The Most Ignored Stories By The Media

[TJones]

The stories that are truly ignored by the media aren't stories at all. Everything discussed here was obviously not ignored by the media.

Not so much ignored, but so much that they weren't harped on for 2 months straight, because that "sizzle" don't sell.

[TheNiche]

No, they are not proven to work...unless what you mean is that they are proven to work at increasing the deficit. The biggest economic expansions in US history were accompanied by top tax rates of 50%, 70%, and even 90%.

Your explanation is better than marksmu's but is still overly simplistic. There are actually two issues being discussed here: 1) level of government spending; and 2) taxes vs. debt vs. seigniorage. Depending upon the circumstances but holding the level of spending constant, it is often necessary and desirable that tax rates be elevated because the issuance of additional government debt would crowd out the market for private debt and drive interest rates higher for households and firms. If the U.S. happens to be paying off a glut of debt from World War Two, for instance, high tax rates are necessary and desirable to restore balance to the financial system; that does not necessarily mean that government spending is elevated during that period.

Also, top tax rates are less relevant to the discussion than are federal tax revenues as a percentage of GDP. That would be the appropriate metric for analysis. How the burden of taxes is distributed among society is a whole other issue altogether, and that bears reflection on the how the alternatives to taxation affect people of different means, as well.

[TheNiche]

I went back and read the rest of your post. It really is a shame that you began with the phrase you did, because there are actually some paragraphs in there that I agree with, specifically the last one. Perhaps ignoring your post because of the phrase you used is snottily liberal, but if you wish for snotty liberals...or anyone else for that matter...to be persuaded by your post, it behooves you not to begin by sounding like a beer guzzling suburban redneck who posts on freerepublic. If I were to begin my posts with references to Nazis and Fascism, I suspect that the mental triggers in your brain would immediately shut down. It is rather foolish of you to think that your catchphrases will not do the same for anyone reading your posts. So, yes, my ignoring the rest of your posr IS typical, as it is for anyone who starts a debate with namecalling.

Red, if you aren't willing to read the whole way through a post, you should consider just not responding to it at all. You've done that to me on occasion and probably would've ultimately saved face if you'd just decided to walk away. It sure beats having to justify why you refuse to read anything but the first parts of things that piss you off when your opponent is bothering to read all of the stuff that you're saying that is pissing him off.

[RedScare]

The master at restating the obvious with outsized and obscure words in an effort to appear intelligent has no business telling me what to read. This issue had been dealt with and need not be rehashed by your lecturing about it several hours later. So as not to further derail the topic, this is my last response to you in this thread. You may have the last overly verbose word.

[TheNiche]

Some lowering of tax burdern can help as a stimulus. Just as food stamps and unemployment benefits are spent immediately by the recipients, lowering the tax rate on the middle class wage earners can spur spending, IF it is retroactive to the beginning of the year, and ONLY for those who receive a paycheck. For everyone else, the money goes into savings, or the tax savings are not realized until April 15 of the next year. So, for targeted and immediate stimulus, tax cuts are not very effective. Studies suggest that tax cuts return $1.02 for every dollar cut.

This is not to suggest that the stimulus package is great. To get it passed, they had to put in pork for the Dems and pork for the GOP. However, even pork can stimulate the economy. In that sense, some of the programs will still work. Others are just as futile as the tax cuts. To give just one example, the Smoking Cessation programs actually work AGAINST stimulating the economy, as they depress tobacco sales, and theoretically, health care costs (years down the road). For all of its merits, a smoking cessation program does not belong in a stimulus package.

In a bill this size, you have to look at the big picture. Is it better to have a flawed stimulus package than nothing? My opinion is yes, even though I have issues with many of the provisions. I think we'd be worse off without it. The time to fight deficits is during expansions, not during recessions. I recognize this fact, even though I am not pleased by it.

You make it sound as though the economy will only heal itself if we can get households to go out and spend more money, and as though an increased rate of savings is the enemy. The problem is that THAT'S WHY WE'RE IN THIS MESS! We spent so much that we were engaging in dis-savings. That's why our banks are financially upside down and struggling to remain solvent. The proximate cause of the general economic suckage is that our banks aren't lending, and unless people save more so as to recapitalize the banks, the banks aren't going to be able to restore lending to healthy levels.

