Unemployment 10.2%: Capitalism continues to fail Americans
Earl Evleth
* By Chris Isidore, CNNMoney.com senior writer
* On 10:25 am EST, Friday November 6, 2009
The nation's unemployment rate rose above 10% for the first time since 1983
in October, a much worse jump than expected as employers continued to trim
jobs from payrolls.
The reading, reported by the government Friday, is a sign of the continued
weakness in the labor market even though the economy grew in the third
quarter following the longest and deepest downturn since the Great
Depression.
The government reported that the unemployment rate spiked to 10.2%, up from
9.8% in September. It is the highest that this rate has been since April
1983. Economists had forecast an increase to 9.9%.
There was also a net loss of 190,000 jobs in October, according to the Labor
Department, an improvement from a revised estimate of 219,000 job losses in
September. However, economists surveyed by Briefing.com had forecast a loss
of only 175,000 jobs in October. This was the 22nd straight month of job
losses.
"The only good news is the number of layoffs are dropping off, but those who
are laid off still aren't finding jobs," said David Wyss, chief economist
with Standard & Poor's.
The jump in the unemployment rate was driven up by a large drop in the
number of people who describe themselves as self-employed, as well as the
number of teenagers who have jobs. The unemployment rate for teenagers in
the labor force soared to 27.6%, up 1.8 percentage points and hitting a
third straight record high.
Both teen workers and the self-employed are not captured very well in the
government's separate survey of employers that is used to calculate the
number of people on U.S. payrolls. That explains much of the disconnect
between fewer job losses overall and the much worse unemployment rate.
The rise in unemployment was not spread evenly across the population. For
those with college degrees, the unemployment rate fell to 4.7% from 4.9% in
September, as the unemployment rate for those in management, professional,
and related occupations slipped to 4.7% from 5.2%.
But the unemployment rate for production jobs, such as factory workers,
jumped to 14.5% from 14.1%. The jobless rate for workers in construction,
maintenance or natural resources industries such as mining rose to 15.5%
from 14.3%.
"There's a real mismatch between the unemployed people out there compared to
what job openings are available," said John Silvia, chief economist with
Wells Fargo Securities. He said construction workers who lost a job when the
housing bubble burst don't have the skills to compete for jobs in sectors
that are hiring, such as health care and technology.
Government efforts to end job losses have had limited effects, although the
Obama administration estimated last month that 640,000 jobs were created or
saved by the federal stimulus package passed earlier this year. But that's
modest compared to the 7.3 million jobs that have been lost since the start
of 2008.
Christina Romer, chair of the President's Council of Economic Advisors, said
the steady decline in monthly job losses since earlier this year is a
hopeful sign for the economy.
But she acknowledged there's still significant pain for those looking for
work. "Having the unemployment rate reach double-digits is a stark reminder
of how much work remains to be done before American families see the job
gains and reduced unemployment that they need and deserve," she said.
Friday's report comes one day after Congress voted overwhelmingly to extend
unemployment benefits by up to 20 weeks. There are now a record 5.6 million
people who have been unemployed for six months or longer, as the average
time an unemployed person has been out of a job hit 26.9 weeks.
Prior to this report, most economists had believed that the unemployment
rate would keep rising and that job losses would continue into next year.
But the jump in unemployment in October took it to levels worse than what
many previously had expected to be the peak.
According to a survey of top forecasters by the National Association of
Business Economics last month, the consensus estimate among economists was
that unemployment would hit a high of 10% in the final three months of this
year and the first quarter of 2010.
The five economists with the most bearish forecasts had expected
unemployment to rise to 10.2% in the fourth quarter of this year before
hitting 10.5% in the first half of next year.
Wyss is one of those economists who had projected an unemployment rate of
10.5% in the middle of next year. He said Friday's report may force him to
raise his worst case estimate.
"Some things aren't playing out the way I expected them to," he said.
"There's just no good news in this report."
But others said they see some early signs of life for the labor market. Sung
Won Sohn, economics professor at California State University Channel
Islands, noted that the biggest increase in temporary employees in two years
took place in October.
