biden administration is looking to add 82,000 employees in fiscal 2024, a 3.6% increase that would bring civilian federal rolls to their highest levels since World War II. Nearly every federal agency would receive a funding boost in President Biden’s fiscal 2024 budget, and all but one major agency is anticipating adding staff as a result.

https://finance.yahoo.com/news/biden-administration-job-growth-numbers-175321823.html

Additionally, and
obviously, illegal and under the table jobs are not being counted.