Well CNN Money has a great article out on what I finally knew was going to happen--the economy is sinking everyday.

Some highlights to be noticed here from that article:
Now notice the way that our Mr. Yamarone wishes to discount the underlying fiend that is causing this problem--debt.

However, Mr. Schiff is around to remind him of it.


We can all just hope and pray that the GDP can cure this problem before it's to late!

I knew the doom and gloom people would jump on this when I read the headlines on Excite this morning. Where are the D&G people when there is good news to be said about this administration/economy, etc. ?? Of course, Chucky Shumer had to put his gloomy spin on this news. He's such a know-nothing.

It seems that the OVERBLOWN housing market is the biggest contributor to the negative news about the economy. And, who even thought that that rampant rise in house appreciation would last forever????

And, no, Grizz, the economy IS NOT sinking every day. Get real! Take a happy pill and quit looking for negatives (just because Bush is in office).

Federal Reserve Chairman Ben Bernanke, however, has said he doesn't believe the economic expansion, now in its sixth year, is in danger of fizzling out. ...."The biggest risk to the economy is if the housing market doesn't stabilize. That could force consumers and businesses to cut back sharply in spending. Those risks seem to be limited at this juncture," Lynn Reaser, chief economist at Bank of America's Investment Strategies Group said. ............"We knew that the housing market would go through an adjustment. The positive news here is that our economy has been able to grow in spite of that very sharp reduction ," Commerce Secretary Carlos Gutierrez said in an interview with The Associated Press.................However, consumers whose shopping is indispensable to a booming economy boosted their spending at a 3.8 percent pace. That was a solid showing although it was slightly weaker than the 4.2 percent rate in the fourth quarter.

A key reason consumers have remained resilient, even in the face of the painful housing slump, is that the jobs markets has managed to stay in good shape.................The nation's unemployment rate dropped in March to 4.4 percent, matching a five-year low.................Wages and salaries went up 1.1 percent, a figure that hasn't been higher since 2001. That's good news for workers and should support consumer spending. Benefit costs, however, edged up just 0.1 percent, the least since the first quarter of 1999.

Don't know about you, but that sounds pretty dam.ned good to me.

Yeah, right, Solo. And I just wonder how much of that is still owed to the banks and how much of that has been paid off

Actually wages and salaries are about 0.2

Bzzzzzzzzzt! Well, Cutie, I guess one could cast doubt upon anything that is put out by asking that question. Woulda, shoulda, coulda. Do you have a link or info to support your question? Or, was it just a speculative question to cast doubt? Again?



Grizz, that link goes to the Consumer PRICE Index, covering food & beverages, energy, housing, transportation, medical care, recreation, education, etc.

It doesn't have anything to do with wages, nor does it mention them. ??

What about the other positives mentioned in this article?

Don't forget that our economy has been GROWING for the past 6 years (guess who's been President during those times?), unemployment is DOWN (matching a 5-year low), job market is in good shape...........all this despite the overvalued house market.

Contrare to what you said, the economy IS NOT sinking every day. Quite the opposite:
Disposition of personal income

Current-dollar personal income increased $245.7 billion (9.2 percent) in the first quarter,
compared with an increase of $126.1 billion (4.7 percent) in the fourth.

Personal current taxes increased $57.8 billion in the first quarter, compared with an increase of
$24.0 billion in the fourth.

Disposable personal income increased $188.0 billion (8.0 percent) in the first quarter, compared
with an increase of $102.0 billion (4.3 percent) in the fourth. Real disposable personal income increased
4.5 percent, compared with an increase of 5.3 percent.

HINT: The increase in taxes means we're putting more $$ into the coffers to reduce national debt. Now, how can anyone put a gloom and doom message out on this?

An Economist talks about the scope of America's growing consumer debt, what's behind it and what it means for the future.

Why are so many Americans falling in to debt.



US Consumer Debt Reaches Record Levels.