Employers typically bring in workers on a temporary basis before deciding to
make more permanent hires. As such, he expects gains in payrolls by next
spring. "Despite the gloomy job picture, there are some encouraging signs,"
he said.
Mike
The Obama Depression
Earl Evleth
a76c0efc-8819-4e09...@u20g2000vbq.googlegroups.com, "Mike"
<foeha...@yahoo.com> wrote:
> The Obama Depression
Capitalism Depression, whose else?
What could have the Republicans done to avoid it?
Remember Hoover?
Oh yes, you are too young for that, I remember him.
John Rennie
elected - what can you remember of Hoover?
Earl Evleth
"John Rennie" <john-...@talktalk.net> wrote:
>> Remember Hoover?
>>
>> Oh yes, you are too young for that, I remember him.
>>
> Humph.. You were one year old when Roosevelt was
> elected - what can you remember of Hoover?
He died in 1964. He was sort of an "icon" that
that Democrats harped on for years.
I came from a strong Republican family.
True I only remember the 1940 and later elections.
But Hoover cast a long shadow.
Donna is better at remembering her youth and
remembers the homeless in a Bakersfield park
at a very young age
PJ O'Donovan
<<<The Obama Depression
Mike>>>
<<Capitalism Depression, whose else?
Evleth>>
< What could have the Republicans done to avoid it?
Rennie>
"We are socialists, we are enemies of today's capitalistic economic
system for the exploitation of the economically weak, with its
unfair
salaries, with its unseemly evaluation of a human being according to
wealth and property instead of responsibility and performance, and
we
are all determined to destroy this system under all conditions."
John Toland, qouting a speech by Adolf Hitler , in his 1976
biography
"Adolf Hitler" (pg. 306 )
Bill Bonde { 'by a commodius vicus of recirculation' )
Earl Evleth wrote:
>
> Unemployment rate hits 10.2%, worst since 1983
>
> * By Chris Isidore, CNNMoney.com senior writer
> * On 10:25 am EST, Friday November 6, 2009
>
> The nation's unemployment rate rose above 10% for the first time since 1983
> in October, a much worse jump than expected as employers continued to trim
> jobs from payrolls.
>
If this is the first time since 1983 that the unemployment rate has
been over 10%, how exactly is capitalism failing Americans, Earl?
How often has French unemployment been over 10%?
--
What I hate about flip flops is the flip and the flop.
Bill Bonde { 'by a commodius vicus of recirculation' )
Earl Evleth wrote:
>
> On 6/11/09 18:13, in article
> a76c0efc-8819-4e09...@u20g2000vbq.googlegroups.com, "Mike"
> <foeha...@yahoo.com> wrote:
>
> > The Obama Depression
>
> Capitalism Depression, whose else?
>
What would you suggest, Earl?
> What could have the Republicans done to avoid it?
>
> Remember Hoover?
>
He was a great man. People remember him for Hoover blankets.
> Oh yes, you are too young for that, I remember him.
>
He was a scholar in various languages and an important mining
engineer.
Jigsaw1695
It is not capatilism that is at fault, it is Obama.
Jigsaw
John Rennie
No it isn't you silly old racist. Unemployment is
an inevitable consequence of the many years of
most Americans (and Europeans for that matter) borrowing
instead of saving. In the this dreadful habit they were
encouraged by the real enemies of the people, the banks.
Long term unemployment is the main price to be paid
for the years of profligacy.
Bill Bonde { 'by a commodius vicus of recirculation' )
John Rennie wrote:
>
> Unemployment is
> an inevitable consequence of the many years of
> most Americans (and Europeans for that matter) borrowing
> instead of saving.
>
If everyone saved everything, there would be no consumption and
therefore no need to hire anyone to do anything.
> In the this dreadful habit they were
> encouraged by the real enemies of the people, the banks.
>
Every single time the economy would slow down, which would
otherwise force consumers and businesses to deal with their
overspending and debt accumulations, the governments (whichever
ones) would then inject cash, lower rates, etc. to "fix" the
problems. But this doesn't, it turns out, really fix the problems.
What it does, it seems, is delay the comeuppance.
> Long term unemployment is the main price to be paid
> for the years of profligacy.
