Texas - having no income tax, could institute one at a relatively low rate and solve their issue whereas California is already taxed to the hilt and can't raise taxes easily. They will raise them though and raise them and raise them.
Will Texas institute an income tax to take care of their deficit? That's the business of residents there don't you think? They'll probably push even lower costs. This is exactly why we have a state system so different people can enact different state hoods. Otherwise we'd just be one big government - we're not.
According to the National Council of State Legislatures the Texas projected 2012 deficit is $7.4 - 17% of it's budget while California's is $19.2 billion or 18.7% of their budget. That's from an LA Times article that was fairly critical of Texas.
We should also be reminded that California used IOU's to pay vendors for a few months last year when they ran out of money. That didn't happen in Texas did it or anywhere else for that matter in the US - not at a state level. Texas though does seem to neglect some base rights such as education etc. These are big trade offs and really another conversation.
So if you were sending your children to public schools and had job offers in all 50 states - all other things being equal would you or I pick Texas? I doubt it.
Regardless neither state has 'better' policies just policies that have come about due to the make up of the voting classes there.
My state has plenty of its own issues so I'm not one to degrade another state's makeup.
One thing I believe we can absolutely agree on is there has been a luke warm recovery at best and imo not even that.
I might mention where that U-6, or broader definition of unemployment is coming from.
I took U-6 directly from the updated December data that was released in the January unemployment report. There is a huge adjustment in December, so I'm not convinced these ratios are that accurate, but it's what we've got.
For January, U-6:
Basically it's 16.1% of the civilian labor force, or 24,663,000 people. (God that's HUGE!)
But if you try to hand calculate that out, by the U-6 definition and the unemployment report, you'll get:
The reason for the difference is the breakdown from the BLS of marginally attached is not seasonally adjusted, but the rest of the metric (i.e. U-3, part time, economic reasons, civilian labor force) are seasonally adjusted.
I just saw a bunch of random numbers being quoted for what U-6 for 01/11 is, so I thought I'd run through this.
So, JOLTS lags 1 month and the above did use the updated numbers but regardless,
Bottom line for every job, there are at least 4 people, if not 8 people looking and wanting one. Haven't even covered those who have dropped out and are really in the weeks called not in the labor force.
How are job losses due to outsourcing any different
than job losses due to technological / efficiency gains?
In either scenario,
1.)The worker is still unemployed
2a.)The consumer gets cheaper goods (and/or)
2b.)The industrialist gets a fatter profit margin
Taken to the extreme, you get the following 2 scenarios:
Scenario A)
100% of all Factory job losses are the result of outsourcing
an American Job @ a cost of $15/unit to a Chinese Worker @ a cost of
$3/unit
Scenario B)
100% of all Factory job losses are the result of outsourcing
a Human Job @ a cost of $15/unit to a Mechanized Worker @ a cost of
$3/unit
I'm new to this site and have seen a number of articles detailing the evils
of job robbing outsourcing, but nothing covering the evils of job robbing
technology.Why?
Your conclusion of "deep do-do" is showing up in the numbers. I've been reading various economists online (many on the right hand column) who are digging deep into the economics/statistics/BLS data at this point, with everyone who is in statistical reality (as well as just walking down the street and looking around reality), saying "where are the damn jobs" in one form or another.
Ok, so now explain why we hear that the job picture is improving, and our economy is on the rise. Just kidding, no one can explain that except the White House. It's strange how putting the numbers together is 180 degrees from the sugar-coated biased reporting about how hiring is taking place, and that we've bottomed-out and on the way up. The Beveridge Curve, Chart 5, shows exactly what I've been taking about for awhile now. Contrary to what Mr. Obama thinks, there are no jobs, and jobs aren't going to fall from the sky. If there are a few jobs in one place, they're off-set by job losses in another place. in other words, we're not gaining on the situation.
Chart 6 shows construction is where it'll more than likely stay for some time to come. At this time, there's no reason to believe that construction will be a boom industry anytime in the near future.
After all is said and done, my question is what will be the catalyst that turns things around, if they ever do turn around. With all of the information being reported, it's hard to imagine a scenario where we go from where we are now, to economic progress and stability in the near future. What will cause mass hiring for an extended period?
Considering the number presently unemployed, and the number entering the workforce for the first time, there's no way to catch-up and keep caught-up with the demand. It would take a solid net gain of 300,000 per month for the next 4 years minimum. What incentive can produce those numbers?
demanding their money back plus interest. The promises, commitments made, are just broken with no consequence. Know anything about the legal angle, has this been considered, dismissed, precedent?
I had to quickly create a few original graphs. Seems St. Louis Fed wasn't into updating their database today. There is one graph, which is still from the St. Louis Fred, which should auto update tomorrow, but the monthly change levels are so similar, I think it's valid for 12/10 and that is the quits vs. being fired difference graph. (it should be updated tomorrow, normally the St. Louis Fed is on the case in terms of updating their databases).
Which makes me wonder folks, I can, actually start maintaining excel spreadsheets are start running original graphs for all data, instead of using the FRED system. Maybe that's a good idea, but the FRED system can create graphs so much faster and on top of things, their excel auto formats are more amenable to graphing, further calculations, the BLS, literally, I could not even get a download of the data today, I had to hand update data from FRED. Then, one has to reorder or deal with multiple columns and crud, bigger hassle.
Anyone reading this what do you think, start running original graphs? The look would improve (sorry, in a hurry today), because I would be updating the graphs per data releases.
So, back to this report, once again, we have the same bad news! Not enough job openings, job creation for the unemployed, although the JOLTS is a 1 month data lag from the unemployment report.
Still, it's dismal. The BLS Beveridge curve closely matches up with that infamous graph from Calculated Risk comparing job losses over time to pass recessions.
Navistar once employed nearly 10,000 in Ft Wayne. Their suppliers and service providers employed many more. They closed the mfg operations in the early 80's, even after much incentives offered by the city. as a consolation, Navistar agreed to keep the engineering operations quality control and test facilities in Ft Wayne. The Southeast side of the city never recovered from the loss of good paying jobs and once very nice neighborhoods fell into disprepair, a micro version of Flint MI
Navistar recently decided to complete the pull out, again despite many concessions from the city AND a major tax hike in Illinois. Company officials only paid token attention to city officials, the deal was already done despite an infrstructure in Ft Wayne to support manufacturing operations and a much lower cost of living than suburban Chicago
What I'm gunning after is proof solid, that one can basically have commodity futures exceed the actual physical demand available. i.e. proof that it's speculation vs. global actual real world physical demand and supply, which can cause prices to increase.
I could see that from esp. CDSes, they had made them "non-linear" by allowing anyone to buy insurance against something they plain didn't own.
So, I will assume that somewhere, there has to be similar non-linearities which would then violate the law of physical supply/demand, i.e. CDO^2, CDO^3, CDS and so on, where they allow others to bet against, pile in, on a payout that has now become non-linear, at least in volume, to the original derivative.
