The economy booms!

[American]

Unemployment Rate Falls to 5.6%, companies add 112,000 new jobs (http://www.foxnews.com/story/0,2933,110632,00.html)

It's time to play my favorite song:


We're in the money, we're in the money;
We've got a lot of what it takes to get along!
We're in the money, that sky is sunny,
Old Man Depression you are through, you done us wrong.
We never see a headline about breadlines today.
And when we see the landlord we can look that guy right in the eye
We're in the money, come on, my honey,
Let's lend it, spend it, send it rolling along!

Oh, yes we're in the money, you bet we're in the money,
We've got a lot of what it takes to get along!
Let's go we're in the money, Look up the skies are sunny,
Old Man Depression you are through, you done us wrong.
We never see a headline about breadlines today.
And when we see the landlord we can look that guy right in the eye
We're in the money, come on, my honey,
Let's lend it, spend it, send it rolling along!



Singing a third refrain is optional.

[BTox]

I've been posting similar items for 2 months. The recovering economy will be the downfall of any dem contender to the whitehouse this fall.

[clk]

Originally posted by BTox
I've been posting similar items for 2 months. The recovering economy will be the downfall of any dem contender to the whitehouse this fall.

Really? How? Because Bush should be credited? I think Bush himself would disagree. Not too long ago, Bush was asked why the economy was still faltering, even though he had given round after round of tax cuts and the Fed had cut the rates. Bush responded:


We had the steady drumbeat to war. As I mentioned in my press conference the other day, on our TV screens there was a -- on some TV screens -- there was a constant reminder for the American people, "march to war." War is not a very pleasant subject in people's minds, it's not conducive for the investment of capital.


He also added:


That's not a very conducive environment for people to take risk, when they hear, ‘March to War' all the time.


Obviously, if CNN was responsible for the continued recession because they kept playing 'March to War' (I wonder which @sshole was marching us to war, btw?), then CNN is also responsible for the recovery, since they always broadcast any favorable economic news on their programs. People must have seen the news, gotten happy, and started investing in the stock market. If it's "not a very conducive environment for people to take risk, when they hear, ‘March to War' all the time", then surely a conducive environment to take risk would involve hearing favorable economic news all the time, right?

Also, I find it highly amusing when the right blames anything that goes wrong on Clinton, or CNN, or 9/11, or the CIA, etc. But anytime something good actually happens (fairly rare under Bush), then it happened because Bush made it happen. This coming from an administration that promised to be responsible. Why isn't Clinton responsible for the recovery? He was responsible for the recession and 9/11, right? Right? Surely a man with such power could easily turn the economy around. But I doubt Bush would agree to that. He already knows that CNN is responsible for the recovery. :rolleyes:


Source: http://www.helenair.com/articles/2003/08/02/national/a02080203_03.txt

[Ed]

Originally posted by clk


Really? How? Because Bush should be credited? I think Bush himself would disagree. Not too long ago, Bush was asked why the economy was still faltering, even though he had given recession and 9/11, right? Right? Surely a man with such power could easily turn the economy around. But I doubt Bush would agree to that. He already knows that CNN is responsible for the recovery. :rolleyes:


Source: http://www.helenair.com/articles/2003/08/02/national/a02080203_03.txt

You do know that this post is silly, right?

Politics is the blame game, period. Both sides do it. So?

[Otther]

Really? How? Because Bush should be credited? Oh gosh no. Everyone knows that the president really doesn't have a great deal of control over the economy. But the fact that the economy is doing better may shifty some of the population's interest back to worrying about terrorists and all the evil non-americans, which probably will help bush out.

[clk]

Originally posted by Ed


You do know that this post is silly, right?

Politics is the blame game, period. Both sides do it. So?

If Clinton would have tried the same tactic, then the Republicans would have tried to hang him. I have rarely seen that kind of spin from the Democrats. Again, if CNN is responsible for the recession, why aren't they responsible for the recovery? If you admit that Bush's March to War stalled the economic recovery, then I would be willing to concede some ground. Otherwise, if you think that CNN was responsible for the recession, but Bush is somehow responsible for the recovery, then, well, I can't help you.

[BTox]

Originally posted by clk
[B]

Really? How? Because Bush should be credited? I think Bush himself would disagree. Not too long ago, Bush was asked why the economy was still faltering, even though he had given round after round of tax cuts and the Fed had cut the rates. Bush responded:



You seem to be missing the point. Whether Bush deserves credit for a booming economy is irrelevant. The fact is, when the economy is doing well, voters give credit to the current administration and stick with the status quo.

[Zero]

The issue isn't so much about the economy as it is about individual people. In fact, if average Americans aren'tdoing better, and keep hearing how corporate profits are up, there is laible to be a backlash.

[BTox]

Originally posted by Zero
The issue isn't so much about the economy as it is about individual people.

Which is why lower unemployment/more jobs is a big deal.

[American]

Again!


We're in the money, we're in the money;
We've got a lot of what it takes to get along!
We're in the money, that sky is sunny,
Old Man Depression you are through, you done us wrong.
We never see a headline about breadlines today.
And when we see the landlord we can look that guy right in the eye
We're in the money, come on, my honey,
Let's lend it, spend it, send it rolling along!

Oh, yes we're in the money, you bet we're in the money,
We've got a lot of what it takes to get along!
Let's go we're in the money, Look up the skies are sunny,
Old Man Depression you are through, you done us wrong.
We never see a headline about breadlines today.
And when we see the landlord we can look that guy right in the eye
We're in the money, come on, my honey,
Let's lend it, spend it, send it rolling along!

[Zero]

Originally posted by BTox


Which is why lower unemployment/more jobs is a big deal. Not if the enemployment rate is partially a function on more people giving up on finding jobs, and if the new jobs are paying significantly less than the old jobs.

[clk]

Originally posted by BTox


The fact is, when the economy is doing well, voters give credit to the current administration and stick with the status quo.

You may be right on that. However, when Bush Sr. was in office, wasn't he faced with a similar situation? The economy was turning around just as the election season was nearing, but he was voted out anyways.

[shanek]

Originally posted by clk
Really? How?

Because the voters pretty much always credit the President with a booming or recovering economy and blame the President if the economy goes south. There is absolutely no reason for this, mind you, as the President can do very little if anything about the business cycle, but the effect is still there.

