Tag: Economic Indicators

Is Recession Waiting?

The economic news is not what I would call good….between tariffs and DOGE screwing with the government things are , according to lead economists, pointing to a serious recession looming….

A former Obama administration economic adviser said Wednesday that the Federal Reserve’s forecast of increased unemployment, accelerating inflation, and slower growth driven by President Donald Trump’s economic policies could portend a return of the “stagflation” that plagued the nation in the 1970s.

The Federal Open Markets Committee, which sets U.S. monetary policy, downgraded its economic outlook for 2025 from an initial projection of 2.1% growth to 1.7%. FOMC also revised its inflation forecast upward from 2.5% to 2.8%.

While FOMC said that “recent indicators suggest that economic activity has continued to expand at a solid pace,” the committee noted that “uncertainty around the economic outlook has increased.”

Fears of an economic slowdown or even a recession have increased dramatically since Trump took office and imposed tariffs on some of the nation’s biggest trade partners while moving to gut critical social programs in order to fund a $4.5 trillion tax cut that will overwhelmingly benefit wealthy Americans.

“Inflation has started to move up now. We think partly in response to tariffs and there may be a delay in further progress over the course of this year,” Federal Reserve Chair Jerome Powell said during a Wednesday news conference, at which he said interest rates will remain unchanged. “The survey data [of] both household and businesses show significant large rising uncertainty and significant concerns about downside risks.”

https://www.commondreams.org/news/trump-stagflation

But as far as the news I see on the tube do not take this outlook….why is that?

Could any bad news be withheld from the public?

As Politicoreported Friday, experts serving on the Bureau of Labor Statistics’ (BLS) Technical Advisory Committee were informed this week that they were no longer needed, leaving the BLS without a panel that has long advised the Labor Department on how economic changes can impact data collection.

A page for the committee was removed from the Labor Department’s website, along with one that had information about the Data Users Advisory Committee, which has advised on how businesses and policymakers can use the agency’s economic reports.

“It would be a bad sign for a software company to cancel all beta testing if you expect to keep making better software,” Michael Madowitz, an economist at the Roosevelt Institute who served on the data users committee, told Politico. “This feels like the same sort of thing.”

https://www.commondreams.org/news/how-will-trumps-tariffs-affect-the-economy

This info is info that every American family needs to have access to so they can determine their family economic health.

No info like this should ever be kept from the public.

Then came more bad news for the economy….Donny and the magic Sharpie will add a new 25% tariff on autos…..

President Trump announced a 25% tariff on imported cars Wednesday, a move he said would “lead to tremendous growth in the automotive industry.” The tariff, to be implemented April 2, will apply to finished cars and trucks imported to the US, including American brands assembled in different countries, the New York Times reports. In remarks at the Oval Office, Trump seemed to rule out exemptions for vehicles from Canada and Mexico, reports the Wall Street Journal. “What we’re going to be doing is a 25% tariff on all cars not made in the US,” he said. Asked if the tariff could be lifted, Trump said it is “100%” permanent.

Trump said car prices would go down, though since almost half the vehicles sold in the US are imported, analysts expect prices to rise significantly. The current tariff on auto imports is 2.5%. After Trump’s announcement, shares in top US automakers dropped sharply in after-hours trading, NBC News reports. European and Japanese automakers will be hit hard by the tariff, and countermeasures are expected, the Times reports. The Detroit News predicts that the “entire industry will likely face severe consequences, from higher vehicle prices to supply chain breakdowns,” if high tariffs are in place for long.

Tesla, which makes all of its vehicles sold in the US in California and Texas, will be less affected than other major US automakers, but Trump said Elon Musk did not influence tariff policy and has “never asked me for a favor in business whatsoever.” Tesla would be hit a lot harder if the tariff was applied to components as well as finished vehicles, the Times notes. If the tariff is fully passed on to consumers, the average auto price could rise $12,500, according to the AP. Trump said Wednesday that he could give car buyers a break by allowing them to deduct interest paid on auto loans from their federal income tax—as long as the vehicles were made in America.
With these new tariffs beginning next month and you may be looking for a new car a few things that you need to watch…..

Wall Street got pulled in opposite directions Thursday as President Trump’s latest tariff escalation created winners and losers among auto stocks, while better-than-expected data on the economy helped support the market.

  • The S&P 500 slipped 18.89 points, or 0.3%, to 5,693.31 after drifting between small gains and losses through the day.
  • The Dow Jones Industrial Average fell 155.09 points, or 0.4%, to 42,299.70.
  • The Nasdaq composite fell 94.98 points, or 0.5% to 17,804.03.