Instead, whereas a disproportionate share of the stimulus is a redistribution of resources to programs that induce lower class households to spend (and not save) more, you can expect demand for inexpensive imported goods to increase. Remember, GDP = Consumption + Investment + Government Spending + Net Exports. An increase in the consumption line is offset by a decrease in the net exports line.

[TheNiche]

The master at restating the obvious with outsized and obscure words in an effort to appear intelligent has no business telling me what to read. This issue had been dealt with and need not be rehashed by your lecturing about it several hours later. So as not to further derail the topic, this is my last response to you in this thread. You may have the last overly verbose word.

If it were obvious, then you wouldn't have made the error in the first place.

^There, done in 15 words. Happy?

[RedScare]

You make it sound as though the economy will only heal itself if we can get households to go out and spend more money, and as though an increased rate of savings is the enemy. The problem is that THAT'S WHY WE'RE IN THIS MESS! We spent so much that we were engaging in dis-savings. That's why our banks are financially upside down and struggling to remain solvent. The proximate cause of the general economic suckage is that our banks aren't lending, and unless people save more so as to recapitalize the banks, the banks aren't going to be able to restore lending to healthy levels.

Instead, whereas a disproportionate share of the stimulus is a redistribution of resources to programs that induce lower class households to spend (and not save) more, you can expect demand for inexpensive imported goods to increase. Remember, GDP = Consumption + Investment + Government Spending + Net Exports. An increase in the consumption line is offset by a decrease in the net exports line.

All of this is largely true, and is a good example why tax cuts as stimulus would not achieve their goal. As you know, during recessionary periods, businesses and consumers hold onto their cash. We saw the banks do it when the banks were lent several hundred billion dollars in hopes of spurring lending, and all they did was hoard the cash. We see it in consumer spending, as we pay down debts and save our money rather than go shopping. And frankly, we SHOULD. However, that does not spur the economy. Letting the "taxpayer keep more of his money" does nothing to encourage spending the money, which is the goal of the government (whether we agree that this should be the goal or not). So, the only way to force money into the economy is for the government to BUY things itself. Businesses and consumers may not spend their money, but they will certainly sell stuff. So, the emphasis rightly should be on government spending that forces the economy to move. Infrastructure projects are one way. Buying new computers and software for the State Department is another (though Republicans attacked this for some reason).

Now, as far as low income people spending more of their money on cheap imported goods, well what can you say. Frankly, the poor spend a disproportionate amount of their income on food and shelter, and most of that is home grown. If your point is that our manufacturing capability is greatly diminished, as Marksmu stated, I absolutely agree. And, though some think it interferes with free markets, I believe it is a legitimate function of government to encourage local manufacturing. A big part of the reason that foreign goods are cheaper is that their governments subsidize their manufacture. By refusing to do the same, we put our manufacturing at a disadvantage.

[TheNiche]

All of this is largely true, and is a good example why tax cuts as stimulus would not achieve their goal. As you know, during recessionary periods, businesses and consumers hold onto their cash. We saw the banks do it when the banks were lent several hundred billion dollars in hopes of spurring lending, and all they did was hoard the cash. We see it in consumer spending, as we pay down debts and save our money rather than go shopping. And frankly, we SHOULD. However, that does not spur the economy. Letting the "taxpayer keep more of his money" does nothing to encourage spending the money, which is the goal of the government (whether we agree that this should be the goal or not). So, the only way to force money into the economy is for the government to BUY things itself. Businesses and consumers may not spend their money, but they will certainly sell stuff. So, the emphasis rightly should be on government spending that forces the economy to move. Infrastructure projects are one way. Buying new computers and software for the State Department is another (though Republicans attacked this for some reason).

I want to be sure that I understand what you're saying in that first paragraph before I respond to your last post.

To put it more concisely, I think you're saying that an increase in the rate of savings does not stimulate the economy but should nevertheless be our goal. Instead the government's stated goal is to encourage consumer spending, which won't work the way that they want it to, and if they want to further that agenda (and not necessarily yours), then they need to increase the rate of government spending excluding transfer payments.