[TillEulenspiegel]

I take a different tack................

If the economy is recovering, it is doing so to rectify the nosedive George II put it in. When he was appointed president there was a balanced buget and a surplus and thru huge tax cuts and increased spending on the war snacthed defeat from the jaws of victory.. Kinda like saying " Ya he robbed the bank , but he started a savings account. The fact is also that we will hit a half trillion debt in the next few years. Makes me wanna party like it's 1999...........

edit Sp

[BTox]

Originally posted by clk


You may be right on that. However, when Bush Sr. was in office, wasn't he faced with a similar situation? The economy was turning around just as the election season was nearing, but he was voted out anyways.

Bush I's re-election came up only 1.5 years after the recession was officially over, but lingering effects such as personal income and employment were still bottoming out less than a year before 11/92. Bush II's re-election will be 3 years after the recession was officially over.

[BTox]

Originally posted by TillEulenspiegel
I take a different tack................

If the economy is recovering, it is doing so to rectify the nosedive George II put it in.

Explain how George II put the economy in a nosedive that started 3rdQ 2000?? That's some trick...

[jj]

Originally posted by BTox
I've been posting similar items for 2 months. The recovering economy will be the downfall of any dem contender to the whitehouse this fall.

While I realize that it is essential for your attack on basic civil liberties that the present president stay in office, I think you're being a bit optimistic in suggesting that the economy is getting better.

Let's look at overall per-capita income, shall we?

Let's look at the investment in basic research, shall we?

We're still gobbling up our seed corn as fast as we can chow down. I hope you're ready for the "success" that this anti-science president brings, with us being reduced to a second-class "former power" because we haven't anything new and are vulnerable to all sorts of new weapons that we didn't invent because we didn't do any research.

[shanek]

Originally posted by jj
While I realize that it is essential for your attack on basic civil liberties that the present president stay in office, I think you're being a bit optimistic in suggesting that the economy is getting better.

Let's look at overall per-capita income, shall we?

Let's look at the investment in basic research, shall we?

Those are indicators that just simply take longer. First, you have an increase in consumer spending; that started months ago. Then, you have job creation; that's just beginning. Later on, you have more savings, more investments, greater donations, increase in income, etc. Those things don't come until later. Give it time.

I think this is the start of a recovery...a long, long overdue recovery.

[BTox]

Originally posted by jj
While I realize that it is essential for your attack on basic civil liberties that the present president stay in office, I think you're being a bit optimistic in suggesting that the economy is getting better.

My attack on civil liberties? I guess you mean my indifference to moving protesters out of camera view. How horrible!

Originally posted by jj
I hope you're ready for the "success" that this anti-science president brings, with us being reduced to a second-class "former power" because we haven't anything new and are vulnerable to all sorts of new weapons that we didn't invent because we didn't do any research.

You're the second person here to make this "anti-science" and "not doing any research" claim. I posted in the other thread government spending increases over the last few years in health sciences, agricultural sciences, national science foundation, national institutes of health, FDA, CDC, etc. For an "anti-science" President, he sure is throwing alot of money into it. But hey, don't let facts get in the way of your story...

[Girl 6]

There is no economy booming, as far as I can tell.

The jobs that are supposedly being created are on the low-end service side. In other words, I doubt that anyone taking those jobs can support themselves without a second job.

G6

[Random]

The two statistics in question (the 110K+ new jobs and the slight dip in unemployment) are not quite the wonderful indicators that the GOP would like us to believe.
First, the population of the US is constantly growing. As more and more people graduate from high school and college faster than older workers retire and/or die, the size of the potential labor pool increases. In order to keep up with the expanding potential labor pool, you currently need to add about 150k jobs a month. 110k jobs is better than we have seen in a while, but it really just means that things are getting worse at a slower pace than they were a few months ago. Wake me when the number of new jobs created in a month hits 180k+. That’s when we can start talking about job recovery.
Second, the lowering of the unemployment rate last month is a sign of a more disturbing trend. Simply put, 300k people gave up looking for work last month. They are still part of the potential labor pool, and will still have to find jobs when the economy improves, but for right now, they are not counted in the Federal Unemployment statistics. It’s really just a statistical illusion that makes the situation look slightly better right now. The flip side of it is that when the economy picks up, those people will re-enter the labor pool and actually work to keep the official unemployment rate high.
Third, all of this only talks about the number of jobs, not the quality of them. If we get lose one thousand $15 an hour manufacturing jobs and replace them with two thousand $7 an hour jobs, is that a good thing?

[shanek]

Originally posted by Girl 6
There is no economy booming, as far as I can tell.

The jobs that are supposedly being created are on the low-end service side. In other words, I doubt that anyone taking those jobs can support themselves without a second job.

Again, give it time. The low-end jobs are naturally the ones to be added to the market first. The higher paying jobs will follow as the economy continues to build back to the level of total output.

No, it's not booming yet, but it does seem to be recovering nicely.

[shanek]

Originally posted by Random
The two statistics in question (the 110K+ new jobs and the slight dip in unemployment) are not quite the wonderful indicators that the GOP would like us to believe.
First, the population of the US is constantly growing. As more and more people graduate from high school and college faster than older workers retire and/or die, the size of the potential labor pool increases. (etc. etc. etc.)

That's why unemployment is expressed as a percentage. 100% represents all those who do not have a job but are actually seeking one. So everything you've mentioned gets figured in.

Second, the lowering of the unemployment rate last month is a sign of a more disturbing trend. Simply put, 300k people gave up looking for work last month. They are still part of the potential labor pool, and will still have to find jobs when the economy improves, but for right now, they are not counted in the Federal Unemployment statistics. It’s really just a statistical illusion that makes the situation look slightly better right now. The flip side of it is that when the economy picks up, those people will re-enter the labor pool and actually work to keep the official unemployment rate high.

This is a good point, and is a good indication of why we can't use unemployment statistics as a sole indicator. You have to look at it in context of what else is going on, and in that context, it does indeed look like things are beginning to recover.

Third, all of this only talks about the number of jobs, not the quality of them. If we get lose one thousand $15 an hour manufacturing jobs and replace them with two thousand $7 an hour jobs, is that a good thing?

See my above point to Girl 6.