I simply took 1.1 and subtracted 0.9 to come up with my figure. You do believe in paying yourself after paying for the necessities of life, don't you, Solo?

Seems we have dueling links, then, as this article completely denies the facts that I posted from the government site above.

From one of the two of the articles you gave from MSNBC: The labor market has been rather weak, employment growth has barely kept pace with population growth, wages have been flat, income has fallen for five years in a row, and at the same time, prices for critical big ticket items-items such as health care, housing, college education—have gone through the roof. In that bind, the only escape valve for middle class families is to borrow more money.

All of which is hardly true and is in fact, a flat out lie, if you look at the figures provided by the BEA's website, and the one you provided yourself above. I guess they don't expect folks to do any homework and just take their word for it.

Oh, but wait. It's from the MSM and the (choke, cough!) World Socalist , one website who has a history of slanting news/info to destroy the good news in this nation, and their cousin & one who is dedicated to overthrow of this country. Never mind. I'm sure, their unbiased facts outweigh what the BEA (Bureau of Economic Analysis) had to say.

Gaaaaw! Grizz, can't you do better than that?????!!!! Citing a socialist website to give a correct view of ANYTHING going on in this country?



1.1 (?) from 0.9 (?)>>>>>>>>>>>>>>where? >>>>>>>>how?
We're talking about wages and salaries. Not spending habits.

Way to hang in there Solo. Gizzard is beyond exasperating, as is D2.

Always the doom and gloom from the libs. Everything sucks. It's all Bushs' fault. And with all this negative patter from the left I have yet to see one solution of theirs to remedy their percieved problems. They remind me of Europeons.

Why? Bush would just veto the thing.

Just shooting from the hip here, no extensive research. Who would think that things could stay this good forever? Isn't this about the best it has ever EVER been? Remember Carter with 2 digit inflation and unemployment? Unless we change direction and take that route again we will not see anything like that from here.

Doom and Gloom guys? LOL!!!!

Just look around. How many factories do you see going up to replace those removed from this nation, along with the wages and benefits? How many bankruptcy notices do you see in the newspaper daily? What about foreclosures on mortgages?

Let's look at what construction is building..restaurants and hotels. Let's see who's populating them...illegals..along with the construction sites and lawn services.

Gloom and Doom? Nope. I'd say we're watching this destruction of our nation while persons who champion it have their heads in the sand..reading the bible in the dark...

As last week's cover story in the Economist pointed out, the US economy is still #1. By far, #1. Many of these indices have seldom been better. Yes, the housing bubble that's been forecast forever has arrived in a few places, but it's surely not the only time and place that real estate prices have gone down in places as divergent as Texas and Boston.

The US dollar is taking a beating, but that has its plus sides. Stop buying foreign imports, folks!

And even if the stock market collapses and house prices drop 30% nationwide, it won't be Bush's fault as much as the fault of Congress, the Federal Reserve, and consumers.

On further enquiry, I see the article in the Economist was not about the economy! My mistake. It was only about the American military. Anyway, the official unemployment rate is very low, even though it only counts people who say they're looking for work. The inflation rate for consumers is still very low, even though it lies and cheats some. The annual deficit is going down from an incredible (but understated) amount to a slightly smaller (but still incredible and understated) amount. The national debt is only five times what they say it is. The savings rate is higher than they say, surely not negative, but surely not sufficient. Basically, most Americans play the lottery called "real estate will always go up in value."

Sure enough, the gloom and doom brigade is usually wrong. Whether or not a news article says so, the American economy is still #1. That means that for the immediate future or the midterm, it's too big to fail.

Unemployment is measured using two studies - unemployment by business and unemployment by household. The old myth that it only measures those who say they are looking for work is just that, a myth.

Measured in anything other than dollars, the dow is currently crashing.















