Category: Markets, Business, and the Economy

Unemployment and Underemployment Mythbusting

According to the current conservative narrative, the unemployed and underemployed are what they are because they are lazy. They’re not doing what it takes to get a job. They’re not willing to get educated for the so-called Jobs Of Tomorrow. They’re not willing to step down to take a job that doesn’t pay enough to cover their rent.

It couldn’t have anything to do with the fact that nationwide, there are more than 3 unemployed people for every 1 job opening. Nope, that couldn’t be a factor.

It couldn’t have anything to do with the fact that some help wanted ads are written to require an impossible montage of skills, and employers aren’t interested in spending more than 3 minutes training someone. Nope, easier to hire nobody. Easier to whine to the Feds that there are no qualified Americans and we need to import an underpaid foreigner who allegedly has these skills. I say suspend the H-1B program until unemployment is under 6%!

If getting a degree were some kind of magic “get a good job” spell, we wouldn’t have hundreds of thousands of people with graduate degrees taking food stamps.

Let’s stop victim-blaming when it comes to unemployment. Attacking the work ethic of most unemployed people is like blaming a rape victim for wearing a skirt. We need to focus on the real issues that cause unemployment.

In Closing: sounds like hype to me; avocados; Shaun T makes Dr. Oz sweat; geeks; and animal research.

Things really are tough all over

Maybe you saw the report showing that the net worth of the average American family is down almost 40%. It’s down to the levels we had during the Original Bush Administration (oh, and Happy 88th Birthday to him).

Now, of course that’s partly because home prices are down to where they were a decade ago. But it’s also because unemployment is still over 8%. And even for those who are employed, last year inflation adjusted income is roughly what it was in 1968. And we’ve still got discouraged workers and the underemployed.

The nicest thing I can say is that at least household debt is going down. Of course, it’s going down for the bad reasons —  like ditching the house that will never be worth what it sold for 5 years ago.

It is still the economy, “stupid.”

In Closing: how is this different than the Bush Administration, exactly?; has anything really changed about the Vatican since Alexander VI?; at least violent crime is down; the impossible dream; now I have really no reason to watch mainstream news unless it’s local; the disappearing phone booth; and illiteracy.

Good News on the Economy

Seriously, I’m coming up on 9 years of writing here, and this is the first time I’ve been able to write those words without meaning it sarcastically.

First, unemployment is down to 8.1% (locally, down to 12.4%). That’s still too high, and it still doesn’t account for people who have given up on finding a job and people who have settled for part time work. And the economy still isn’t quite up to making enough jobs for people new to the workforce, and new grads are still going to have a crappy time out there. However, not that long ago we were looking at almost 10%.

Second, there are signs of life in American manufacturing. Auto plants are working at capacity, and may have to actually hire an additional shift of workers — which is much less expensive than building a new plant and then having it sit idle 16 hours a day. Some industries that decided it was cheaper to make it overseas and ship it here are thinking twice. Senior executives are cautiously optimistic, and 40% report moving operations to the United States.

Finally, home prices are starting to inch up. Granted, this is at least in part because of reduced supply (and at least in part because prices got stupid-low on a per-square-foot basis in some places).

So there you have it. People are getting jobs and buying stuff. Some manufacturers are running out of the ability to make more stuff — so they may have to build places and hire people to make even more stuff. Maybe soon the Fed can raise interest rates from the supposedly “stimulating” levels they are today, and in turn banks will be able to make a reasonable profit lending money without making up fees or outright committing fraud.

In Closing: Who could have guessed that Citizens United could open the door to ordinary people taking over elections?; never forget Romney’s dog; Tokyo Sky Tree now open; too useful to be real; cheap and free ebooks; yet one more reason I’m against school vouchers; FISA; $27,000??; and the Vatican gets outraged when nuns actually act on What Would Jesus Do.

 

Mama Economy

Remember Tay Zonday? He’s back, and he understands economics.

In Closing: Autopsy; Castro; Google thinks I’m a dude too (clearly I need to search more for shoes and makeup); Just for fun, read the first paragraph to somebody before telling them it’s Bob Dole; Because surely her hair is more important than anything else; Okay, maybe that’s a problem; and have a great weekend.

Down And Out on Paradise

Sticklers for detail will notice this is the Strip and not actually Paradise, a few blocks East.

Things are tough all over.