[Solitaire]

Originally posted by shanek
I think this is the start of a recovery... a long, long overdue recovery.

No... It seems way too early.
The business cycle which takes from thrity to fourty years and requires
at least eight to twelve years to rebound. More likely this is the result of
election year spending. When he's in his second term, they'll probably
cut back and employment will drop again.

[shanek]

Originally posted by Synchronicity
No... It seems way too early.
The business cycle which takes from thrity to fourty years and requires
at least eight to twelve years to rebound.

??? Where are you getting this from? The business cycle is more like ten years and in the past has only required a year or two to rebound. Look at the recession around 1990 that led to the 1990s boom, and there are a lot of similarities between what we're experiencing now and that recovery.

8 to 12 years to rebound?! Poppycock! In fact, this 4-year recession is almost unprecedented, save for the Great Depression.

More likely this is the result of
election year spending.

You're fooling yourself if you think government spending has anything at all to do with economic recovery.

Maybe you should go read the Macroeconomics thread?

[Zero]

Originally posted by Random
The two statistics in question (the 110K+ new jobs and the slight dip in unemployment) are not quite the wonderful indicators that the GOP would like us to believe.
First, the population of the US is constantly growing. As more and more people graduate from high school and college faster than older workers retire and/or die, the size of the potential labor pool increases. In order to keep up with the expanding potential labor pool, you currently need to add about 150k jobs a month. 110k jobs is better than we have seen in a while, but it really just means that things are getting worse at a slower pace than they were a few months ago. Wake me when the number of new jobs created in a month hits 180k+. That’s when we can start talking about job recovery.
Second, the lowering of the unemployment rate last month is a sign of a more disturbing trend. Simply put, 300k people gave up looking for work last month. They are still part of the potential labor pool, and will still have to find jobs when the economy improves, but for right now, they are not counted in the Federal Unemployment statistics. It’s really just a statistical illusion that makes the situation look slightly better right now. The flip side of it is that when the economy picks up, those people will re-enter the labor pool and actually work to keep the official unemployment rate high.
Third, all of this only talks about the number of jobs, not the quality of them. If we get lose one thousand $15 an hour manufacturing jobs and replace them with two thousand $7 an hour jobs, is that a good thing? Shhhhh!! Don't tell the truth, you'll scare the "conservatives"!!

[Iacchus]

Originally posted by Zero
Shhhhh!! Don't tell the truth, you'll scare the "conservatives"!! Hey Zero, you've gotta check this out! ... http://www.randi.org/vbulletin/showthread.php?s=&postid=1870304558#post1870304558

[shanek]

I somehow missed this before:

Originally posted by Random
Simply put, 300k people gave up looking for work last month.

It is incorrect to say they "gave up" looking for work. All we know is that they stopped looking for work. There could be any number of reasons for that.

For example: I "gave up" looking for work last year when I and my partners started the business. We aren't employees, so technically we're not employed; but neither are we unemployed because we're not seeking work anywhere else. Your wording makes it sound like these people are suffering in dispair with no way to make the bills, and that isn't necessarily the case.

[Chaos]

Originally posted by shanek
I somehow missed this before:



It is incorrect to say they "gave up" looking for work. All we know is that they stopped looking for work. There could be any number of reasons for that.

For example: I "gave up" looking for work last year when I and my partners started the business. We aren't employees, so technically we're not employed; but neither are we unemployed because we're not seeking work anywhere else. Your wording makes it sound like these people are suffering in dispair with no way to make the bills, and that isn't necessarily the case.

Take me for example. I have now been unemployed for...(how late is it?)...13 months, 11 days. I´ve been looking for a job since then - without success.
My unemployment compensation expired shortly after X-Mas, and I will go to University starting in April (if they accept me), so I will no longer be unemployed.
Both will count as an improvement of unemployment statistics, (one less to pay for, one less lookinf for work) but neither actually means I found a job or started creating a single Cent of GDP. And neither indicates any economic recovery.

[shanek]

Originally posted by Chaos
And neither indicates any economic recovery.

On its own, no. That's why you have to look at all the indicators. We've seen two consecutive quarters of very strong GDP growth. We're seeing new jobs created. Everything is happening just as economics says it does when there's a recovery underway.

[Zero]

Originally posted by shanek


On its own, no. That's why you have to look at all the indicators. We've seen two consecutive quarters of very strong GDP growth. We're seeing new jobs created. Everything is happening just as economics says it does when there's a recovery underway. Yeah, only much much slower.

[Jim Lennox]

Forgive my ignorance for I know little about such matters, but if the US economy is 'booming', how come my one pound sterling will buy 1.8 dollars?

[Rouser2]

Originally posted by American [/i]

>>Unemployment Rate Falls to 5.6%, companies add 112,000 new jobs

>>It's time to play my favorite song:

>>"We're in the money, we're in the money;
We've got a lot of what it takes to get along!
We're in the money, that sky is sunny,
Old Man Depression you are through, you done us wrong. "

>>"We never see a headline about breadlines today.
And when we see the landlord we can look that guy right in the eye
We're in the money, come on, my honey,
Let's lend it, spend it, send it rolling along!"

Perhaps the history of this song may sober you up a bit -- written in 1933 for the movie "Gold Diggers," there followed 10 more years of ever deepening depression. Written by Harry Warren and Hal Dubin, the last line "Let's lend it, spend it, send it rolling along" could have been written by J. Maynard Kaynes, or for that matter FDR. That's just what he and his predesessor did, and those spend-thrift programs only produced the deepest, severest, longest lasting depression in Am. history. Sorry to rain on your parade. But I would suggest that it perhaps is time to batten the hatches; we're in for it.

-- Rouser

[shanek]

Originally posted by Jim Lennox
Forgive my ignorance for I know little about such matters, but if the US economy is 'booming', how come my one pound sterling will buy 1.8 dollars?

The exchange rate has little to do with economic factors internally in an economy, with certain exceptions. Check the Macroeconomics thread for more information.

[shanek]

Originally posted by Rouser2
Perhaps the history of this song may sober you up a bit -- written in 1933 for the movie "Gold Diggers," there followed 10 more years of ever deepening depression. Written by Harry Warren and Hal Dubin, the last line "Let's lend it, spend it, send it rolling along" could have been written by J. Maynard Kaynes, or for that matter FDR. That's just what he and his predesessor did, and those spend-thrift programs only produced the deepest, severest, longest lasting depression in Am. history.