This is standard boom-bust capitalism, created entirely by the fiat currency we have in place. Essentially what happens is as follows: The fed has a target rate for inflation, which it enforced either by buying stock with newly printed money (increasing the money supply) or selling stock, and then burning the money it gets (reducing the money supply). Either way, what happens is that the interest rate changes from what it would be in a commodity money scenario, which would have neither inflation nor deflation. The interest rate changes, and investors interpret the time preference of savers to be higher or lower than it actually is. The result is that they malinvest, putting money either too high or too low in the capital structure. If it is too high, as we are seeing now, what happens is that consumers (who have saved less than investors believe, due to the distorted interest rates, thanks to the fed) are ready to purchase goods now, but there are not enough goods currently on the market (since investment was placed higher in the capital structure, they are still being created) to satisfy their needs. We have too much money chasing too few goods, and as Friedman showed, this creates inflation. That is the current scenario.

In the opposite scenario, we have too little money chasing too many goods, resulting in deflation.

Either way, the solution is a return to commodity money, namely the 100% gold dollar. Free banking would be even better, but far less realistic. We are currently on the boom side of a oncoming bust.

Gosh, Ben, you sound so erudite.

Glad to read your words again. Are you still in school.......in London, I believe?

Hi Solo

I'm home for the summer right now. Yea I'm still in school, I'll be a Junior this fall. Majoring in Economics and minoring in Physics.

Welcome back, BenT, whatever all that economic mumbo-jumbo said. I'll check about how unemployment is measured; thanks for the warning.

Later, added: Now that I've checked one unofficial source (Wikipedia) and the American BLS, I stand by what I said.

Wikipedia, article with no citations:
On the other hand, individuals are classified as "unemployed" if they do not have a job, have actively looked for work in the prior four weeks, and are currently available for work. The unemployed includes all individuals who were not working for pay but were waiting to be called back to a job from which they had been temporarily laid off.

American BLS website http://www.bls.gov/cps/cps_htgm.htm
The basic concepts involved in identifying the employed and unemployed are quite simple:
People with jobs are employed.
People who are jobless, looking for jobs, and available for work are unemployed.
People who are neither employed nor unemployed are not in the labor force.

Maybe the UK does it differently, but we're discussing the American economy here.

I'm not sure what you are suggesting, that the BLS should include people who are outside the labor force as "unemployed"?

Ben, welcome back and I really am glad to see you here. I'm just saying that this claim you made in post #13, "Unemployment is measured using two studies - unemployment by business and unemployment by household. The old myth that it only measures those who say they are looking for work is just that, a myth" appears to be your new, false myth. In other words, I cited two sources (the first two I looked at), which both say that unemployment measures those who say they are looking for work.

What did you mean to say? Is it true that unemployment is measured as the BLS says it measures it? I'm not saying how the rate should be measured, only how the agency says it measures it.

Oh, I see. Sorry, I was confused.

I meant to originally present that as saying that the reason it is a myth that those who are no longer looking for work aren't counted is because they are accounted for by the BLS study that goes by business. Its called Current Employment Statistics Survey.

Yea, the other survey doesn't count you as unemployed if you are no longer looking for work.

I just input Current Employment Statistics Survey into google, got the BLS website for that survey, and it's an employment survey about employment, and I see nothing about unemployment. Could you please now prove your point for what it's worth? Where does the BLS study say they count the workers that aren't looking for work? Or have I just asked you to disprove a double nonnegative?

Is it a fact that US unemployment statistics don't count those who are not looking for work? What's the myth?

Back more on the original topic, I'll bet your graphs look even worse after this week's bloodbath on the American stock exchanges. The stock market isn't doing well, but then the Dow Jones is not the best measure of the stock market. S&P500 is a far broader measure.

AWHWWWW come on, Fit!!

A Bloodbath!!??? It closed at 2 points below the highest ever Dow score. Sheesh! Sortuv customery for the libs to take something positive and look for the negative to report. Like when the libs were rejoicing while reporting Bush's lowest rating........... when Congress was EVEN lower!!

Where where D&B crowd when it closed at the HIGHEST ever......... a few days before?