Is that right?

[RedScare]

I want to be sure that I understand what you're saying in that first paragraph before I respond to your last post.

To put it more concisely, I think you're saying that an increase in the rate of savings does not stimulate the economy but should nevertheless be our goal. Instead the government's stated goal is to encourage consumer spending, which won't work the way that they want it to, and if they want to further that agenda (and not necessarily yours), then they need to increase the rate of government spending excluding transfer payments.

Is that right?

Partially right. Government's goal is to stimulate the economy in all areas, including consumer spending. Unemployment benefits and food stamps will stimulate some consumer spending. Direct government spending on infrastructure (among other things) can also stimulate the economy and produce jobs.

My point on savings is that in a credit drenched state, consumers need to save and pay down debt, even though this has the effect of not stimulating the economy. The government is in the position of wishing for more consumer spending while knowing that its citizens need a higher savings rate.

I've stated before, and you've commented on it, that since the economy had been juiced by easy credit, it is not likely to return to that level soon, with or without stimulus. There is a very valid debate on whether we should take our lumps now, or attempt to postpone the inevitable for a period of time (with a stimulus). One hurts much worse for a short period of time, the other is a lesser lingering pain. I don't know which is better.

[TheNiche]

Now, as far as low income people spending more of their money on cheap imported goods, well what can you say. Frankly, the poor spend a disproportionate amount of their income on food and shelter, and most of that is home grown. If your point is that our manufacturing capability is greatly diminished, as Marksmu stated, I absolutely agree. And, though some think it interferes with free markets, I believe it is a legitimate function of government to encourage local manufacturing. A big part of the reason that foreign goods are cheaper is that their governments subsidize their manufacture. By refusing to do the same, we put our manufacturing at a disadvantage.

Housing prices are falling, especially at the low end. Food prices seem to have stabilized, but then they're already massively subsidized. And frankly, there are already enough programs in place that I have a really hard time pointing to many people that are now homeless or starving (that aren't psychologically damaged, anyway). It would seem that most additional infusions of money would be likely to go towards consumer discretionary spending.

It doesn't bother me so much that the lower-class American consumer is in effect not supporting American manufacturing. When they buy something from India, somebody in India has claim to American goods denominated in Dollars. The foreign-held Dollar is like an IOU, and it is worthless if the foreigner doesn't cash it in. They may not spend it on something that we manufacture, but it is assured that foreigners will at some point in time demand goods and services from us in exchange for those that they have sold us. Maybe all they'll do is buy a Treasury bill; that's good, it keeps our interest rates down, and that also has a stimulative effect on the economy.

As for foreign-subsidized manufacturing...I'm cool with that too. If they can make their goods less expensive for our consumers, then our Dollars go further for us. They may as well be giving us free stuff. And to the extent that the deals are so good that it is putting many of our manufacturing operations out of business, I'm perfectly OK funding retraining programs for the unemployed...but less expensive goods are beneficial to everybody.

Partially right. Government's goal is to stimulate the economy in all areas, including consumer spending. Unemployment benefits and food stamps will stimulate some consumer spending. Direct government spending on infrastructure (among other things) can also stimulate the economy and produce jobs.

My point on savings is that in a credit drenched state, consumers need to save and pay down debt, even though this has the effect of not stimulating the economy. The government is in the position of wishing for more consumer spending while knowing that its citizens need a higher savings rate.

I've stated before, and you've commented on it, that since the economy had been juiced by easy credit, it is not likely to return to that level soon, with or without stimulus. There is a very valid debate on whether we should take our lumps now, or attempt to postpone the inevitable for a period of time (with a stimulus). One hurts much worse for a short period of time, the other is a lesser lingering pain. I don't know which is better.

I disagree that saving fails to have a stimulative effect on the economy, it's just that the effect is less immediately potent. All those savings held by financial institutions do ultimately get lent out to firms, households, and even the government to finance new consumption and investment. To the extent that the supply of loanable funds remains diminished, the result is higher interest rates; and higher interest rates act as a mechanism to ration the loanable funds, resulting in suppressed consumption and investment.