Because the money wasn't there. The Federal Reserve refused to grow the money supply and didn't provide liquidity for the banks' assets like they were supposed to. It wasn't until World War II, when Federal spending for the war effort finally encouraged the Fed to expand the money supply, that we were able to grow out of the economy (because expanding the money for the Federal government to use also expands it for everyone else to use).

Again, I must urge people to read the Macroeconomics thread.

http://www.randi.org/vbulletin/showthread.php?s=&threadid=28574

Sorry to rain on your parade. But I would suggest that it perhaps is time to batten the hatches; we're in for it.

There's no reason at all to believe that.

[Jim Lennox]

Cheers Shane, I will crack on with the macroeconomics thread.

I find the subject incredibly tedious but it is something I feel I should learn about.

I may have to ask you some questions over there once I get round to finishing the thread. (We can't all be as smart as Corpy)...

[The Central Scrutinizer]

Originally posted by shanek
For example: I "gave up" looking for work last year when I and my partners started the business. We aren't employees, so technically we're not employed;

You're not employees of your own business? So your just an investor?

[RussDill]

The job market has definately changed significantly in the past year. A year ago, it took me more than 3 months to find a job, and when I did find one, it was on pure luck. Just now, I found a just in just under a month with no problem (computer engineering field)

[American]

Don't make me sing the song again.

[Rouser2]

Originally posted by shanek [/i]


>>Because the money wasn't there. The Federal Reserve refused to grow the money supply and didn't provide liquidity for the banks' assets like they were supposed to.


That simply is not true. The Fed in fact made the mistake of trying to reflate the supply of money, when it should have deflated. The attempted reflation only exacerbated the situation.

In reviewing Murray Rothbard's landmark book "America's Great Depression, Frank Shostack points out that...


"...when credit is created out of "thin air" and returned on the maturity day to the bank this amounts to a withdrawal of money from the economy, i.e, to a decline in the money stock. The reason for this is because there wasn't any original saver/lender, since this credit was created out of "thin air."


This vewi is in sharp conatrast to the Milton Freidman monetarist view of those events, but one that seems far more logical. The boom of the 20s was caused by easy credit policies of the Fed which was the receipe for the eventual bust. Instead of trying to prop up the system with more easy credit simply created from out of thin air and continuting to prop up the malinvestments created by the previous boom, the Fed should have deflated further, allowing these malinvestments to liquidate quickly, and thus restore real assets to valid investment. The result of these mis-guided inflationary and then reflationary policies of the Fed along with profligate fiscal activities of the Hoover and Roosevelt administrations all contributed to the longest and deepest depression in American history.

http://www.gold-eagle.com/gold_digest_03/shostak041903pv.html

-- Rouser

[shanek]

Originally posted by The Central Scrutinizer
You're not employees of your own business? So your just an investor?

Well, investors who put in work and don't get paid for it; we just disburse the profits. If we were to be employees, then we'd have to pay ourselves a salary and open up all kinds of tax and liability issues.

[hammegk]

Just a silly question; anyone know when the last PhD on causes of The Depression was granted? Anytime recently perhaps?

[shanek]

Originally posted by Rouser2
That simply is not true.

Yes, it is. Read hte Macroeconomics thread.

The Fed in fact made the mistake of trying to reflate the supply of money, when it should have deflated. The attempted reflation only exacerbated the situation.

Long-discredited Keynesial shash.

"...when credit is created out of "thin air" and returned on the maturity day to the bank this amounts to a withdrawal of money from the economy, i.e, to a decline in the money stock.

Complete bull$#!7. The money is created, and is there. It is an increase in the money supply, and if the money is not properly invested, can lead to inflation. That just couldn't happen if it were a decrease in the money supply.

The reason for this is because there wasn't any original saver/lender, since this credit was created out of "thin air."

Again, complete bull$#!7, and for evidence you only need lok at how the fractional reserve system is set up. There IS an original saver that the money comes from; the bank, since it only has to keep a small portion in reserves, loans the rest out.

When it does, the person it loans the money out to becomes a depositor, and the money he deposits, as far as his bank is concerned, is new reserves. A portion of that money is kept and the rest lent out, and so forth, until it peters out.

It's all in the Macroeconomics thread.

This vewi is in sharp conatrast to the Milton Freidman monetarist view of those events, but one that seems far more logical.

Not even remotely. Besides, maybe you'd care to explain why it was von Mises who successfully predicted the Great Depression years before it occured when the Keynesians were struck completely by surprise?

The boom of the 20s was caused by easy credit policies of the Fed which was the receipe for the eventual bust.

No, it wasn't. It was caused because the Fed didn't step in and provide liquidity like they were supposed to, and fearing inflation contracted the money supply when it wasn't called for, to an extreme amount.

The result of these mis-guided inflationary and then reflationary

If it's inflationary or reflationary, then the money supply expanded, not contracted. You're contradicting yourself.

[The Central Scrutinizer]

Remember, Rouser2 believes that the Federal Reserve is in cahoots with the Illuminati and the Trilateral Commission. And the Jews, of course.

So don't even waste your time "debating" him.

[The Central Scrutinizer]

Originally posted by shanek


Well, investors who put in work and don't get paid for it; we just disburse the profits. If we were to be employees, then we'd have to pay ourselves a salary and open up all kinds of tax and liability issues.

But if you only take dividends, aren't you getting taxed twice? Once at the coporate rate (since dividends can't be expensed), and once at your personal rate?

Of course W's wonderful tax cut (and I'm not being smug - it really was wonderful) changed the taxation of dividends to a person, so depending on your tax bracket, I guess you could be better off paying the double tax.

[Bjorn]

Originally posted by shanek


Well, investors who put in work and don't get paid for it; we just disburse the profits. If we were to be employees, then we'd have to pay ourselves a salary and open up all kinds of tax and liability issues. How are you 'not getting paid' if you disburse the profits? :confused:

[jj]

Originally posted by shanek


Those are indicators that just simply take longer. First, you have an increase in consumer spending; that started months ago. Then, you have job creation; that's just beginning. Later on, you have more savings, more investments, greater donations, increase in income, etc. Those things don't come until later. Give it time.