See what I'm gunning for? Right now we have our rogue bloggers, which is Naked Capitalism, Zerohedge and others saying this is speculation, then you get your more international economics saying one has to have physical supply, therefore, this is pure global demand and lack of supply....
Then, we have the infamous blame the fed and I don't quite buy that with floating exchange rates and even pegs in other nation-states, the prices are not flying through the roof in comparison to Egypt...
So, I think I've got one of the issues boiled down to non-linearities, i.e. the secondary derivatives and any CDS like things, causing # speculative derivatives to greatly exceed those who must take possession of actual physical quantity.
if you're got others who have nailed this, consider explaining to the rest of the class on EP in a blog post. We have LaTex (mimetex) on here and image upload for graphs. Any help with this kind of thing I will for I imagine such a piece would require heavy graphing and possible mathematics.
I just don't quite "get" it yet and that's in spite of studying all of those MBS derivatives in gory obnoxious, mind blowing mathematical and mnemonic roadblocks.
So true, and so sad at the same time. I do feel sorry for the American worker, and feel for their pain.
Cutting through the chase here, it is not the fault of the worker, nor is it the fault of corporate America. Yes, corporate America works the strings that move our puppet government, but our government willingly allows it. In other words, greed moves the strings, and the thirst and hunger for power and influence motivates the actions on the other end of those strings. As I've said many times, legislation and policy are dictated by Lobbyists, which controls the U.S. Congress. The operative word was "Lobbyists", just in case anyone missed the point. Considering the untold $Billions that have passed through the hands of Lobbyists, is there any doubt that legislation and policy is bought and paid for? And to think that there are folks out there that still believe that we have a government by the people, and for the people. Pleeeeeeeeeeeese !!!!
Yes, we have, and continue to do so, supported the economies of India, China, Korea, Japan, and many others. I remember back in the 50's when I was just a small kid, going into Ben Franklin's five and dime store, and almost everything in the store was made in Japan. As the years went by, the shelves in almost all stores were filled with products from many more countries. Today, it's hard to find very many products on shelves with "Made In U.S.A." labels. What we're seeing, and have grown accustom to, is the "Wal-Mart" syndrome.
I remember when the steel mills closed, when the last American made TV disappeared from stores, and when foreign made cars and trucks became common on American streets. I was working in the textile industry when it began to fold under pressure from cheap imports. Did the American worker cause our markets to be flooded with cheap imports? Not hardly. It was our government that sold us out to foreign interests via corporate greed.
Lets face the cold hard facts here for a moment, please. Our standard of living doesn't allow us to compete with foreign labor. We can't work for $5.00 a day. And, we have labor laws that will not allow us to work children under sweat shop conditions. Also, we must comply with OSHA, EPA, and other restrictions. The math is simple, we can not produce a bath towel for $.15. There was a time when only union workers could afford union made products. So, non-union workers bought cheap foreign imports. This was the beginning of economic disaster for the American worker. Slowly, over several decades, union membership has drastically declined. ( reference the steel, textile, automotive, and other unionized industries ). But, even without union wages and benefits, we still can't compete with cheap foreign labor. Why, you may ask? Because we're not a third world economy, yet.
If we continue to be import dependent, there's no way for us to create enough jobs to keep pace with our rapidly growing population. In addition, as job out-sourcing to foreign countries increase, our service sector will soon fall in step with the near collapse of our manufacturing sector. In fairness, I must point out that advances in technology is responsible for some job losses. We've advanced in such a way that we can produce more with less manpower. Machines and computers have replaced many workers. But, that doesn't account for what we're seeing across the board.
We must ask ourselves, considering the extremely high cost of an "unemployed America", is cheap foreign imports really cheaper than American made products? Is it really cheaper to out-source service jobs to foreign labor markets? Before you answer, give some thought to the amount of taxpayers' dollars needed to fund government assistance programs, poverty, subsidies, bailouts, and unemployment for 99 weeks. Then consider the lost industries and the ghost towns of the rust-belt. Consider the cuts in local, state, and federally funded services, lost tax revenue from payroll deductions, and the unemployed with families that have lost everything, including their homes. It's not a pretty picture, is it.
The term "Global Economy" basically means "equalization to the lowest level". The sooner our derelict dysfunctional apathetic government realizes that, the sooner we might be able to go back to work, and once again become an independent self-supporting economy. But, don't bet the farm on that happening just yet. First, alot of voters afflicted with "blind patriotism" has to awaken to the cold hard facts.
Oh yeah, it's the game of collateralized commodity obligations. These money changers synthesize EVERYTHING.
From Naomi Prinz at Mother Jones: http://motherjones.com/politics/2008/06/who-benefits-high-food-prices
Additionally, the hot new favorite among traders is betting on packages of energy and agricultural futures. Called CCO's (collateralized commodity obligations), they are like their subprime cousins, CDO's (collateralized debt obligations). Their performance is linked to rising commodity prices; the higher the prices, the more profit to the CCO.
Kaufman explained this financial innovation in a July 16 interview on Democracy Now:
Goldman . . . came up with this idea of the commodity index fund, which really was a way for them to accumulate huge piles of cash for themselves. . . . Instead of a buy-and-sell order, like everybody does in these markets, they just started buying. It’s called "going long." They started going long on wheat futures. . . . And every time one of these contracts came due, they would do something called "rolling it over" into the next contract. . . . And they kept on buying and buying and buying and buying and accumulating this historically unprecedented pile of long-only wheat futures. And this accumulation created a very odd phenomenon in the market. It’s called a "demand shock." Usually prices go up because supply is low . . . . In this case, Goldman and the other banks had introduced this completely unnatural and artificial demand to buy wheat, and that then set the price up. . . . [H]ard red wheat generally trades between $3 and $6 per sixty-pound bushel. It went up to $12, then $15, then $18. Then it broke $20. And on February 25th, 2008, hard red spring futures settled at $25 per bushel. . . . [T]he irony here is that in 2008, it was the greatest wheat-producing year in world history.
. . . [T]he other outrage . . . is that at the time that Goldman and these other banks are completely messing up the structure of this market, they’ve protected themselves outside the market, through this really almost diabolical idea called "replication" . . . . Let’s say, . . . you want me to invest for you in the wheat market. You give me a hundred bucks . . . . [W]hat I should be doing is putting a hundred bucks in the wheat markets. But I don’t have to do that. All I have to do is put $5 in. . . . And with that $5, I can hold your hundred-dollar position. Well, now I’ve got ninety-five of your dollars. . . . [W]hat Goldman did with hundreds of billions of dollars, and what all these banks did with hundreds of billions of dollars, is they put them in the most conservative investments conceivable. They put it in T-bills. . . . [N]ow that you have hundreds of billions of dollars in T-bills, you can leverage that into trillions of dollars. . . . And then they take that trillion dollars, they give it to their day traders, and they say, "Go at it, guys. Do whatever is most lucrative today." And so, as billions of people starve, they use that money to make billions of dollars for themselves.