I pretty much agree with the rest of your analysis, but whereas you don't know whether the short-term or long-term lumps are the better choice, I have a firm opinion on the matter: emphasis on consumption in lieu of savings risks us falling (further) into a dis-savings trap. The economy will not recover at all if its financial institutions are not recapitalized and lending at healthy levels, and forcing households to consume when they would rather be saving (either directly or indirectly via government) could be viewed as a kind of unsustainable economic cannibalism.

I vaguely recall you complaining at various points that shareholder emphasis on short-term performance on Wall Street leads to some nonsensical actions on the part of executives. You're right! Unfortunately...that pattern also plays out with voters and politicians too. Scary.

EDIT: I was looking to see if I could get some urban vs. suburban stats from DATABook Houston for a different thread (turns out I'd have to buy it) and read through Bart Smith's commentary. He discusses a lot of the stuff that we are. It's a very interesting read.

[RedScare]

I disagree that saving fails to have a stimulative effect on the economy, it's just that the effect is less immediately potent. All those savings held by financial institutions do ultimately get lent out to firms, households, and even the government to finance new consumption and investment. To the extent that the supply of loanable funds remains diminished, the result is higher interest rates; and higher interest rates act as a mechanism to ration the loanable funds, resulting in suppressed consumption and investment.

I pretty much agree with the rest of your analysis, but whereas you don't know whether the short-term or long-term lumps are the better choice, I have a firm opinion on the matter: emphasis on consumption in lieu of savings risks us falling (further) into a dis-savings trap. The economy will not recover at all if its financial institutions are not recapitalized and lending at healthy levels, and forcing households to consume when they would rather be saving (either directly or indirectly via government) could be viewed as a kind of unsustainable economic cannibalism.

I vaguely recall you complaining at various points that shareholder emphasis on short-term performance on Wall Street leads to some nonsensical actions on the part of executives. You're right! Unfortunately...that pattern also plays out with voters and politicians too. Scary.

This whole thing is a series of paradoxes and catch-22s. The voters are furious that banks and corporations are getting bailouts, but if we let the banks fail, we're all screwed. Saving is good, but saving means less money spent on the economy. Fiscal restraint is preferable, but the government needs to stimulate the economy with spending. It is enough to drive one to drink, which sounds like a good way to stimulate the economy.

Probably the most frustrating part of it all is that there is no gaurantee that any of this even works. We already know that TARP 1 did not work as planned. We lent the banks hundreds of billions and they hoarded it, but credit did not loosen up. Who knows if this other crap works. I only know that I am saving my money regardless what the economists and politicians want me to do. Someone else can save the economy.

I got interrupted and did not finish my point. You noted that I said I don't know which is better, a hard fall now, or a slower longer fall. My gut says the hard fall is preferable, as it is over with quicker, and everything after that...however slow...is recovery. But, I find it difficult to root for a collapse like that.

[Marksmu]

I firmly believe that nobody really knows even remotely what needs to be done. I think this is for several reasons...first - the economy now is a global economy. Almost all theories of economics always speak to the global economy, but we have not had a global economy long enough to know what it actually will do for us. Also - I think America has made a fundamental switch to a service economy - banks, restaurants, investment devices, lawyers, doctors, etc. We have lost a huge percent of our manufacturing and it shows. Banks are unwilling to lend money to people without assets - what asset to do most service companies have? None - they rent office space or restaurant space, and the majority of their business "equipment" is furniture or fixtures.

We have a new problem here - one that has never been encountered before really - we have a worldwide decline in consumption - a worldwide banking crisis, and the country who brought everyone out of everything in the past (US) has fundamentally changed since then. YET the world still looks to us to solve it, and blames us for its creation. Its OUR fault our people over spent, and artifically propped up THEIR economies. Its rediculous and infuriating. Im tired of everyone wiping their feet on us. Take responsibility for your own actions.

