The trade and economy mega-thread (1 Viewer)

another bump


The central bank raised its benchmark interest rate by 0.75 percentage points Wednesday, matching hikes in June and July. The Fed has been boosting borrowing costs at the fastest pace in decades. But so far, its actions have done little to curb the rapid run-up in prices.

The annual inflation rate in August was 8.3% — down only slightly from the month before. While the price of gasoline has dropped sharply from its record high in June, and used cars and airline tickets have gotten somewhat cheaper, other costs — including rent, groceries and electricity — continue to climb.

Came across this today. Another example of "blame Democrats"

zztop said:

Came across this today. Another example of "blame Democrats"

Click to expand...

Thats the problem with the macro economy, no one has the patience to see how policy plays out, and by the time the success is realized, the players have changed and the rules changed, therefor continuing an endless cycle of ups and downs.

Tell me again how the economy is so bad right now ...

============

Blue collar workers won big in 2023, defying bleak predictions​

The year began with a recession forecast but ended with substantial wage growth and record union contracts for hundreds of thousands of workers​

A year that started out with bleak prospects, including a widely predicted recession, shaped up to be a boon for the average American worker — and one of the most triumphant for organized labor in a generation.

More than 525,000 workers in the United States walked off the job in 2023, according to Bloomberg Law’s database of work stoppages, making it one of the three biggest strike years since 1990. Many of those strikes led to big concessions from employers, such as the landmark deal reached by the UAW in October.

Employers agreed to pay more for workers because of a historically tight labor market, meaning it proved more economical to boost wages and benefits than to try to find new workers or risk losing current ones.

The unemployment rate, a key indicator of the labor market’s health, has remained below 4 percent for two years as of November, a stretch last accomplished in the 1960s. And hourly wage growth began to outpace inflation this spring after years of falling behind, boosting workers’ standard of living, especially the lowest earners.

“Resilience was really the theme for the labor market in 2023,” said Daniel Zhao, lead economist at the jobs site Glassdoor, noting that the market created a ripe environment for a heightened number of workers to strike. “We entered the year with significant headwinds. But as the year progressed, the labor market was able to continue powering forward.”

Headed into 2023, many Wall Street forecasters were predicting a recession. The Federal Reserve was in the midst of an aggressive campaign to raise interest rates to fight inflation, leading to the widespread belief that the unemployment rate would rise in response to weakened labor demand. Those fears lingered into the early months of the year, as 160,000 layoffs in the tech industry in the first quarter and a series of bank failures briefly sparked concerns about a broader meltdown in the economy.

Justin Wolfers, an economist at the University of Michigan, called 2023 “genuinely a banner year for the working class and low-paid workers,” noting the economic recovery since covid has been strongest for those on the lower end of the income scale.

“Low unemployment is the most important thing raising the stock of American workers,” he said. “The second most important thing is they’ve managed to negotiate quite substantial real wage gains.”

...

===============

zztop said:

Came across this today. Another example of "blame Democrats"

Click to expand...

He forgot Trump's trade war with China that cost us 0.7% points in gdp while accomplishing nothing. Or how he interfered in an opec+ oil price war that raised gas prices. And of course, that 2 trillion dollars tax break for the mega wealthy and corporations. And to think some Americans think he's good for the economy when he lived off of Obama's policy.

I wonder if I should post this in the inflation topic on the EE board

zztop said:

I wonder if I should post this in the inflation topic on the EE board

Click to expand...

The problem is the dummy in the tweet doesn't understand or acknowledge that corporate profits are a key driver of inflation.

Regardless, I'm not sure anyone out there is denying increased corporate profits are a substantial component of inflation. Whether that's justified or not is a whole other discussion.

There's disagreement among economist as to whether not corporate profit drives inflation or benefits from inflation.

interesting spin

It’s mind-blowing that Trump has people agreeing that the economy sucks - the economy is going gang busters, and when relative to the rest of the world, it’s incredibly strong.

superchuck500 said:

It’s mind-blowing that Trump has people agreeing that the economy sucks - the economy is going gang busters, and when relative to the rest of the world, it’s incredibly strong.

https://www.cnbc.com/2024/10/30/private-job-creation-totaled-a-stunning-233000-in-october-far-more-than-expected-adp-says.html

Click to expand...

When your hatred is soul deep, you'd believe every crazy idea that the person allowing you to hate tells you.

superchuck500 said:

It’s mind-blowing that Trump has people agreeing that the economy sucks - the economy is going gang busters, and when relative to the rest of the world, it’s incredibly strong.

https://www.cnbc.com/2024/10/30/private-job-creation-totaled-a-stunning-233000-in-october-far-more-than-expected-adp-says.html

Click to expand...

and dont forget he has them agreeing that the only reason that Wall St is performing as it is, is because Wall St is anticipating a Trump victory Nov 5.

Its the alternate reality the article you posted weeks back is talking about. They are fully enveloped in this "alternate universe information bubble". Fully.

Shocking that a strong dollar and economy drives 1/5 of Americans to travel abroad, yet America's economy is trash? I don't believe that it's solely the rw echo system driving this narrative. The MSM has to take some blame. It's the tired double standard dating back to impossibly high standards given to obama, and vice versa, low ones for bush and trump. And make no mistake, the tip of that spear is the rw information sphere. The msm happily follows asking these rw talking points.

