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……

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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?

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Trump’s Trade War

There are a wealth of effects of the trade war that dear leader has set his policies on…..like higher prices and Christmas on the way…..but the one number that Americans will pay attention to is the jobs numbers…..

A job count is depressing……….

President Trump says he is “winning big time, against China.” But his trade war is causing measurable damage to the U.S. economy, with the pain likely to worsen.

Forecasting firm Moody’s Analytics estimates that Trump’s trade war with China has already reduced U.S. employment by 300,000 jobs, compared with likely employment levels absent the trade war. That’s a combination of jobs eliminated by firms struggling with tariffs and other elements of the trade war, and jobs that would have been created but haven’t because of reduced economic activity.

The firm’s chief economist, Mark Zandi, told Yahoo Finance that the job toll from the trade war will hit about 450,000 by the end of the year, if there’s no change in policy. By the end of 2020, the trade war will have killed 900,000 jobs, on its current course. The hardest-hit sectors are manufacturing, warehousing, distribution and retail.

Other data back up the Moody’s Analytics numbers. Employers have created 1.3 million jobs so far this year, down from 1.9 million during the same period in 2018. The manufacturing sector has actually contracted, with many producers struggling with higher prices caused by Trump’s tariffs. Business investment is growing by the smallest amount since late 2016.

https://finance.yahoo.com/news/trumps-trade-war-has-killed-300000-jobs-194717808.html

Since this trade war will be a drag on Trump’s re-election hde had to come up with something to change the conversation……and he possibly has found his answer…..the problem is it will a deficit buster…..

President Donald Trump promised to unveil an “inspirational” middle class tax cut next year during a political retreat in Maryland late Thursday, just as the Treasury Department said the nation’s budget deficit topped the $1 trillion mark for only the second time on record. 

Trump told House Republicans in the state’s biggest city, Baltimore, that his “substantial” tax cut plans would be “very, very inspirational … for  middle-income folks, who work so hard,” and that details would be released early next year. Congress, however, would need to approve and pass any suggested tax reductions from the executive branch, setting up a potential election-defining fight with Democratic lawmakers heading into next year’s presidential elections.

The pledge will also add further pressure on the nation’s finances after the Treasury reported a $169 billion shortfall in revenues in August, taking the overall deficit for the 11 months ended in August, the government’s fiscal year, to $1.07 trillion. The last trillion-plus deficit was recorded in the three years that followed the 2008 global financial crisis. 

(thestreet.com)

Where are the deficit hawks?  The Fiscal Conservatives are a bunch of low life cowards.

This is just a promise like all his promise hollow and without merit.

It’s The Economy

I have been saying that out leader Trump should STU about everything but the economy for he could claim all success there but instead he chooses to go about running that tireless uninformed mouth to everyone’s chagrin.

Well that may not be an option now……seems the economy is slowing down according to some of the latest reports……Trump may well have missed the best opportunity to hawk his economic prowess….

This week, much of the story that the White House likes to tell about its economic record fell apart.

It’s not just that growth appears to have slowed, though it has. On Friday, the Commerce Department reported that the country’s gross domestic product expanded at a middling 2.1 percent annual rate during the the second quarter, down from 3.1 percent over the first three months of 2019. This was only a preliminary estimate, a guesstimate really; the government will gather more data and revise that number in the coming months. But it was clearly worrisome to Donald Trump, who tried in vain to put a glass-half-full spin on the news while also placing blame for any weakness on his nemeses at the Federal Reserve.

https://slate.com/business/2019/07/trump-gdp-report-economy.html

But not to worry Trump supporters he will do what he ALWAYS does….make stuff up and lie his ass off.

But for a closer look at the economy……

Economists noted that business capital investment, which has been strong for the past two years, fell at a 0.6% annual rate in the April-June quarter, the first decline in three years. That weakness likely reflects, at least in part, a reluctance by businesses to commit to new projects because of uncertainty surrounding President Trump’s trade war with China. Indeed, most analysts think the US economy could slow through the rest of the year, reflecting both global economic weakness and the trade war between the world’s two largest economies. That is one key reason why the Federal Reserve is widely expected to cut interest rates next week and to signal that it may further ease credit in the months ahead.

It may be too late for the president to use the economy as a political prop….you snooze you lose……

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Job Numbers Are Worrying

Could all this “booming” economy be worrying news?

The job market is one that has “real” economists worried….that one in the White House only played an economist on TV…nothing about him is expert.

AXIOS has done some research that needs reporting more….

The U.S. jobs market, having long been the bedrock of the nation’s economic expansion, is starting to worry economists ahead of next week’s payroll data.

What’s happening: After years of remarkably smooth sailing, 2019 has brought market volatility and some concern about whether the economy can keep adding jobs at a fast enough pace to sustain the expansion.

What we’re hearing: Job gains don’t necessarily have to turn negative to signal trouble, Mark Zandi, chief economist at Moody’s Analytics, told Axios at a labor market conference hosted by payroll processor ADP this week.

All that’s required is a strong slowdown in job growth. A 0.5% increase from a cyclical low on the unemployment rate has accurately predicted every recession in recent history and has never been a false positive, as Brookings economist Claudia Sahm noted recently.

  • “Once unemployment starts to rise, even from a very low level, it undermines confidence, and the only difference between an expanding economy and a recessionary one is faith,” Zandi said.
  • “A recession is a collective loss of faith, and people lose faith when they start seeing unemployment rise.”

Why now? A slowdown is not that unlikely, given the state of the labor market. The unemployment rate is at a 50-year low — it was 3.6% in May — and employers are reporting more trouble finding people to hire.

  • In a poll of small business owners conducted in May, 25% said that finding qualified workers was their No. 1 problem, according to the National Federation of Independent Business.
  • The trade war also is adding stress to the economy, but so far the effects have been concentrated in the trade and export sectors, which make up a small piece of overall employment.

What to watch: The all-important services side of the economy has been strong, but is beginning to feel the impact of the tight labor market, said Ahu Yildirmaz, co-head of ADP Research Institute. The number of job openings exceeded the number of unemployed Americans by the largest margin on record in April.

  • “Let’s remember you need approximately 100,000 net new jobs to keep the economy moving. We’re still above that level, however there are so many other factors,” she said.
  • “If you look at the last couple months, the jobs numbers were really, really volatile.”

The bottom line: Another blowout print like January’s, which showed 312,000 jobs added, will calm a lot of jitters.

Keep in mind that there is more to an economy than just the markets……but the MSM wants every American to believe all is good as long as the profits are being made by corporations…..not necessarily so.

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