So - do we need more manufacturing? I think yes - does that mean that we need to impose a tariff on goods coming in? No - not necessarily - more subsidies, or tax breaks for companies willing to manufacture here would be just as good - but our manufacturers are NOT on a level playing field with those in other countries. Our dollar is weak, Other nations have a two fold advantage - First, they have never paid the same wages, offered even similar health care options, retirement plans, college savings plans, dental, vision, bonus, etc - Second - they can buy the raw materials from us for a lower price (due to exchange rates) than our own suppliers can.

In the past a constant was manufacturing it could continue when other areas slowed - now that it is just about gone, were looking to banks and service industries to save us - something I do not believe they can do now. They still do not produce a tangible asset - they merely offer a service - and its very difficult to take a service to the bank as collateral.

So am I Xenephobic for thinking that we cant just continue to ship money out of the country? I dont think so. At some point you need to look around and decide you know what Im going to do what is RIGHT for MYSELF and MY COUNTRY...to Heck with the rest of you. We give to much to others, with no expectation of it helping us. All the economic theory in the world can not convince me otherwise. Because at the end of the day its all theory. Each step of each theory requires someone to do something that is expected, and we are all people with free will...so your theory wont work. As Red said - the theory is if they give it to me I will spend it, but he wont - neither will I - so that theory is not universal.

In my opinion, and with a very conservative mindset - a free market economy works perfectly when it is controlled by political or geographical boundaries - in a global economy there needs to be some form of an equalizer. I don't know what that equalizer is, and I am aware that it is in contrast to a purely "conservative" view - but I am a Conservative, who happens to think the views are old views that have not been reconsidered in the changing enviornment in which we now live.

Change comes in many ways - and one must rethink their way of doing things when the ways of the past no longer work - the definition of insanity is to continue to repeat the same actions, and to expect a different result

Again, my 2 cents.

[Rammer]

Myth: 'The dollar is weak'

Wrong.

The dollar(DXY) has gone from 78 in mid December to 85.99 at the moment of my post.

As people sell their stocks, money flows into the dollar. The dollar actually got much stronger during the October collapse! BUT, everything will change dramatically once the world stops buying our lame treasuries. China and others could pull the rug out from under us. Our massive printing of bogus fiat currency will eventually crater the dollar, but it hasn't happened yet. When it does, the party will be over.

[TheNiche]

Myth: 'The dollar is weak'

Wrong.

The dollar(DXY) has gone from 78 in mid December to 85.99 at the moment of my post.

As people sell their stocks, money flows into the dollar. The dollar actually got much stronger during the October collapse! BUT, everything will change dramatically once the world stops buying our lame treasuries. China and others could pull the rug out from under us. Our massive printing of bogus fiat currency will eventually crater the dollar, but it hasn't happened yet. When it does, the party will be over.

No, the AP has done numerous stories about the value of the Dollar, picked up by most serious newspapers. Maybe you're just not reading the right publications.

Btw, saying that a particular currency would be inadequate to convey any meaning whatsoever. What could be said is that the US Dollar has become weaker relative to the Euro since 2003, but that it has strengthened over the past year.

And add to that that the factors influencing the value of the US Dollar are affecting other major currencies similarly around the globe. The relative change that you cited only indicates that some currencies have been affected worse than others.

China isn't going to sell all their treasuries for two very good reasons: 1) we're they're #1 customer and they wouldn't want to endanger our ability to purchase their products, and 2) they couldn't sell all of their treasuries quickly enough, and as soon as they started the process, the market price would adjust downward overnight and obliterate the value of most of their treasuries.

[TJones]

Never fear, the new AMERO is right around the corner to cure our currency woes. I am gonna invest in Pesos from here on out, until the change, that way when the change occurs, my money will be worth TEN TIMES what it was before the change.

[N Judah]

Also - I think America has made a fundamental switch to a service economy - banks, restaurants, investment devices, lawyers, doctors, etc.

I agree...we have become a nation of middle managers. When there was money flying everywhere it's not like people were using it to go back to school to become scientists. Instead they just got bigger cars and were flipping houses.

Overall i agree with your post but instead of manufacturing (which can be outsourced to anywhere) we should be doing more R+D type stuff.