Plus, that inflation shock is the recency bias. I informed someone irl that there are studies that pinned the inflation directly to covid (high demand with a rapidly opening economy and a supply disruption caused by covid) and that quantitative easing had some but marginal effects relative to supply and demand. It was quickly brushed off. It's still biden's fault bc of all the stimulus money. Urgg....the disconnect that those legislation (Ira, chips, and infrastructure) had not yet directly injected money into the economy was completely ignored. And that trump had his part in the quantitative easing. Funnily enough, this same person is planning a trip abroad. There's some level of zombie walking in this country that are ignoring expert conclusions and the msm complicitly joining into a preferred narrative. No one can listen to trump at msg and comes out with, "trump in the final message is of hope...". But the usatoday? What in sanewashing is the msm doing?

For a consolation, I saw an analysis that more Americans than not aren't sold on this bad economy narrative...if I remember correctly, they used data from the consumer confidence index to come to their conclusion. And caveat, I recognize that polls of americans are unreliable now, and I am uncomfortable referencing it...but harris on the economy is even with trump. Sadly....however perspective anyone interprets that...it's quite jarring that it's even. But again, Republicans has that baked in bias from Americans. Biden if I remember correctly trailed Trump in 2020. My god, I remember listening to NPR in 2020 when they interviewed a hispanic trump voter referring to the economy as the reason why he voted for Trump. I lost my mind. Historic bias? I don't know. Maybe?

It's frustrating that Americans hold on to that. I recently checked Fred's data on deficit vs gdp...and guess what? On avg, dems had net positive trends since Carter. Clinton being the lone surplus. Who quickly destroyed that?

UriUT said:

https://www.reuters.com/world/americas/record-number-americans-plan-traveling-abroad-next-6-months-2023-08-29/

Shocking that a strong dollar and economy drives 1/5 of Americans to travel abroad, yet America's economy is trash? I don't believe that it's solely the rw echo system driving this narrative. The MSM has to take some blame. It's the tired double standard dating back to impossibly high standards given to obama, and vice versa, low ones for bush and trump. And make no mistake, the tip of that spear is the rw information sphere. The msm happily follows asking these rw talking points.

Plus, that inflation shock is the recency bias. I informed someone irl that there are studies that pinned the inflation directly to covid (high demand with a rapidly opening economy and a supply disruption caused by covid) and that quantitative easing had some but marginal effects relative to supply and demand. It was quickly brushed off. It's still biden's fault bc of all the stimulus money. Urgg....the disconnect that those legislation (Ira, chips, and infrastructure) had not yet directly injected money into the economy was completely ignored. And that trump had his part in the quantitative easing. Funnily enough, this same person is planning a trip abroad. There's some level of zombie walking in this country that are ignoring expert conclusions and the msm complicitly joining into a preferred narrative. No one can listen to trump at msg and comes out with, "trump in the final message is of hope...". But the usatoday? What in sanewashing is the msm doing?

For a consolation, I saw an analysis that more Americans than not aren't sold on this bad economy narrative...if I remember correctly, they used data from the consumer confidence index to come to their conclusion. And caveat, I recognize that polls of americans are unreliable now, and I am uncomfortable referencing it...but harris on the economy is even with trump. Sadly....however perspective anyone interprets that...it's quite jarring that it's even. But again, Republicans has that baked in bias from Americans. Biden if I remember correctly trailed Trump in 2020. My god, I remember listening to NPR in 2020 when they interviewed a hispanic trump voter referring to the economy as the reason why he voted for Trump. I lost my mind. Historic bias? I don't know. Maybe?

It's frustrating that Americans hold on to that. I recently checked Fred's data on deficit vs gdp...and guess what? On avg, dems had net positive trends since Carter. Clinton being the lone surplus. Who quickly destroyed that?

Click to expand...

first you have to concede that many average Americans dont know what "economy" is- for them, it is simplified to gas, grocery and housing. AKA "their personal economy" - put simply- How much can they afford on their income TODAY vs 4 years ago. Thats it...thats their definition of "economy".

So when asked, thats the basis in which the question gets answered.

They dont understand nor give 2 shirts about GDP, Core inflation, consumption, trade, investment, money supply etc etc. And for someone making $25/hr, i dont expect them to know how all that relates to our economy.

"Is my take home pay more now than before?"

THATS the "economy".

efil4 said:

first you have to concede that many average Americans dont know what "economy" is- for them, it is simplified to gas, grocery and housing. AKA "their personal economy" - put simply- How much can they afford on their income TODAY vs 4 years ago. Thats it...thats their definition of "economy".

So when asked, thats the basis in which the question gets answered.

They dont understand nor give 2 shirts about GDP, Core inflation, consumption, trade, investment, money supply etc etc. And for someone making $25/hr, i dont expect them to know how all that relates to our economy.

"Is my take home pay more now than before?"

THATS the "economy".

Click to expand...

I'll concede that. Most americans are more concerned with getting by day to day.

[edit]
Also, most are simplistic because of that. Narrow messaging like, unemployment rates resonates. Then if that rate is below full unemployment, then the messaging then became...well wages aren't rising. There is a point when what's reported hits home.

UriUT said:

I'll concede that. Most americans are more concerned with getting by day to day.

[edit]
Also, most are simplistic because of that. Narrow messaging like, unemployment rates resonates. Then if that rate is below full unemployment, then the messaging then became...well wages aren't rising. There is a point when what's reported hits home.

Click to expand...

exactly

its the "dumbing down of America" thru media who are on a never-ending quest for profit. If you are too "technical" you will only appeal to a segment of the population and operate in a very narrow revenue stream

if you make it SIMPLE, you now appeal to a much larger audience that will tune in/buy subscription/click/open etc and now that revenue stream is a revenue ocean.

They didnt plan to make us dumb, they just made information easier to digest for the layman who didnt want to invest their time or brain power in understanding the economics of the US. ( even tho it DIRECTLY affects them ) - much easier to have someone tell them what to believe.

the path of least resistance.