Other researchers have concurred in this explanation of the food crisis. In a July 2010 article called “How Goldman Sachs Gambled on Starving the World’s Poor – And Won,” journalist Johann Hari observed:
Beginning in late 2006, world food prices began rising. A year later, wheat price had gone up 80 percent, maize by 90 percent and rice by 320 percent. Food riots broke out in more than 30 countries, and 200 million people faced malnutrition and starvation. Suddenly, in the spring of 2008, food prices fell to previous levels, as if by magic. Jean Ziegler, the UN Special Rapporteur on the Right to Food, has called this "a silent mass murder", entirely due to "man-made actions.”
It's all gonna end when the worlds wage earners collectively go off the grid.
I just read this post commenting on the recent come alive data on the U.S. manufacturing sector.
Just a comment, he's right in his article (link again), the inputs to U.S. manufacturing w.r.t the ISM are imports, exports are finished goods, and is not correlated to what we think of as imports/exports from the U.S. trade imports/exports. (or necessarily, I have never seen any correlation for it at least, suffice it to say they are not the same thing).
Rutherford is also correct that the ISM percentage point monthly change is the rate of change and in terms of imports/exports, it is absolute levels which tell you the ratio per month.
Finally, in terms of GDP though, I beg to differ in a way. When one has a deceleration of imports, that change, or delta, does imply increased GDP due to, if I can call it this, a substitution effect...i.e. import less yet activity humming, implies domestic goods were used for that "economic hum". So, while not the "true strength" of the economy, in a way it implies some "true strength" due to the above.
This comment on GDP is separate from any comment in the manufacturing ISM and it's respective import/export indices.
So, sorry, got kind of sloppy on that import/export statement and glad there are others catching this stuff and discussing it in other articles.
Their lobbyists must be an army. Literally it was clear they had paid manual comment spammers for blogs to write up nice sounding crap in response to posts....it's actually one of the reasons all things are moderated on this site. No glorified lobbyists comments, or businesses trying to put in a bunch of links for free. They can buy an ad but the content of this site stays "regular folk driven".
Their damage with "white paper spin" is beyond belief and it's very clear they have more legislative writers than Congress. i.e. they write up legislation, with some nice tricks to hide what they are doing, one of the reasons we're getting 2000 page plus bills with references to other acts via a "semi-colon", often introduced without even legislative text in the Congressional record, yet magically passed.....
many of these amendments, even full bore bills, are written not by our Congress and their legislative staff, but by lobbyists and their legislative staff (attorneys) to be dumped into our laws pretty much any time they want it.
That's just positively disgusting. Never mind now Obama has literally let them into the White House, there isn't even a pretense of separation of government from multinational corporations at this point.
one can see signs of offshore outsourcing in total labor costs, operating costs being slashed, on how Indian body shops profits soar, increasingly larger GDP, while the U.S. is having a jobs slaughter, India couldn't find enough workers. You can see it in Foxconn employee lists, almost a million, in China, in China's trade exports, in the U.S. trade deficit, it's all over the place yet magically one cannot get anything past Blinder to say this just might be a problem for the American workforce.
I don't think you can tell that to the corporations running the globe until the last dog dies. In other words, they seem to be insisting on complete global collapse before they would even contemplate what they are doing, long term to the U.S. economy (at minimum).
I'll assume you're talking about interest on the debt. Here's something I'd like to dig into more and that is derivatives w.r.t. physical commodities, i.e. cooper, oil, food, wheat and so on. There is the never ending argument for one must take possession of the physical commodity at some point, but....are there newer "derivatives" which make that "not so" and/or is it a game of hot potato in order to churn flash profits, last one standing is left with holding the real losses bag?
Well, if job out-sourcing was good for our economy, and our workforce, why haven't we seen any signs of it? If our participation in the global market place was beneficial to American manufacturing, why haven't we seen signs of it? If the relocation of American businesses to points outside of our borders was beneficial, why haven't we seen signs of it? If bringing in foreign workers was a huge boost to our economy, why haven't we seen signs of it? If subsidizing American businesses that export American jobs was beneficial to American workers, why haven't we seen signs of it?
The point is that, through government engineered economically damaging policies, we've sacrificed our own economy in order to pad corporate bottom lines, and to boost foreign economies. Again, I say that this was not by accident nor chance, but intentional selfish self-service.
In the first place, there's not enough numbers and stats to express the harm done to our economy, our economic well-being, and to the future of this once great nation. On Main Street America, the "truth" is obvious. Secondly, it is very unlikely, and even ridiculous to think, that noone in Washington saw this coming decades ago. If a dumb country boy like me saw it coming way back in the 60's, surely those very close to the process knew.
We've allowed ourselves, through trust and optimism, to be oppressed and suppressed by a government believing itself to be an entity unto itself, answerable to noone except itself. The root article does a great job of expressing the pain felt by our workforce. What explanation could possibly justify what has happened to our economic well-being? The American worker is not lazy, uneducated, unskilled, nor inexperienced. There's no justifiable reason why we must stand in long unemployment lines, depend on government assistance programs, and live in shelters, all for the benefit of a relatively small percentage of Americans.
When I hear those politicians, especially Mr. Obama, say that American businesses should invest and start hiring, I can't help but laugh. In the first place, American businesses are not turning away business because they don't want to staff-up to meet demand. That's silly even to imply such. Secondly, business America wouldn't hesitate to hire more employees if they had demand for their products and services. Afterall, isn't that how businesses grow? Business America is not hiring because there's no demand for their products and services. The demand is for cheap foreign made goods, and cheap foreign labor. Contractors aren't turning away hundreds of thousands of home buyers, and textile mills aren't turning down orders for bolts of cloth. With millions of Americans unemployed, almost 44 million living in poverty, and many more homeless and living in shelters, where's the spendable income to support the American retail market?
Mr. Obama can ask business America to invest and hire until he faints, but business America doesn't hire just to be hiring, and they won't hire until their business merits adding additional employees. What Mr. Obama could do to encourage business America to hire, is to create a level playing field for American businesses. This, as I've said for many years now, could be accomplished through fair, equal, and balanced foreign trade. In addition, there must be severe penalties for job out-sourcing, and also for businesses that relocate outside of our borders. We need to strictly enforce our immigration laws, and severely punish anyone that breaks them.
There are ways to put America back to work, but it'll take a pro-America government seated in Washington to do it. We can get back on a path to economic independency, but it won't be via unfair, unjust, and one-sided foreign trade agreements and policies. And, it won't be by our continued practice of out-sourcing our jobs to cheap foreign labor. I will agree to a point, that our economic woes are such that it'll require complex and complicated measures to remedy. But, as the old saying goes, "an honest effort is better than no effort at all". We have to start somewhere, and that starting point has to be Washington DC. We can not continue our "blind patriotism", and expect things to change. We've basically worn that path out, and we can all see where it lead us. We must stop allowing the smooth talking silver tongued politicians from getting our votes. Our votes are our voices, and is the only thing we have to fight the establishment with.