Even General Motors sank 7.4% for one of the market’s sharper losses after Trump announced 25% tariffs on imported cars. Ford Motor dropped 3.9%.

US automakers selling vehicles in the country can feel the pain of tariffs because their supply chains are spread throughout North America, the AP reports. Trump says he wants more manufacturing to take place within the US. “There are still a lot of unknowns, but if this remains in place, there will clearly be some pain for the companies to digest,” according to UBS analyst Joseph Spak. Among the uncertainties are how the government will determine how to apply tariffs to parts that are compliant with the free-trade agreement that it has with Mexico and Canada but are not made entirely within the US. Tracking parts could be difficult, according to Spak.
All you need is information you can trust.
Let the recession begin!

Watch your finances

I Read, I Write, You Know

“lego ergo scribo”

Things Breaking For Biden?

For over a year the outlook on the economy has been dire for Biden who is looking for re-election in November….the American people have not been happy with the economic landscape but that may be changing…..

President Biden has been dogged for much of the past year by what the Economist calls an “emotional disconnect” on the economy. Growth has been strong, but Americans have remained in a lousy mood about money, thanks largely to high prices across the board. Now, however, a closely watched gauge suggests that might be changing.

  • Key stat: A monthly survey of consumer sentiment by the University of Michigan came in at 79.6 in February, its highest mark since the summer of 2021, reports Quartz. What’s more, the collective increase over the last three months is the biggest in more than three decades, notes the Economist.
  • Vibes: “We do think about vibes, because historically the vibes—consumer sentiment and business sentiment—have been good predictors of consumer spending and business investment,” said Chicago Fed president Austan Goolsbee recently. In the view of Quartz, the Michigan stats suggest the “American vibes recession is over.”
  • Politics: All of which is good news for Biden in theory, reports the New York Times, which talks to economist Neil Dutta. “If sentiment simply hovered at today’s levels, he said the simple historical relationship between consumer confidence readings and incumbent vote share would give Mr. Biden about 49% of the vote,” per the story in January. “But the job market is strong, gas prices are moderate, and the stock market just hit a new record, all of which could drive further improvement.” In fact, sentiment as measured by the Michigan survey ticked up from 79 to 79.6 since he spoke.
  • Then again: It’s an unusual election. “Geopolitics and domestic issues could throw curveballs into this cycle, too,” writes Lora Kelley at the Atlantic. “That consumers seem more upbeat about the economy is certainly not unwelcome news for Biden, but a lot can happen between now and November.”

Great news for all those Biden aficionados (I am not one of them….to me he is teetering old man that needs to be in a rest home)….and those that are afraid that Donald the Orange will get elected for a second term.

But like they say….it is a long way to November and a lot can happen before the day of the vote.

A side note:  Speaking of presidents…..which are the ones with the best rankings?

In honor of Presidents’ Day, the 2024 Presidential Greatness Project Expert Survey polled 154 historians on the subject of presidential rankings—and Donald Trump came in last, again. President Biden, despite his current approval rating sitting at around 37%, came in 14th, the New York Times reports. “Biden’s most important achievements may be that he rescued the presidency from Trump, resumed a more traditional style of presidential leadership, and is gearing up to keep the office out of his predecessor’s hands this fall,” wrote the college professors who conducted the survey. Coming in at No. 1 was Abraham Lincoln, who also topped the same survey in 2015 and 2018, Fox News reports.

  • Abraham Lincoln, 93.87
  • Franklin Delano Roosevelt, 90.83
  • George Washington, 90.32
  • Teddy Roosevelt, 78.58
  • Thomas Jefferson, 77.53
  • Harry Truman, 75.34
  • Barack Obama, 73.8
  • Dwight Eisenhower, 73.73
  • Lyndon Baines Johnson, 72.86
  • John F. Kennedy, 68.37

Other notable presidents who ranked below Biden include Woodrow Wilson (15th), Ronald Reagan (16th), and Ulysses S. Grant (17th). Bill Clinton finished 12th, George W. Bush 32nd, and Jimmy Carter 22nd. According to the survey, respondents’ political affiliation and ideology did not “make a major difference overall,” with the most notable partisan splits coming for the more recent presidents. Trump is “by far the most polarizing president,” write the historians. His numerical score was 10.92, compared to Biden’s 62.66.

Not my list for I would have put Jefferson and Truman further down the list.

But Washington never had gold sneakers.

Just food for thought.

