Tag: Economic News

But The Economy Is Doing Well

Have you noticed that the MSM reports the economy is doing well….apparently based on market information not reality….in other words as long as corporations are turning a big profit the people should be happy and compliant.

If all that is true and the economy is going great why is one of the biggest issues in the upcoming election the economic woes we are facing those days?

If the economy is working so well how come child poverty has risen yet again?

Democratic Sen. Joe Manchin and congressional Republicans faced fresh backlash on Tuesday after the U.S. Census Bureau released new data showing that the nation’s child poverty rate more than doubled in 2022 compared to the previous year, thanks in large part to the expiration of the boosted Child Tax Credit.

The expanded CTC, an American Rescue Plan (ARP) policy that sent eligible families up to $300 per month for each child and eliminated the original CTC’s regressive phase-in, helped push the U.S. child poverty rate to a record low of 5.2% in 2021.

But the program expired at the end of that year after Manchin (D-W.Va.), who supported the ARP, opposed an extension, baselessly claiming that some parents would use the money on drugs instead of their children. (Survey data showed that most families, including those in West Virginia, used the money to buy food and help with rent, along with other essentials.)

Congressional Republicans, who unanimously opposed the ARP, also rejected calls to support an extension of the boosted CTC, part of a broader pandemic-era safety net that is now collapsing.

The result of the program’s expiration, as predicted, was a devastating surge in child poverty. According to the new Census Bureau data, the child poverty rate rose to 12.4% in 2022—the largest single-year increase on record.

The overall U.S. poverty rate also increased, rising from 7.8% in 2021 to 12.4% last year. More than 37 million people in the U.S. lived in poverty in 2022, the Census Bureau said.

https://www.commondreams.org/news/manchin-child-poverty

No one I talk with seems to hold the belief that the economy is doing good.

How about you?

I Read, I Write, You Know

“lego ergo scribo”

Sanctions–Ineffective At Best

I have made my opinions on sanctions to my readers….these do little to turn the course of international relations….take Cuba, Iran, China, etc etc….of all our sanctions have we changed anything?

Now with Ukraine and Russia going at it like oversexed hogs….sanctions are once again in the news….and in the news….

But is the world behind our efforts to make change?

Not really.

Looks like the US will have to threaten the world to get them to play along…..

The White House plans to send a clear message to its European partners in the economic war against Russia, “you are either with us or against us.” Two US Treasury officials will visit European and Central Asian partners next month to demand all sanctions on Russia be implemented.

Treasury officials Liz Rosenberg and Brian Nelson will meet with leaders of financial institutions in Switzerland, Italy and Germany. The AP reports the officials will have a simple message, “1. Continue to provide Moscow with material support or 2. Keep doing business with countries that represent 50 percent of the global economy.”

Rosenberg and Nelson will provide their European counterparts with intelligence on alleged sanctions evaders. If those countries fail to crack down on those still doing business with Russia, then Washington is threatening to issue “penalties.” It is unclear how far the Joe Biden administration is willing to punish NATO allies for violating sanctions.

The policy echoes President George W. Bush’s doctrine that countries must either actively align with Washington in its Middle East wars, or else be judged as working “with the terrorists.” 

(antiwar.com)

Is sanctions a type of siege warfare?

In the distant past, the one place that people could escape a marauding army was behind the walls of a castle. Though this usually protected them from any immediate danger, it created problems of its own. While under siege and waiting for outside help or for the attackers to leave in frustration, those behind the walls could ultimately run out of food and even potable water, which would lead either to surrender or a slow, terrible death.

Although they’re never portrayed as such, in our own time, a form of siege warfare is applied to whole countries, usually poorer ones, through the misuse of sanctions.

There are innumerable forms of sanctions: opprobrium, boycotts, embargoes, denial of service, travel bans, export bans, divestment, asset seizures, blockades, censure, and much more.

…

We have often been told that sanctions like those used against Iraq will eventually lead to the overthrow of governments Western powers don’t like. History doesn’t bear this out. If anything, in countries as diverse as North Korea, Iran and Cuba, sanctions appear to have had the opposite effect, becoming a useful tool for rallying these populations behind their leaders. Just as Russian war crimes are making it more likely to increase Ukrainian resolute resistance, sanctions that hurt average Russians will tend to make them more loyal to Putin and less likely to resist him.

