Friday, June 24, 2016

About The Economy



This note deals with the real status of our nation's economy.  It is in stark contrast to what Obama and his fawning media tell us.  The first 10 items will give you a feel for things.  The reality is, though, they only touch on the many issues we face.  The balance add to the first 10 items so pick and choose those that strike your interests. 

1)  The government is lying to us about the economy.  But then you already knew that...but check this out anyway.  Quote: "This week we are told by the government that monthly retail sales were up 1.3% in April overall and .6% excluding autos, gas, and food. I have trouble making sense of this number considering that stores of all economic levels have reported decreasing sales for February through April. This includes Kohls, Macy’s, the Gap, Nordstroms, and Penneys. Sports Authority and American Apparel sales were so weak they are liquidating. Sears and K Mart are excep[tionally weak and Walmart is flat at best. We have to remember that although Amazon’s sales and total online sales are going up they are still a very small percentage of the overall economy.  The government said that part of the reason first quarter growth was so slow -- ½% -- was because the American people were saving more. Yet we are told in other reports that 63% of people live paycheck to paycheck and don’t even have $1,000 saved. Where are all these savings going? With  the savings rate so high and economic growth so slow you would think that people would be paying down debt or not borrowing much, yet consumer credit is rising rapidly."       http://www.americanthinker.com/blog/2016/05/do_government_economic_numbers_make_sense.html

2)  Things are not well in either our economy or the global economy.   Failed Keynesian economic policies and the rise of socialistic control of nation states is a good bet to be the culprit. Quote: "Anyone that believes that things are “just fine” is in a massive state of denial.  Consuming far more wealth than we produce is not a formula for a sustainable economy, and it is just a matter of time before we find this out the hard way."  Our once vaunted economy has long been in decline due to the above cited reasons and now (communist) China is following suit.  http://patriotpowerednews.com/plunging-manufacturing-numbers-mean-that-it-is-time-to-hit-the-panic-button-for-the-global-economy/

3)  Obama claims his proudest achievement as president is, " "I'm proud of saving the American economy."  When one examines the facts there is no doubt that his economic policies have been a total failure.  Quote:"Just days ago, in Argentina, Obama explained that the debate between communism and capitalism was merely an "interesting intellectual argument." He suggested that each state simply "choose from what works."  By that standard, Obamanomics -- compared to the Reagan-style policy of reducing taxes, slowing down government spending, and decreasing regulation -- simply ... hasn't ... worked."      http://townhall.com/columnists/larryelder/2016/03/31/why-the-anger-obamanomics-has-failed-n2141324/page/full   Read this and ask yourself what Obama is talking about.  Saved the economy????  Obama is incapable of telling the truth.  Quote: "The U.S. economy added the fewest number of jobs in seven months in April and Americans dropped out of the labor force in droves, signs of weakness that cast doubts on whether the Federal Reserve will raise interest rates before the end of the year.  Nonfarm payrolls increased by 160,000 jobs last month as construction employment barely rose and the retail sector shed jobs, the Labor Department said on Friday. That was the smallest gain since September and below the first-quarter average job growth of 200,000.  Employers added 19,000 fewer jobs in February and March than previously reported. While the unemployment rate held at 5.0 percent that was because people dropped out of the labor force."  https://ca.news.yahoo.com/good-u-payrolls-gains-seen-swelling-labor-force-051124975--business.html  

4)  He is either ignorant, misinformed or outright lying when Obama says our economy is improving as are the jobs numbers.  Wrong... Quote: "To listen to President Barack Obama, Americans live in a liberal paradise: a robust economy, 75 consecutive months of jobs growth and a government aggressively promoting social justice..Sadly, it’s not so. Family incomes are down about $1,600 on Obama’s watch, whereas they rose by $4,800 during the Reagan years. For African-American families, income losses are greater, their children trail further in school achievement, poverty is tougher to escape, and the wealth gap with whites has widened.  The recent Labor Department jobs report tells the sad story why.  The economy added a paltry 38,000 new positions in May. The liberal media will apologize that the Verizon strike cut about 35,000 but monthly job gains have been trending down since 2014 and 2015. That’s frustrating a stronger recovery in wages, especially for minorities."        http://www.newsmax.com/Finance/PeterMorici/obama-jobs-liberal-failures/2016/06/03/id/732113/?   Piling on... Quote: "May jobs report worst in 5 years: Only 38,000 jobs added, labor force declines 458K."   http://hotair.com/archives/2016/06/03/may-jobs-report-worst-in-5-years-only-38000-jobs-added-labor-force-declines-458k/?