I think this is the start of a recovery...a long, long overdue recovery.

I think it's more likely the start of a period of inflation thanks to fuel prices, but it would be nice if you were right.

[subgenius]

Originally posted by Zero
Not if the enemployment rate is partially a function on more people giving up on finding jobs, and if the new jobs are paying significantly less than the old jobs.
Bingo.
I'm not going to read this entire thread, the premise is so thin. One in four of the good jobs lost was here in Michigan.
But then we didn't vote for the fool last time. Not even Oakland County, the richest, most Republican county in the state was stupid enough to do that last time.
McJobs.

[Rouser2]

Originally posted by shanek [/i]

>>quote:
--------------------------------------------------------------------------------
The Fed in fact made the mistake of trying to reflate the supply of money, when it should have deflated. The attempted reflation only exacerbated the situation.
--------------------------------------------------------------------------------

>>Long-discredited Keynesial shash.

Keynesian? No, not Keynesian. Austrian. But fact, not "shash" nor trash.


quote:
--------------------------------------------------------------------------------
"...when credit is created out of "thin air" and returned on the maturity day to the bank this amounts to a withdrawal of money from the economy, i.e, to a decline in the money stock.
--------------------------------------------------------------------------------

>>Complete bull$#!7. The money is created, and is there. It is an increase in the money supply, and if the money is not properly invested, can lead to inflation. That just couldn't happen if it were a decrease in the money supply.


Counterfeit money does not increase the real supply of money in terms of value, but only subtracts from the value of real money.



quote:
--------------------------------------------------------------------------------
The reason for this is because there wasn't any original saver/lender, since this credit was created out of "thin air."
--------------------------------------------------------------------------------


>>Again, complete bull$#!7, and for evidence you only need lok at how the fractional reserve system is set up. There IS an original saver that the money comes from; the bank, since it only has to keep a small portion in reserves, loans the rest out.


The bank is only a holder, not an original saver. Bank credit created from out of thin air only serves to lift the real wealth consumption at the expense of real wealth production. The imbalance causes depressions:

"Whenever the extensive creation of credit out of "thin air" lifts the pace of real-wealth consumption above the pace of real-wealth production the flow of real savings is arrested and a decline in the pool of real funding is set in motion. Consequently, the performance of various activities starts to deteriorate and banks' bad loans start to rise. In response to this, banks curtail their lending activities and this in turn sets in motion a decline in the money stock.
The fall in the money stock begins to further undermine various nonproductive activities, i.e. an economic depression emerges."

http://www.gold-eagle.com/gold_digest_03/shostak041903pv.html

quote:
--------------------------------------------------------------------------------
This vewi is in sharp conatrast to the Milton Freidman monetarist view of those events, but one that seems far more logical.
--------------------------------------------------------------------------------

>>Not even remotely. Besides, maybe you'd care to explain why it was von Mises who successfully predicted the Great Depression years before it occured when the Keynesians were struck completely by surprise?

Maybe you'd care to explain why you, an alleged Libertarian, apparently don't know a Keynsian from an Austrian (Von Mises and Rothbard) from a Monetarist (Friedman).

quote:
--------------------------------------------------------------------------------
The boom of the 20s was caused by easy credit policies of the Fed which was the receipe for the eventual bust.
--------------------------------------------------------------------------------

>>No, it wasn't. It was caused because the Fed didn't step in and provide liquidity like they were supposed to, and fearing inflation contracted the money supply when it wasn't called for, to an extreme amount.


Murray Rothbard shows that the Fed did indeed provide liquidity.

...a close examination of the historical data shows that contrary to Friedman the Fed was extremely loose and pumped reserves into the system in its attempt to revive the economy (on this see Murray Rothbard's America's Great Depression). The extent of monetary injections is depicted by changes in the Fed's holdings of U.S. government securities. Thus on January 1930 these holdings stood at $485 million. By December 1933 they had jumped to $2,432 million—an increase of 401% (see chart). Moreover, the average yearly rate of monetary injections by the Fed during this period stood at 98%." (See chart below)

http://www.gold-eagle.com/gold_digest_03/shostak041903pv.html

>>If it's inflationary or reflationary, then the money supply expanded, not contracted. You're contradicting yourself

You still don't get it. The reflationary efforts in fact led to further deflation.

-- Rouser

[shanek]

Originally posted by The Central Scrutinizer
But if you only take dividends, aren't you getting taxed twice? Once at the coporate rate (since dividends can't be expensed), and once at your personal rate?

No; we only pay personal taxes on the money we disburse. We only pay corporate taxes on any profits not disbursed at the end of the year.

[shanek]

Originally posted by Bjorn
How are you 'not getting paid' if you disburse the profits? :confused:

Because the profits aren't the same thing as a regular paycheck. If you don't make regular payments, or payments based on the amount of time worked, it isn't considered wages to an employee by the IRS.

[shanek]

Originally posted by jj
I think it's more likely the start of a period of inflation thanks to fuel prices,

Fuel prices in and of themselves cannot spurn inflation. They're only a small part of the CPI. True, they have reverberations through the economy that many other prices don't, but inflation isn't one of them.

[shanek]

Originally posted by Rouser2
Keynesian? No, not Keynesian. Austrian.

No, not Austrian. Friedman, the one you admitted was contrary to your notion, was a big part of the Austrian movement. Do you know ANYTHING about economics?

Everythin you posted is straight out of the Keynesian Big Book of Bull$#!7.

Counterfeit money does not increase the real supply of money in terms of value, but only subtracts from the value of real money.

Again, bull$#!7. By tying the creation of money to new investment, our fractional reserve system helps ensure that when money is created it is met by a corresponding increase in goods and/or services in the economy, and when that happens, you DON'T get inflation. You only get inflation with an increase in the money supply that is NOT met by a corresponding increase in the total amount of goods and services in the economy.

The bank is only a holder, not an original saver.

The money the bank gets is from savers.

Bank credit created from out of thin air only serves to lift the real wealth consumption at the expense of real wealth production.

Again, look at the way the fractional reserve system works. You are completely, 100% WRONG. Banks only issue credit when they fully expect a return on investment. And that is only going to happen when the investment is productive in the economy.