I Read, I Write, You Know

“lego ergo scribo”

What About This Inflation Thing?

I have heard much ‘good’ news about the economy lately….but unfortunately the real facts say different….

Investors were fully expecting good news from the new monthly inflation report out Tuesday. But instead of declining, prices actually rose in August. Which means the Federal Reserve is all but certain to forge ahead with an aggressive rate hike at its Sept. 20-21 meeting. Details:

  • Monthly rise: Prices rose 0.1% in August from July, according to the Consumer Price Index, reports CNBC. Most analysts had forecast a decline of 0.1%. Investors were hoping for a sign that inflation had peaked.
  • Yearly increase: Compared to a year earlier, prices in August were up 8.3%, which is extremely high by historical standards, though below the annual figures of 8.5% in July and 9.1% in June, per the Wall Street Journal.
  • Market flips: Dow futures were up about 200 points before the report came out, with investors hoping an inflation cool-down would convince the Fed to temper its interest-rate hikes. But as soon as the report came out, Dow futures were down by 300 points, per CNBC.
  • The Fed: The new report is all but certain to keep the Fed “firmly in inflation-fighting mode,” per the New York Times. Most observers expect another hike of three-quarters of a percentage point. “Inflation is far too high, and it is too soon to say whether inflation is moving meaningfully and persistently downward,” Christopher Waller, one of the Fed’s governors, said last week. “This is a fight we cannot, and will not, walk away from.”

So the news is not so good and Wall Street reacting as could be predicted…..

The stock market fell the most since June 2020 following Wall Street’s humbling realization Tuesday that inflation is not slowing as much as hoped. The S&P 500 fell 177.72 points, or 4.3%, to 3,932.69. The Dow Jones Industrial Average fell 1,276.37 points, or 3.9%, to 31,104.97. The Nasdaq fell 632.84 points, or 5.2%, to 11,633,57. A hotter-than-expected report on inflation has traders bracing for the Federal Reserve to ultimately raise interest rates even higher than expected, with all the risks for the economy that entails. Bond prices also tumbled, sending yields sharply higher, after the government reported inflation decelerated last month by less than economists forecast.

Investments seen as the most expensive or the riskiest are the ones hardest hit by higher rates. Bitcoin tumbled 7.1%. In the stock market, all but four of the stocks in the S&P 500 fell. Technology and other high-growth companies fell more than the rest of the market because they’re seen as most at risk from higher rates, the AP reports. Apple, Microsoft, and Amazon all fell more than 4% and were the heaviest weights on the market. The communication services sector, which includes Google’s parent company and other internet and media companies, sank 4.8% for the largest loss out of the 11 sectors that make up the S&P 500 index.

Most of Wall Street came into the day thinking the Fed would hike its key short-term rate by a hefty three-quarters of a percentage point at its meeting next week. But the hope was that inflation was in the midst of quickly falling back to more normal levels after peaking in June at 9.1%. The thinking was that such a slowdown would let the Fed downshift the size of its rate hikes through the end of this year and then potentially hold steady through early 2023. Tuesday’s report dashed some of those hopes. “Right now, it’s not the journey that’s a worry so much as the destination,” says Brian Jacobsen at Allspring Global Investments. “If the Fed wants to hike and hold, the big question is at what level.”

Not to worry they will manipulate the economy to make everything look okay for us mere peasants…..but if you have to earn a living you know it is not ‘healthy’ by any stretch of the imagination.

But go ahead bury your head and plug along barely making it….or do something about it.

I Read, I Write, You Know

“lego ergo scribo”

What Happened To Productivity?

Inflation is running rampant and no one in DC will do a goddamn thing about it…..the latest numbers tell the tale…..

The consumer price index for June is worse than expected—and what was expected was bad. The CPI was up 9.1% year-over-year in June, above economists’ prediction of 8.8%. Even that estimate was worse than May’s 8.6%. The last time inflation was this high was in November 1981, reports MarketWatch. The so-called core CPI, which takes volatile food and energy prices out of the equation, was up 5.9%, slightly higher than the 5.7% estimate. The AP observes the reports “likely seal[s] the case for another large interest rate hike by the Federal Reserve, with higher borrowing costs to follow.” Dow futures were down 300 points on the news.

“A higher inflation rate … will put more pressure on the Fed to increase the interest rate more than expected, and that increases the possibility that the US is going to enter a recession,” University of Cincinnati economist Hernan Moscoso Boedo told ABC News prior to the CPI data being released.