Sanctions as Siege Warfare

Let’s be honest….sanctions are at best…. ineffective.

Now we have the war in Ukraine and as predictable sanctions are our most publicized tactic….(besides the massive amount of monetary support that no one wants to talk about)

Joe Biden’s administration keeps boasting about how successful international sanctions have been in punishing Russia for invading Ukraine. But that boast is increasingly hollow, both with respect to the extent of international unity and the success of the sanctions. Instead of being a success story, the U.S.-led sanctions campaign against Russia is fast becoming another example of a chronically failed tactic.

The administration’s propaganda about widespread global support relies primarily on 2 resolutions condemning the invasion that the UN General Assembly approved, one in March 2022 and the other in February 2023. However, both resolutions were purely symbolic, toothless measures. They did not commit member states to take any action. Nevertheless, more than one-fifth of the UN members, including such key players as China, South Africa, and India, defied Washington’s pressure and cast negative votes or abstentions.

A more graphic and substantive indication of the unwillingness of countries not already in Washington’s geopolitical orbit to join the crusade against Moscow is their refusal to impose economic sanctions. Except for the NATO bloc and long-standing U.S. security dependents in East Asia, the global map is nearly devoid of countries that have adopted punitive measures. Such absence of support throughout the Middle East, Africa, and Latin America is especially striking.

Economic Sanctions Are Simultaneously Ineffective and Cruel

There is nothing now or in the past that illustrates just how effective sanctions are to try and control the situation…..

Hint:  They are far from effective.

And yet they will most likely be more sanctions in the news as the conflict drags on.

Typical War Department waste of time.

I Read, I Write, You Know

“lego ergo scribo”

Our National Debt

The big news yesterday was that our national debt hit a whopping $31 trillion….that is right that is trillion with a “T”…..

The gross US national debt, which topped $30 trillion for the first time earlier this year, has now risen to more than $31 trillion, according to a Treasury Department report released Tuesday. The disclosure comes at what the New York Times calls an “inopportune time”—interest rates are rising, make it more expensive to borrow money and raising the cost of servicing the debt, which has ballooned to its current level from around $23 trillion at the end of 2019, just before the pandemic hit. “Too many people were complacent about our debt path in part because rates were so low,” says Michael A. Peterson at the Peter G. Peterson Foundation, which promotes debt reduction.

In May, the Congressional Budget Office estimated that interest payments and other debt costs would cost the federal government around $8.1 trillion over the next decade. The Peterson foundation estimates higher rates will add at least another $1 trillion. The Office of Management and Budget said in August that the federal budget deficit will drop by a record $1.7 trillion this year, though analysts warn that the underlying “addiction” to debt remains, the AP reports. “When you increase government spending and money supply, you will pay the price later,” says Sung Won Sohn, an economics professor at Loyola Marymount University. He predicts that high inflation will continue for the foreseeable future.

Our Congress has done what they always do….pass a Continuing Resolution to keep our government in business for the next few months.

This should be a gimme but instead the GOP and the Dems have to have a political theater around this necessity.

They even added money debt to the bill by promising more millions possibility billions to Ukraine for their conflict with Russia.

To the tune of $16 billion.

Now my question is why is there NOT some opposition to this blatant waste of taxpayer cash…..I mean they have plenty of opposition to social programs that would benefit the poor and needy….but have nothing to say about cash flowing into Ukraine on a daily basis.

Why?

Someone just please tell me the bottom line for Ukraine.

I Read, I Write, You Know

“lego ergo scribo”

Those Russian Sanctions

At the start of the Ukraine/Russia mash-up the US did what we always do….imposed sanctions.

I have not been a fan of sanctions because I do not believe they are all that effect…… as I wrote in the past…..

Sanctions, What Are They Good For?

I post this because of the news from this weekend….

Russia’s gas giant Gazprom is set to rake in 85% higher revenues this year, to around $100 billion, as natural gas prices surged following the Russian invasion of Ukraine and the significant cut to Russian pipeline gas exports to Europe, an analyst told the Financial Times on Friday.

By choking supply to Europe, Gazprom has driven natural gas prices three times higher than last year’s price, which more than offsets the lower volumes Russia is sending to Europe, Ron Smith, an oil and gas analyst at BCS Global Markets, told FT.

