solarz
Brigadier
That's what the Chinese would call "pick up a brick to smash one's own foot".
American Economics Thread
- Thread starter Bernard
- Start date
That's what the Chinese would call "pick up a brick to smash one's own foot".
Bernard
Junior Member
10 Reasons to be Bullish on the U.S Economy
1.America has the largest and most productive in economy in the world
2. The US is a global leader in manufactured goods ...
3.This is the world's top choice for Foreign Direct Investment (FDI)
4.and is the global technology leader
The top-ranked universities in the world are in the US
The dollar is still the world's top reserve currency
Read more detail from the article here. Not too long of an article.
1.America has the largest and most productive in economy in the world
2. The US is a global leader in manufactured goods ...
3.This is the world's top choice for Foreign Direct Investment (FDI)
4.and is the global technology leader
The top-ranked universities in the world are in the US
The dollar is still the world's top reserve currency
Read more detail from the article here. Not too long of an article.
Last edited:
Bernard
Junior Member
American economy still hurting from the recession
Published on July 03, 2016
A report issued by the Federal Reserve Board in May found that 46 per cent of Americans said they did not have enough money to cover a $400 emergency expense.
Instead, they would have to put it on a credit card and pay it off over time, borrow from friends or family, or simply not cover it at all.
The U.S. economy is becoming lethal to the less fortunate, according to the National Centre for Health Statistics, which reported recently that death rates in the country have risen for the first time in a decade.
The death rate rose to 729.5 deaths per 100,000 people in 2015, up from 723.2 in 2014. Especially noticeable is the rising mortality among working-class whites, particularly those with no more than a high school education. Some of this is due to drug use and suicide.
Carol Graham, a researcher at the Brookings Institution, recently analyzed data on life satisfaction and found that when it comes to their outlook on the future, the most desperate groups are poor and near-poor whites.
There is “a shrinking pie of good jobs for low-skill/blue collar workers,” Graham told the Washington Post.
So while the unemployment rate is falling and some wages are rising, for many that progress isn’t being felt.
Typical is a city like Pottstown, Pennsylvania, where manufacturing has collapsed in the face of foreign competition. Since 1950, the number of jobs in Pottstown has fallen from 12,287 to 9,434, even as the population has held steady at just over 22,000.
The economy has been growing for 84 months, but the pace of this recovery has been the slowest since the Second World War, with average annual growth of about 2.1 per cent. And wages remain stagnant.
In 2007, about 88 per cent of men between the ages of 25 and 54 were working. Now, roughly 85 per cent of such men are working. That’s a difference of about two million men, and most would undoubtedly like jobs.
The explanation, according to New York Times economics writer Binyamin Appelbaum: Job growth is slowing because the economy is losing steam.
“We’ve come a long way from the bottom of 2009,” remarked David Shulman, an economist at the University of California’s Anderson School of Management in Los Angeles.
“But compared to the historical growth track, we’re so far below it that it’s staggering, and that’s the unease the public feels about the economy.”
Census Bureau data shows that real per capita income is still below 2007 levels. And there has been a shift from full-time to part-time employment.
Some 2.5 million full-time jobs have disappeared, to be replaced by part-time employment. So the U.S. economy is really short 10 million full-time jobs.
“What we see today is a U.S. economy that is great for banks, great for bankers, and not so great for ordinary workers,” writes Salvatore Babones, professor of sociology and social policy at the University of Sydney.
“Employment rates are down, employment hours are down, and wages are down. Bank profits are up, up, up to record levels. It’s no wonder that ordinary people are not as optimistic as the Board of Governors of the Federal Reserve System.”
So despite the nation being in the midst of a so-called recovery, American workers aren’t benefitting. The job market is flat and underemployment remains high.
In fact, weakened since the 1970s, the American working class has allowed investors to accumulate the lion’s share of wealth. Already by the 1990s, banking regulations had fallen to below pre-1930s levels.
This helps explain the popularity of Donald Trump. Pottstown is just the kind of place where he hopes to win votes.
“Trump actually talks about stuff working people care about, like job-destroying free trade agreements and a deep-rooted fear that the good life (at least for working-class white people) is a thing of the past,” writes Boston University sociologist Nicole Aschoff, managing editor of the left-wing magazine Jacobin and author of The New Prophets of Capital.
Wedded to globalization, the American elite is “so terrified of a Trump presidency” that they prefer Hillary Clinton, she contends.
Published on July 03, 2016
A report issued by the Federal Reserve Board in May found that 46 per cent of Americans said they did not have enough money to cover a $400 emergency expense.