The Wall Street Journal reports gasoline prices surged more than other categories, with an 11.2% gain over May. Some economists are hoping we’re at or near an inflation peak: Gas prices, for instance, were at $5 a gallon in mid-June but were down to a $4.66 nationwide average Tuesday—”still far higher than a year ago but a drop that could help slow inflation for July and possibly August,” per the AP.

They say (whoever the Hell ‘they’ are) that productivity is a better indication of the health of an economy than jobs (which is the focus of any economic report)….

We all are suffering from the creeping inflation that is plaguing this country…..and the best our government can do is try to protect profits for the oligarchs that control everything.I suggested that Biden consider price controls to give our citizens a break from the crushing inflation…..I was scolded for such a idea because it would make our national productivity suffer…..and yet without this ‘control’ it is already down…..

June’s employment report surprised most analysts, as US businesses added 372,000 jobs, way above expectations. The strong numbers dampened talk of impending recession, but what do they say about the strength of the economy overall? By themselves, they don’t really say much, according to New York Timeseconomics columnist Peter Coy. To get a truer sense of what’s happening—and what the future may hold—Coy says to pay attention to productivity, defined by the BLS as output per hour worked. That number shrank in the first quarter at a surprising 7.3% annual rate and is “on track for one of its worst 12-month performances” since 1947, Coy writes. That means GDP isn’t growing despite strong hiring.

The pandemic has a lot to do with it, but not for reasons most people might have expected in 2020. Back then, the economy experienced a productivity surge, which many analysts chalked up to deployment of new technologies to accommodate a homebound workforce. But it turns out 2020’s labor output was skewed by a change in the mix of workers, as lower-skilled, lower-paid workers were laid off but skilled workers remained.

Low-skilled workers are in high demand now, forcing companies to hire “less productive workers that in normal circumstances would not be active,” and output is inevitably falling as a result. Increased hiring and decreased productivity tend to signal that “businesses’ costs are rising and profits are getting squeezed,” and that scenario tends to end with layoffs.

Read the whole column here.

Lots of excuses of why this is……excuses does not help the situation…..many blame the output of the workers….why?  Workers only produce what they are told to produce…..

I still think that some sort of price controls would help me and my fellow Americans that are struggling with the situation these days.

I Read, I Write, You Know

“lego ergo scribo”

Biden On Inflation

Inflation is roaring to new heights daily…..high gas prices….runaway food prices….everything is making life difficult for most Americans…..

With an election approaching Biden has decided to sound more in control than he is…….

How about those gas prices?

About a month ago, President Biden ordered the release of a million barrels of oil a day from national reserves to help curb steep gas prices. On Tuesday, however, those gas prices reached their steepest point on record—an average of $4.37 across the US, reports the Hill. No state has gas for less than $3.90, and drivers in California are paying $5.84. When adjusted for inflation, Americans paid more in 2008, the equivalent of an average of $5.37 a gallon in today’s dollars. But Biden himself on Tuesday acknowledged the hit to people’s wallets from rising prices in general.

“I know that families all across America are hurting because of inflation,” he said in a White House speech Tuesday, per Reuters. “I want every American to know that I am taking inflation very seriously and it is my top domestic priority.” Biden, apparently trying to head off voter resentment before the midterms, sought to blame Republicans for holding up his agenda and contrasted his plans with one floated by GOP Gov. Rick Scott of Florida for a minimum federal income tax, reports the Washington Post.

“The bottom line is this: Americans have a choice right now between two paths reflecting two very different sets of values,” Biden said. “My plan attacks inflation and lowers the deficit. … The other path is the ultra MAGA plan.” Emma Vaughn, a spokesperson for the Republican National Committee, counters: “Voters know that Republican-led states are leading in economic recovery and job creation, and will vote for Republicans and our proven agenda come November.”

This is all so much bullsh*t!

How will he work ‘lower deficits”?

I mean we are throwing money at Ukraine in a shocking amounts….money that is needed here….but no somebody somewhere has decided war is more important (read profitable) than the people of this country.

I want to see this ‘plan’ more in detail….but what little information I have it is nothing more than election posturing that is no help to those Americans struggling with their monetary lives.