[TheNiche]

I firmly believe that nobody really knows even remotely what needs to be done. I think this is for several reasons...first - the economy now is a global economy. Almost all theories of economics always speak to the global economy, but we have not had a global economy long enough to know what it actually will do for us.

That is freaking ridiculous. There has been a global economy for as long as there have been civilizations with numerous kingdoms, and even caravans through the great Asiatic deserts. That's many millennia of history. David Ricardo theorized on the nature of international economics in the early 19th century and his theories have been advanced and improved upon in the time since, confirmed as valid time and time again.

Just because you aren't up on your history or economics doesn't mean that nobody knows what's going on.

So - do we need more manufacturing? I think yes - does that mean that we need to impose a tariff on goods coming in? No - not necessarily - more subsidies, or tax breaks for companies willing to manufacture here would be just as good - but our manufacturers are NOT on a level playing field with those in other countries. Our dollar is weak, Other nations have a two fold advantage - First, they have never paid the same wages, offered even similar health care options, retirement plans, college savings plans, dental, vision, bonus, etc - Second - they can buy the raw materials from us for a lower price (due to exchange rates) than our own suppliers can.

That our Dollar is weak (which flies in the face of the post you made following this one) is actually beneficial to our manufacturing sector because it makes our finished goods appear less expensive to foreign consumers and (as you pointed out) raw materials and intermediate goods appear less expensive to foreign firms.

As for wages, it isn't that our manufacturers are on an unfair playing field. On the contrary, the field is quite fair, and what is fair is that labor-intensive manufacturing operations go overseas because frankly, our unskilled pool of labor makes way more money than they're worth. This isn't something that nations just decide on. It's the global labor market at work, bringing jobs to countries that just a decade ago were ridden with huge populations living in absolute squalor.

In the past a constant was manufacturing it could continue when other areas slowed - now that it is just about gone, were looking to banks and service industries to save us - something I do not believe they can do now. They still do not produce a tangible asset - they merely offer a service - and its very difficult to take a service to the bank as collateral.

False. Industrial output falls during recessions. The manufacturing sector is typically hit especially hard as consumer discretionary spending is highly volatile.

So am I Xenephobic for thinking that we cant just continue to ship money out of the country? I dont think so. At some point you need to look around and decide you know what Im going to do what is RIGHT for MYSELF and MY COUNTRY...to Heck with the rest of you. We give to much to others, with no expectation of it helping us.

Speak for yourself. I shopped for mostly foreign-made hardware at The Home Depot today, and it helped me save money. And I'm unemployed now, so the savings are actually much appreciated and go a long way.

All the economic theory in the world can not convince me otherwise. Because at the end of the day its all theory. Each step of each theory requires someone to do something that is expected, and we are all people with free will...so your theory wont work. As Red said - the theory is if they give it to me I will spend it, but he wont - neither will I - so that theory is not universal.

What Red pointed out was what the politicians were talking about. Would it surprise you if the politicians weren't actually putting forth academically-accepted economic theory, and were instead pandering to uneducated malcontents?

And by the way, have you actually read through and made any attempt to understand my previous posts which addressed that bit about how savings works!?

In my opinion, and with a very conservative mindset - a free market economy works perfectly when it is controlled by political or geographical boundaries - in a global economy there needs to be some form of an equalizer. I don't know what that equalizer is, and I am aware that it is in contrast to a purely "conservative" view - but I am a Conservative, who happens to think the views are old views that have not been reconsidered in the changing enviornment in which we now live.

Change comes in many ways - and one must rethink their way of doing things when the ways of the past no longer work - the definition of insanity is to continue to repeat the same actions, and to expect a different result

Again, my 2 cents.

What does that mean? What do you think should actually be done? What is the next step?

[TheNiche]

I agree...we have become a nation of middle managers. When there was money flying everywhere it's not like people were using it to go back to school to become scientists. Instead they just got bigger cars and were flipping houses.

Overall i agree with your post but instead of manufacturing (which can be outsourced to anywhere) we should be doing more R+D type stuff.

Why would a middle manager want to become a measly scientist!? Science typically doesn't pay as well.

