Why Half Of America Incorrectly Thinks We're In A Recession

[PlanetJosh]

^^ After the Hyperinflation and Revolution in the preceding post another stage could be added - Foreign intervention in the Revolution. As in military intervention to help whichever side the foreign superpower favors.

 

[Engineer]

Usually when they compare labor force participation rates they only go back to around 1978 because generally we want to compare apples to apples jobs.

If you go back to the 1950s technically "women" weren't really in the workforce per se, as the majority of women working were young single women working temporary or part-time jobs, one of the most common jobs was "live-in nanny" like in the Brady Bunch. Men earned enough to support a family back then and there was no need for women to be co-bread earners. You can see while overall LFP may have been 59% in 1950, about 88% of men of working age were employed.

Edit: didn't realize blogspot images were banned here...

You never mentioned "American men" in your post, just "Americans'.

 

[OverVolt]

bunch o crap

How are we going to have significant inflation with stagnant wages?

 

[OverVolt]

^^ After the Hyperinflation and Revolution in the preceding post another stage could be added - Foreign intervention in the Revolution. As in military intervention to help whichever side the foreign superpower favors.

The best guide for QE is japan and they are 3 decades into it at QE 8. There are two potential outcomes.... bad debts removed by default, or bad debts removed by inflation.

I think we are tipping towards defaults on a personal level as oppose to just willy nilly money printing like in Argentina. I think that QE is actually deflationary. There is no way to have rampant inflation and stagnant wages.

 

[fskimospy]

Its times like this when I remember my old sig


Internet bubble-->Real Estate bubble-->Stock Market Bubble--->Government Bubble--->Hyperinflation------>Revolution

As always, I am open to taking bets on when this hyperinflation will occur.

If only people had the courage to put their money where there mouth is I would have made a ton of cash by now.

 

[QuantumPion]

Yeah I don't think we are headed for some kind of catastrophe or revolution. Japan is the most likely model of what will happen - perpetual 0 interest and 0 growth for decades with stagnate or slightly decreasing standard of living.

 

[alcoholbob]

You never mentioned "American men" in your post, just "Americans'.

Now your sounding like democrats saying we're "creating jobs" even if we gain 800k part time jobs and lose 500k full time jobs.

 

[piasabird]

If you believe any government financial data you are making a big mistake. I would not trust GDP numbers. The government keeps changing how they compute it. They selectively decide not to count things like food and fuel.

Lately the need for fuel has been decreasing. That could indicates less real economic growth and productivity.

 

[fskimospy]

If you believe any government financial data you are making a big mistake. I would not trust GDP numbers. The government keeps changing how they compute it. They selectively decide not to count things like food and fuel.

Lately the need for fuel has been decreasing. That could indicates less real economic growth and productivity.

Basically nothing you wrote there is correct. It seems very odd not to "trust" something that you clearly don't understand.

 

[fskimospy]

Now your sounding like democrats saying we're "creating jobs" even if we gain 800k part time jobs and lose 500k full time jobs.

You realize that the vast majority of jobs that have been created since the recession have been full time jobs, right?

 

[alcoholbob]

If you believe any government financial data you are making a big mistake. I would not trust GDP numbers. The government keeps changing how they compute it. They selectively decide not to count things like food and fuel.

Lately the need for fuel has been decreasing. That could indicates less real economic growth and productivity.

Well no one has proved government is willfully lying about the numbers, even though some economists have had troubling lining up some of the prices of items in the cpi basket with the same numbers in the bureau of labor statistics, however I think the real problem with the data is real apples to apples comparisons are difficult, as Paul Craig Roberts (former treasury secretary) mentioned, they've modified the cpi 18 times since they first started using the statistic.

It would be fine if they replot the entire cpi graph with the new calculations including past data, but instead they just continue the graph with the new cpi for the newer data, which kinda makes a flawed graph.

 

[mirageracerx]

my thing is, what is reported is not what always goes on. what data bean counters go off of doesnt exactly translate to the real world. As of late i have seen a huge disconnect between your average joe shmoe and the typical economy analyst. Everyone says it ended in 2009, if so, how does that translate to more money in my pocket? it really doesnt do much of anything for anyone. and the excuse of rising costs due to "the economy" has been a household phrase now. and the saying "well the costs are always rising" doesnt excuse the fact that the costs raised and stayed there. if we are out of a recession i'd imagine a sort of bounce back.

 

[Knowing]

I'll just leave this here. FWIW, the guest actually recently wrote the book on GDP. The number 2 book on GDP on amazon is written by Stiglitz, who leans left if I recall correctly and Sen who I like very much. It's titled, Mismeasuring Our Lives: Why GDP Doesn't Add Up.