Maybe you'd care to explain why you, an alleged Libertarian, apparently don't know a Keynsian from an Austrian (Von Mises and Rothbard) from a Monetarist (Friedman).

An "alleged Libertarian"....That's rich! And the Monetarist movement comes from the classical theories of economics as started by Adam Smith. Many if not most of the Austrians are Monetarists.

Thank you for proving what Scrut claimed: It's a waste of time debating with you, because you don't know what you're talking about, and apparently don't want to learn. If you did, you'd go read the Macroeconomics thread and then you wouldn't be in here spewing out this garbage.

Murray Rothbard shows that the Fed did indeed provide liquidity.

No, he didn't. Rothbard is being misquoted by a man with an agenda. Rothbard supported Friedman's evaluation of the Great Depression. I've actually read Rothbard's book. Have you?

[The Central Scrutinizer]

Originally posted by shanek


No; we only pay personal taxes on the money we disburse. We only pay corporate taxes on any profits not disbursed at the end of the year.

But you still have to pay corporate taxes on those disbursements because they are income. And they can't be expensed like salaries can.

[shanek]

Originally posted by The Central Scrutinizer
But you still have to pay corporate taxes on those disbursements because they are income.

Not under the terms we incorporated under.

[Rouser2]

Originally posted by shanek [/i]

>>Re: Re: Re: Re: Re: Re: The economy booms!

quote:
--------------------------------------------------------------------------------
Originally posted by Rouser2
Keynesian? No, not Keynesian. Austrian.
--------------------------------------------------------------------------------

>>No, not Austrian. Friedman, the one you admitted was contrary to your notion, was a big part of the Austrian movement. Do you know ANYTHING about economics?

Sure fooled me. Can you expand on that one? Just what "big part" did Friednman play in the "Austrian Movement"??? Sure can't find him listed anywhere under "Austrian". Please enlighten me.

>>Everythin you posted is straight out of the Keynesian Big Book of Bull$#!7.

Well, let's not deal with "eveything". Just one example will do. Could you kindly provide just one???? I'm eager to be re-educated.

quote:
--------------------------------------------------------------------------------
Counterfeit money does not increase the real supply of money in terms of value, but only subtracts from the value of real money.
--------------------------------------------------------------------------------

>>Again, bull$#!7. By tying the creation of money to new investment, our fractional reserve system helps ensure that when money is created it is met by a corresponding increase in goods and/or services in the economy, and when that happens, you DON'T get inflation. You only get inflation with an increase in the money supply that is NOT met by a corresponding increase in the total amount of goods and services in the economy.

Now that is indeed Keynesian -- as is much of the claptrap in your so-called macro-economics thread.


quote:

--------------------------------------------------------------------------------
Bank credit created from out of thin air only serves to lift the real wealth consumption at the expense of real wealth production.
--------------------------------------------------------------------------------


>>Again, look at the way the fractional reserve system works. You are completely, 100% WRONG. Banks only issue credit when they fully expect a return on investment. And that is only going to happen when the investment is productive in the economy.

In the 1920's banks extended easy credit that was not productive to the economy. And that was the cause of the "boom" that led to "bust".


quote:
--------------------------------------------------------------------------------
Maybe you'd care to explain why you, an alleged Libertarian, apparently don't know a Keynsian from an Austrian (Von Mises and Rothbard) from a Monetarist (Friedman).
--------------------------------------------------------------------------------

>>An "alleged Libertarian"....That's rich! And the Monetarist movement comes from the classical theories of economics as started by Adam Smith. Many if not most of the Austrians are Monetarists.

Von Mises, Rothbard, Hayek, Monetarists????


>>Thank you for proving what Scrut claimed: It's a waste of time debating with you, because you don't know what you're talking about, and apparently don't want to learn. If you did, you'd go read the Macroeconomics thread and then you wouldn't be in here spewing out this garbage.


I read your copied stuff. And some of it is correct; a lot of it is garbage.


quote:
--------------------------------------------------------------------------------
Murray Rothbard shows that the Fed did indeed provide liquidity.
--------------------------------------------------------------------------------

>>No, he didn't. Rothbard is being misquoted by a man with an agenda.

Misquoted??? Exactly where and how? Agenda??? And just what agenda would that be????

>> Rothbard supported Friedman's evaluation of the Great Depression.

Rothbard totally disagreed with Friedman's view of the cause of the Great Depression.


>>I've actually read Rothbard's book. Have you?

Oh, indeed I have. But when you say you have read it, those are empty words in view of your complete ignorance of his analysis.


-- Rouser

[shanek]

Rouser2, you have nothing more than misinformation with no support whatsoever. And your only recourse to rebuttal is to call the source names. You are indeed a waste of time. Good-bye.

[The Central Scrutinizer]

Originally posted by shanek


Not under the terms we incorporated under.

OK, I'll leave it at that. Besides, it's none of my business, and it's not the topic of this thread. BTW, what is the topic of this thread? :D

[The Central Scrutinizer]

Originally posted by shanek
Rouser2, you have nothing more than misinformation with no support whatsoever. And your only recourse to rebuttal is to call the source names. You are indeed a waste of time. Good-bye.

If you'll recall, I posted this earlier:

Remember, Rouser2 believes that the Federal Reserve is in cahoots with the Illuminati and the Trilateral Commission. And the Jews, of course.

I don't want to say I told you so, but.......

[The Central Scrutinizer]

I TOLD YOU SO!!!

:p :D

[Solitaire]

Originally posted by shanek
Where are you getting this from?

I'm tempted to do the ninety minute drive to Boon, NC with
my set Raveendra N. Batra books, but it's Winter, icy, and
dangerous to drive on the moutain roads this time of year.

The business cycle is more like ten years and in the past has only
required a year or two to rebound. Look at the recession around
1990 that led to the 1990s boom, and there are a lot of similarities
between what we're experiencing now and that recovery.

Those would be referred to as the small business cycles.
Then there's the midsized ones that occure on thrity year
periods such as the 1930's, 1970's, and the 2000's.

8 to 12 years to rebound?! Poppycock!
In fact, this 4-year recession is almost unprecedented,
save for the Great Depression.

My sources are vairied.
The Elizabeth Warren Info (http://www.pbs.org/now/politics/middleclassmyths.html) and the Rubin interview in this months
Money magazine lead me to believe that the removal of the middle class
might take longer than expected - and thusly, the recovery will take longer.