   Quote: "I have been discussing downward revisions for some time. If they come, revisions are likely to show the US is in recession already.  More and more things simply do not add up.  I have a report tomorrow listing 10 reasons the May jobs report was not an outlier. If you prefer to believe cheerleaders, I have another answer."     http://finance.townhall.com/columnists/mikeshedlock/2016/06/10/bls-says-jobs-openings-up-actually-openings-falling-fast-n2176180/page/full    

5) Does this sound good to you?  Quote: "The Markit U.S. Services PMI™ final data shows a weaker rise in service sector business activity in May.The Composite PMI (manufacturing plus services) flirts with contraction.  Key Points
6) This is the Obama and progressive left's economy.  Quote: "It is hard to live the American Dream when the deck is stacked against you.  Our politicians stood idly by as millions of good paying jobs were shipped overseas, our economic infrastructure was absolutely gutted and multitudes of small businesses were choked to death by miles of red tape.  Now, we are reaping the consequences.  In America today, nobody has a job in one out of every five families, and there are more than 100 million working age Americans that are currency not working.  And thanks to our transition to a “service economy," many of those that are actually working are deeply struggling too.  According to the Social Security Administration, 51 percent of all American workers make less than $30,000 a year.  And the Federal Reserve says that 47 percent of all Americans could not pay an unexpected $400 emergency room bill without borrowing the money from somewhere or selling something.  That means that about half the country is flat broke, and things get even more precarious for working families with each passing day."   http://freedomoutpost.com/the-startling-truth-about-how-working-families-are-truly-faring-in-this-economy/   I repeat. This is the Obama and the progressive left's economy.

7) This is for those that think socialism is a good thing.  Thomas Sowell lays out the facts.   http://townhall.com/columnists/thomassowell/2016/05/31/socialism-for-the-uninformed-n2171042?

8)  Past items discussing the Federal Reserve System have made the points in this link.  This discussion, however, provides additional support.  Quote: "I don’t agree with Paul Krugman on many things, but he’s right when he says that the Fed is culpable for causing the ups and downs of the business cycle in the United States. Milton Friedman argued the same thing. In this sense, both Krugman and Friedman — political opposites — are monetarists."  And, "What is the Fed up to now? Based on the chart, the Fed still has adopted an easy-money policy. Not only are interest rates low, but the Fed seems to have backed up raising rates. Moreover, the supply of money is gushing, with M2 growing at a 9% clip. The Fed is still fighting a slowing economy (largely caused by the Obama administration’s anti-business attitude, higher taxes and more regulations)."   While the discussion closes detailing an upcoming conference which will cover the issue in more detail, it would certainly be interesting but I will, of course, not be attending. http://humanevents.com/2016/05/26/does-the-federal-reserve-create-recessions/?   This is a solid indicator that the economy is not in good shape.   Quote: "Volatility in financial markets has left an air of uncertainty across the globe. So much so, says Civelli, that many of the investors he talks to on a regular basis are just as concerned about the unknown as the Fed, with many either sitting in large cash positions, making risky stock market bets in an effort to generate some yield on their investments, or willing to pay governments to keep their money “safe.”    http://patriotpowerednews.com/venture-capitalist-says-investors-are-terrified-of-market-volatility-and-weak-economy-they-are-scared-and-dont-know-what-to-do/