Instead, they would have to put it on a credit card and pay it off over time, borrow from friends or family, or simply not cover it at all.
The U.S. economy is becoming lethal to the less fortunate, according to the National Centre for Health Statistics, which reported recently that death rates in the country have risen for the first time in a decade.
The death rate rose to 729.5 deaths per 100,000 people in 2015, up from 723.2 in 2014. Especially noticeable is the rising mortality among working-class whites, particularly those with no more than a high school education. Some of this is due to drug use and suicide.
Carol Graham, a researcher at the Brookings Institution, recently analyzed data on life satisfaction and found that when it comes to their outlook on the future, the most desperate groups are poor and near-poor whites.
There is “a shrinking pie of good jobs for low-skill/blue collar workers,” Graham told the Washington Post.
So while the unemployment rate is falling and some wages are rising, for many that progress isn’t being felt.
Typical is a city like Pottstown, Pennsylvania, where manufacturing has collapsed in the face of foreign competition. Since 1950, the number of jobs in Pottstown has fallen from 12,287 to 9,434, even as the population has held steady at just over 22,000.
The economy has been growing for 84 months, but the pace of this recovery has been the slowest since the Second World War, with average annual growth of about 2.1 per cent. And wages remain stagnant.
In 2007, about 88 per cent of men between the ages of 25 and 54 were working. Now, roughly 85 per cent of such men are working. That’s a difference of about two million men, and most would undoubtedly like jobs.
The explanation, according to New York Times economics writer Binyamin Appelbaum: Job growth is slowing because the economy is losing steam.
“We’ve come a long way from the bottom of 2009,” remarked David Shulman, an economist at the University of California’s Anderson School of Management in Los Angeles.
“But compared to the historical growth track, we’re so far below it that it’s staggering, and that’s the unease the public feels about the economy.”
Census Bureau data shows that real per capita income is still below 2007 levels. And there has been a shift from full-time to part-time employment.
Some 2.5 million full-time jobs have disappeared, to be replaced by part-time employment. So the U.S. economy is really short 10 million full-time jobs.
“What we see today is a U.S. economy that is great for banks, great for bankers, and not so great for ordinary workers,” writes Salvatore Babones, professor of sociology and social policy at the University of Sydney.
“Employment rates are down, employment hours are down, and wages are down. Bank profits are up, up, up to record levels. It’s no wonder that ordinary people are not as optimistic as the Board of Governors of the Federal Reserve System.”
So despite the nation being in the midst of a so-called recovery, American workers aren’t benefitting. The job market is flat and underemployment remains high.
In fact, weakened since the 1970s, the American working class has allowed investors to accumulate the lion’s share of wealth. Already by the 1990s, banking regulations had fallen to below pre-1930s levels.
This helps explain the popularity of Donald Trump. Pottstown is just the kind of place where he hopes to win votes.
“Trump actually talks about stuff working people care about, like job-destroying free trade agreements and a deep-rooted fear that the good life (at least for working-class white people) is a thing of the past,” writes Boston University sociologist Nicole Aschoff, managing editor of the left-wing magazine Jacobin and author of The New Prophets of Capital.
Wedded to globalization, the American elite is “so terrified of a Trump presidency” that they prefer Hillary Clinton, she contends.
Excessively low interest rates damage the income of people depending on interest payments, for example pensioners, and so make productive investment unattractive. Investment is then driven out by speculation and jobs are not created. Besides maintenance and investment by municipalities, states and the federal authorities in roads, sewers, dams, bridges, has been too low for decades and that too is reducing the jobs available and reducing the wealth of the US. On the other hand the military expenditure is much higher than that of any other country. That's a game a country cannot win.
Blackstone
Brigadier
That's because it is rigged. Special interest groups dominate not only Washington DC, but all the state capitals, county seats, municipal districts, city halls, townships, hamlets, the military, the civil services, school boards, Boy/Girl Scouts, down to your local SPCA. The nation lost a lot of steam from patronage system reforms, and Tammany Hall is back in a big way.
Trump isn't the solution to our ills, but we sure need an updated version of the Pendleton Act.
Bernard
Junior Member
1,700 People in America Are Becoming Millionaires Every Day
Despite little wage growth and declining job prospects among young Americans, the U.S. is home to vast stores of wealth and a millionaire class that outsizes that of any other country in the world. And it’s .
The number of Americans who meet the millionaire threshold is set to increase by an average of 1,700 every day for the coming years, Bloomberg reports, based on projections by the Boston Consulting Group. By the year 2020, the U.S. is expected to welcome 3.1 million new members into its millionaires’ club, which grew by 2.4 million from 2010 to 2015.