>
I think that instead of a $1tn in "stimulus", Obama should have
waited and fixed underlying problems. One of the obvious ones is
interest rates. How can the Fed charge essentially zero percent
interest while banks are charging consumers sometimes 30%? It
should be obvious that affording a loan to invest or to consume or
to do anything is simply not possible, at least not likely, at
rates like that. It shouldn't be a surprise that the economy is
dead in the water.
Izzy Mandelbaum
> Unemployment rate hits 10.2%, worst since 1983
>
> * By Chris Isidore, CNNMoney.com senior writer
Whew!
Thank God for that stimulus money!
Without it, the unemployment rate might go higher than... uh... never-
mind.
Izzy Mandelbaum
> On 6/11/09 19:22, in article zaGdnR4At57h9GnXnZ2dnUVZ8qNi4...@giganews.com,
>
> "John Rennie" <john-ren...@talktalk.net> wrote:
> >> Remember Hoover?
>
> >> Oh yes, you are too young for that, I remember him.
>
> > Humph.. You were one year old when Roosevelt was
> > elected - what can you remember of Hoover?
>
> He died in 1964. He was sort of an "icon" that
> that Democrats harped on for years.
>
> I came from a strong Republican family.
So where did you go wrong?
Earl Evleth
'by a commodius vicus of recirculation' )" <tribuyl...@yahoo.co.uk>
wrote:
> If this is the first time since 1983 that the unemployment rate has
> been over 10%, how exactly is capitalism failing Americans, Earl?
> How often has French unemployment been over 10%?
Most of the world's economies are capitalistic, so the same failure
occurs here. But on top of that system is a social security policy
which reduces the pain of unemployment.
Earl Evleth
"John Rennie" <john-...@talktalk.net> wrote:
>> It is not capatilism that is at fault, it is Obama.
>>
>> Jigsaw
>
>
> No it isn't you silly old racist. Unemployment is
> an inevitable consequence of the many years of
> most Americans (and Europeans for that matter) borrowing
> instead of saving. In the this dreadful habit they were
> encouraged by the real enemies of the people, the banks.
> Long term unemployment is the main price to be paid
> for the years of profligacy.
Note that Jiggy has not come up with suggestions of
how the Republicans would do differently. Historically
the Republicans and their Capitalist co-conspirators,
gave the nation the Great Depression, also the produce
of excesses of the 1920s.
Obama is doing what is politically possible.
Note that Jiggy worked at a public job which gave
him job security for life. In that sense, he
profited from a socialist way of life.
Earl Evleth
a commodius vicus of recirculation' )" <tribuyl...@yahoo.co.uk> wrote:
>
>
> John Rennie wrote:
>
>> Unemployment is
>> an inevitable consequence of the many years of
>> most Americans (and Europeans for that matter) borrowing
>> instead of saving.
>>
> If everyone saved everything, there would be no consumption and
> therefore no need to hire anyone to do anything.
What a dodge! We are talking about saving rates higher than
the -0- practices in the USA. Saving 15% is a nice target.
Managing one's debts is important, something you brush under
the table in being an apologist for unstrained consumption.
>>
> I think that instead of a $1tn in "stimulus", Obama should have
> waited and fixed underlying problems.
Waited until the barn burned down!
> One of the obvious ones is
> interest rates. How can the Fed charge essentially zero percent
> interest while banks are charging consumers sometimes 30%?
Note that the Federal Reserve acts independently of the
Administration. Once the Baard is in place they are God.
You have just failed Economics 101
Earl Evleth
1a36fcee-2804-474f...@z41g2000yqz.googlegroups.com, "Izzy
Mandelbaum" <texa...@hotmail.com> wrote:
> Thank God for that stimulus money!
> Without it, the unemployment rate might go higher than... uh... never-
> mind.
Probably, the Government claims a lot of jobs saved. I have
one colleague who hired three scientists on his stimulus
payment.
Unfortuately the jobs "saved" is not a statistic, but
a guess.