    The mess at the Federal Reserve.   http://finance.townhall.com/columnists/charlespayne/2016/03/25/revolt-at-the-fed-n2138518/page/full   I completely agree with the author's last sentence.  Quote: " I would like the Fed to go away; until that happens, stop blowing it!  Both our government and the Fed lie to us regarding the true state of our economy.  Read this to see what I mean.  Quote: "Peter Schiff was on Tuesday’s edition of PreMarket Prep, where he reiterated his bearish thesis for the market in the wake of the Federal Reserve’s decision not to raise interest rates last week.  Schiff wasn’t convinced by the positive market talk coming out of the Fed.  “I knew that it was all talk, and when Janet Yellen actually spoke she validated what I said,” Schiff said. “She basically came out and said ‘We’re not raising rates and it’s not because we think the economy is weak, it’s because we decided that lower interest rates are appropriate.’ Which is all B.S, because it’s all about the economy. The economy is a disaster. I think Yellen probably realizes we’re in a recession.”     https://www.lewrockwell.com/2016/04/no_author/fed-talk-pure-baloney/

     And get this!  In partnership with the Federal Reserve the federal government (Congress and Administration) are screwing our kids, grand kids, great grand kids and beyond.  The headline for this link says it all. "Auditor: Government Will Owe More Money Than Entire Economy Produces".    http://freebeacon.com/issues/government-owe-money-entire-economy/ 
    
     Quote: "It’s obvious China is hiding behind a basket of lies. China can weight its alleged currency basket however it wants.  However, don’t point a finger just at China. All the central banks are liars."    http://finance.townhall.com/columnists/mikeshedlock/2016/03/01/g20-lies-and-admissions-n2126587/page/full

     Far too many Americans do not know or understand how the Federal Reserve came to be.  This item provides insight.   http://www.thesleuthjournal.com/federal-reserve-private/

9)  About that minimum wage rage.   Add to the kind of leadership cited in the  previous items along with the leadership cited in this link we need no enemies. We will, as Lenin said, destroy ourselves or at least these elitists at the top will.  These two socialist governors admit that the $15.00 minimum wage may not be the best thing for the economy but both signed it into law in their respective states.   Quote: "California Gov. Jerry Brown and other advocates of hiking the minimum wage to $15 per hour have conceded that the pay increase might not be the best way to help workers, causing questions about the sincerity of the “Fight for 15” movement.  “Economically, minimum wages may not make sense,” Brown told the Sacramento Bee before signing the wage increase for his state. The governor followed suit with New York Gov. Andrew Cuomo, who did the same last week."  And, "However, even progressive voices are warning that such a steep increase would have economic consequences. The Washington Post editorialized on Tuesday:  Moderate minimum wage increases in the past have not produced disastrous short-term employment consequences, at least not sharp enough to outweigh the perceived benefits of protecting workers from a race to the bottom of the labor market. Yet $15 per hour would represent a quantum leap in the U.S. minimum wage, from its present level of about 35 percent of the median full-time hourly wage to nearly 75 percent of it, based on our reading of figures from the Organization for Economic Cooperation and Development and the Bureau of Labor Statistics. No other industrialized country’s statutory minimum wage even comes close." http://www.theblaze.com/stories/2016/04/07/advocates-admit-15-minimum-wage-may-not-make-sense-but-offer-a-glimpse-of-motivation-for-hike/   Government officials obviously have no idea how the economy works.  They think by their magic tricks good things will happen.

     Continuing the theme from the previous item the liberals can say what they want but this is what is really going on.  Quote: "Chris Rossini brilliantly explains what so many liberals seem to have such a hard time understanding. Namely, that government is forcing employers to automate their businesses instead of hiring low-skilled workers.  What’s that, you say? ‘But I thought government was trying to help poor people by raising the minimum wage?’ This is precisely the problem. When liberals use the government to step in and force employers to raise the minimum wage, the costs of doing business rise prohibitively for employers, forcing them to think outside the box for solutions to staying in business. If minimum wage goes up, perhaps the business will be forced to fire employees in order to pay the bills. The problem is that this solution means that service will suffer. If the business decides to keep everyone on the payroll, then the likely solution is that prices will necessarily rise, meaning that the business may lose customers who can no longer afford the prices. In either scenario, the business suffers, the employees suffer, and the customers suffer. Raising the minimum wage is a lose-lose-lose proposition… unless the employer can ‘think outside the box." http://eaglerising.com/32156/liberals-are-using-the-minimum-wage-to-make-the-poor-poorer/