Today, there are about 8 million American households with assets worth more than $1 million, excluding properties and luxury goods, the firm said.
The coming spike in individual wealth will largely be due to what Bloomberg calls “the largest generational transfer of wealth in history.” Much of America’s wealth is concentrated among older generations, whose mostly already affluent offspring are about to inherit a fortune.
Inheritance matters in maintaining financial growth, according to research by the Spectrem Group, a consulting firm cited by Bloomberg. Over 73% of surveyed investors under 50 with assets above $25 million told the group that inheritance factored into their success.
Some 75% of Americans, however, are what the Federal Reserve Bank of St. Louis calls “strugglers,” while the remainder is classified as “thrivers.” The former make just enough to get by little each year, while the latter are able to successfully save and accumulate wealth. With so much money being handed down through inheritance, a swift rise in the number of millionaires is unlikely to upset the order of concentrated wealth.
For more on wealth inequality in the U.S., watch Fortune’s video:
But being a millionaire may not matter as much as it used to. Bloomberg says a net worth of $1 million today has the buying power of, say, $341,000 in 1980, or $45,000 in the early 20th century. Being a millionaire these days doesn’t even necessarily qualify one as “rich,” as living expenses, education, and retirement easily chip away at the sum.
Nonetheless, the vast majority of America’s working class would surely welcome an invitation into the country’s growing legion of seven-figure holders.
Credit Suisse expects Canada to have 50 per cent more millionaires by 2021
Postmedia NewsCanada now has 1,117,000 millionaires, 25,000 more than last year.
The number of Canadian millionaires is expected to grow by 50 per cent over the next five years, according to the latest edition of the annual Credit Suisse Wealth Report.
William Watson: From those to whom much is given much is required. The Bible says that, but also the Canada Revenue Agency.
Credit Suisse said Canada currently has 1,117,000 adults with asset holdings exceeding US$1 million, an increase of 25,000 individuals from last year. Based on forecasts in the growth of Canada’s gross domestic product and equity market capitalization, Credit Suisse expects the number of adult Canadians whose wealth exceeds US$1 million will rise by 50 per cent to 1,680,000 in 2021.
Canada is a rich country by global standards. According to Credit Suisse, Canada has about 4 per cent of the richest 1 per cent, even though Canada makes up only 0.6 per cent of the world’s adult population.
Credit Suisse said wealth per adult in Canada lags the U.S. by about 22 per cent. The average Canadian adult has about US$270,000 in assets, while the average American holds US$344,000.
Yet Canada’s wealth is better distributed, with Canada’s median wealth per adult, US$96,700, more than double than in the U.S., where it’s US45,000. Canada also has a smaller percentage of adults whose wealth is beneath US$10,000 and a larger percentage of adults with more than US$100,000.
Credit Suisse says wealth per adult in Canada has grown an average of 5.9 per cent a year since 2000 when measured in U.S. currency, or 4.9 per cent a year when measured in loonies. The Canadian economy is heavily weighted to resources and has suffered from the dip in prices for oil and other commodities. Yet Credit Suisse says Canadian wealth has still managed to rise because low interest rates continue fuel housing prices in major urban cities.
Globally, Credit Suisse says aggregate wealth increased by US$3.5 trillion or 1.7 per cent to US$255.7 trillion. The bank said the increase merely kept pace with global population growth, and wealth per adult of US$52,819 was unchanged for the first time since 2008.
The United Kingdom posted a notable slide in wealth in the aftermath of the June Brexit vote. Wealth per adult decreased US$30,000 to US
Despite little wage growth and declining job prospects among young Americans, the U.S. is home to vast stores of wealth and a millionaire class that outsizes that of any other country in the world. And it’s .
The number of Americans who meet the millionaire threshold is set to increase by an average of 1,700 every day for the coming years, Bloomberg reports, based on projections by the Boston Consulting Group. By the year 2020, the U.S. is expected to welcome 3.1 million new members into its millionaires’ club, which grew by 2.4 million from 2010 to 2015.
Today, there are about 8 million American households with assets worth more than $1 million, excluding properties and luxury goods, the firm said.
The coming spike in individual wealth will largely be due to what Bloomberg calls “the largest generational transfer of wealth in history.” Much of America’s wealth is concentrated among older generations, whose mostly already affluent offspring are about to inherit a fortune.
Inheritance matters in maintaining financial growth, according to research by the Spectrem Group, a consulting firm cited by Bloomberg. Over 73% of surveyed investors under 50 with assets above $25 million told the group that inheritance factored into their success.