Mike
> On 7/11/09 1:58, in article 4AF4C649.79A55...@yahoo.co.uk, "Bill Bonde { 'by
> a commodius vicus of recirculation' )" <tribuyltinfp...@yahoo.co.uk> wrote:
>
>
>
> > John Rennie wrote:
>
> >> Unemployment is
> >> an inevitable consequence of the many years of
> >> most Americans (and Europeans for that matter) borrowing
> >> instead of saving.
>
> > If everyone saved everything, there would be no consumption and
> > therefore no need to hire anyone to do anything.
>
> What a dodge! We are talking about saving rates higher than
> the -0- practices in the USA. Saving 15% is a nice target.
> Managing one's debts is important, something you brush under
> the table in being an apologist for unstrained consumption.
>
>
>
> > I think that instead of a $1tn in "stimulus", Obama should have
> > waited and fixed underlying problems.
>
> Waited until the barn burned down!
Scare tactics
>
> > One of the obvious ones is
> > interest rates. How can the Fed charge essentially zero percent
> > interest while banks are charging consumers sometimes 30%?
>
> Note that the Federal Reserve acts independently of the
> Administration. Once the Baard is in place they are God.
End the Fed. It's a giant ongoing money scam.
Happy99
"Bill Bonde { 'by a commodius vicus of recirculation' )"
news:4AF478AB...@yahoo.co.uk...
Happy99
"Mike" <foeha...@yahoo.com> a �crit dans le message de
news:a76c0efc-8819-4e09...@u20g2000vbq.googlegroups.com...
John Rennie
>
> John Rennie wrote:
>
>> Unemployment is
>> an inevitable consequence of the many years of
>> most Americans (and Europeans for that matter) borrowing
>> instead of saving.
>>
> If everyone saved everything, there would be no consumption and
> therefore no need to hire anyone to do anything.
How funny your comments are, Bill. If everyone saved
'everything' they wouldn't eat or clothe themselves.
Once upon a time if one wanted to buy a 'big' TV
one saved up and then bought it. Understand now?
>
>
>> In the this dreadful habit they were
>> encouraged by the real enemies of the people, the banks.
>>
> Every single time the economy would slow down, which would
> otherwise force consumers and businesses to deal with their
> overspending and debt accumulations, the governments (whichever
> ones) would then inject cash, lower rates, etc. to "fix" the
> problems. But this doesn't, it turns out, really fix the problems.
> What it does, it seems, is delay the comeuppance.
>
>
>> Long term unemployment is the main price to be paid
>> for the years of profligacy.
>>
> I think that instead of a $1tn in "stimulus", Obama should have
> waited and fixed underlying problems. One of the obvious ones is
> interest rates. How can the Fed charge essentially zero percent
> interest while banks are charging consumers sometimes 30%? It
> should be obvious that affording a loan to invest or to consume or
> to do anything is simply not possible, at least not likely, at
> rates like that. It shouldn't be a surprise that the economy is
> dead in the water.
'should have waited and fixed'? Couldn't do both I'm afraid.
M'Balz Es-Hari
news:C71AF38E.187409%evl...@wanadoo.fr...
Here's one of my favorites:
The federal government sent Bob Bray $26,174 in stimulus aid to fix a fence
and replace the roofs on public apartments in Blooming Grove, Texas, a town
of fewer than 900 people outside Dallas. He hired five roofers and an
inspector to do the job.
But the number of jobs he reported to the government looked very different -
450 jobs.
"Oh, no," said Bray, who runs the local public housing authority part-time
with his wife, Linda, when asked about the discrepancy. He said that he told
the government that he had created six jobs but that a federal official told
him that wasn't right. So he reported the number of hours the roofers worked
instead. The Department of Housing and Urban Development caught the mistake,
but he couldn't fix it before the jobs figures were published. "The money
was great, but the reports are really confusing," he said. "I've been
fighting with it for over a month and a half."
http://freedomeden.blogspot.com/2009/11/stimulus-jobs-saved-or-created-numbers.html
Earl Evleth
"M'Balz Es-Hari" <texa...@hotmail.com> wrote:
>
> http://freedomeden.blogspot.com/2009/11/stimulus-jobs-saved-or-created-numbers
> .html
actually from
http://content.usatoday.net/dist/custom/gci/InsidePage.aspx?cId=tucson&sPara
m=36696168.story&
Basically you don't create any jobs for $26,174, not even one.
