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dtknowles
09-18-2014, 06:31 PM
Household wealth hits an all tie high.



Read more: http://www.nasdaq.com/article/household-wealth-hits-recordupdate-20140918-01015#ixzz3DhyRKD1Y

"Economists hope rising asset values, falling unemployment and stronger household finances lead to more consumer spending, which accounts for roughly two-thirds of economic output. Recent reports on the nation's economic health have been mixed: Unemployment is falling faster than many expected, yet growth remains fitful thanks in part to weak income gains for most Americans."

It is not about creating wealth it all about spending.

Tim

troyboy
09-18-2014, 06:43 PM
Economy still is in the tank and the dollar buys less daily. Wonder where the wealth is?

dragon813gt
09-18-2014, 07:14 PM
Concentrated in the hands of a few people.

smokeywolf
09-18-2014, 07:39 PM
Carefully cherry picked numbers rendered meaningless by the also carefully chosen numbers to which they are compared.
Lower unemployment? Just means more people have exhausted their UI and have replaced the $900.00 40 hour a week full time jobs they once held with $300.00 29 hour a week part time jobs they now barely hold.

The only words coming from the State (California anyway) and Fed gov't. that you can believe is, "We're raising your taxes".

smokeywolf

runfiverun
09-18-2014, 07:56 PM
my stuff is worth more worthless dollars...cool.
every ones unemployment has run out, I gotta spend more on food, utilities, and gasoline, and I ain't getting a raise again this year.

they called it right, they just used the wrong words.

shooter93
09-18-2014, 08:06 PM
Smoke and mirrors. We are a very long way from recovery.

Hickory
09-18-2014, 08:11 PM
Economics 101, the economy is driven by consumers buying good & service's.

PB234
09-18-2014, 08:30 PM
Lets say there are two of us and we both have good jobs. One of us gets fired and so the unemployment rate goes to 50%. Now after a year or two the fired guy stops looking for a job and then then unemployment rate goes back to zero.

Lets try it a different way. Suppose there are two folks in the economy and each is a well paid auto worker. Now the auto industry uses robitics and fires both of them, but they get jobs paying 25% of what they used to make working at Wal Mart as greeters. The unemployment rate is still zero, but incomes of consumers has dropped 75%.

The increase in wealth reflect the increase in the stock market price level. If you have a bunch of assets invested you are now richer. If you are not wealthy enough to have a portifilio of stocks and other investments you are out of luck and like the rest of us just amazed at the increased price of food, etc. Remember the 5 pound bag of sugar? Remember when a bag of potato chips was not mostly air?

Say a guy owns a factory adn figures out he can make more money and increase the nations overall production by using robotics. He automates and makes a bunch more money. What exactly happens to the people who use to work in the factory of even the community that depended on those workers to raise taxes to support schools and other services?

Last year the government went another trillion dollars into debt. Somehow this will eventually need to be accounted for. Got children or grandchildren? Ask them how they feel about paying the debt we ran up.

Yep, the economy is doing great. The newspaper told me so.

smokeywolf
09-18-2014, 09:34 PM
Very well explained PB234.

The only way this Country will ever see a recovery is if all of the $20.00 to $40.00 per hr. jobs that have been exported to $2.00 to $4.00 per hour countries are brought back to the U.S.

Without those middle class jobs the U.S. economy cannot and will not recover. You can't build an economy on $10.00 an hour part time jobs.

smokeywolf

Duckiller
09-19-2014, 12:54 AM
In 1963 I learned that investments increased the economy. Consumer has very little effect on growth of the economy. Consumers are going to buy food in boom times or a depression. The amount doesn't change that much. Investments on the other hand can very greatly and significantly effect the economy.

smokeywolf
09-19-2014, 01:36 AM
Personally, when I look at a stock, one of the more important factors I look at is their PE (price to earnings) ratio. Without consumers that figure would look pretty bleak. When people can't afford to buy new refrigerators, washers & dryers, TVs, computers, back to school clothes, go out to dinner or a movie, the economy suffers.
Most, not all investors can figure out that if a company does not have a ready market; that is, consumers ready and able to buy their product, that company is probably not a good place to put your money.