America wants to work, citizens want to be self-supporting, and our workforce deserves better than what they're getting out of our government.
…….I’ve been watching (and occasionally trying to deal with) the Chamber for years, and all I know is it has a deep, abiding belief in cutting taxes on the wealthy, eroding regulations that constrain Wall Street, cutting back on rules that promote worker health and safety, getting rid of the minimum wage, repealing the new health-care law, fighting unions, cutting back Medicare and Social Security, reducing or eliminating corporate taxes, and, in general, taking the nation back to the days before the New Deal.
So what, exactly, is the deal Obama is pitching to the Chamber?
……Virtuous cycle? American businesses are doing quite nicely as it is. Their profits are soaring. And one reason they’re doing so well is they’re holding down costs, especially payrolls. So why would they ever agree to add more workers now?
……. Not long ago I debated a conservative economist who argued American workers had priced themselves out of the global labor market and would therefore have to settle for lower real wages and benefits before they’d be hired back in large numbers. By his logic, many health and safety regulations would also have to be compromised or abandoned, since they also make American workers more expensive.
If this is the tacit bargain the President is offering business, it’s not a good deal for American workers.
There’s no secret to creating lots of jobs by reducing the median wage, slashing benefits, compromising health and safety at the workplace, and, effectively, reducing the standard of living of millions of Americans. We’ve been doing it for years.
And it doesn’t lead to a “virtuous cycle.” It leads to the kind of economy we’ve had for years – including, right now, the most anemic recovery from a deep trough since the mid-1930s. Indeed, when the debt bubble popped in 2008, we discovered how many Americans no longer had the ability to buy enough to keep the economy going. In this and other ways, 2008 bore an uncomfortable resemblance to 1929…………..
What you are both describing is really the dark heart of GLOBALISM, and I have good news.
Globalism in it's present form is OVER.
Globalism, the pet system of the Trilaterals, the Bilderberger's, the Rothschilds and the other generational banking dynasties that spawned it, is NOT sustainable under the current paradigm of monetarism.
As more and more wage earners (like me, and Robert Oak and Sonny Clark) come to realize that AUSTERITY is just a code word for BAILOUT when the public tolerance for "BAILOUTS" has ended, those wage earners are going to become extremely PISSED at the lies, the greed, and the inhumanity of globalism.
And I think we're also beginning to understand that behind all the smoke and mirrors, if you keep your eye on the pea beneath the bankers shell and refuse to be mesmerized by the misdirection, what we are really seeing is a massive devaluation of wages and savings relative to the monetization of debt, which in turn is the result of continuing these stealth bailouts of massive fraudulent monetary obligations to debt.
And what we are really bailing out is a fantasy world prepared by Bankers to lure wage earners into malinvestment, to believe that home values will never fall, and that we can all have good paying jobs producing nothing of relative value to the global marketplace, and everyone who wants a job either gets one or an unemployment check, and everyone gets a full belly whether they work or not (thanks to food stamps) and America can be GREAT by simply resting on the laurels of its global innovations in FINANCIALIZATION.
And what we are bailing out is the difference between REALITY and all that bullshit above, the bankers debt-trap CON.
BUT the reality is that there isn't enough productivity, or wage accumulation, or middle class wealth in that illusion (not even in the land of the opportunity) to cover the default risk of that fantasy, as expressed by the universe of financial DERIVATIVES.
And because they are mathematically proven to be unhedged, when the money printing dislocation finally creates the interest rate risk event (probably through a complete bond collapse) that will unravel the great fantasy debt tied up in Interest Rate Derivatives, representing more than the next 20 years of true global GDP in PRINCIPLE, the INTEREST upon which cannot be paid under any foreseeable reality in this CENTURY.
The Austerity price tag of the backdoor bailout to cover these bets as they unravel expresses as hyperinflation, as we hyper-print fiat currencies to fuel the collapse. This will eventually cause the food riots and tax revolts of North Africa, Mexico, soon Europe (you're being lied to about the riots you know of and there are others not even being reported yet) and eventually the pain of hyperinflation will usher in the end of monetarism.
The global elite will have finally saved humanity from itself by purging the world of useless eaters not essential to the system. We don't know what the new system will look like, but it is a mathematical certainty that the old system is suicidal, and humanity will end it (violently, I'm afraid) as an alternative to extinction.
There must be enough pain worldwide to cause people like me, Robert Oak and Sonny Clark to say "Screw this, I've got nothing left to lose." And that's means we're so fed up we stop paying taxes if we still have jobs, or we lose our jobs, and we lose title to our homes, and we're out on the streets panhandling as the brown shirts line up to keep order and we're all tired and hungry and fearful of a military coup, or worse. When there's no blood left in the turnip it's over.
But as long as we remain "civilized" we take it up the "O-zone" because it's still better than Armageddon. Well, when Armageddon finally comes, it's a self fulfilling prophecy.
The only way out of this mess is for human nature to dramatically change. We can't predict what will make that happen in a positive way, but a new dark age will certainly do it in a rather harsh way, depending on how badly we want to make it rain down on us -- the longer we kick the can, the harder the fall.
And when you look at it that way, why would anything Obama says or does have any bearing on anything? Behind all that right-sounding rhetoric and cheerleading, he's biding his time just like we are. And "Hoping" for "Change".
Thanks for posting this comment. I would like to see the "big picture" list of corporations who have gotten tax incentives, even cash from local, state and even Federal governments on the promise of economic development and jobs for their areas, only to have that corporation pocket the money and move to China and India.
I know IBM has done it and there are many corporations doing the same behavior. Recently we had a "green solar panels" companies get millions in grants and tax incentives to pocket the money and move to China.
This is plain wrong, at minimum these companies should be required to pay the money back, with interest, since they did not do what they said they would originally to get these tax breaks, grants and other incentives.
Interesting phrase considering Egypt. What makes my own blood boil is when policies, legislation and agendas we know kill jobs and do not help the economy are touted by these politicians as helping the economy.
I've pointed to it many times, but there is a group of economic "theory" and "research" that claims "outsourcing is good for America". The thing is, only someone with a math degree is going to be able to read those "papers" and see major, gapping manipulations, biased assumptions, flaws to make their "conclusion" work out.
That, irks me most of all, spinning agenda with phony numbers.
Texas - having no income tax, could institute one at a relatively low rate and solve their issue whereas California is already taxed to the hilt and can't raise taxes easily. They will raise them though and raise them and raise them.