“You can make a solid case that Gazprom will earn more from supplying less gas,” according to the analyst.

…

The EU is looking to limit Putin’s revenues from gas, and European Commission President Ursula von der Leyen said on Wednesday the Commission would propose a price cap on Russian gas as “We must cut Russia’s revenues which Putin uses to finance this atrocious war against Ukraine.”

Also on Wednesday, Vladimir Putin threatened the West that Russia would stop supplying all energy products to Europe if the EU and its Western allies impose price caps on Russian oil and natural gas.

Several EU member states are opposed to the Commission’s plan on a price cap on Russian gas amid concerns that Putin would retaliate with a complete halt of all pipeline gas deliveries to Europe. 

(oilprice.com)

Sanctions do not always achieve the desired goal…..

If you are interested in more information then I suggest this post on IST…..

Sanctions And Tariffs

Now you know….

I Read, I Write, You Know

“lego ergo scribo”

Is Inflation Slowing?

The good news lately has been that the rate of inflation is slowing…..that report made most of the MSM……good news indeed….but is it all show much smoke and mirrors?

While many economists are anxious to have the Fed push forward with an aggressive path of rate hikes, there is good reason to be cautious. If we deliberately raise the unemployment rate, and throw millions of people out of work, it will be the most disadvantaged in the economy and society who will be hardest hit.

And, the impact is not just on the people who actually lose their jobs, but on millions more who will be fearful of losing their jobs. In addition, tens of millions may feel stuck at dead end jobs with poor working conditions and abusive bosses. We should always be cautious about a policy that deliberately throws people out of work and try to avoid going this route unless it is absolutely necessary. (We should also come up with better routes for dealing with inflation, but I’ll skip that one for now.)

The recent government data on inflation, along with a wide variety of private measures, give us good reason to believe that we are seeing at least a temporary pause where the monthly inflation data will be moderate. As noted, there is clear evidence of substantial labor market weakening, which could slow the pace of wage growth to a rate consistent with moderate inflation. The Fed should take advantage of this pause to slow its path of rate hikes and get a better sense of where the labor market now stands.

Inflation: Where Are We Now?

The things that I buy shows no slowing….food is still up….gas is down….

Economists see things that we mere mortals do not……but I can only say how it is affecting me and my family…..so far inflation is still biting hard.

How about you?

I Read, I Write, You Know

“lego ergo scribo”

Are You Worried About Inflation?

Rising food costs…..gas prices doubling……housing costs going out of sight…..low wages…..

If you are worried then do not be so……

Why?

The CEOs are having a bumper year in 2022……

Even when regular workers win their biggest raises in decades, they look minuscule compared with what CEOs are getting. The typical compensation package for chief executives who run S&P 500 companies soared 17.1% last year, to a median $14.5 million, according to data analyzed for the AP by Equilar. That leap was the biggest since a 23.9% surge for 2010 compensation packages, according to the data analyzed by Equilar. The gain towers over the 4.4% increase in wages and benefits netted by private-sector workers through 2021, which was the fastest on record going back to 2001. The raises for many rank-and-file workers also failed to keep up with inflation, which reached 7% at the end of last year.

CEO pay took off as stock prices and profits rebounded sharply as the economy roared out of its brief 2020 recession. Because much of a CEO’s compensation is tied to such performance, their pay packages ballooned after years of mostly moderating growth. In many of the most eye-popping packages—such as Expedia Group’s, valued at $296.2 million, and JPMorgan Chase’s $84.4 million—boards gave particularly big grants of stock or stock options to recently appointed CEOs navigating their companies through the pandemic, or to established leaders they wanted to convince to hang around.

The CEOs often can’t cash in on such stock or options for years, or possibly ever, unless the company meets performance targets. But companies still must disclose estimates for how much they’re worth. Only about a quarter of the typical pay package for all S&P 500 CEOs last year came as actual cash they could pocket. Whatever its composition, the chasm in pay between CEOs and the rank-and-file workers they oversee keeps widening. At half the companies in this year’s pay survey, it would take the worker at the middle of the company’s pay scale at least 186 years to make what their CEO did last year. That’s up from 166 a year earlier.

I know I shall go to bed feeling less hungry because the CEOs are doing so well for themselves.