In my opinion, to place less importance on the consumer than the investor is a bit short sighted.

Consumption nurtures investment; not the other way around.

smokeywolf

Gator 45/70
09-20-2014, 12:04 AM
I traded a 100 rd box today of 22lr. CCI for a half of bucket of wheel weights.

Does that count ?

Bzcraig
09-20-2014, 12:31 AM
Those great looking numbers look great cause an election is just around the corner.

starmac
09-20-2014, 12:41 AM
Numbers don't lie, but they can sure be manipulated to anything a guy wants to hear.

redriverhunter
09-20-2014, 01:49 AM
I often wonder how our economy keeps going. As I remember it from a class, as people make money they decide to purchase items, resulting in more production, the need for more productions requires more employees resulting in more money to be spent. My mom was telling when she was a kid they had to bring something to school that was made in foreign country, and it was a challenge to find something. Today it seems hard to find something truly made in America. I heard somewhere that America was becoming a service driven economy. I hope I am wrong, but I can not see how we can survive with out a strong manufacturing industry.

Hickory
09-20-2014, 08:15 AM
I traded a 100 rd box today of 22lr. CCI for a half of bucket of wheel weights.

Does that count ?

Knowing how to barter can be a valuable asset in the near future.

WallyM3
09-20-2014, 08:35 AM
The Government uses statistics like a drunk uses a lamp post.

For support rather than illumination.

BrassMagnet
09-20-2014, 09:02 AM
The Government uses statistics like a drunk uses a lamp post.

For support rather than illumination.

Wally,

I am sure glad you explained that. I had a completely different mental picture!

BrassMagnet

Thumbcocker
09-20-2014, 09:28 AM
Interesting since back in August it was announced that 52% of Americans could not deal with at $400 emergency without putting it on a credit card, borrowing, or selling something. Google will confirm.

BrassMagnet
09-20-2014, 09:31 AM
In 1963 I learned that investments increased the economy. Consumer has very little effect on growth of the economy. Consumers are going to buy food in boom times or a depression. The amount doesn't change that much. Investments on the other hand can very greatly and significantly effect the economy.

Duckiller,

I think you are right about investments in accordance with economic textbooks, but no longer right in accordance with reality.
Our Gov't has so twisted things that an investment is no longer an investment. At best, it is now a malinvestment.
If I invest my life savings to buy machinery to make a product our people need, rent or buy work space, and hire workers to run the machinery; then that is investment.
If I invest my life savings to buy machinery to make a product our people don't want and don't need, rent or buy work space, and hire workers to run the machinery; then that is malinvestment.
If I invest my life savings to "improve" my plant to try and comply with Gov't regulations to try and keep my plant in operation when the Gov't is just going to make more stringent regulations next year, then that is malinvestment.
Our Gov't has so twisted the marketplace since 1913 that I believe it is now impossible to tell the difference between investment and malinvestment. How many businesses in America now exist solely to supply Gov't or to satisfy Gov't mandates on business?
Now toss in the desire of this administration to seize property from investors and give it to the unions such as they did with GM. Why I would I be stupid enough to invest my life savings in this economy? I believe many real Americans with money now believe like I do.
So who is investing? One report I saw said the "too big to fail" banks were handed billions to loan out, but they didn't want to risk it by loaning it to us, so they invested it in stock for the other "too big to fail" banks. That same report said if the financial section of the Dow rises, it will tend to drag most of the Dow with it.
Now that you have created more inflation, all you have to do is report growth in inflated dollars! Instant growth! Don't report the M3 money supply as that will merely point out that all growth is merely a result of more M3 money supply and our supposed growth is actually less than the growth in the M3 money supply.
Could our economy actually be contracting? Not in dollars. Only in dollars adjusted for inflation. We can fix that! Let's subtract food, fuels, and everything else that people must buy in boom times or a depression!
There, he's the One! The most successful President in history! He only promised two things, Hope and Change. We have Change. We have no Hope. 50% success rate!

dragon813gt
09-20-2014, 09:53 AM
The most successful President in history! He only promised two things, Hope and Change. We have Change. We have no Hope. 50% success rate!