Will Texas institute an income tax to take care of their deficit? That's the business of residents there don't you think? They'll probably push even lower costs. This is exactly why we have a state system so different people can enact different state hoods. Otherwise we'd just be one big government - we're not.
According to the National Council of State Legislatures the Texas projected 2012 deficit is $7.4 - 17% of it's budget while California's is $19.2 billion or 18.7% of their budget. That's from an LA Times article that was fairly critical of Texas.
We should also be reminded that California used IOU's to pay vendors for a few months last year when they ran out of money. That didn't happen in Texas did it or anywhere else for that matter in the US - not at a state level. Texas though does seem to neglect some base rights such as education etc. These are big trade offs and really another conversation.
So if you were sending your children to public schools and had job offers in all 50 states - all other things being equal would you or I pick Texas? I doubt it.
Regardless neither state has 'better' policies just policies that have come about due to the make up of the voting classes there.
My state has plenty of its own issues so I'm not one to degrade another state's makeup.
One thing I believe we can absolutely agree on is there has been a luke warm recovery at best and imo not even that.
I might mention where that U-6, or broader definition of unemployment is coming from.
I took U-6 directly from the updated December data that was released in the January unemployment report. There is a huge adjustment in December, so I'm not convinced these ratios are that accurate, but it's what we've got.
For January, U-6:
Basically it's 16.1% of the civilian labor force, or 24,663,000 people. (God that's HUGE!)
But if you try to hand calculate that out, by the U-6 definition and the unemployment report, you'll get:
U-6 = U-3+marginally attached+part-time economic reasons
= 25,070,000
The reason for the difference is the breakdown from the BLS of marginally attached is not seasonally adjusted, but the rest of the metric (i.e. U-3, part time, economic reasons, civilian labor force) are seasonally adjusted.
I just saw a bunch of random numbers being quoted for what U-6 for 01/11 is, so I thought I'd run through this.
So, JOLTS lags 1 month and the above did use the updated numbers but regardless,
Bottom line for every job, there are at least 4 people, if not 8 people looking and wanting one. Haven't even covered those who have dropped out and are really in the weeks called not in the labor force.
Honest question,
How are job losses due to outsourcing any different
than job losses due to technological / efficiency gains?
In either scenario,
1.)The worker is still unemployed
2a.)The consumer gets cheaper goods (and/or)
2b.)The industrialist gets a fatter profit margin
Taken to the extreme, you get the following 2 scenarios:
Scenario A)
100% of all Factory job losses are the result of outsourcing
an American Job @ a cost of $15/unit to a Chinese Worker @ a cost of
$3/unit
Scenario B)
100% of all Factory job losses are the result of outsourcing
a Human Job @ a cost of $15/unit to a Mechanized Worker @ a cost of
$3/unit
I'm new to this site and have seen a number of articles detailing the evils
of job robbing outsourcing, but nothing covering the evils of job robbing
technology.Why?
Your conclusion of "deep do-do" is showing up in the numbers. I've been reading various economists online (many on the right hand column) who are digging deep into the economics/statistics/BLS data at this point, with everyone who is in statistical reality (as well as just walking down the street and looking around reality), saying "where are the damn jobs" in one form or another.
First, good work making it all so clear.
Ok, so now explain why we hear that the job picture is improving, and our economy is on the rise. Just kidding, no one can explain that except the White House. It's strange how putting the numbers together is 180 degrees from the sugar-coated biased reporting about how hiring is taking place, and that we've bottomed-out and on the way up. The Beveridge Curve, Chart 5, shows exactly what I've been taking about for awhile now. Contrary to what Mr. Obama thinks, there are no jobs, and jobs aren't going to fall from the sky. If there are a few jobs in one place, they're off-set by job losses in another place. in other words, we're not gaining on the situation.
Chart 6 shows construction is where it'll more than likely stay for some time to come. At this time, there's no reason to believe that construction will be a boom industry anytime in the near future.
After all is said and done, my question is what will be the catalyst that turns things around, if they ever do turn around. With all of the information being reported, it's hard to imagine a scenario where we go from where we are now, to economic progress and stability in the near future. What will cause mass hiring for an extended period?
Considering the number presently unemployed, and the number entering the workforce for the first time, there's no way to catch-up and keep caught-up with the demand. It would take a solid net gain of 300,000 per month for the next 4 years minimum. What incentive can produce those numbers?
In my opinion, we're in deep do-do.
demanding their money back plus interest. The promises, commitments made, are just broken with no consequence. Know anything about the legal angle, has this been considered, dismissed, precedent?
I had to quickly create a few original graphs. Seems St. Louis Fed wasn't into updating their database today. There is one graph, which is still from the St. Louis Fred, which should auto update tomorrow, but the monthly change levels are so similar, I think it's valid for 12/10 and that is the quits vs. being fired difference graph. (it should be updated tomorrow, normally the St. Louis Fed is on the case in terms of updating their databases).
Which makes me wonder folks, I can, actually start maintaining excel spreadsheets are start running original graphs for all data, instead of using the FRED system. Maybe that's a good idea, but the FRED system can create graphs so much faster and on top of things, their excel auto formats are more amenable to graphing, further calculations, the BLS, literally, I could not even get a download of the data today, I had to hand update data from FRED. Then, one has to reorder or deal with multiple columns and crud, bigger hassle.
Anyone reading this what do you think, start running original graphs? The look would improve (sorry, in a hurry today), because I would be updating the graphs per data releases.
So, back to this report, once again, we have the same bad news! Not enough job openings, job creation for the unemployed, although the JOLTS is a 1 month data lag from the unemployment report.
Still, it's dismal. The BLS Beveridge curve closely matches up with that infamous graph from Calculated Risk comparing job losses over time to pass recessions.
Will this ever end?
Navistar once employed nearly 10,000 in Ft Wayne. Their suppliers and service providers employed many more. They closed the mfg operations in the early 80's, even after much incentives offered by the city. as a consolation, Navistar agreed to keep the engineering operations quality control and test facilities in Ft Wayne. The Southeast side of the city never recovered from the loss of good paying jobs and once very nice neighborhoods fell into disprepair, a micro version of Flint MI
Navistar recently decided to complete the pull out, again despite many concessions from the city AND a major tax hike in Illinois. Company officials only paid token attention to city officials, the deal was already done despite an infrstructure in Ft Wayne to support manufacturing operations and a much lower cost of living than suburban Chicago
What I'm gunning after is proof solid, that one can basically have commodity futures exceed the actual physical demand available. i.e. proof that it's speculation vs. global actual real world physical demand and supply, which can cause prices to increase.
I could see that from esp. CDSes, they had made them "non-linear" by allowing anyone to buy insurance against something they plain didn't own.
So, I will assume that somewhere, there has to be similar non-linearities which would then violate the law of physical supply/demand, i.e. CDO^2, CDO^3, CDS and so on, where they allow others to bet against, pile in, on a payout that has now become non-linear, at least in volume, to the original derivative.