You're fooling yourself if you think government spending
has anything at all to do with economic recovery.

Perhaps recovery is the wrong word.
The economic boost will dry up after the election.

Maybe you should go read the Macroeconomics thread?

I did a while ago. Quite enjoyed it. Might read it again some day. :)

[Rouser2]

Originally posted by shanek [/i]

>>Rouser2, you have nothing more than misinformation with no support whatsoever.


Oh, but all I have done is to correct your own misinformation, and with plenty of sources. You, on the other hand, cannot provide a single source for any of your made up assertions (Friedman, an Austrian???, that's a good one!)." And I thought libertarians were supposed to be smart.


-- Rouser

[shanek]

Originally posted by Synchronicity
Those would be referred to as the small business cycles.
Then there's the midsized ones that occure on thrity year
periods such as the 1930's, 1970's, and the 2000's.

Those do not have a cyclical cause. The 1930s was due to bad monetary policy. The 1970s was due to the supply shocks caused by those countries exporting oil to the US. And the 2000s are very similar to the recession ten years before, exacerbated by 9/11 and the Iraq war, which are not cyclical phenomena.

You're making as much sense as those who said that every President elected on a year ending in 0 dies in office.

The Elizabeth Warren Info [/URL] and the Rubin interview in this months
Money magazine lead me to believe that the removal of the middle class
might take longer than expected - and thusly, the recovery will take longer.

"Removal of the middle class"? What is this crap?

[Rouser2]

Originally posted by shanek [/i]

>>The 1970s was due to the supply shocks caused by those countries exporting oil to the US.


Comment: The 1970s deep recession was not caused by oil supply shocks. The curtailed oil supplies were a natural reaction. to the US government inflation; specifically the de-monetization of the dollar when the final connection to gold was ended when Pres. Nixon closed the gold window in 1971.


-- Rouser

[Attrayant]

With all this dancing and singing about money, there ought to be a big broadway marquee overhead. How about this one:

http://fff.fathom.org/pages/attrayant/debt.jpg

Nobody should be singing that song while their bank account is seven trillion in the red.

[shanek]

Originally posted by Rouser2
Comment: The 1970s deep recession was not caused by oil supply shocks. The curtailed oil supplies were a natural reaction. to the US government inflation; specifically the de-monetization of the dollar when the final connection to gold was ended when Pres. Nixon closed the gold window in 1971.

Those policies came about AFTER the first supply shock...in fact, they were a reaction to it. Try again.

[Solitaire]

Originally posted by shanek
Those do not have a cyclical cause. The 1930s was due to bad monetary
policy. The 1970s was due to the supply shocks caused by those countries
exporting oil to the US. And the 2000s are very similar to the recession ten
years before, exacerbated by 9/11 and the Iraq war, which are not cyclical
phenomena. You're making as much sense as those who said that every
President elected on a year ending in 0 dies in office.

You just have to read "Surviving the Great Depression of 1990" to see
the wonderfull graph showing the thirty to fourty year cycle he found.
Okay, he might have been off by a few years, but nobody is perfect.

"Removal of the middle class"? What is this crap?

I found the transcript. Two Income Transcript (http://www.pbs.org/now/transcript/transcript306_full.html) :)

The corporations have decided to maximize profits though a policy of
destroying the middle class by off shoring manufacturing jobs and by
legitimizing the use of illegal immigrants, I think. But of course, nothing
is ever truly certain.

[WildCat]

Originally posted by subgenius

Bingo.
I'm not going to read this entire thread, the premise is so thin. One in four of the good jobs lost was here in Michigan.
But then we didn't vote for the fool last time. Not even Oakland County, the richest, most Republican county in the state was stupid enough to do that last time.
McJobs.
OK, Sub. I'll bite:
1. Why do you think Michigan is losing so many jobs?
2. What do you think Al Gore would have done to reverse the trend?

[Jet Grind]

Friedman was an Austrian? I thought he was a Chicagoite?

[The Central Scrutinizer]

Originally posted by Attrayant
With all this dancing and singing about money, there ought to be a big broadway marquee overhead. How about this one:

http://fff.fathom.org/pages/attrayant/debt.jpg

Nobody should be singing that song while their bank account is seven trillion in the red.

Well, the good news is, I've been staring at your debt clock for over an hour now, and I can report that the amount has not increased! So W has at least stopped the bleeding!

[shanek]

Originally posted by Synchronicity

You just have to read "Surviving the Great Depression of 1990" to see
the wonderfull graph showing the thirty to fourty year cycle he found.
Okay, he might have been off by a few years, but nobody is perfect.

Correlation ≠ causation. You can't just show a graph; you have to show the reasons for the effect. As I have shown, the reasons for these "depressions" don't have anything to do with any cyclical phenomena.

The corporations have decided to maximize profits though a policy of
destroying the middle class by off shoring manufacturing jobs and by
legitimizing the use of illegal immigrants, I think. But of course, nothing
is ever truly certain.

Sounds like a conspiracy theory to me...

[shanek]

Originally posted by Jet Grind
Friedman was an Austrian? I thought he was a Chicagoite?

No, Austrian as in the Austrian school of economic thought.

[Rouser2]

Originally posted by Jet Grind
Friedman was an Austrian? I thought he was a Chicagoite?


Milton Friedman has never been considered to be of the Austrian "school" of economic theory but rather a Monetarist, sometimes also referred to as the "Chicago" school, owning to Friedman's tenure at the U of C. Contrary to Shanack's babblings, Monetarists, like the Keynasians extol the "quantity" of money theory; Austrians emphasize the "quality" of money as the central key to economic stability and progress.

-- Rouser

[Rouser2]

Originally posted by Synchronicity [/i]


>>"The corporations have decided to maximize profits though a policy of
destroying the middle class by off shoring manufacturing jobs and by
legitimizing the use of illegal immigrants, I think. But of course, nothing
is ever truly certain."


Corporations do not make it their business to destroy the very people whom they serve. When corporations serve their own interests and the interests of their customers, they simply make rational decisions to the end of making as much money as possible -- a very good and virtuous goal for all. American business has always had the option to transfer jobs and operations to foreign entities, but it has never made a lot of sense. But what motivates corporations to do so today is excessive taxation and regulation, minimum wage laws, health care costs, environmental restrictions, etc., etc., etc. To say that corporations "decided to maximize profits" by "destroying the middle class" is ludicroius and betrays an anti-business, pro government regulation bias -- policies that hurt the very people they are supposed to help.

