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

[fskimospy]

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.

You realize that would be extremely likely to lead to an economic catastrophe, right?

 

[OverVolt]

It's sad that you still believe this nonsense.

No really its absolutely true when you enforce price controls it leads to shortages or surpluses.

It is literally off the supply and demand chart from econ 101. If the price is not allowed to float to equilibrium due to laws and such there will be shortages or surpluses depending on if it is a price cap or price floor. This is happening to countries all over the world this very second because they are too stupid to have learned the lesson.

http://www.huffingtonpost.com/2014/04/01/venezuela-rationing_n_5072160.html

Venezuela is the current winner of the price controls award.

President Nicolas Maduro's administration says the cards to track families' purchases will foil people who stock up on groceries at subsidized prices and then illegally resell them for several times the amount.

Subsidize is really the wrong word because its more like "lower price enforced by law" which ties into the second point, any time price controls are enforced secondary (black) markets always appear for goods that more accurately reflect their true price. You are a supply and demand luddite. You really should understand this shit if you're going to be voting. This is like "the biggest argument against democracy is to talk to a voter" type stuff.

Registration begins at more than 100 government-run supermarkets across the country Tuesday, and working-class shoppers who sometimes endure hours-long lines at government-run stores to buy groceries at steeply reduced prices are welcoming the plan.

How much more clear could it be? The shelves of that place are likely barren and picked clean. Thats just how the world works. It just is.

http://www.huffingtonpost.com/2014/04/30/venezuela-food-company-suspends-production_n_5242688.html

In trying to force cheaper pasta, the pasta supplier shut down. There is now less (no) pasta on the shelves. That is the definition of a shortage. At the government set price, you must wait in long lines to acquire pasta. You can turn around and probably sell it at a 200% markup for your efforts in the black market. Its so classic it hurts.

I'd rather just pay the going rate thanks.

When you enforce a cheaper price you all but ensure a long wait time for that item. The price then becomes the currency amount mandated by law and then a waiting time because of the shortage. When prices are allowed to float freely the number of people who demand XYZ item meet up with the supply of XYZ item very nicely. When you mandate a lower price by law, now wayyyy too many people can afford the same item. So it becomes a game of who can wait in line the longest. Or who has the money to buy it in the black market and not stand in line. Cause what would really fix the economy is everybody standing around like we're in a russian bread line.

 

[ch33zw1z]

Recession? Not really, I see it as another tax payer funded bubble that's going to pop eventually.

As prices for everything increase...from food, water, gas, government employees and their guaranteed raises, telco hook ups and gear, just pick something....even housing (yea i know home owners were hit hard by the bubble, as so were landlords so rentals go up), somethings got to give eventually. So people cut down on stuff like eating out, or movies, or junk food, or taking a family vacation, etc....everyone's situation is different. Somethings going to give.

Personally, my medical coverage for a family of four has doubled in the last 4 years. That's what getting us the most. Can't wait to see how much it goes up this year. It really feels like it's happening to force us onto the government provided healthcare, so then the corporation doesn't have to provide the benefits.

 

[Attic]

Recession? Not really, I see it as another tax payer funded bubble that's going to pop eventually.

As prices for everything increase...from food, water, gas, government employees and their guaranteed raises, telco hook ups and gear, just pick something....even housing (yea i know home owners were hit hard by the bubble, as so were landlords so rentals go up), somethings got to give eventually. So people cut down on stuff like eating out, or movies, or junk food, or taking a family vacation, etc....everyone's situation is different. Somethings going to give.

Personally, my medical coverage for a family of four has doubled in the last 4 years. That's what getting us the most. Can't wait to see how much it goes up this year. It really feels like it's happening to force us onto the government provided healthcare, so then the corporation doesn't have to provide the benefits.

Yea, it's hitting folks in different areas, for you it's healthcare, and probably food/energy. If you have kids, tuition. These increases are much more clear and severe when taken in total since 2000.

So folks if spending more on "essentials", will have less to spend elsewhere if there wages aren't keeping up. It appears that for a large marjotiy of folks that wages simply aren't keeping up, so it feels like a recession to them despite GDP not being negative 2 quarters in a row. The other issue is that while for a lot of folks they are having less, since 2009 the recovery has been amazing for top 1% and especially top 0.1-0.01% due to equity and housing bubbles reinflated by easy money policy. This is somewhat zero sum, the benefit to the top is coming at the expense of everyone else as increases in housing/assett prices apprecited by the top 1% before the appreciation are then only available to everyone else after prices have been inflated, and everyone else doesn't have very easy (cheap) money to purchase with. Rigged sums it up best.

The outcome couldn't be more clear given what we are seeing. We'll have to do with less. Lower standard of living may describe it in harsher terms, but that's somewhat debatale depending on where the cuts actually are made. Cutting out junkfood, cable, smartphone extravagant plans/phones is arguably increasing standard of living.

Ultimately to get growth up, government will have bail out taxpayers with easy money, or (more likely) work to lower lending standards by redefining FICO scores and other obstacles to taking on more debt. I think loading americans with more debt is most likely outcome since that is what has fueled unsustanable growth that gets skimmed to top 0.01% for decades and is now being taped out under current conditions.

 

[Ronstang]

The average person equates a recession and a bad economy as the same thing. The truth is our government has been destroying this country for decades and it's just getting worse. People know there is inflation if they buy groceries yet are told by dear leader that there is none because he is a liar and uses a different market basket of goods to make it appear there is no inflation.

 

[MongGrel]

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

He just copies and pastes things, don't expect him to actually think

 

[alcoholbob]

The average person equates a recession and a bad economy as the same thing. The truth is our government has been destroying this country for decades and it's just getting worse. People know there is inflation if they buy groceries yet are told by dear leader that there is none because he is a liar and uses a different market basket of goods to make it appear there is no inflation.