FYI, my stocks are higher than they've ever been while Clinton was in office. Almost double, in fact. They've been slowing climbing for the last 6 years despite the slight correction toward the end of this week. Still much higher than they were for years! I'm very satisfied as I watch them slowly creep upwards.

So quit reading those lib websites. They're meant to depress and deceive.

I'm unsure what you are saying. The Current Employment Statistics Survey accounts for people not looking for work, because it interviews businesses. To quote wiki:



The interviews of individual workers are done via the Current Population Survey.

Ben, that isn't the point at issue here. You're the one who challenged my assertion that the unemployment numbers ignore people who are not looking for work. You haven't proven your point. Please, find us a reliable URL from the BLS that clearly says they compute unemployment figures using a standard that does NOT exclude people who are not looking for work. I already quoted a BLS statement, that is admittedly an old statement, saying the BLS excludes those who are not looking for work. You must quote a fact from the source itself, to debunk a myth. I think.

Surely you're not saying that simply because the BLS uses methods that interview businesses, that therefore it knows from those businesses who is not looking for work? Joe Business Owner says to the interviewer, "I know lots of people who never apply for work here, so that counts"?

Here is my source, Yahoo, and it tells below where it got its source. It reports that Friday's close was 13,265, and the 12 month high was 14,121. A difference of 856 points, a wee bit more than two points. So it appears that you are dead wrong saying, "It closed at 2 points below the highest ever Dow score. Sheesh!" Like, you are wrong by 42,800 percent.

DOW JONES INDUSTRIAL AVERAGE IN (^DJI) Summary, News 13,265.47 208.10(1.54%) 337,123,901 4:07pm ET
Quotes and other information supplied by independent providers identified on the Yahoo! Finance Partner Page. U.S. and Canadian historical chart data provided by Commodity Systems, Inc. (CSI). International historical chart data provided by Hemscott Americas.

Although I may have gotten my thursday-friday news from Reuters. Are they owned by wild eyed liberals?

Please, SoloNav, don't assume that Anabaptists are liberals, or that I read even half as many liberal websites as you read. I do not get my economic data off of alternet or moveon.org and I seldom read those websites.

As for Clinton and Bush's economic accomplishment, the budget was balanced by the end of Clinton's regime, even after subtracting SS funds, I believe. But that's not one man's accomplishment; Congress and the Federal Reserve and all business people and all investors get the major share of credit for economic improvements. Sheesh, indeed!

Edited: here's another source, off of some website like "the street.com" on Wall Street, surely not a flag burning liberal Commie plot: "Yikes!
That seemed to be the reaction as U.S. indices suffered their worst weekly drop in about five years. Let's go right to the numbers this week.

The Dow Jones Industrial Average gave back 4.2% for the week, and if that sounds ugly, brace yourself, because the Dow turned in the best performance of the U.S. indices. The Nasdaq fared a little worse, dropping 4.7%, while the S&P 500 gave up 4.9%. Two indices outright plummeted: The Russell 2000 careened 7% into the red, and the REIT index tumbled 8.8%. As you might have expected, the industry sectors that have run the furthest gave back the most. "

But hey, maybe that's not a bloodbath. But it's more than a superficial cut, far more than closing two points off its highest ever.

My apologies. Your reports were connected to Thursday-Friday. Mine were Wednesday-Thursday. Yes, the MSM does try to blow information out of perspective to cast a negative impression. The DOW did close on Wednesday the highest ever. My point: Very little fanfare was made over it. Were you even aware of it?


I was referring to the websites, not you personally. Your religious persuation was not even an issue in this discussion.

Nice diversion, but as you commented to Ben, that's that the issue being discussed.........we were talking about stocks, not "economic accomplishments."

[However,since you brought it up, as far as balanced budget, I'm afraid there was as much of the smoke screen under Clinton as you were referring to in an earlier post about our current national debt. He was balanced only by playing footsey with the future amounts of $$ which were planned to be spent, but then were cut.]



Correct. It wasn't a bloodbath as you stated.

