Yeah, or hopefully prices come down slowly so people can adjust and get out of debt. This is a link to some interesting charts, to say the least. http://www.prudentbear.com/bc_chart_library.html
The Fed has been able to keep US interest rates artificially low because huge inflows of cash from China and Japan have been buying US treasuries. China has to keep buying treasuries or the US will raise hell (and import duties) over the artificially price Yuan, shutting off the engine of their growth, probably causing a depression and possibly civil unrest. It's sort of like a Mutually Assured Destruction relationship but the hamster has to get off the wheel sometime, somehow. How much US deficit will the Chinese worker finance before he wants to cash out? Can US growth finance the bonds we have out now, much less those we will issuing for the next 4 years at the current tax rate? No wonder Greenspan is retiring.
Whoooahhh... haven't you heard? One of the mildest recessions in our nation's history has rendered the unemployment rate a completely inaccurate measure because there are literally millions (if not BILLIONS) of Americans who simply just quit looking for work. Nevermind that any of the really bad recessions in this country didn't have this effect, but the very, very mild recession from a couple of years ago was different. Trust me.
Greenspan is finishing his term and isn't eligible to continue. You have the China story completely backward. China is the one who is artificially keeping their currency value low to boost their exports. The USA has been arguing for them to stop doing this for some time now, and China finally started (barely) to ease their policy a few months ago. You make it sound like China is getting a raw deal here, but it's their govt's policy to keep the Yuan's value low.
Bloated payroll? Unfunded pension? Unattractive products? Where have I seen that before? Oh yeah! Federal budget deficit, social security, and trade deficit. GM's balance sheet probably looks better than U.S.'s right now.
Well Bigtexx, I suppose you only want to look at one "metric" i.e., the 3rd qtr growth rate to say that the economy, and I suppose you mean Bush, is doing a good job. ****** August 31, 2005 Economy up, people down Declining earnings undercut income growth Although the economy expanded solidly in 2004, the inflation-adjusted income of the median household was unchanged and remains $1,700, or 3.8%, below its most recent peak in 1999, according to yesterday's release by the U.S. Bureau of the Census. The main factor explaining this significant, ongoing decline in household income appears to be the faltering job market, especially regarding real annual earnings, which fell significantly for both men (-2.3%) and women (-1.0%). The decline for men was the largest one-year drop since 1990; for women, it was the biggest fall since 1995. EPI's analysis of the Census data shows that increased hours of work actually raised mid-level household annual incomes by 0.5% in 2004, but that real hourly wage decline subtracted that much and more (-1.3%) from income growth. The 2004 level of median household income—$44,389—was slightly below the 2003 level, but the change was not statistically significant. However, the 1.2% decline in real household income for non-elderly families from 2003 to 2004 was statistically significant, again implicating a weak job market in these results. Since 2000, the median household income of non-elderly households is down $2,572 (or 4.8%) compared to $1,669 (or 3.6%) for all households. The real income of the typical household has fallen five years in a row, despite the fact that the last three of those years—2002, 2003, and 2004—have been years of economic expansion. Over these years, our workforce has become a great deal more productive, as output per hour is up 15% from 2000 to 2004. Yet, as shown in Figure 1, these productivity gains have failed to reach the typical household. http://www.epinet.org/content.cfm/webfeatures_econindicators_income20050831
Some facts: - US National Debt now stands at $8.1 Trillion, a 51% increase in 3.5 years - State and Municipal Debt = $1.7 Trillion - Household Debt = $10.3 Trillion - Corporate Debt = $7.8 Trillion - Financial Sector Debt = $11.4 Trillion Total = $39.3 Trillion And ~$36 Trillion more in unfunded employee pension debt, Social Security promises, and Medicare liabilities. Grand Total of more than $75 Trillion altogether. This nation is swimming in DEBT.
I'm interested where you got this list of companies. The way it's presented makes the data look flawed. Alot of the companies on your list are having layoffs due to M&A. Those layoffs were obviously implied when the deals were announced, so its not really accurate to say that all of the layoffs were announced this month. Also, a strong case can be made for layoffs at the auto and pharma companies on your list. Actually, a strong case can probably be made for layoffs at all of the companies on your list. Ex. BofA bought MBNA--there will be overlap there. Ex. Anthem was acquired by Wellpoint. Ex. GM & Ford's unions, pension put significant operating constraints on the company, need to be trimmed. Ex. Citi's deal with Legg Mason, depending on how you see the deal, "layoffs" could be perceived. Ex. Merck loses patent protection on zocor, fosamax in the next couple of years, not to mention vioxx situation--less plant production/salesforce is needed. Alot of these people will find jobs at other pharma companies with stronger pipelines. Basically, this list isnt much of an indicator of overall economic strength. I'm real interested in why you have Citi on this list, can you post a link to that information? Thanks.
Major...don't posts facts as a rebuttal to bigtexxx. They shake the foundation of the parallel myopic "reality" he lives in.
Other snippets worth quoting from glynch's article: EPI's analysis of the Census data shows that increased hours of work actually raised mid-level household annual incomes by 0.5% in 2004, but that real hourly wage decline subtracted that much and more (-1.3%) from income growth. ... the 1.2% decline in real household income for non-elderly families from 2003 to 2004 was statistically significant, again implicating a weak job market in these results. ... The real income of the typical household has fallen five years in a row, despite the fact that the last three of those years—2002, 2003, and 2004—have been years of economic expansion. ... The number and share of persons in poverty also increased last year, from 12.5% to 12.7%, the fourth consecutive increase since poverty hit 11.3% in 2000 (the end of the last expansion). ... Although the job market expanded consistently in 2004—the Census report shows the addition of 1.5 million workers in 2004 over 2003—this addition was not faster than the growth of total households and not enough to absorb the labor market slack left over from the longest jobless recovery on record. ... As for health insurance coverage, the overall number of Americans without health insurance increased for the fourth year in a row, up six million since 2000, to 45.8 million in 2004, an increase in the share of uninsured Americans from 14.2% to 15.7%. So summarized, the average American is making less, facing a weak job market, and is less likely to have health insurance. More people are in poverty than at the beginning of the expansion. Yes, this clearly is an expansion that's benefitting everyone.