But what the big story is that inflation may be slowing before the plan is announced…

Inflation slowed in April after seven months of relentless gains, a tentative sign that price increases may be peaking while still imposing a financial strain on American households. Consumer prices jumped 8.3% last month from 12 months earlier, the Labor Department said Wednesday. That was below the 8.5% year-over-year surge in March, which was the highest rate since 1981, reports the AP. On a month-to-month basis, prices rose 0.3% from March to April, a still-elevated rate but the smallest increase in eight months. Consumer prices had spiked 1.2% from February to March, mostly because of a sudden jump in gas prices triggered by Russia’s invasion of Ukraine

Still, the Wall Street Journal points out that the so-called core-price index—which drops some volatile categories, like food and energy—was up 0.6%, a “sharp pickup” from March’s 0.3% rise. Nationally, the price of a gallon of regular gas has reached a record $4.40, according to AAA, though that figure isn’t adjusted for inflation. Gas had fallen to about $4.10 a gallon in April, after reaching $4.32 in March. The April report “suggests that the deceleration is going to be painstakingly slow,” Principal Global Investors chief strategist Seema Shah tells CNBC.

New disruptions overseas or other unforeseen problems could always send US inflation back up to new highs. If the European Union decides, for example, to cut off Russian oil, gas prices in the United States would likely accelerate. China’s COVID lockdowns are also worsening supply problems and hurting growth in the world’s second-biggest economy.

My question now is…did Biden make his announcement because he saw the news for political gain?

I guess it did not matter for the inflation news was worse than the media had pretended otherwise….

Stocks fell on Wall Street Wednesday, led by more drops in technology companies, after a report on inflation came in worse than feared. The S&P 500 fell 65.87 points, or 1.6%, to 3,935.18. The Dow Jones Industrial Average fell 326.63 points, or 1%, to 31,834.11. The Nasdaq fell 373.44 points, or 3.2%, to 11,364.24. Wednesday’s report from the US Labor Department showed inflation slowed a touch in April, down to 8.3% from 8.5% in March. Investors also found some glass-half-full signals in the data that inflation may be peaking and set to ease further. Nevertheless, the numbers were still higher than economists forecast.

They also showed a bigger increase than expected in prices outside food and gasoline, something economists call “core inflation” and which can be more predictive of future trends. Economists said the inflation report will keep the Fed on track for rapid and potentially sharp increases in interest rates in upcoming months, the AP reports. “Core inflation came in hot, and that’s what really matters to the Fed at this point,” said Brian Jacobsen, senior investment strategist at Allspring Global Investments.

Where will this American nightmare end?

I will be watching!

Watch This Blog!

I Read, I Write, You Know

“lego ergo scribo”

Closing Thought–03May21

When elected Biden was said by conservs that the markets would suffer…..but all their doom and gloom from the GOP and its spokesmen…….happily they were WRONG.

Modest gains for stocks nudged the S&P 500 and the Nasdaq to more record highs on Wall Street as investors braced for a deluge of earnings reports from big US companies. Of the 500 members of the S&P 500 index, 181 will report their results this week. Apple, Microsoft, McDonald’s, and Caterpillar are among the big-name companies that will be telling investors how they did in the first three months of the year. Ten of the 30 members of the Dow will also release their results.. The S&P 500 rose 7.45 points, or 0.2%, to 4,187.62. The Dow Jones Industrial Average fell 61.92 points, or 0.2%, to 33,981.57. The Nasdaq rose 121.97 points, or 0.9%, to 14,138.78. The Russell 2000 index of smaller companies rose 26.15 points, or 1.2% to 2,298.01

The stakes for investors are high this week, the AP reports. With millions of vaccines going out daily and trillions of dollars worth of government-led economic support being paid out, investors have turned much of their attention to how well the global economy—and corporate profits—will do in the recovery. Corporate profits in the S&P 500 are expected to be up 24% from this time a year ago, according to FactSet. Earnings growth is being welcomed by investors who have had to justify high stock values as many companies continue to emerge from a pandemic slump. About a quarter of S&P 500 companies have reported quarterly results so far this earnings season. Of these, 84% have delivered earnings that topped Wall Street’s estimates, according to FactSet.

Not to worry the CEOs are raking in the cash for themselves.

Once again the GOP has shown just how bad they lie and just how outta touch they truly have become.

I Read, I Write, You Know

“lego ergo scribo”

Is The Economy Rigged?

My answer ….yes….. you bet your sweet bippy it is.

But I am sure that there will be those that do not agree with my assessment…..

Let me point to the stock markets during these trying times….over 30 million Americans are unemployed and yet the stock markets are still going great guns…..

The stock market is doing fine, even though everything else is definitely not.