Some 75% of Americans, however, are what the Federal Reserve Bank of St. Louis calls “strugglers,” while the remainder is classified as “thrivers.” The former make just enough to get by little each year, while the latter are able to successfully save and accumulate wealth. With so much money being handed down through inheritance, a swift rise in the number of millionaires is unlikely to upset the order of concentrated wealth.
For more on wealth inequality in the U.S., watch Fortune’s video:
But being a millionaire may not matter as much as it used to. Bloomberg says a net worth of $1 million today has the buying power of, say, $341,000 in 1980, or $45,000 in the early 20th century. Being a millionaire these days doesn’t even necessarily qualify one as “rich,” as living expenses, education, and retirement easily chip away at the sum.
Nonetheless, the vast majority of America’s working class would surely welcome an invitation into the country’s growing legion of seven-figure holders.
Credit Suisse expects Canada to have 50 per cent more millionaires by 2021
Postmedia NewsCanada now has 1,117,000 millionaires, 25,000 more than last year.
The number of Canadian millionaires is expected to grow by 50 per cent over the next five years, according to the latest edition of the annual Credit Suisse Wealth Report.
Credit Suisse said Canada currently has 1,117,000 adults with asset holdings exceeding US$1 million, an increase of 25,000 individuals from last year. Based on forecasts in the growth of Canada’s gross domestic product and equity market capitalization, Credit Suisse expects the number of adult Canadians whose wealth exceeds US$1 million will rise by 50 per cent to 1,680,000 in 2021.
Canada is a rich country by global standards. According to Credit Suisse, Canada has about 4 per cent of the richest 1 per cent, even though Canada makes up only 0.6 per cent of the world’s adult population.
Credit Suisse said wealth per adult in Canada lags the U.S. by about 22 per cent. The average Canadian adult has about US$270,000 in assets, while the average American holds US$344,000.
Yet Canada’s wealth is better distributed, with Canada’s median wealth per adult, US$96,700, more than double than in the U.S., where it’s US45,000. Canada also has a smaller percentage of adults whose wealth is beneath US$10,000 and a larger percentage of adults with more than US$100,000.
Credit Suisse says wealth per adult in Canada has grown an average of 5.9 per cent a year since 2000 when measured in U.S. currency, or 4.9 per cent a year when measured in loonies. The Canadian economy is heavily weighted to resources and has suffered from the dip in prices for oil and other commodities. Yet Credit Suisse says Canadian wealth has still managed to rise because low interest rates continue fuel housing prices in major urban cities.
Globally, Credit Suisse says aggregate wealth increased by US$3.5 trillion or 1.7 per cent to US$255.7 trillion. The bank said the increase merely kept pace with global population growth, and wealth per adult of US$52,819 was unchanged for the first time since 2008.
The United Kingdom posted a notable slide in wealth in the aftermath of the June Brexit vote. Wealth per adult decreased US$30,000 to US
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Bernard
Junior Member
US Economy Growing Strongly As Services (The Vast Majority Of The Economy) Surge
Much is said about manufacturing and the American economy and much of what is said is really more than just a little irrelevant. Sure, maybe it would be nice if there were more places where high school graduates could make physical things. But as far as the US economy as a whole is concerned manufacturing is a side show. The real activity is over in services, which is where it always is in a modern or rich economy. Even in Germany, the most manufacturing heavy of the large rich nations, only has 25% of its economy in manufacturing. And to a reasonable level of accuracy in the US it's about 10% manufacturing and some 80% services. Thus the wealth of the nation is very largely determined by what happens with services and little else.
At which point we find out that services in the US are surging, :
"U.S. service industries boosted production and hiring in November, the latest sign the economy is expanding at a solid pace after a weak first half of the year.
The Institute for Supply Management said Monday its index of nonmanufacturing activity rose to 57.2 in November from 54.8 in October. A reading above 50 indicates sector expansion. "
And this really is the important part of the:
"The service side of the U.S. economy that employs the vast majority of Americans grew in November at the fastest pace in a year, with most companies reporting that business is steady."
It not just employs most Americans it accounts for the vast majority of the value added in the .
"Measures of business activity and employment strengthened at companies that cover almost 90 percent of the economy, signaling growing optimism about demand. The group’s factory survey released last week also showed promise, with manufacturing expanding by the most in five months."
Yes, manufacturing is also doing well which means that we can expect the economy as a whole to be doing well also.
So, interesting short term news. But one of the things that we should note here is that the service side of the economy is expanding faster than the manufacturing. As has actually been true for well over half a century now. That being the reason that manufacturing has fallen as a percentage of the economy. US manufacturing output is, today, at an all time high. There hasn't actually been (absent the effects of recessions and recoveries) a fall in US manufacturing output. The shrinkage of manufacturing as a portion of the economy is purely that services have been expanding faster. And as far as we know this is going to continue too.