How about you?

***Obviously, in case you missed it, is sarcasm***

I Read, I Write, You Know

“lego ergo scribo”

2020 The Worst In History

There are so many events that could make the year 2020 as the worst in history……but for this post we will look at the economy….

The markets are at all time highs….and too many in Congress want us to believe that the economy is going great guns…..it is not….maybe for millionaires but as a total entity…..2020 SUCKED!

The final report on the 2020 economy is in, resulting in bleak historical comparisons but also hope for a better 2021. In terms of the specific numbers, the economy grew by 4% in the final quarter of the year, below estimates of 4.3%, reports CNBC. For the full year, that means the economy—as measured by gross domestic product—shrank 3.5%. Coverage:

  • Comparisons:The economy’s yearly decline of 3.5% is the worst in 74 years, reports the AP. In 1946, the mark was 11.6%, thanks to the end of World War II. The 2020 decline is the first since a fall of 2.5% in 2009, during the Great Recession. The worst ever was 12.9% in 1932, during the Great Depression.
    Context: All in all, given the pandemic and unprecedented political turmoil, “the economy closed in fairly good shape,” writes Jeff Cox of CNBC. “There has been a broad recovery, but economically speaking, we’re not out of the woods yet,” is how Ben Herzon of IHS Markit puts it to the Washington Post.
  • On the horizon: Economists expect sluggish growth to continue in the early part of this year before picking up later if vaccines get the pandemic under control, reports the Wall Street Journal. “Coming out of the disaster of the pandemic, we’re going to see outsized growth from the second quarter onwards and a sharp decline in joblessness,” says Joseph Brusuelas of RSM US LLP. Two estimates cited in the story predict annual growth of 4% or 5% in 2021.
  • Relatively stable: The figure of 4% in the final quarter follows wild swings earlier in the year. GDP contracted 31.4% in the second quarter before rebounding by a record 33.4% in the third, notes CNBC.

So basically do not buy the hype that the media and the GOP would have you believe…..

They are LYING!

Keep in mind….a booming market does not an economy make.

I Read, I Write, You Know

“lego ergo scribo”

 

Closing Thought–11Jan21

Remember in the days of yore (2020) when Donald the Orange use to chest thump along with the GOP about all the jobs he, Trump, had created?

Well looks like that has come to a screeching halt….

The relentless virus finally overtook new hiring. Employers shed 140,000 jobs in the US in December, reversing a trend of seven months of job growth, reports the Wall Street Journal. The unemployment rate stayed at 6.7%, which the AP notes is the first time it has not declined since April. Since employers shed 22 million jobs in the spring because of the pandemic, they had been rehiring workers at a steady clip prior to December. Despite the gloomy numbers, analysts saw reason for hope, at least for later in the year.

“It’s reasonably hopeful this will be a one-off rough patch and we’ll recover from there,” Barclays economist Pooja Sriram tells the Journal. The rollout of vaccines and expectations of more COVID relief in the Democratic-controlled Congress were among the factors he and other analysts cited. Eventual warmer weather should help, too. Still, the figure of 140,000 lost jobs was worse than the 50,000 expected by analysts, notes CNBC.

The pandemic surging is wrecking havoc on us mere mortals…..especially with jobs….

We can only hope that there are better days ahead….I really do not believe that a new president will make much difference…the real key is whether Daddy Warbucks wants to part with some of their profit.

May we all see better days.

I Read, I Write, You Know

“lego ergo scribo”

Economic News 2020

These are the final reports before we go screaming into a new year…..the news is not as rosy for some as it is for others……

For instance the jobs outlook for the end of the year…..

The number of Americans seeking unemployment benefits fell by 89,000 last week to a still-elevated 803,000, evidence that the job market remains under stress nine months after the coronavirus outbreak sent the US economy into recession and caused millions of layoffs. The latest figure, released Wednesday by the Labor Department, shows that many employers are still cutting jobs as the pandemic tightens business restrictions and leads many consumers to stay home. Before the virus struck, jobless claims typically numbered around 225,000 a week before shooting up to 6.9 million in early spring. The pace of layoffs has since declined but remains historically high in the face of the resurgence of COVID-19 cases, reports the AP