-- Rouser

[Rouser2]

Originally posted by shanek [/i]

>>
quote:
--------------------------------------------------------------------------------
Originally posted by Rouser2
Comment: The 1970s deep recession was not caused by oil supply shocks. The curtailed oil supplies were a natural reaction. to the US government inflation; specifically the de-monetization of the dollar when the final connection to gold was ended when Pres. Nixon closed the gold window in 1971.
--------------------------------------------------------------------------------

>>Those policies came about AFTER the first supply shock...in fact, they were a reaction to it. Try again.


Boy, oh boy, I sure don't know where Shanek gets his junk. The first oil shock came in 1973 and was a direct result of the closing of the Gold Window by Pres. Nixon. As the Wall Street Journal editor Robert Bartley explained in a speech before the Heritage Foundation...

"The conventional wisdom, of course, is that 1973 was the year of the oil embargo, when the Organization of Oil Exporting Countries set the price of oil soaring. But OPEC’s actions were a direct result of the August 71 decision to close the gold window. How do we know this? Because OPEC told us so. Five weeks after the Nixon shock of August 15, it met in extraordinary session in Beirut and passed its Resolution XXV.140..."

http://www.heritage.org/Research/TradeandForeignAid/wm383.cfm


-- Rouser

[shanek]

Originally posted by Rouser2
Boy, oh boy, I sure don't know where Shanek gets his junk.

It's called "economics class." Try taking one sometime.

The first oil shock came in 1973

No, it wasn't. It was late 1970. The oil EMBARGO is NOT the same as the first supply shock. The embargo came about as a RESULT of the shock.

If you want a direct rebuttal of this from the man himself, just read Nixon's memoirs.

[Zero]

Originally posted by Rouser2
Originally posted by Synchronicity [/i]


>>"The corporations have decided to maximize profits though a policy of
destroying the middle class by off shoring manufacturing jobs and by
legitimizing the use of illegal immigrants, I think. But of course, nothing
is ever truly certain."


Corporations do not make it their business to destroy the very people whom they serve. When corporations serve their own interests and the interests of their customers, they simply make rational decisions to the end of making as much money as possible -- a very good and virtuous goal for all. American business has always had the option to transfer jobs and operations to foreign entities, but it has never made a lot of sense. But what motivates corporations to do so today is excessive taxation and regulation, minimum wage laws, health care costs, environmental restrictions, etc., etc., etc. To say that corporations "decided to maximize profits" by "destroying the middle class" is ludicroius and betrays an anti-business, pro government regulation bias -- policies that hurt the very people they are supposed to help.

-- Rouser Wow, that's a load of nonsense, isn't it?

[Solitaire]

Originally posted by shanek
Correlation ≠ causation. You can't just show a graph; you have
to show the reasons for the effect. As I have shown, the reasons
for these "depressions" don't have anything to do with any cyclical
phenomena.

Hm. I'm not sure. Maybe if I quote a bit of the text it'd be clear.

How can we prove this proposition? How can the doubts raised by the Keynesians and other skeptics be resolved? In support of his view, Friedman cites the postwar behavior of the American economy, where annual fluctuations in the growth of both money and gross national product have declined. Keynesians, however, have countered by arguing that, first, the money growth is hard to control, and second, the change in the GNP may be generating the change in the money supply and not vice versa, so that money need not hold the pivotal position in the economy.

There is only one way to demonstrate decisively that money, nothing else, is the source of all oscillations under capitalism. And that is to pose the most difficult test. Since every entity is cyclical, the dominant entity also has a cycle. But this cycle must be rhythmical. This is because the primary variables must have an exact and stable cycle of its own. How else could it regulate the cycles of others? How else could it be dominant?

Thus, the test that we have proposed is this. If money is the primary variable in society, its growth must follow a cyclical path of constant pattern or rhythm. Stated differently, unless the economy is in complete shambles, the cycle of money growth must hit either a peak or a trough every x number of years.

There can be no criterion tougher than this. Cycles of varying durations, mentioned in chapter one, have been discovered for many variables in the past, but none displays the exactness demanded by the test posed above. If any such cycle exists, then it is proof not only of the supreme position of that variable in society, but also of the broader concept of historical determinism underlying the law of social cycles. Note that our concern here is not with the time path of money supply but with its growth. This is because we are analyzing an economy that has been growing over time.

[Rouser2]

Originally posted by shanek [/i]

>>quote:
--------------------------------------------------------------------------------
The first oil shock came in 1973
--------------------------------------------------------------------------------

>>No, it wasn't. It was late 1970. The oil EMBARGO is NOT the same as the first supply shock. The embargo came about as a RESULT of the shock.


So Opec shocked itself in 1970, and then that caused Opec to embargo???? And the first "shock" came in 1970??? What a strange economics class you must have taken. But there was no oil "shock" in 1970. In Robert Bartley's OPEC reference (above), Opec clearly confesses the reason for their actions -- and it was not an oil "shock" but a dollar "shock" when Nixon closed the gold window. As for any "shocks" in 1970, the chart below clearly shows there was none, your non-specific but highly dubious reference to Nixon's Memoirs notwithstanding.

http://www.petroleum.org/knowledge/wop702000.htm

[American]

Originally posted by Synchronicity

Hm. I'm not sure. Maybe if I quote a bit of the text it'd be clear.



Bull.

Times are good. Enjoy life!


http://www.pinkhousemovie.com/images/snzjamming.jpg http://mountaingrownmusic.org/images/gidney1.jpg

[The Central Scrutinizer]

Originally posted by American



Bull.

Times are good. Enjoy life!


Wow! Congratulations! It sounds like you got a raise to $8.75 an hour!

[clk]

Originally posted by The Central Scrutinizer


Wow! Congratulations! It sounds like you got a raise to $8.75 an hour!

I think he also got promoted to Assistant Janitor. Congratulations, American! I'm so proud of you!

[Zep]

The Bush Economy Booms!

http://www.umkc.edu/lib/spec-col/ww2/PostWarWorld/images/96-655.gif