We don't actually have an example of a near post-industrial society as yet but we think we can map out what is going to happen. We think it's going to be just what happened to agriculture. Back two centuries that agriculture was 70 to 80% of everyone's economy everywhere. OK, maybe three centuries in the case of Britain. Then productivity increased in agriculture, it needed less labour, and so people could go off and work in the factories of the Industrial Revolution. Which is what they did and now in the rich countries agriculture employs perhaps 1 or 2% of the population and produces perhaps 1 or 2% of GDP. Do note that agricultural production has risen massively over this time--it's only fallen as a portion, not in absolute output. And something similar has been happening to manufacturing these past few decades. We're becoming more efficient at it, more productive. So, labour is freed up and is moving over into services. Manufacturing output keeps going up but it keeps shrinking as a portion of the economy as the service economy grows faster. Just what manufacturing once did to agriculture.
As I say, no one really knows as no one has really got there yet. Manufacturing is still about 10% or more of most rich economies. But a reasonable prediction is that it will, as a portion, fall to that 1 or 2% of agriculture over the next 50 odd years. Output will continue to grow but services will grow even faster. This latest news about services expansion in the US is just that larger picture write small for one month. As long as services expand faster than manufacturing then that manufacturing will, inevitably, become just the single percentage point rump on an economy dominated by services.
Much is said about manufacturing and the American economy and much of what is said is really more than just a little irrelevant. Sure, maybe it would be nice if there were more places where high school graduates could make physical things. But as far as the US economy as a whole is concerned manufacturing is a side show. The real activity is over in services, which is where it always is in a modern or rich economy. Even in Germany, the most manufacturing heavy of the large rich nations, only has 25% of its economy in manufacturing. And to a reasonable level of accuracy in the US it's about 10% manufacturing and some 80% services. Thus the wealth of the nation is very largely determined by what happens with services and little else.
At which point we find out that services in the US are surging, :
"U.S. service industries boosted production and hiring in November, the latest sign the economy is expanding at a solid pace after a weak first half of the year.
The Institute for Supply Management said Monday its index of nonmanufacturing activity rose to 57.2 in November from 54.8 in October. A reading above 50 indicates sector expansion. "
And this really is the important part of the:
"The service side of the U.S. economy that employs the vast majority of Americans grew in November at the fastest pace in a year, with most companies reporting that business is steady."
It not just employs most Americans it accounts for the vast majority of the value added in the .
"Measures of business activity and employment strengthened at companies that cover almost 90 percent of the economy, signaling growing optimism about demand. The group’s factory survey released last week also showed promise, with manufacturing expanding by the most in five months."
Yes, manufacturing is also doing well which means that we can expect the economy as a whole to be doing well also.
So, interesting short term news. But one of the things that we should note here is that the service side of the economy is expanding faster than the manufacturing. As has actually been true for well over half a century now. That being the reason that manufacturing has fallen as a percentage of the economy. US manufacturing output is, today, at an all time high. There hasn't actually been (absent the effects of recessions and recoveries) a fall in US manufacturing output. The shrinkage of manufacturing as a portion of the economy is purely that services have been expanding faster. And as far as we know this is going to continue too.
We don't actually have an example of a near post-industrial society as yet but we think we can map out what is going to happen. We think it's going to be just what happened to agriculture. Back two centuries that agriculture was 70 to 80% of everyone's economy everywhere. OK, maybe three centuries in the case of Britain. Then productivity increased in agriculture, it needed less labour, and so people could go off and work in the factories of the Industrial Revolution. Which is what they did and now in the rich countries agriculture employs perhaps 1 or 2% of the population and produces perhaps 1 or 2% of GDP. Do note that agricultural production has risen massively over this time--it's only fallen as a portion, not in absolute output. And something similar has been happening to manufacturing these past few decades. We're becoming more efficient at it, more productive. So, labour is freed up and is moving over into services. Manufacturing output keeps going up but it keeps shrinking as a portion of the economy as the service economy grows faster. Just what manufacturing once did to agriculture.
As I say, no one really knows as no one has really got there yet. Manufacturing is still about 10% or more of most rich economies. But a reasonable prediction is that it will, as a portion, fall to that 1 or 2% of agriculture over the next 50 odd years. Output will continue to grow but services will grow even faster. This latest news about services expansion in the US is just that larger picture write small for one month. As long as services expand faster than manufacturing then that manufacturing will, inevitably, become just the single percentage point rump on an economy dominated by services.