My colleague got well over $100,000 and this paid for his postdocs.
(my guess is that those he had cost a total of $120,000 a year.
These are by nature temporary jobs, the next year they leave
and are replace if money is available.
Typically a job creation costs a lot of money unless one is
hiring for a short period. However saving existing jobs
costs less.
Another friend at the University of California had his TA
staff in Freshman Chemistry cut in half from 6 to 3.
How did he handle that? He doubled the class size
for discussion groups from 20 to 40, meaning
individual students get less help. The TAs don't
work more hours however. So the savings go on the
back of the students. The faculty is on a 5% salary
furlough meaning a pay cut but that does not mean
they work 5% less.
3 post for the quarter would probably run about $10,000
that amount of money would have saved three jobs
but for 3 months. TAs don't get high salaries, and
they effectively work part time (20 hours a week).
However, they get tuition wavers, worth a lot more
than they are paid as a TA.
Bill Bonde { 'by a commodius vicus of recirculation' )
You mean in France where the dole is extended more liberally?
Earl Evleth
> You mean in France where the dole is extended more liberally?
No.
Most of Europe have unemployment payments which allow people
to have economic sercurity. American rates are so low that
people are starved bad to work.
Of course the capitalists are please by high employment
rates. It allows them to terrorize their employees
while being able to hire people at ever lower salaries.
They only care about profits and get worried when they
start losing money. Since greed drives them they
are easy to understand, their motives are transparent.
The workers motives are too. They want to eat.
By the way Bill want did you do when you were working.
Rennie indicates that you yourself are on some sort
of dole in the UK. True, not true? What are the facts.
Mr Q. Z. Diablo
He just told you.
--
The Professor: What's "Friends"?
Satan: A TV show. Six characters in search of a smack in the mouth.
- Andy Hamilton, Old Harry's Game
Izzy Mandelbaum
> On 7/11/09 15:18, in article hd3vjs$l9...@news.eternal-september.org,
>
> "M'Balz Es-Hari" <texan...@hotmail.com> wrote:
>
> >http://freedomeden.blogspot.com/2009/11/stimulus-jobs-saved-or-create...
> > .html
>
> actually fromhttp://content.usatoday.net/dist/custom/gci/InsidePage.aspx?cId=tucso...
> m=36696168.story&
>
> Basically you don't create any jobs for $26,174, not even one.
>
So clearly, the 450 jobs was a lie.
How many of the other jobs 'created or saved' are a lie?
Earl Evleth
6c16ed80-cdeb-451c...@d21g2000yqn.googlegroups.com, "Izzy
Mandelbaum" <texa...@hotmail.com> wrote:
> So clearly, the 450 jobs was a lie.
An error. This administration is not a lying one.
That habits and errors of the previous ones are
gradually being corrected.
Bill Bonde { 'by a commodius vicus of recirculation' )
John Rennie wrote:
>
> Bill Bonde { 'by a commodius vicus of recirculation' ) wrote:
> >
> > John Rennie wrote:
> >
> >> Unemployment is
> >> an inevitable consequence of the many years of
> >> most Americans (and Europeans for that matter) borrowing
> >> instead of saving.
> >>
> > If everyone saved everything, there would be no consumption and
> > therefore no need to hire anyone to do anything.
>
> How funny your comments are, Bill. If everyone saved
> 'everything' they wouldn't eat or clothe themselves.
> Once upon a time if one wanted to buy a 'big' TV
> one saved up and then bought it. Understand now?
>
I understood before. But nevertheless, if everyone saved and didn't
spend, the economy would contract. You might be able to make an
intelligent argument for saving before buying, especially in the
case of big screen TVs, but generally doing this would not solve
the economic crisis as it is today, because, somehow, more consumer
spending is needed. But if they spend more, they have more debt.
That's why this isn't easy to fix.
> >> In the this dreadful habit they were
> >> encouraged by the real enemies of the people, the banks.