Fine, we agree that the DowJones was at its peak and then fell sharply, but that a week doesn't define a decade. And even if one miraculous year may have balanced the current federal budget with or without SS, we agree that far too many debts make for bad govt. finance.

I'm still disagreeing with Grizzly's points about doom and gloom. Any way you measure national economies, the USA is #1 and is not in danger of losing that status within the decade. The US$ is taking a beating, regardless.

Interesting.

Here is another statement from another forum made about the high that I was talking about :


A one day, two an a quarter percent adjustment from historic market highs is conclusive evidence that the economy is in the crapper?

As another poster put it (and I couldn't have said it better myself), "It's really simple and predictable: Stocks reached a record high and a bunch of investors decided to take the money, so they sold. with all that stock for sale the price went down. Now that the price is down bargain hunters are snapping it up. As more stock gets bought there is less of it for sale and the price goes up. As the price goes up they sell to make a profit. More stock for sell the price goes down. Then the bargain hunters start snapping it up. Less stock for sale the price goes up. They see a profit and sell. . ."

Ahhh, they are at it already. Link.


Dow Surges 93 Points After Pullback

Monday July 30, 8:08 PM EDT

NEW YORK (AP) — Wall Street found a foothold Monday as investors, still anxious that a credit crunch could crimp U.S. growth, took advantage of low prices after last week's steep losses. The Dow Jones industrial average surged more than 90 points.....

Much of the stock market is a gambling speculation, especially commodities and future markets, and derivatives. The sub-prime lending mortgage market was also a gamble on high risk borrowers. None of this should be overly used to measure an economy. Shanghai's market will surely collapse. Heck, the Nikkei index in Tokyo has never recovered from its collapse, almost twenty years ago, but their manufacturing and economy are fine.

Did you know that when FDR first took office (after the Great Depression), the stock market and economy fell dramatically further because of his ignorant experimenting with the economy? He would attack big corporations, and then small corporations, and then back off both. It changed monthly, or so. There is a great myth that FDR ended the Great Depression when he took office when he actually made it worse with his experimenting.

See here. The Forgotten Man: A New History of the Great Depression

....Shlaes also traces the mounting agony of the New Dealers themselves as they discovered their errors. She shows how both Presidents Hoover and Roosevelt failed to understand the prosperity of the 1920s and heaped massive burdens on the country that more than offset the benefit of New Deal programs. The real question about the Depression, she argues, is not whether Roosevelt ended it with World War II. It is why the Depression lasted so long. From 1929 to 1940, federal intervention helped to make the Depression great—in part by forgetting the men and women who sought to help one another......


The point to which I'm laboring to get to is that it took from 1929 until the early 1950's for the stock market to get back to its pre-Depression highs. We rebound much quicker.

Interviewing both population and businesses accounts for people who are not looking for work, because we can cross-reference the degree of employment that is available with the actual unemployment rate. I didn't say that any study interviews people who aren't looking for work, I said that the studies account for those outside the labor force.

Interviewing both population and businesses accounts for people who are not looking for work, because we can cross-reference the degree of employment that is available with the actual unemployment rate. I didn't say that any study interviews people who aren't looking for work, I said that the studies account for those outside the labor force.

Ben, I really didn't mean to quibble with you over this fine point that I don't really care much about. As far as I can see from the source itself, the BLS computes the unemployment rate by measuring the work force and measuring those who are trying to be in the work force by looking for work, and it does not measure the unemployment rate by measuring people who aren't even looking for work. I don't understand what you're saying even when you restate or repeat, so why don't we just drop it.

The US economy is still very strong, which is a point we probably agree.

Alright, I don't know how else to put it, so we might as well drop it.

Me, too. And speaking of dropping, the stock market had another very bad week. Nevertheless, you should not measure an economy by its main stock market. I think Japan is still the #2 economy in the world, and the Nikkei Index of its top 225 stocks is now around 17,171, after a high of 38,951 in Dec. 1990, and a low of 7,63 in April 2003.