 

[alcoholbob]

A certain percentage of GDP can be faked, which the Chinese have learned from the west. Theres's a technique called "tripping" where you ship goods between two ports and call that economic activity. If the goods get shipped back and forth twice you can double count the value of the goods in GDP. They've been doing some tripping between Hong Kong and Shen Zheng and counting the value of goods shipped multiple times.

 

[Engineer]

Now your sounding like democrats saying we're "creating jobs" even if we gain 800k part time jobs and lose 500k full time jobs.

My 1st graph represented exactly what you posted. Nothing more....nothing less. You then changed the definition to mean "men only" in referring to the lowest recorded percentage of working age people (men) in the US.

How can the recession have ended and the people be incorrect about it if the percentage Americans of working age with a job is at an all-time low?

or are you saying that American working women are not considered Americans?

 

[Jhhnn]

It's not a recession anymore- it's what Krugman correctly describes as "the Lesser Depression". What makes it different from the Great Depression is the way the FRB dealt with it. They avoided deflation.

 

[Attic]

The implied question we are getting from the economy and people is, "what to do about and how to deal with low growth?"

I don't know the answer. We are trying to spur growth, I don't think that's the right answer. If growth is the answer then trickle down is a questionable way to achieve it. I don't have much faith in the money changers nor the elected representatives to deviate from what the money changers want to do/accomplish here and now. A reality of low growth makes all the calls the money changers have on future productivity and the debt system much more risky,... Massive entrenched wealth is not a really that wealth today, it's calls on future productivity and skims from an economy. There needs to be certain level of growth for those calls to be worth anything, otherwise a lot of that massive entrenched wealth (calls on wealth the economy generates over a period of time) loses a lot of value. If the economy doesn't produce enough growth then debt can't be repaid appropriately to sustain our debt system.

The conundrum is that a system built on debt, as ours is, needs a certain level of growth to sustain. We may have crossed peak growth, if so, like plate tectonics there may be some earthquakes as things re-align to a new reality of low growth. QE is a confirmation of low growth. QE tries to spur growth by acting as a vehicle to get money in people's hands instead of/or in addition to existing debt. If QE4 comes then it will be more confirmation. I'd look for that possibility between 2016-2020.

 

[Mai72]

A new America is emerging between the wealthy and the poor. The middle class is going to pay the price. With it our way of living is going to be threatened. The days of picking yourself off the floor and making yourself wealthy in America is dying. I see a lot of people living off of the government in the near future. Taxes are going to increase ten fold which will put more stress on middle class Americans.

The dollar is being devalued. The American dollar is being generated out of thin air. It's losing its value. It's absolutely sickening. Add in stagnating pay and you can see where we are headed.

 

[Jaskalas]

Its times like this when I remember my old sig


Internet bubble-->Real Estate bubble-->Stock Market Bubble--->Government Bubble--->Hyperinflation------>Revolution

^^ After the Hyperinflation and Revolution in the preceding post another stage could be added - Foreign intervention in the Revolution. As in military intervention to help whichever side the foreign superpower favors.

I suspect we'd turn to tribalism, Iraqi style.

 

[Jaskalas]

You realize that the vast majority of jobs that have been created since the recession have been full time jobs, right?

I love your talking point, having already dealt with it before. You carefully chose "since the recession" to hide what has happened more recently than 2009.

2013: 75 Percent Of Jobs Created This Year Were Part-Time Due To Weak Economy, Obamacare Concerns

 

[OverVolt]

I'm loving the "incorrectly think we're in a recession" part. Per the quantitative route, no we're not in a recession. But the economy sucks, just ask Gallop.

 

[Pr0d1gy]

The simple solution is to bring prices back down to a more reasonable level. Since wages began to stagnate in the 70's, the prices have skyrocketed for everything...especially essentials such as food, gas, automobiles, etc. If those prices were brought back down to a more reasonable level people would have a much easier time. We need a pretty sizable deflation, badly.

 

[Engineer]

The simple solution is to bring prices back down to a more reasonable level. Since wages began to stagnate in the 70's, the prices have skyrocketed for everything...especially essentials such as food, gas, automobiles, etc. If those prices were brought back down to a more reasonable level people would have a much easier time. We need a pretty sizable deflation, badly.

simple? :hmm:

 

[OverVolt]

simple? :hmm:

Yes you press the staples that was easy button and make an executive order that all prices are now 20% lower overnight.

And then suddenly there are shortages of everything but you can't let a few unintended consequences get in the way of your master plan.

 

[Pr0d1gy]

And then suddenly there are shortages of everything

It's sad that you still believe this nonsense.