And it strikes me that you're drawing these conclusions based on the performance of your social peers, not data.

[Rammer]

No, the AP has done numerous stories about the value of the Dollar, picked up by most serious newspapers. Maybe you're just not reading the right publications.

Btw, saying that a particular currency would be inadequate to convey any meaning whatsoever. What could be said is that the US Dollar has become weaker relative to the Euro since 2003, but that it has strengthened over the past year.

And add to that that the factors influencing the value of the US Dollar are affecting other major currencies similarly around the globe. The relative change that you cited only indicates that some currencies have been affected worse than others.

China isn't going to sell all their treasuries for two very good reasons: 1) we're they're #1 customer and they wouldn't want to endanger our ability to purchase their products, and 2) they couldn't sell all of their treasuries quickly enough, and as soon as they started the process, the market price would adjust downward overnight and obliterate the value of most of their treasuries.

Deal with numbers, not adjectives.

Everything is relative, people have to put their money somewhere.

I don't disagree with some of your points...but don't put words in my mouth.

I said China 'could', not 'will'. We don't know what China will do.

'The dollar is weak'. No it isn't. YET.(Today is 02/13/09 at 1:50 pm...timing is everything)

(I look at the DXY every single day. I have Swiss Francs, Euros, Japanese Yen)

[TheNiche]

Deal with numbers, not adjectives.

Good advice. I wish you'd applied it to the reasoning you used at the end of your post. The US Dollar could be weak or strong, it just depends what your basis is.

I said China 'could', not 'will'. We don't know what China will do.

I know that they aren't going to dump all their treasuries and crater the Dollar. It'd hurt them more than it hurts us.

[N Judah]

Why would a middle manager want to become a measly scientist!? Science typically doesn't pay as well.

And it strikes me that you're drawing these conclusions based on the performance of your social peers, not data.

No, to my knowledge almost none of my "social peers" run everything up on credit card debt. Sorry! I'm pretty sure it's the middle managers who need to save more. A 60K/yr millionaire at the end of the day is still...a 60K/yr millionaire.

[Rammer]

Good advice. I wish you'd applied it to the reasoning you used at the end of your post. The US Dollar could be weak or strong, it just depends what your basis is.

I know that they aren't going to dump all their treasuries and crater the Dollar. It'd hurt them more than it hurts us.

The DXY is 85.98 on 02/13/09 at 02:06 p.m.

When the dollar starts plummeting, you'll see what 'weak' is all about.

[TJones]

I know that they aren't going to dump all their treasuries and crater the Dollar. It'd hurt them more than it hurts us.

Exactly, we are China's biggest client. They aren't gonna risk losing their lazy American connection that refuses to build anything for under $20 an hr.

[TheNiche]

No, to my knowledge almost none of my "social peers" run everything up on credit card debt. Sorry! I'm pretty sure it's the middle managers who need to save more. A 60K/yr millionaire at the end of the day is still...a 60K/yr millionaire.

If not your peer group, then where are you getting this ridiculous load of bunk?

[N Judah]

yahoo/googld/whatever search engine you use

"savings rate us" etc etc

[Marksmu]

That is freaking ridiculous. There has been a global economy for as long as there have been civilizations with numerous kingdoms, and even caravans through the great Asiatic deserts. That's many millennia of history. David Ricardo theorized on the nature of international economics in the early 19th century and his theories have been advanced and improved upon in the time since, confirmed as valid time and time again.

WRONG - your just FLAT WRONG - I dont care how many people wrote about it in the 19th century - the true global nature of our economy and the impact that one country US has on it, cannot be figured out - its too large. B/C you think it, and toss a name out does not make it true.

Just because you aren't up on your history or economics doesn't mean that nobody knows what's going on.

NOBODY does know - if someone knew things would be getting fixed. I guess since you know YOU can fix it. Then again, maybe not, b/c after reading I find that your unemployed now so clearly you dont know everything, or you would have a job fixing it.

That our Dollar is weak (which flies in the face of the post you made following this one) is actually beneficial to our manufacturing sector because it makes our finished goods appear less expensive to foreign consumers and (as you pointed out) raw materials and intermediate goods appear less expensive to foreign firms.