> >>
> > Every single time the economy would slow down, which would
> > otherwise force consumers and businesses to deal with their
> > overspending and debt accumulations, the governments (whichever
> > ones) would then inject cash, lower rates, etc. to "fix" the
> > problems. But this doesn't, it turns out, really fix the problems.
> > What it does, it seems, is delay the comeuppance.
> >
> >
> >> Long term unemployment is the main price to be paid
> >> for the years of profligacy.
> >>
> > I think that instead of a $1tn in "stimulus", Obama should have
> > waited and fixed underlying problems. One of the obvious ones is
> > interest rates. How can the Fed charge essentially zero percent
> > interest while banks are charging consumers sometimes 30%? It
> > should be obvious that affording a loan to invest or to consume or
> > to do anything is simply not possible, at least not likely, at
> > rates like that. It shouldn't be a surprise that the economy is
> > dead in the water.
>
> 'should have waited and fixed'? Couldn't do both I'm afraid.
>
The stimulus doesn't fix anything. All it does is push the economy
forward for a while. At some point, it has to spin up and stay spun
up. I think there are underlying problems that are not being
addressed. I have named them, including but not limited to consumer
debt load, US government debt loan, imbalance of trade, often with
countries that have many citizens who would benefit for greater
consumer oriented spending at home. Not fixing or even addressing
these problems means that if you have a $1tn to spend on a
stimulus, you might have spent it and not got a long term spin up.
I full expect Obama to borrow more and stim again, though. What I
can't tell is how far that will go. At some point, there won't be
more money to borrow.
Bill Bonde { 'by a commodius vicus of recirculation' )
Earl Evleth wrote:
>
> On 6/11/09 22:42, in article nYqdnbdiZemxBWnX...@giganews.com,
> "John Rennie" <john-...@talktalk.net> wrote:
>
> >> It is not capatilism that is at fault, it is Obama.
> >>
> >> Jigsaw
> >
> >
> > No it isn't you silly old racist. Unemployment is
> > an inevitable consequence of the many years of
> > most Americans (and Europeans for that matter) borrowing
> > instead of saving. In the this dreadful habit they were
> > encouraged by the real enemies of the people, the banks.
> > Long term unemployment is the main price to be paid
> > for the years of profligacy.
>
> Note that Jiggy has not come up with suggestions of
> how the Republicans would do differently. Historically
> the Republicans and their Capitalist co-conspirators,
> gave the nation the Great Depression, also the produce
> of excesses of the 1920s.
>
Kook Alert.
> Obama is doing what is politically possible.
>
Spend a boatload of cash? That's always popular, until the taxes go
up.
Bill Bonde { 'by a commodius vicus of recirculation' )
How are the jobs saved if they are now over, whatever the number
is? That's the problem with a stimulus, it doesn't save jobs, it
delays layoffs. Only if your spin up the economy in a way that is
self sustaining, can you save jobs long term. Unfortunately, I
don't hear a lot of talk in that direction from this
administration. They are keen to take credit but not seriously deal
with the underlying issues.
John Rennie
>
> John Rennie wrote:
>> Bill Bonde { 'by a commodius vicus of recirculation' ) wrote:
>>> John Rennie wrote:
>>>
>>>> Unemployment is
>>>> an inevitable consequence of the many years of
>>>> most Americans (and Europeans for that matter) borrowing
>>>> instead of saving.
>>>>
>>> If everyone saved everything, there would be no consumption and
>>> therefore no need to hire anyone to do anything.
>> How funny your comments are, Bill. If everyone saved
>> 'everything' they wouldn't eat or clothe themselves.
>> Once upon a time if one wanted to buy a 'big' TV
>> one saved up and then bought it. Understand now?
>>
> I understood before.
No you didn't or you wouldn't have made such a stupid
response.
But nevertheless, if everyone saved and didn't
> spend, the economy would contract. You might be able to make an
> intelligent argument for saving before buying, especially in the
> case of big screen TVs, but generally doing this would not solve
> the economic crisis as it is today,
It was the profligate spending without the necessary saving
that helped cause the crisis of today. Now many are saving when
they should be spending - we just can't get it it right.