The basket of goods is the real problem. The bureau of labor statistics lists the individual prices of common commodities going up at annualized rates like chicken (3.8%), beef (4.5%), and bacon (6.6%) and healthcare premiums and gas are rising even more rapidly. However BLS then says cpi is 1.4% because we don't put any of these items in the basket to calculate inflation.

 

[Jhhnn]

The basket of goods is the real problem. The bureau of labor statistics lists the individual prices of common commodities going up at annualized rates like chicken (3.8%), beef (4.5%), and bacon (6.6%) and healthcare premiums and gas are rising even more rapidly. However BLS then says cpi is 1.4% because we don't put any of these items in the basket to calculate inflation.

So when the numbers don't match your pre-conceived notions, claim they're wrong, make false attributions, yell at the clouds, huh?

http://stats.bls.gov/cpi/cpifaq.htm#Question_6

Or is it all a conspiracy? Is it all interconnected through Benghazi?

 

[alcoholbob]

So when the numbers don't match your pre-conceived notions, claim they're wrong, make false attributions, yell at the clouds, huh?

http://stats.bls.gov/cpi/cpifaq.htm#Question_6

Or is it all a conspiracy? Is it all interconnected through Benghazi?

What does the cpi excluding beef and pork products have to do with benghazi?

 

[MongGrel]

What does the cpi excluding beef and pork products have to do with benghazi?

He's just a silly person that way.

I think most tend to ignore it these days from what I've seen.

 

[fskimospy]

What does the cpi excluding beef and pork products have to do with benghazi?

CPI conspiracists have a lot in common with Benghazi conspiracists.

 

[Jhhnn]

What does the cpi excluding beef and pork products have to do with benghazi?

Well, yeh, except that they *are* included.

Your belief to the contrary is a form of motivated reasoning & truthiness.

Table 2-

http://www.bls.gov/news.release/pdf/cpi.pdf

Finding that was trivially easy, btw.

Benghazi is a state of mind. When the chumps are told what they want to believe, they do.

Any other questions?

 

[Engineer]

gas are rising even more rapidly

Gas has been up and down over the last 3 years and is lower than it was 3 years ago. It's currently on the down slide (surprisingly). Might be on the way up now that we've fucked our way back into Iraq.

 

[alcoholbob]

CPI conspiracists have a lot in common with Benghazi conspiracists.

So they're all republicans?

 

[Attic]

Gas has been up and down over the last 3 years and is lower than it was 3 years ago. It's currently on the down slide (surprisingly). Might be on the way up now that we've fucked our way back into Iraq.

Yea, gas is cheaper now than in 2008 (by roughly 50c). The biggest stinger is that it's over 3x as expensive as it was in 2000. The damage to consumers was done before 2011 and they're still dealing with that exacerbated transpo cost on stagnant wages.

 

[Engineer]

Yea, gas is cheaper now than in 2008 (by roughly 50c). The biggest stinger is that it's over 3x as expensive as it was in 2000. The damage to consumers was done before 2011 and they're still dealing with that exacerbated transpo cost on stagnant wages.

3X ? It's 7 times here what it was in 1998 ($0.49 in Corbin, KY and $0.59 in Lexington, KY). Yes, it's hyper-inflated vs the late 90's/ early 2000's but in the last few years, while it's been up and down, it has, on average, been flat (my point). Also keep in mind that fuel mileage has increased over the last decade and will really take off as the older cars are traded in/scrapped for newer, much higher fuel efficient cars (the average age of cars on the highway is at a recorded, historical high - pent up demand will eventually push many of them off to the junk pile and replace them with better efficiency cars). The downside to that is the people buying the cars will be taking on new debt for the new cars (and any inflation that those cars have had occur since the last time they purchased a new one).

As for wages, I agree that real wages have been flat for decades and negative the better half of the last 10 years. That's what happens when you offshore your middle class economy.

 

[Zorkorist]

It's all fake numbers. Until Government is held accountable to spending, there is no validity to any "great analysis!"

-John

 

[Zorkorist]

It's liking pissing into the breeze.

-John

 

[Pr0d1gy]

It is literally off the supply and demand chart from econ 101.

Yeah that's all well and good if the economy were actually based on that. Sadly, so many of you think it still is despite the overwhelming evidence to the contrary. Now, you call me a conspiracy theorist and bemoan my lack of intelligence in your eyes and I go on my way, because I honestly could not give two shits anymore. Most of the people who argue this stuff don't even know what the effective tax rate for the top earners was in the USA in the 70's and before.

I understand now that discussing these things on this board, or even in real life, is so completely pointless because people are just stuck in their religions...whichever they may be. The market is rigged, the gold and silver prices are rigged, the entire damned system is rigged. Go do some research. Productivity has massively outpaced consumption to a point where the very notion of what you are trying to pass off as education is a laughably outdated joke passed down to the serfs by the kings of industry in order to keep you under control.

I took the same classes, I had the same religious-political ideaology and unflappable patriotism. I'm just not that naïve Republican kid that believes everything my favorite news channel/professor/politician tells him anymore.

 

[OverVolt]

..

 

[fskimospy]

So they're all republicans?

They are more likely to be republicans, but they don't have to be. I just mean the fact that they believe in a conspiracy based on no factual evidence.

 

[MrCassdin]

I know some people doing very well and some basically are destitute. I think we are past the point of measuring the economy as doing good or doing bad.

 

[woolfe9998]

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.

Are you kidding? What sources are you learning your economics from?