He never said what type of hope. So he's at 100% success. I think you will find less people putting money in the bank and more people putting it under their mattress. Why would I put money in a savings account when it's paying out 0.10%? And then I'm taxed on any of those measly earnings. I count myself lucky because I am in a good spot right now. And I can do what I do for a living anywhere in the industrialized world, not so much in a jungle. I'm just trying to work my way out of debt. But sometimes I wonder why bother? It doesn't seem to matter in this day and age. I just don't want to be crippled by debt if something were to happen financially. As much as there is all the gloom and doom talk. The US economy is to big to fail. It would drag the entire world down w/ it at the moment. Who knows what the future will hold and this could certainly change.

BrassMagnet
09-20-2014, 10:20 AM
I'm just trying to work my way out of debt. I just don't want to be crippled by debt if something were to happen financially. As much as there is all the gloom and doom talk. The US economy is to big to fail. It would drag the entire world down w/ it at the moment. Who knows what the future will hold and this could certainly change.

Here is a good plan to get out of debt:

116929

Here is a plan for bad times:

116930

WallyM3
09-20-2014, 10:27 AM
Wally,

I am sure glad you explained that. I had a completely different mental picture!



BrassMagnet

You mean, like a dog uses a hydrant?

BrassMagnet
09-20-2014, 10:42 AM
You mean, like a dog uses a hydrant?

Yepper!

dtknowles
09-20-2014, 01:32 PM
Reading more in the link and elsewhere. The increase in incomes and net worth was mostly at higher income levels (increase was mostly from increase in value of homes and stocks) and the point not made particularly clear was that improvement in the incomes of those with lower incomes was dependent on those with higher incomes spending the new found wealth on goods and services produced in the U.S.

Said another way, the poor need the rich to spend money to create jobs. If the rich decide to hold on to their money or spend it overseas the poor go without work.

Tim

BrassMagnet
09-20-2014, 02:03 PM
Reading more in the link and elsewhere. The increase in incomes and net worth was mostly at higher income levels (increase was mostly from increase in value of homes and stocks) and the point not made particularly clear was that improvement in the incomes of those with lower incomes was dependent on those with higher incomes spending the new found wealth on goods and services produced in the U.S.

Said another way, the poor need the rich to spend money to create jobs. If the rich decide to hold on to their money or spend it overseas the poor go without work.

Tim

Tim,

I agree completely.

Unfortunately, our Gov't has set a tax system in place which makes it stupid to invest.

Our poor and middle class pay the penalty for our onerous tax rates even if they don't pay income tax.

I have learned a neat way to find the source of a person's income. Ask them how the economy is.
If they say it is great, you can rest assured they receive their income from the Gov't.
If they say the economy is poor, they either work for a living somewhere in industry or they are awake and looking around rather than just listening to a news commentator.

ohland
09-20-2014, 10:26 PM
The administration claims that the economy is fine. Only reason why gas is (slowly) coming down is the productivity of private wells. Leading question: If the Fed pumped all this money into liquidity, then where is the surge of employment? I can remember the old days where 350,000 jobs added a month was good recovery. Now we limp about with 125k and we are told that it's just fine. What?

Consumers need to spend more? How so, if the Feds are sucking that money up in order to provide it to Wall Street in the form of extremely low cost money? If you earn a small amount with money that cost you very little, that is still a profit. Except I can't ring up JP Morgan to get a few mill and play the market.

My representative is convinced we need a path to amnesty for illegal aliens. He should be requesting amnesty from behind bars.

41 mag fan
09-20-2014, 11:10 PM
Not too hard to have money later in life....whether it be inflated or not.
Live like a poor boy now to live rich in the future...or in other words whats considered necessities today was considered luxuries in years gone past.
I've always figured the economies going to fluctuate regardless of whose in office and whatever new regs come down the pike...if you're not born rich 98% chance you'll still be poor when you die...only a very small percentage strike it rich....sadly i will not be one of them

Duckiller
09-22-2014, 03:24 PM
As Dragon pointed out savings now earn about 0.1%. Money should earn 3% +/- inflation/deflation. We do not have 2.9% deflation. We truely need to beat up on banks. Excessive earning should be taxed at a confiscatory rate and bank presidents should make not more than 5% more than minimum wage.

dtknowles
09-22-2014, 04:00 PM
Tim,

I agree completely.