Earlier in the coronavirus crisis, Wall Street had a meltdown. Stocks plunged amid fears of the disease’s spread and its potential impact on the global economy, sometimes to the point that trading was halted altogether to rein in the chaos. But in recent weeks, the market has been doing okay. It’s not at the record highs it was in mid-February, but it’s not bad — the S&P 500 is hovering around where it was last fall. And given the state of the world — a deadly global pandemic with no end in sight, 30 million Americans recently out of jobs, an economy that’s fallen off of a cliff — a relatively rosy stock market is particularly perplexing.

Sure, the stock market isn’t the economy, but right now, it seems particularly divorced from what’s happening on the ground. “The gap between markets and economic data has never been larger,” wrote Matt King, global head of credit strategy at Citigroup, in a recent note.

https://www.vox.com/covid-19-coronavirus-economy-recession-stock-market/2020/5/6/21248069/stock-market-economy-federal-reserve-jerome-powell

The latest reports on the economy are grim…..

The Dow Jones Industrial Average surged more than 300 points at opening Friday, while the S&P 500 and Nasdaq continued to steadily climb from a low point in late March, when states across the country were imposing economic shutdowns.

The Dow also increased by 250 points right after the Labor Department released its May jobs report Friday, which showed an official unemployment rate of 14.7%, the highest since the Great Depression. Economists estimate that including people who lost their jobs in the last two weeks and people who have not filed for unemployment, the actual unemployment rate is likely higher than 20%.

https://www.commondreams.org/news/2020/05/08/what-rigged-economy-looks-says-sanders-stock-market-enjoys-best-month-33-years

I agree that it is time for the economy to be more reflective of society….granted the markets are NOT the economy…but those thieves need reining in….

Even Trump’s lackeys are not painting a rosy picture for this Summer…..

The US economy is in rough shape, and things are going to get worse. That was the dire prediction from not one but two of the White House’s top economic advisers Sunday, per the Washington Post:

  • “The reported numbers are probably going to get worse before they get better,” Treasury Secretary Steven Mnuchin said on Fox News Sunday. “I think you’re going to have a very, very bad second quarter.” Asked by host Chris Wallace whether the nation’s unemployment rate was “close to 25% at this point, which is Great Depression neighborhood,” Mnuchin replied, “Chris, we could be.”
  • “To get unemployment rates like the ones that we’re about to see … which I think will climb up towards 20% by next month, you have to really go back to the Great Depression to see that,” said White House economic adviser Kevin Hassett on CBS’ Face the Nation. He predicted the rate will be “north of 20%” by next month, and added that “nobody knows” when the jobless will be able to go back to work.
  • But it wasn’t all dire; Mnuchin predicted the job market could start to improve by September. The situation we’re in, he noted, “is no fault of American business, it is no fault of American workers, it is the fault of a virus.” And Vox notes that on ABC’s This Week, Larry Kudlow, director of the Trump administration’s National Economic Council, said that of the latest unemployment numbers, “80% of it was furloughs and temporary layoffs,” which “suggests strongly that the cord between the worker and the business is still intact.”

This economy is driven by greed, pride, gluttony and vanity….we need an economy that benefits everyone not the wealthy few.

To prove that point I point to the recent report that 20.5 million Americans are unemployed…..and that same day there was a market rally…..

The clearest illustration of that came on Friday, when the government reported that 20.5 million people lost their jobs in April. It marked a period of unfathomable pain across the country not seen since the Great Depression. Also on Friday, the stock market rallied.

The S&P 500 is now up 30% from its lows in mid-March and back to where it was last October, when the outlook for 2020 corporate earnings looked sunshiny. Companies have sold record amounts of debt in recent weeks for investment-grade companies. Junk bonds, historically dodgy during an economic swoon, have roared back.

https://www.propublica.org/article/the-bailout-is-working-for-the-rich

Now you tell me who benefits the most from this system?

Count out the workers….and the nation……

Learn Stuff!

I Read, I Write, You Know

“lego ergo scribo”

The Economy Sucks–But The Markets Are Up

This pandemic shows the people just how absurd this version of capitalism is……..

And why would I say such a thing?

Because of the pandemic in the first quarter the GDP shrank by 4.8%

The United States’ gross domestic product (GDP) shrank at an annual rate of 4.8% during the first quarter of 2020, the Commerce Department reported Wednesday.