“The fact that more than nine months into the crisis, initial claims are still running at such a high level is, in absolute terms, bad news,” Joshua Shapiro, chief US economist at the economic consulting firm Maria Fiorini Ramirez Inc., wrote in a research note. “With the pandemic again worsening, it is likely that claims will remain quite elevated for some time to come.” According to the data firm Womply, closings are rising in some hard-hit businesses. For example, 42% of bars were closed as of Dec. 16, up from 33% at the start of November. Over the same period, closures rose from 25% to 29% at restaurants and from 27% to 35% at salons and other health and beauty shops. And the Wall Street Journal sees sobering news elsewhere, noting existing-home sales, “which had been a bright spot in recent months,” were down 2.5% in November over October.

The Trump Labor Department takes a parting shot at low wage workers….those that work for tips….

New changes to Labor Department rules are being called a “year-end victory” for the restaurant industry, per the National Restaurant Association—though servers who rely on tips to boost their sub-minimum-wage pay may not be giving it an enthusiastic thumbs-up. Fox Business reports on a revision made final Tuesday by the DOL that now gives employers the ability to mandate a “tip pool,” in which tipped workers, such as waiters and bartenders, must hand over a portion of their tips to nontipped workers, including dishwashers and cooks. Advocates of the rule change, which will go into effect in February and vary by state, say it will help even out the pay disparities that exist between those employees who work the floor for tips and those who don’t, putting an additional $109 million into back-of-house workers’ pockets, per DOL estimates.

Restaurant Business Online notes that due to this current wage gap, it can be difficult to find back-of-house help. Servers, however, may grumble at now having to split their tips, and another Labor Department shift won’t make them any happier: Per CBS News, a past limit on how much time tipped employees could spend doing nontipped work, such as helping to set up or clean up, has been nixed. Heidi Shierholz, policy director at the Economic Policy Institute nonprofit, says this could lead to big savings for restaurants, as servers are typically paid much less than workers who usually do those nontipped tasks—but tipped workers could lose out on up to $700 million a year due to this rule change, per EPI estimates last year. “You don’t solve the low wages of the lowest paid workers by taking it out of the wages of the second-lowest paid workers,” Shierholz tells CBS. “You pay them more.”

One of the first things Biden should do is repeal this POS….tip workers are the lowest paid of all and the pandemic has made it less likely to make their livelihood.

I Read, I Write, You Know

“lego ergo scribo”

Jobs And Markets

The jobs report came out last week and it was not all that good as it was reported….

The new unemployment report is out, and it has a figure that in normal times would be strong: Employers added 245,000 new jobs in November. Meanwhile, the unemployment rate dropped from 6.9% to 6.7%. But in the context of the surging pandemic, the stat about new jobs is worrisome because it comes in well below expectations of 440,000, per the Wall Street Journal. The November figure is down sharply from 610,000 in October and marks the fifth consecutive month of a decline, per the AP. And CNBC notes that things will likely get worse for the economy in the next few months until vaccines are readily available.

As infection rates go down, as the number of people vaccinated goes up, then we’ll start to see … business activity expand at a faster rate, and we will see the employment numbers pick up more strongly,” David Berson of Nationwide Mutual Insurance Co. tells the Journal. For more context, the AP notes that the economy has recovered only 12 million or so of the 22 million jobs that were lost in March and April when the pandemic began. November’s figure of 245,000 new jobs is the lowest since April.

So while many Americans are with jobs and the crisis deepens there is good news for the bastards on Wall Street…..

A weaker-than-expected jobs report didn’t hurt the markets on Friday. In fact, it might have helped as Wall Street pushed further into record territory, reports CNBC. The Dow rose 248 points to 30,218, the S&P 500 rose 32 points to 3,699, and the Nasdaq rose 87 points to 12,464. All the gains were under 1%. “In a twist of irony, the bad jobs number is positive for markets today,” Keith Buchanan of Globalt Investments tells the AP. The idea is that the weak numbers will add to the pressure on Congress to reach a stimulus deal. “The market is telling us today that if the labor market continues to show slowing momentum, it’s much more likely the powers that be in DC agree to something that’s material,” says Buchanan.

So it is a positive note that Americans are without jobs and Christmas is on the horizon…..right?

Ain’t capitalism grand?

I Read, I Write, You Know

“lego ergo scribo”