See what I'm gunning for? Right now we have our rogue bloggers, which is Naked Capitalism, Zerohedge and others saying this is speculation, then you get your more international economics saying one has to have physical supply, therefore, this is pure global demand and lack of supply....
Then, we have the infamous blame the fed and I don't quite buy that with floating exchange rates and even pegs in other nation-states, the prices are not flying through the roof in comparison to Egypt...
So, I think I've got one of the issues boiled down to non-linearities, i.e. the secondary derivatives and any CDS like things, causing # speculative derivatives to greatly exceed those who must take possession of actual physical quantity.
if you're got others who have nailed this, consider explaining to the rest of the class on EP in a blog post. We have LaTex (mimetex) on here and image upload for graphs. Any help with this kind of thing I will for I imagine such a piece would require heavy graphing and possible mathematics.
I just don't quite "get" it yet and that's in spite of studying all of those MBS derivatives in gory obnoxious, mind blowing mathematical and mnemonic roadblocks.
So true, and so sad at the same time. I do feel sorry for the American worker, and feel for their pain.
Cutting through the chase here, it is not the fault of the worker, nor is it the fault of corporate America. Yes, corporate America works the strings that move our puppet government, but our government willingly allows it. In other words, greed moves the strings, and the thirst and hunger for power and influence motivates the actions on the other end of those strings. As I've said many times, legislation and policy are dictated by Lobbyists, which controls the U.S. Congress. The operative word was "Lobbyists", just in case anyone missed the point. Considering the untold $Billions that have passed through the hands of Lobbyists, is there any doubt that legislation and policy is bought and paid for? And to think that there are folks out there that still believe that we have a government by the people, and for the people. Pleeeeeeeeeeeese !!!!
Yes, we have, and continue to do so, supported the economies of India, China, Korea, Japan, and many others. I remember back in the 50's when I was just a small kid, going into Ben Franklin's five and dime store, and almost everything in the store was made in Japan. As the years went by, the shelves in almost all stores were filled with products from many more countries. Today, it's hard to find very many products on shelves with "Made In U.S.A." labels. What we're seeing, and have grown accustom to, is the "Wal-Mart" syndrome.
I remember when the steel mills closed, when the last American made TV disappeared from stores, and when foreign made cars and trucks became common on American streets. I was working in the textile industry when it began to fold under pressure from cheap imports. Did the American worker cause our markets to be flooded with cheap imports? Not hardly. It was our government that sold us out to foreign interests via corporate greed.
Lets face the cold hard facts here for a moment, please. Our standard of living doesn't allow us to compete with foreign labor. We can't work for $5.00 a day. And, we have labor laws that will not allow us to work children under sweat shop conditions. Also, we must comply with OSHA, EPA, and other restrictions. The math is simple, we can not produce a bath towel for $.15. There was a time when only union workers could afford union made products. So, non-union workers bought cheap foreign imports. This was the beginning of economic disaster for the American worker. Slowly, over several decades, union membership has drastically declined. ( reference the steel, textile, automotive, and other unionized industries ). But, even without union wages and benefits, we still can't compete with cheap foreign labor. Why, you may ask? Because we're not a third world economy, yet.
If we continue to be import dependent, there's no way for us to create enough jobs to keep pace with our rapidly growing population. In addition, as job out-sourcing to foreign countries increase, our service sector will soon fall in step with the near collapse of our manufacturing sector. In fairness, I must point out that advances in technology is responsible for some job losses. We've advanced in such a way that we can produce more with less manpower. Machines and computers have replaced many workers. But, that doesn't account for what we're seeing across the board.
We must ask ourselves, considering the extremely high cost of an "unemployed America", is cheap foreign imports really cheaper than American made products? Is it really cheaper to out-source service jobs to foreign labor markets? Before you answer, give some thought to the amount of taxpayers' dollars needed to fund government assistance programs, poverty, subsidies, bailouts, and unemployment for 99 weeks. Then consider the lost industries and the ghost towns of the rust-belt. Consider the cuts in local, state, and federally funded services, lost tax revenue from payroll deductions, and the unemployed with families that have lost everything, including their homes. It's not a pretty picture, is it.
The term "Global Economy" basically means "equalization to the lowest level". The sooner our derelict dysfunctional apathetic government realizes that, the sooner we might be able to go back to work, and once again become an independent self-supporting economy. But, don't bet the farm on that happening just yet. First, alot of voters afflicted with "blind patriotism" has to awaken to the cold hard facts.
Oh yeah, it's the game of collateralized commodity obligations. These money changers synthesize EVERYTHING.
From Naomi Prinz at Mother Jones:
http://motherjones.com/politics/2008/06/who-benefits-high-food-prices
Additionally, the hot new favorite among traders is betting on packages of energy and agricultural futures. Called CCO's (collateralized commodity obligations), they are like their subprime cousins, CDO's (collateralized debt obligations). Their performance is linked to rising commodity prices; the higher the prices, the more profit to the CCO.
And of course this jewel from Ellen Brown:
http://www.webofdebt.com/articles/egyptian_tinderbox.php
Kaufman explained this financial innovation in a July 16 interview on Democracy Now:
Goldman . . . came up with this idea of the commodity index fund, which really was a way for them to accumulate huge piles of cash for themselves. . . . Instead of a buy-and-sell order, like everybody does in these markets, they just started buying. It’s called "going long." They started going long on wheat futures. . . . And every time one of these contracts came due, they would do something called "rolling it over" into the next contract. . . . And they kept on buying and buying and buying and buying and accumulating this historically unprecedented pile of long-only wheat futures. And this accumulation created a very odd phenomenon in the market. It’s called a "demand shock." Usually prices go up because supply is low . . . . In this case, Goldman and the other banks had introduced this completely unnatural and artificial demand to buy wheat, and that then set the price up. . . . [H]ard red wheat generally trades between $3 and $6 per sixty-pound bushel. It went up to $12, then $15, then $18. Then it broke $20. And on February 25th, 2008, hard red spring futures settled at $25 per bushel. . . . [T]he irony here is that in 2008, it was the greatest wheat-producing year in world history.
. . . [T]he other outrage . . . is that at the time that Goldman and these other banks are completely messing up the structure of this market, they’ve protected themselves outside the market, through this really almost diabolical idea called "replication" . . . . Let’s say, . . . you want me to invest for you in the wheat market. You give me a hundred bucks . . . . [W]hat I should be doing is putting a hundred bucks in the wheat markets. But I don’t have to do that. All I have to do is put $5 in. . . . And with that $5, I can hold your hundred-dollar position. Well, now I’ve got ninety-five of your dollars. . . . [W]hat Goldman did with hundreds of billions of dollars, and what all these banks did with hundreds of billions of dollars, is they put them in the most conservative investments conceivable. They put it in T-bills. . . . [N]ow that you have hundreds of billions of dollars in T-bills, you can leverage that into trillions of dollars. . . . And then they take that trillion dollars, they give it to their day traders, and they say, "Go at it, guys. Do whatever is most lucrative today." And so, as billions of people starve, they use that money to make billions of dollars for themselves.