I do hope nobody is surprised to learn that poverty in the United States is even higher than expected. After all, some 15% of our population is on food stamps — and that’s according to the freaking Wall Street Journal! And it is worse than average here in Vegas, where the “recovery” you lucky souls in other parts of the nation have been experiencing the last 2 years has passed us by like some angry Santa:

There’s a newer version of this chart right here. Add to that the fact that Vegas is still the reigning foreclosure capital of the nation, and it shouldn’t be any shock that we have a problem with homelessness and “food security” — a fancy term for “no food and/or no money for food.” Please remember that no matter what you may think of the work ethic of people in these situations, some of the people effected are children. There are mighty few jobs available to children that will pay the family’s bills, and most of them are worse than mere hunger.

Maybe if Wall Street didn’t sell us a pack of lies about how we can run our economy on lattes and cheap imports, we could change things. Even Starbucks is trying to create jobs outside the Latte Economy.

In Closing: is police use of a GPS really different from tailing them (uh, yeah); whites use more drugs, but blacks get sent to prison more (huh, could the War on Drugs possibly be racist??); even a broken clock is right twice a day; Americans would rather have government bureaucrats than insurance company bureaucrats (who could know these things?); amen; and right on, Rick.

The Most Important Thing You Are Likely to Read Today

Hi folks. Sorry for the lack of posts. It’s been a crazy, crazy couple of weeks.

So, what are the protesters so upset about, really?

Do they have legitimate gripes?

To answer the latter question first, yes, they have very legitimate gripes.

And if America cannot figure out a way to address these gripes, the country will likely become increasingly “de-stabilized,” as sociologists might say. And in that scenario, the current protests will likely be only the beginning.

Want to know why the protesters are so upset? Here it is, with pictures. This ain’t hard. The only thing missing is the frustration of knowing that banks are above the law, allowed to continue being so big they can single-handedly crash the economy,  and they made matters worse by creating the foreclosure crisis.
Read ’em and weep. And then do something about it.
In Closing: Let women die; crazy idea; huhuhmmhuhuh; reason #128 why nobody gives a shit what the American Academy of Pediatrics has to say; amen; death and taxes; free trade; and have a great week.

The Economy is Depressing.

So the poverty level is at its highest level in decades. Think about that a minute. Most people didn’t know what the internet was the last time poverty was this bad. Household income is down 7% since the Bush Administration began. In fact, income hasn’t been this low since 1996. And plans to slash the federal budget to the bone — the heart of the current GOP platform — only make poverty worse. It’s worse for kids: 22% of kids under 18 live in poverty. Remember that. Walk into a typical classroom of 30 kids, and 6 or 7 of them live in poverty (more at someplace like Vegas’s Whitney Elementary, of course).

Since poverty and school performance are directly correlated — that means that poor kids always on average do worse than rich kids, even when you account for how well educated their parents are and how good their local schools are — that says some very, very bad things for our future as a nation.

Heaven forbid we should put people to work building things we need, like better roads, bridges, and school buildings. I mean, that sounds like kind of an FDR sort of idea.

In Closing: Salem was governed by “Christian Values” (and that explains the First Amendment); E-Verify is even more flawed than the Do Not Fly list; more than half of Americans support gay marriage; why is it that Republicans keep forgetting that the Post Office is one of the few government functions explicitly required by the Constitution — you remember, that document that they and the quasi-Libertarians claim to so revere?; turns out the sheep don’t like it when you molest the lambs; or, we could just disband the whole corrupt system.

Unmade in America

A couple of weeks ago I read this Forbes article called “Why Amazon Can’t Make A Kindle In the USA.” I was looking for the two tired and mostly false arguments that usually get trotted out:

  • Greedy American workers want outrageous things like a living wage, regular hours, decent benefits, and a safe workplace.
  • We have so many onerous regulations and taxes, that it just isn’t practical to do business here except of course to suck the money out of our wallets.

I was pleasantly surprised to find that instead, the article focused on the fact that too many of the components of high-tech gadgetry aren’t available from American suppliers, therefore we can’t really put together the whole product here. It’s a problem that has gotten worse over the years as Americans have shifted from a manufacturing economy to an information economy to the Latte Economy.

So then I didn’t really know what to do when I read about a little problem over at Gibson Guitars. It seems that federal agents raided Gibson, confiscating millions of dollars worth of woods such as ebony and rosewood, instruments, and electronic records. Apparently this was done in violation of the law: “US officials have actually refused to tell Gibson what it allegedly did wrong, and why the raid was conducted. The company was never notified of any potential violations prior to the raid, and no official charges were ever filed. By all appearances, the government simply decided one day to unlawfully storm the company’s manufacturing units with loaded weapons, and is now attempting to destroy one of the last honest American manufacturers in existence.”

Such heavy handed — and potentially politically motivated — enforcement of the law could leave legitimate owners of antique instruments in deep doo-doo too.