Earl Evleth
"John Rennie" <john-...@talktalk.net> wrote:
> It was the profligate spending without the necessary saving
> that helped cause the crisis of today. Now many are saving when
> they should be spending - we just can't get it it right.
I look at it as "shock" when the body reacts in an inappropriate
manner and makes things worse
In physical shock
"Regardless of the cause, the restoration of the circulating volume is
priority"
So in economics this means increasing the money volume and getting
it to circulate faster.
This does not mean that this will cure the patient but aid
natural curative processes. Hoarding money is not a positive
reaction to economic shock.
Bill Bonde { 'by a commodius vicus of recirculation' )
John Rennie wrote:
>
> Bill Bonde { 'by a commodius vicus of recirculation' ) wrote:
> >
> > John Rennie wrote:
> >> Bill Bonde { 'by a commodius vicus of recirculation' ) wrote:
> >>> John Rennie wrote:
> >>>
> >>>> Unemployment is
> >>>> an inevitable consequence of the many years of
> >>>> most Americans (and Europeans for that matter) borrowing
> >>>> instead of saving.
> >>>>
> >>> If everyone saved everything, there would be no consumption and
> >>> therefore no need to hire anyone to do anything.
> >> How funny your comments are, Bill. If everyone saved
> >> 'everything' they wouldn't eat or clothe themselves.
> >> Once upon a time if one wanted to buy a 'big' TV
> >> one saved up and then bought it. Understand now?
> >>
> > I understood before.
>
> No you didn't or you wouldn't have made such a stupid
> response.
>
The response showed the stupidity of your original comment. It's
very important to understand that what might work for an
individual, saving, might not work if everyone suddenly did it. If
the savings rates in the US went up, the economy would slow down.
The saving rates in the US *are* going up or have gone up, because
people are scared. The economy has slowed down:
http://www.nytimes.com/2009/06/27/business/economy/27econ.html
#begin quote
Tax cuts from the stimulus package and increases in Social Security
checks lifted personal incomes sharply in May, the government
reported on Friday, but it appeared that many people were putting
that money away instead of spending it.
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The New York Times
Although personal spending increased slightly last month, the
saving rate climbed to its highest level in 15 years as consumers
tried to build a buffer against the threat of job losses and more
economic hardships.
The personal saving rate, which dipped below zero during the
housing boom as Americans tapped home equity loans and other easy
lines of credit, rose to 6.9 percent in May, the Commerce
Department reported. That was its highest point since December
1993.
#end quote
> But nevertheless, if everyone saved and didn't
> > spend, the economy would contract. You might be able to make an
> > intelligent argument for saving before buying, especially in the
> > case of big screen TVs, but generally doing this would not solve
> > the economic crisis as it is today,
>
> It was the profligate spending without the necessary saving
> that helped cause the crisis of today.
>
Of course spending is too high in the US. But it's not high enough
in places that are accumulating all the money, like China. To have
a smoothly functioning world economy, no one can horde the money.
If they do, and then loan it back to the overspending types (in our
example, Americans), the situation becomes more and more
unbalanced. None of this changes the fact that the economy would
rebound if the Americans went nuts and spent with wild abandon
instead of saving. The American consumer has been the last hope of
exporting nations, like China, to dump their excess industrial
capacity. That really has to end, especially given the fact that
places like China are is desperate need to spend themselves on
infrastructure and on consumer goods. Americans don't need a sixth
DVD player, Chinese need food, electricity, plumbing, water,
washing machines and all that.
> Now many are saving when
> they should be spending - we just can't get it it right.
>
As individuals, they should be saving. I would argue that every
person individually should look at his total income and net worth
and think about what overspending gets him in the way of worry and
problems. So I'd not recommend overspending. But the economy needs
consumption to spin up. Ideally China would start importing more.
They may fear what happens when they unleash their pent up consumer
demand.
Bill Bonde { 'by a commodius vicus of recirculation' )
Obviously it's more complicated than that. If Americans are now
more restrained in their spending, this will force the rest of the
world to re-evaluate how it does business. How cheap do things have
to get before Americans buy Yet Another Big Screen TV? It's
possible that many have been scared straight and won't spend like
nuts no matter what. That's a big deal.