I have repeatedly said the dollar is weak - IT IS WEAK - The US dollar used to be the benchstone to which all was compared, the strongest curreny....its lost that, its not the end all of paper anymore. Its great for raw materials, if you use cheap junk - I happen to be in an industry where cheap materials from foreign countries is not available. I have to have super alloy materials, which you cannot get anywhere except the US, or the UK - Not CHINA. Goto any website and track the decline of the dollar against other currencies

As for wages, it isn't that our manufacturers are on an unfair playing field. On the contrary, the field is quite fair, and what is fair is that labor-intensive manufacturing operations go overseas because frankly, our unskilled pool of labor makes way more money than they're worth. This isn't something that nations just decide on. . It's the global labor market at work, bringing jobs to countries that just a decade ago were ridden with huge populations living in absolute squalor.

Maybe you dont get it - I DONT CARE about other countries. I care about THIS COUNTRY. I will pay more, if it means we improve OUR COUNTRY.

t

False. Industrial output falls during recessions. The manufacturing sector is typically hit especially hard as consumer discretionary spending is highly volatile.

Historically - the manufacturing is what saved the US - we have not undergone a period of recession this large and deep in the past - so you have nothing to base this on.

Speak for yourself. I shopped for mostly foreign-made hardware at The Home Depot today, and it helped me save money. And I'm unemployed now, so the savings are actually much appreciated and go a long way.

Good for you - now go live where you bought those things. Be proud of your cheap junk. Next time you need something though look to that country not this one.

What Red pointed out was what the politicians were talking about. Would it surprise you if the politicians weren't actually putting forth academically-accepted economic theory, and were instead pandering to uneducated malcontents?

And by the way, have you actually read through and made any attempt to understand my previous posts which addressed that bit about how savings works!?

I have read all of your posts, thoroughly, which you dont necessarily return the courtesy but that is fine. The politicians are pandering to the idiots, thats the problem - the idiots in this country greatly outnumber the non-idiots, and the new system is to just promise the idiots more so you can stay in office. Its easy for Obama to stand there and promise he will take from those who have, and give to those who dont, b/c there are more of those who dont. - Sounds like a simple election plan to me. Promise everything deliver nothing, kill the goose who is busy laying the golden eggs.

Finally, simply because you write well, does not make that which you write more true. You speak down to me and everyone else in your posts like you know everything, and you are a god, and I dont know you, so I wont judge you, but - I will say there is nothing that you can say that will be over my head.

[TheNiche]

yahoo/googld/whatever search engine you use

"savings rate us" etc etc

Great, you're citing "the internet" as a source.

And surely, people on the internet are about as random a cross section of the population as you'll ever find...

[N Judah]

You don't have to believe anything that contradicts what you have already decided to be true. But you can also look up "record foreclosures" if you want.

Anyway -don't worry- the brain drain is coming and then you can have your middle management nation all to yourself.

[TheNiche]

You don't have to believe anything that contradicts what you have already decided to be true. But you can also look up "record foreclosures" if you want.

Anyway -don't worry- the brain drain is coming and then you can have your middle management nation all to yourself.

In post #81, you didn't say anything about foreclosures. I don't see the relevance.

[Rammer]

We just became the U.S.S.A.(United Socialist States of America) today, and who does the Houston Chronicle have on the front webpage? A drunk driver killing another drunk/and Robin Williams.

At least one publication, NewsWeek, had the cover titled 'We Are All Socialists Now'.

Congrats to NewsWeek. (If you think we are all Fascists now, that's also acceptable)

The populated cities of America unofficially became dangerous today.

The minority cities along the Gulf Coast & Mexican border have just become particularly dangerous.

Don't wait for the media to tell you to stock up, it may be too late by then.

Snap out of your programmed media reflex dependence and turn on your brain.

Remember Ike and go to the store.

Emergency Supply List: Bottled water, canned food, rice, oatmeal, energy bars, nuts, batteries, wind-up flashlights, wind-up radios, battery operated fans, ice chests, cigarette lighters, bikes, bullets, guns, and cash.

Get them while the lines are short.