But wait! This gets even messier! Apparently, there would be no problem with this wood having been imported if it had been finished by workers in India. So let me get this straight: the feds would rather that wood was finished by poorly paid laborers in India — possibly child laborers — than finished by highly paid craftsmen in Tennessee. And moreover, if it wasn’t legal to import this wood in the first place, how did it make it through customs in the first place? For the first time, I wonder if it is practical to make guitars in the United States.

Make no mistake. I am for reasonable regulations that protect the world’s resources and prevent tyrants/terrorists from profiting on the suffering of their people. But clearly we have highly arbitrary regulations when it comes to some products: Does finishing a piece of ebony mean anything about how it was harvested? Does finishing a diamond mean no warlords made a profit? Or does the regulation just protect the profit of the plunderer? These regulations have been handed down from both Democratic and Republican administrations — go ahead and read that link about diamonds if you don’t believe me — so it is clear that neither party has any respect for American workers. And since our economy is currently creating no jobs, that’s just despicable.

There’s clearly more to the Gibson story. So if you have information to add, please put it in comments.

In Closing: so we can give them expensive drugs; expect your health insurance premiums to be exactly 9% higher next year; and science fiction timeline.
Thanks to Jukkou-san for some of the links above. Credit where credit is due.

Misdirection

OK, Maybe CNN wasn’t terribly subtle when they said “Washington could take down a mega-bank” and then immediately below showed a row of Bank of America ATMs. And don’t get me wrong, everything I have read about B of A lately indicates that they are skating on thin ice.

But don’t lose track of the prize. Fannie Mae just was forced to buy bought $500,000,000 in crappy loans from B of A — despite having plenty of foreclosures and pre-foreclosures of their own — in what Fortune calls a “back-door TARP.”

Gee, this couldn’t possibly have anything to do with the motivation behind a proposed program to help get rid of Fannie, Freddie, and HUD’s foreclosed properties, now could it? By the way, the headline is just a tweak misleading. They aren’t talking about slapping a “For Rent” sign in the lawns of these houses; they are talking about finding some sucker investor to buy them in bulk (that means with limited ability to pick and choose) under the condition of renting them out. Never mind that these homes are in conditions that vary from pristine to bulldozer-ready. Never mind that investors are already cherry-picking the best of them. Never mind that Fannie, Freddie, and HUD all have systems in place to favor owner-occupants when selling foreclosed properties.

Not gonna work.

In closing: I hope he’s still open for civil damages; She-Ra; Clavell did this as a novel, but with helicopters; If I Had $1000 Dollars; it hasn’t worked yet so let’s keep doing it; S&P and 63% of Americans agree about one thing; I know things are bad when Ron Paul starts to make sense; check your LinkedIn prefs; and Bert and Ernie are puppets, they have no sexual orientation.

Someone Noticed the Man Behind the Curtain?

Today the Dow Jones Industrial Average was down over 500 points. Now make no mistake, I don’t like to read too much into the Dow. After all, it’s only 30 stocks, tweaked so the most expensive ones matter the most. However, the S&P 500 also dropped almost 5% today.

The culprit? “Fears over the economy.” That’s the same economy that — at least outside corporate boardrooms — was crappy a week ago, a month ago, a year ago. But now? Someone is exposing the Wizard behind the curtain and it’s obvious that Bad Things are afoot in the Wonderful World of Oz.

What’s different now? Is it that the State of New York isn’t going to let Bank of America get off with a pennies on the dollar settlement? Is it that Congress has done such a bad job that their disapproval rating is at an all time high? Perhaps it’s that we now understand some of the lies surrounding the federal budget? Maybe somebody outside peace activists has realized that we really are running 2 and a half pointless wars (to say nothing of thinking we can still starve Cuba into capitalism)? Did some stock broker take a wrong turn into the wrong neighborhood and notice that trickle down doesn’t work? Could it be that somebody noticed that unemployment is up nearly everywhere, and there’s nothing in the budget deal or any other federal plan that would create jobs?

Of course, I am not alone in thinking we never actually got out of the Great Recession.

If you are looking for a silver lining, mortgage rates are down due to the economic data. Assuming you have a job, and good enough credit to qualify for a mortgage.

In Closing: Fannie and Freddie were just following everyone else off the cliff; if we seriously believe that some criminals can’t be rehabilitated, the answer is life in prison, not a scarlet letter (oh but then we would have to think for more than 10 seconds); it still wasn’t the drugs, but the scopes; Toyota, and Honda lose to Nissan, Kia, and VW; tax reform zombie; you have to be wealthy to eat healthy; and aww honey honey.