Other researchers have concurred in this explanation of the food crisis. In a July 2010 article called “How Goldman Sachs Gambled on Starving the World’s Poor – And Won,” journalist Johann Hari observed:
Beginning in late 2006, world food prices began rising. A year later, wheat price had gone up 80 percent, maize by 90 percent and rice by 320 percent. Food riots broke out in more than 30 countries, and 200 million people faced malnutrition and starvation. Suddenly, in the spring of 2008, food prices fell to previous levels, as if by magic. Jean Ziegler, the UN Special Rapporteur on the Right to Food, has called this "a silent mass murder", entirely due to "man-made actions.”
It's all gonna end when the worlds wage earners collectively go off the grid.
I just read this post commenting on the recent come alive data on the U.S. manufacturing sector.
Just a comment, he's right in his article (link again), the inputs to U.S. manufacturing w.r.t the ISM are imports, exports are finished goods, and is not correlated to what we think of as imports/exports from the U.S. trade imports/exports. (or necessarily, I have never seen any correlation for it at least, suffice it to say they are not the same thing).
Rutherford is also correct that the ISM percentage point monthly change is the rate of change and in terms of imports/exports, it is absolute levels which tell you the ratio per month.
Finally, in terms of GDP though, I beg to differ in a way. When one has a deceleration of imports, that change, or delta, does imply increased GDP due to, if I can call it this, a substitution effect...i.e. import less yet activity humming, implies domestic goods were used for that "economic hum". So, while not the "true strength" of the economy, in a way it implies some "true strength" due to the above.
This comment on GDP is separate from any comment in the manufacturing ISM and it's respective import/export indices.
So, sorry, got kind of sloppy on that import/export statement and glad there are others catching this stuff and discussing it in other articles.
Their lobbyists must be an army. Literally it was clear they had paid manual comment spammers for blogs to write up nice sounding crap in response to posts....it's actually one of the reasons all things are moderated on this site. No glorified lobbyists comments, or businesses trying to put in a bunch of links for free. They can buy an ad but the content of this site stays "regular folk driven".
Their damage with "white paper spin" is beyond belief and it's very clear they have more legislative writers than Congress. i.e. they write up legislation, with some nice tricks to hide what they are doing, one of the reasons we're getting 2000 page plus bills with references to other acts via a "semi-colon", often introduced without even legislative text in the Congressional record, yet magically passed.....
many of these amendments, even full bore bills, are written not by our Congress and their legislative staff, but by lobbyists and their legislative staff (attorneys) to be dumped into our laws pretty much any time they want it.
That's just positively disgusting. Never mind now Obama has literally let them into the White House, there isn't even a pretense of separation of government from multinational corporations at this point.
one can see signs of offshore outsourcing in total labor costs, operating costs being slashed, on how Indian body shops profits soar, increasingly larger GDP, while the U.S. is having a jobs slaughter, India couldn't find enough workers. You can see it in Foxconn employee lists, almost a million, in China, in China's trade exports, in the U.S. trade deficit, it's all over the place yet magically one cannot get anything past Blinder to say this just might be a problem for the American workforce.
I don't think you can tell that to the corporations running the globe until the last dog dies. In other words, they seem to be insisting on complete global collapse before they would even contemplate what they are doing, long term to the U.S. economy (at minimum).
I'll assume you're talking about interest on the debt. Here's something I'd like to dig into more and that is derivatives w.r.t. physical commodities, i.e. cooper, oil, food, wheat and so on. There is the never ending argument for one must take possession of the physical commodity at some point, but....are there newer "derivatives" which make that "not so" and/or is it a game of hot potato in order to churn flash profits, last one standing is left with holding the real losses bag?
Well, if job out-sourcing was good for our economy, and our workforce, why haven't we seen any signs of it? If our participation in the global market place was beneficial to American manufacturing, why haven't we seen signs of it? If the relocation of American businesses to points outside of our borders was beneficial, why haven't we seen signs of it? If bringing in foreign workers was a huge boost to our economy, why haven't we seen signs of it? If subsidizing American businesses that export American jobs was beneficial to American workers, why haven't we seen signs of it?
The point is that, through government engineered economically damaging policies, we've sacrificed our own economy in order to pad corporate bottom lines, and to boost foreign economies. Again, I say that this was not by accident nor chance, but intentional selfish self-service.
In the first place, there's not enough numbers and stats to express the harm done to our economy, our economic well-being, and to the future of this once great nation. On Main Street America, the "truth" is obvious. Secondly, it is very unlikely, and even ridiculous to think, that noone in Washington saw this coming decades ago. If a dumb country boy like me saw it coming way back in the 60's, surely those very close to the process knew.
We've allowed ourselves, through trust and optimism, to be oppressed and suppressed by a government believing itself to be an entity unto itself, answerable to noone except itself. The root article does a great job of expressing the pain felt by our workforce. What explanation could possibly justify what has happened to our economic well-being? The American worker is not lazy, uneducated, unskilled, nor inexperienced. There's no justifiable reason why we must stand in long unemployment lines, depend on government assistance programs, and live in shelters, all for the benefit of a relatively small percentage of Americans.
When I hear those politicians, especially Mr. Obama, say that American businesses should invest and start hiring, I can't help but laugh. In the first place, American businesses are not turning away business because they don't want to staff-up to meet demand. That's silly even to imply such. Secondly, business America wouldn't hesitate to hire more employees if they had demand for their products and services. Afterall, isn't that how businesses grow? Business America is not hiring because there's no demand for their products and services. The demand is for cheap foreign made goods, and cheap foreign labor. Contractors aren't turning away hundreds of thousands of home buyers, and textile mills aren't turning down orders for bolts of cloth. With millions of Americans unemployed, almost 44 million living in poverty, and many more homeless and living in shelters, where's the spendable income to support the American retail market?
Mr. Obama can ask business America to invest and hire until he faints, but business America doesn't hire just to be hiring, and they won't hire until their business merits adding additional employees. What Mr. Obama could do to encourage business America to hire, is to create a level playing field for American businesses. This, as I've said for many years now, could be accomplished through fair, equal, and balanced foreign trade. In addition, there must be severe penalties for job out-sourcing, and also for businesses that relocate outside of our borders. We need to strictly enforce our immigration laws, and severely punish anyone that breaks them.