The contraction is the first in six years, and the worst since the Great Recession, which ended in 2009.

https://justthenews.com/nation/economy/us-gdp-contracts-48-during-first-quarter-2020

…….and about 20% of the work force is unemployed……

Now in its seventh week, the U.S. unemployment crisis continues to deepen. According to Thursday’s data release from the Department of Labor, 3.8 million more Americans filed for unemployment insurance during the week ending April 25. Although that represents the fourth consecutive week of decline in seasonally adjusted initial claims, the number remains historic. (Remember, no single week prior to March 21 had ever seen even 1 million initial claims since 1967, the earliest year that data is available from the Federal Reserve.) If we add up all of the initial claims filed since the coronavirus recession began,1 more than 30 million people — or nearly 19 percent of the total U.S. labor force — have filed for unemployment claims over the past month and a half.

Nearly 20 Percent Of The U.S. Labor Force Has Filed For Unemployment Since Mid-March

And yet during the pandemic markets go up and up…..how can this be?  And why?

The stock market is doing fine, even though everything else is definitely not.

Earlier in the coronavirus crisis, Wall Street had a meltdown. Stocks plunged amid fears of the disease’s spread and its potential impact on the global economy, sometimes to the point that trading was halted altogether to rein in the chaos. But in recent weeks, the market has been doing okay. It’s not at the record highs it was in mid-February, but it’s not bad — the S&P 500 is hovering around where it was last fall. And given the state of the world — a deadly global pandemic with no end in sight, 30 million Americans recently out of jobs, an economy that’s fallen off of a cliff — a relatively rosy stock market is particularly perplexing.

Sure, the stock market isn’t the economy, but right now, it seems particularly divorced from what’s happening on the ground. “The gap between markets and economic data has never been larger,” wrote Matt King, global head of credit strategy at Citigroup, in a recent note.

https://www.vox.com/covid-19-coronavirus-economy-recession-stock-market/2020/5/6/21248069/stock-market-economy-federal-reserve-jerome-powell

This scenario is NOT what Adam Smith envisioned in the Wealth of Nations…..(use Google for god’s sake)……

Any thoughts?

I Read, I Write, You Know

“lego ergo scribo”

 

That Trump Economy

It is just a matter of days before we start picking our Dem candidate for the 2020 election who will in turn meet Trump on the field of politics.

One of the few things that Trump can say for his presidency is that the economy is booming.

You see I do not buy that spin.

The markets are setting records which is great for investors but the average Joe may not be sharing in all this boom……. the stock market grew 31 percent in the 807 trading days before Trump’s election, but it grew by 56 percent in the 807 trading days after it, up through the third anniversary of Trump’s inauguration. 

But seriously folks…..

It should not surprise us in the least that the most dishonest president in U.S. history would spin a fantastical vision of the economy that appears to exist only in his imagination.

…

Indeed, Trump’s version of the U.S. economy is so outlandish that it would be laughable were he not president of the United States. “The United States is in the midst of an economic boom the likes of which the world has never seen before,” he said triumphantly Tuesday at Davos. Throwing out as many buzzwords as he could gather together in one speech, Trump proclaimed, at the risk of sounding repetitive, “America is thriving, America is flourishing, and yes, America is winning again like never before.” And, he claimed, “America’s newfound prosperity is undeniable, unprecedented and unmatched anywhere in the world.” Giving few specifics beyond the standard talking points scripted by his economic advisers, Trump resorted to his usual superlatives, saying, “America’s economic turnaround has been nothing short of spectacular,” and proclaiming, “No one is benefitting more than America’s middle class.”

But when asked about the economy, Americans take a different view from their president. A recent Pew research poll found that “[s]even-in-10 U.S. adults say the economic system in their country unfairly favors powerful interests, compared with less than a third who say the system is generally fair to most Americans.” Large majorities in all income groups from rich to poor are convinced the current system benefits powerful interests such as corporations and wealthy individuals.

https://www.commondreams.org/views/2020/01/24/trumps-rosy-economic-outlook-big-lie

Then there is the slow economic growth…….

The US economy grew at a moderate 2.1% rate in the final three months of 2019, capping a year when growth slowed significantly due to a weaker global economy and trade war uncertainties, the AP reports. The Commerce Department reported Thursday that the fourth-quarter increase in the gross domestic product, the economy’s total output of goods and services, matched the 2.1% gain of the third quarter. Both quarters were well below the 3.1% surge seen in the first quarter. For the October-December quarter, growth was supported by solid but slower consumer spending and an improvement in the trade deficit. Those factors offset a further drop in business investment in new plants and equipment and a slowdown in restocking store shelves. For the whole year, GDP increased 2.3%, the weakest performance in three years.