Unfortunately, our Gov't has set a tax system in place which makes it stupid to invest.

Our poor and middle class pay the penalty for our onerous tax rates even if they don't pay income tax.

I have learned a neat way to find the source of a person's income. Ask them how the economy is.
If they say it is great, you can rest assured they receive their income from the Gov't.
If they say the economy is poor, they either work for a living somewhere in industry or they are awake and looking around rather than just listening to a news commentator.

You are wrong about you can tell who people work for and the state of the economy. I work for a private company and we do no work for local, state or federal government agencies. We are a growing company. Construction is up locally and in other locations where I work. The economy is much improved and by some measures even better than before the recession. I know the recovery is uneven around the country but where I go it is clear that the recession is over.

Tim

dtknowles
09-22-2014, 04:16 PM
As Dragon pointed out savings now earn about 0.1%. Money should earn 3% +/- inflation/deflation. We do not have 2.9% deflation. We truely need to beat up on banks. Excessive earning should be taxed at a confiscatory rate and bank presidents should make not more than 5% more than minimum wage.

Why do you think insured liquid assets (bank checking and savings accounts) should earn a 3 percent real interest rate. It would seem to me that liquid assets should earn a zero percent real interest rate, since you can take your money out at any time and it is insured against loss. The banks are protecting your money and provided clearing house services (checks, credit, debit cards) so unless you are paying them a fee I don't see why you think they owe you interest greater than inflation. That said they aren't paying interest even at the rate of inflation because they can get all the money they can loan directly from the Fed at very low rates. The Fed needs to start raising rates and stop pumping money into the system.

How do you define excessive earnings? I don't believe anything is excessive earnings. It the money was made in an ethical manner then it is normal profit and should be tax as such.

I don't think that there should be a minimum wage, let the market set wages for everyone including bank presidents. If you think a bank president makes too much don't use that bank or own its stock.

Tim

dtknowles
09-22-2014, 04:38 PM
The administration claims that the economy is fine. Only reason why gas is (slowly) coming down is the productivity of private wells. Leading question: If the Fed pumped all this money into liquidity, then where is the surge of employment? I can remember the old days where 350,000 jobs added a month was good recovery. Now we limp about with 125k and we are told that it's just fine. What?

Consumers need to spend more? How so, if the Feds are sucking that money up in order to provide it to Wall Street in the form of extremely low cost money? If you earn a small amount with money that cost you very little, that is still a profit. Except I can't ring up JP Morgan to get a few mill and play the market.

My representative is convinced we need a path to amnesty for illegal aliens. He should be requesting amnesty from behind bars.

I seem to remember the last time the president talked about the economy he said it was getting better but more need to be done to create more jobs. I have been hearing the same thing from Yellen. Gasoline is coming down because demand is not rising as fast as was expected. China is not growing as fast as expected. So oil is cheaper and demand for exported gasoline is slower.

Very little of the money the Fed is pumping out is going to build more things in this country. A lot is being reloaned overseas or is invested in local markets or to pump up bank balance sheets.

Job growth is going to be weak or worse for a long time to come. More people in this country and around the world want to work than are needed for to make and do all the things that anyone wants done. Locally there are a lot of help wanted signs but they are all for very low wage jobs. If you want to make a decent wage you better have in demand skills.

Rich consumers need to spend more and hopefully spend it locally. They need to keep the restaurants, bars, movie houses, play houses, nail salons...... full and humming, oh and they need to tip well. Poor consumers need to save for the days when they can't work, they need to pay down their debt. They need to stop buying toys from companies overseas.

We do not need more immigrants to fill our labor pools.

Tim

smokeywolf
09-22-2014, 05:12 PM
Tim, I think I could agree with your theory if,,, this were a perfect world and our government worked for and represented us and the oil companies weren't controlling our economy and the Feds and State of Kali wasn't levying a 20% tax (soon to increase to 25 to 35%) on the purchase of every gallon of fuel and we didn't have 12,000,000 criminal aliens polluting our labor market and robbing our welfare system.

smokeywolf