There are ways to put America back to work, but it'll take a pro-America government seated in Washington to do it. We can get back on a path to economic independency, but it won't be via unfair, unjust, and one-sided foreign trade agreements and policies. And, it won't be by our continued practice of out-sourcing our jobs to cheap foreign labor. I will agree to a point, that our economic woes are such that it'll require complex and complicated measures to remedy. But, as the old saying goes, "an honest effort is better than no effort at all". We have to start somewhere, and that starting point has to be Washington DC. We can not continue our "blind patriotism", and expect things to change. We've basically worn that path out, and we can all see where it lead us. We must stop allowing the smooth talking silver tongued politicians from getting our votes. Our votes are our voices, and is the only thing we have to fight the establishment with.
America wants to work, citizens want to be self-supporting, and our workforce deserves better than what they're getting out of our government.
Robert Reich also has a good article on this today -
Obama’s Deal with the U.S. Chamber of Commerce
http://robertreich.org/post/3179090621
…….I’ve been watching (and occasionally trying to deal with) the Chamber for years, and all I know is it has a deep, abiding belief in cutting taxes on the wealthy, eroding regulations that constrain Wall Street, cutting back on rules that promote worker health and safety, getting rid of the minimum wage, repealing the new health-care law, fighting unions, cutting back Medicare and Social Security, reducing or eliminating corporate taxes, and, in general, taking the nation back to the days before the New Deal.
So what, exactly, is the deal Obama is pitching to the Chamber?
……Virtuous cycle? American businesses are doing quite nicely as it is. Their profits are soaring. And one reason they’re doing so well is they’re holding down costs, especially payrolls. So why would they ever agree to add more workers now?
……. Not long ago I debated a conservative economist who argued American workers had priced themselves out of the global labor market and would therefore have to settle for lower real wages and benefits before they’d be hired back in large numbers. By his logic, many health and safety regulations would also have to be compromised or abandoned, since they also make American workers more expensive.
If this is the tacit bargain the President is offering business, it’s not a good deal for American workers.
There’s no secret to creating lots of jobs by reducing the median wage, slashing benefits, compromising health and safety at the workplace, and, effectively, reducing the standard of living of millions of Americans. We’ve been doing it for years.
And it doesn’t lead to a “virtuous cycle.” It leads to the kind of economy we’ve had for years – including, right now, the most anemic recovery from a deep trough since the mid-1930s. Indeed, when the debt bubble popped in 2008, we discovered how many Americans no longer had the ability to buy enough to keep the economy going. In this and other ways, 2008 bore an uncomfortable resemblance to 1929…………..
What you are both describing is really the dark heart of GLOBALISM, and I have good news.
Globalism in it's present form is OVER.
Globalism, the pet system of the Trilaterals, the Bilderberger's, the Rothschilds and the other generational banking dynasties that spawned it, is NOT sustainable under the current paradigm of monetarism.
As more and more wage earners (like me, and Robert Oak and Sonny Clark) come to realize that AUSTERITY is just a code word for BAILOUT when the public tolerance for "BAILOUTS" has ended, those wage earners are going to become extremely PISSED at the lies, the greed, and the inhumanity of globalism.
And I think we're also beginning to understand that behind all the smoke and mirrors, if you keep your eye on the pea beneath the bankers shell and refuse to be mesmerized by the misdirection, what we are really seeing is a massive devaluation of wages and savings relative to the monetization of debt, which in turn is the result of continuing these stealth bailouts of massive fraudulent monetary obligations to debt.
And what we are really bailing out is a fantasy world prepared by Bankers to lure wage earners into malinvestment, to believe that home values will never fall, and that we can all have good paying jobs producing nothing of relative value to the global marketplace, and everyone who wants a job either gets one or an unemployment check, and everyone gets a full belly whether they work or not (thanks to food stamps) and America can be GREAT by simply resting on the laurels of its global innovations in FINANCIALIZATION.
And what we are bailing out is the difference between REALITY and all that bullshit above, the bankers debt-trap CON.
BUT the reality is that there isn't enough productivity, or wage accumulation, or middle class wealth in that illusion (not even in the land of the opportunity) to cover the default risk of that fantasy, as expressed by the universe of financial DERIVATIVES.
Derivatives are an UNHEDGED FANTASY.
http://letthemfail.us/archives/7439
And because they are mathematically proven to be unhedged, when the money printing dislocation finally creates the interest rate risk event (probably through a complete bond collapse) that will unravel the great fantasy debt tied up in Interest Rate Derivatives, representing more than the next 20 years of true global GDP in PRINCIPLE, the INTEREST upon which cannot be paid under any foreseeable reality in this CENTURY.
The Austerity price tag of the backdoor bailout to cover these bets as they unravel expresses as hyperinflation, as we hyper-print fiat currencies to fuel the collapse. This will eventually cause the food riots and tax revolts of North Africa, Mexico, soon Europe (you're being lied to about the riots you know of and there are others not even being reported yet) and eventually the pain of hyperinflation will usher in the end of monetarism.
The global elite will have finally saved humanity from itself by purging the world of useless eaters not essential to the system. We don't know what the new system will look like, but it is a mathematical certainty that the old system is suicidal, and humanity will end it (violently, I'm afraid) as an alternative to extinction.
There must be enough pain worldwide to cause people like me, Robert Oak and Sonny Clark to say "Screw this, I've got nothing left to lose." And that's means we're so fed up we stop paying taxes if we still have jobs, or we lose our jobs, and we lose title to our homes, and we're out on the streets panhandling as the brown shirts line up to keep order and we're all tired and hungry and fearful of a military coup, or worse. When there's no blood left in the turnip it's over.
But as long as we remain "civilized" we take it up the "O-zone" because it's still better than Armageddon. Well, when Armageddon finally comes, it's a self fulfilling prophecy.
The only way out of this mess is for human nature to dramatically change. We can't predict what will make that happen in a positive way, but a new dark age will certainly do it in a rather harsh way, depending on how badly we want to make it rain down on us -- the longer we kick the can, the harder the fall.
And when you look at it that way, why would anything Obama says or does have any bearing on anything? Behind all that right-sounding rhetoric and cheerleading, he's biding his time just like we are. And "Hoping" for "Change".
Thanks for posting this comment. I would like to see the "big picture" list of corporations who have gotten tax incentives, even cash from local, state and even Federal governments on the promise of economic development and jobs for their areas, only to have that corporation pocket the money and move to China and India.
I know IBM has done it and there are many corporations doing the same behavior. Recently we had a "green solar panels" companies get millions in grants and tax incentives to pocket the money and move to China.
This is plain wrong, at minimum these companies should be required to pay the money back, with interest, since they did not do what they said they would originally to get these tax breaks, grants and other incentives.
Interesting phrase considering Egypt. What makes my own blood boil is when policies, legislation and agendas we know kill jobs and do not help the economy are touted by these politicians as helping the economy.
I've pointed to it many times, but there is a group of economic "theory" and "research" that claims "outsourcing is good for America". The thing is, only someone with a math degree is going to be able to read those "papers" and see major, gapping manipulations, biased assumptions, flaws to make their "conclusion" work out.
That, irks me most of all, spinning agenda with phony numbers.
Nice rant!
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