     In follow-up to the previous item here is a discussion that tries to make sense of the ongoing nonsense minimum wage rage.   https://www.lewrockwell.com/2016/04/andrew-p-napolitano/damaging-minimum-wage/   Here's more evidence of the consequences of incoherent government mandated minimum wage laws.  http://patriotupdate.com/liberal-minimum-wage-argument-destroyed-guess-working-mcdonalds-now/?  Want more?   http://www.latimes.com/business/la-fi-garment-manufacturing-la-20160416-story.html      Here is how Wendy's is handling the problem.  It spells even worse unemployment figures.  http://townhall.com/tipsheet/christinerousselle/2016/05/13/wendys-to-replace-workers-with-selfserve-kiosks-due-to-minimum-wage-increases-n2162487?   Thanks progressive leftists/Democrats.  Your solutions to problems "always" eventually hurt the very people you claim to help.

     This progressive/liberal government sound good but irresponsible mandate is a bad economic decision.  History tells us that over and over again.  As usual feel good trumps do good.  Quote: "There is a single thought that unites the political parties of the left all over the world (from welfare state liberals to socialists and communists) and it is this: incentives don’t matter. And since prices are the mechanism that coordinates incentives and clears markets, it follows that prices don’t matter either." And, "Given these developments, what could be more irrational or less humane than imposing a $15 minimum wage, effectively making low-skilled workers increasingly unattractive vis-a-vis their robot competitors?" And, "The “gig economy” is only a small part of a much larger development: alterative work arrangements, including independent contractors, on-call workers, temp workers and workers employed by contract firms. By one estimate, these workers are now 11 percent of the workforce in manufacturing and 16 percent in health care and education.  Amazingly, virtually all the job growth in the past 10 years is due to the growth of alternative labor!  So why is the loony left willing to leave all these people alone? In the world of “barnyard Marxism,” the economy consists of the oppressors (employers) and the oppressed (employees). If there are no oppressors, there is no oppression. If there is no oppression, there is nothing for government to do."    http://townhall.com/columnists/johncgoodman/2016/04/02/15-an-hour-why-not-30-why-not-100-n2142044/page/full

     More regarding the disaster of government imposed minimum wage mandates.  Quote: "The saddest aspect of the minimum wage story is the damage it does to human beings. The current hourly wage for a fast-food restaurant cashier is $7.25 to $9 per hour. That produces a yearly salary of $15,000 to $20,000, plus fringes. That’s no great shakes, but it is honest work and a start in life. It might be the very best some people could do. Enter the arrogance and callousness of the elite. Their vision of what a person should earn, expressed by higher minimum wages, destroys people’s best alternative without offering a superior one in its place. Maybe the elite believe that welfare, unemployment compensation and possibly engaging in illegal activities are a superior alternative to earning an honest and respectable living on a cashier’s salary. That is a despicable vision."    https://www.lewrockwell.com/2016/06/walter-e-williams/arrogant-elite/

10)   Readers will recall that Glass-Steagall was passed by Congress in the wake of the collapse that led to the Great Depression.  However during President Clinton's tenure he along with our esteemed Congress felt that that was old fashioned and needed to be repealed.  So they did repeal it... The rest of the story is the history of financial disaster that soon followed.  Quote: "During the 1990’s the conventional economic wisdom supported the repeal of Glass-Steagall. However, “10 years later, the end of Glass-Steagall has been blamed by some for many of the problems that led to last fall’s (2008) financial crisis. While the majority of problems that occurred centered mostly on the pure-play investment banks like Lehman Brothers, the huge banks born out of the revocation of Glass-Steagall, especially Citigroup, and the insurance companies that were allowed to deal in securities, like the American International Group, would not have run into trouble had the law still been in place.”    http://www.thesleuthjournal.com/repeal-glass-steagall-big-fail-culture/   Bear in mind that Hillary has declared that she will have Bill tackle economic solutions during her administration.  That would be a disaster - the good economic times he enjoyed were not of his making.  History tell us that they were the concentrated results of the previous administration and the happy happenstance of the .dot com" explosion, among a few other actions forced on him by the Republican's Contract with America.  Lately, we have seen leftist Democrat governance lead the way for Puerto Rico's default of "$370 million worth of bonds."   Do we want a continuation of flawed economic policies of the current president and a return to bad decisions made during Bill's term in office? 
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