That was also a slowdown from a 2.9% gain in 2018 when the economy got a boost from President Trump’s tax cuts and billions of dollars in increased government spending. Economists expect even slower growth in 2020 of around 1.8%. But that outcome could be threatened by various threats, from a spreading coronavirus in China to a flare-up in trade tensions between the US and China. Even the US presidential election could end up having an adverse effect on growth if a hard-fought campaign increases uncertainty among consumers and businesses and causes them to cut back on spending. While Trump has not achieved his GDP growth goals, he has seen unemployment fall to a 50-year low during his presidency, and after trade tensions with China began to cool late last year, the stock market rebounded and climbed to new record highs.

The Middle Class is struggling….the wealthy class is rolling in money and benefits….so you tell me who is making out like a bandit.

I Read, I Wrote, You Know

“lego ergo scribo”

Mr. Trump, What About That Economy?

2020 will be a mandate on how the economy is doing and how the American people are doing economically.

You would think that if the economy is as good as Trump use to brag about then he would be beating his chest about how damn good it is and that his policies were the fire that started this good burn.

In case you are new and have not been keeping up I have a little reminder of how this economy is really doing…..not the bluster of bullsh*t from some deluded toad and his lackeys….but real facts.

Let me help…….https://lobotero.com/2019/08/15/the-economy-stupid/

What bout all those beautiful jobs and factory re-openings and good times had by all?

It seems the the manufacturing sector is having a bit of a slide……

A gauge of U.S. manufacturing showed the lowest reading in more than 10 years in September as exports dived amid the escalated trade war.

The U.S. manufacturing purchasing managers’ index from the Institute for Supply Management came in at 47.8% in September, the lowest since June 2009, marking the second consecutive month of contraction. Any figure below 50% signals a contraction.

The new export orders index was only 41%, the lowest level since March 2009, down from the August reading of 43.3%, ISM data showed.

https://www.cnbc.com/2019/10/01/us-manufacturing-economy-contracts-to-worst-level-in-a-decade.html

How about all those steel mills that would be re-opening?  That was another economic promise. 

It seems that this sector is not as stable thanx to Trump….

Louisiana is the latest state to see a steel mill close due to President Donald Trump’s tariffs.

“Hundreds of Louisiana steelworkers are finding out they no longer have a job. This comes as Bayou Steel “unexpectedly” shut down its mill in LaPlace on Monday.

Now, 376 people are looking for new work.

Bayou Steel transports and makes steel beams and other similar products. They also collect industrial scrap for recycling. Company officials say the mill will be permanently closed on November 30, and sent out a WARN letter to parish and state officials Monday. That letter cited ‘…unforeseen business circumstances and the inability to secure necessary capital’ for the closure….

Steel Mill In State That Voted For Trump Closes Suddenly, Leaving Hundreds Jobless

Trump’s economic adviser stated that “Manufacturing is strong as a rock”….maybe they misspoke and meant that it is sinking like a rock.

Then there is all the talk about how well the sanctions Trump has imposed is doing for the country…..really?

The Trump administration has made sanctions a key part of its foreign policy arsenal, placing enormous economic pressure on nations like North Korea and Iran in a bid to force concessions in negotiations with the United States. But is there real evidence that this tactic works?

The U.S. government, it turns out, can’t be sure. A new report released by a government watchdog this week found that although the agencies that implement sanctions track their economic impact, they do not measure whether the sanctions achieve their aim in forcing a target to change its behavior.

https://outline.com/V5rVXb

Finally, what about the federal deficit under the Trump presidency?  Well thanks for the Trump tax cuts the deficit is approaching $1 trillion…that is trillion with a “T”…….

The federal budget deficit for 2019 is estimated at $984 billion, a hefty 4.7 percent of gross domestic product (GDP) and the highest since 2012, the Congressional Budget Office (CBO) said on Monday.

The difference between federal spending and revenue has only ever exceeded $1 trillion four times, in the period immediately following the global financial crisis.

The deficit, which has grown every year since 2015, is $205 billion higher than it was in 2018, a jump of 26 percent.

The CBO has warned that the nation’s debt is on an unsustainable path. Higher levels of debt increase borrowing costs, make it harder for the government to battle economic downturns and increase the share of future spending devoted to paying off interest costs.

https://thehill.com/policy/finance/464764-federal-deficit-estimated-at-984b-highest-in-seven-years#.XZvfoTG5TFN.twitter

If the 20320 election will truly be about the economy…then should not this stuff be making the news?

Just asking but I already know why….do you?

Be Smart!

Learn Stuff!

“I Read, I Wrote and now You Know”

Lego Ergo Scribo”