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Old 11-07-2007, 11:26 PM
 
Location: Salt Lake City, Utah
7,731 posts, read 12,159,067 times
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Quote:
The government says the economy is great - do you believe this?
Not for a minute.
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Old 11-08-2007, 06:03 AM
 
Location: Mesa, Az
21,148 posts, read 37,368,901 times
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My take on the economy is thus:

I work for a auto repair place whose customer base in probably in the top 75% percentile of income.

More and more of our customers are spending $1,500-$6,000 to repair their 7-20 YO cars and trucks; admittedly, living here in Arizona being the bodies stay immaculate (they do not rust) may have some bearing on things.

Two years ago many of the above vehicles would have been traded off. Not now.

Yes; we are in a de facto recession------the full force of which has yet to hit.
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Old 11-08-2007, 12:34 PM
 
Location: Near Manito
19,489 posts, read 20,806,021 times
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Quote:
Originally Posted by ArizonaBear View Post
My take on the economy is thus:

I work for a auto repair place whose customer base in probably in the top 75% percentile of income.

More and more of our customers are spending $1,500-$6,000 to repair their 7-20 YO cars and trucks; admittedly, living here in Arizona being the bodies stay immaculate (they do not rust) may have some bearing on things.

Two years ago many of the above vehicles would have been traded off. Not now.

Yes; we are in a de facto recession------the full force of which has yet to hit.
I don't know. Auto purchases and maintenance provide an inexact way to predict the economy. I have never seen as many new, bloated, Cadillac / Lexus / Mercedes "SUVs" in my life around here (Pacific northwest) as I've seen lately. I have no idea where these people get so much disposable income. I would wager that most of them spend more on their monthly cellular bill than I do on wine. And I deny myself very little when it comes to the Cote d'Or.
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Old 11-08-2007, 12:58 PM
 
Location: Pa
20,310 posts, read 19,391,836 times
Reputation: 6523
For me its great...
unemployement at all time lows.
More houses sold in the last 6 years than ever before. New first time home owners than ever before. Doesn't sound to bad to me.
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Old 11-08-2007, 01:07 PM
 
4 posts, read 4,866 times
Reputation: 12
Default Lies, Lies and more Lies

Good question. As the dollar fell to new record lows and oil and gold prices surged to new highs, Wall Street remained fixated on wholly meaningless government data that managed to report the lowest inflation in the last half century. These bizarre numbers were integral in allowing the Commerce Department to report 3.9% annualized GDP growth in the third quarter, which was heralded by the bulls as evidence that a resilient U.S. economy had shrugged off the problems in the housing and mortgage markets. However, the government’s ability to make “economic growth” magically appear is based purely on statistical finesse.

To arrive at this rate, the government had to assume that inflation during the quarter ran at an annualized rate of .8% (that’s less than 1%). That is the lowest rate of inflation used to calculate U.S. GDP since the Eisenhower administration. With oil priced at almost $100 per barrel, gold futures trading over $800 per ounce, the dollar hitting record lows, and the Fed printing money like it is going out of style, the government has the nerve to claim that current inflation is the lowest it has been in half a century. Unbelievable!
Just in case there is some confusion, the government adjusts nominal GDP gains using the GDP deflator, which represents the inflation rate during the time period being measured. This is done to strip inflation out of the GDP calculation so that only real growth gets counted: not nominal gains that result purely from inflation.

The consensus estimate for 3rd quarter GDP growth was 3.4%. The reason we beat that number was that the government adjusted the nominal 4.7% gain by a mere .8%. Had the government assumed a higher rate of inflation, say 2.6% (identical to the rate used to deflate second quarter GDP,) the 3rd quarter gain would have been only 2.1%, well shy of the consensus forecast. My guess is that inflation is actually running at an annualized rate closer to 10%. Therefore using a more honest deflator, the U.S. economy is actually contracting, which would explain the recent anecdotal evidence provided by various economic polls, voter dissatisfaction and consumer sentiment numbers. In fact, if one simply measures U.S. GDP using gold or any other currency, it is clear that we are already in a recession.
Similar illusions are created in other numbers, such as retail sales, corporate earnings, and stock prices, which are all rising merely as a result of actual inflation being higher than the official reports. For example, higher retail sales reflect consumers paying higher prices for the products that they buy. They may in fact be buying less stuff, but are paying more for it. Further, part of the gains result from tourists using their appreciated foreign currencies to buy products cheaper here than they can in the own countries. I have heard about Canadians checking into U.S. hotels with empty suitcases, crossing the border to indulge in weekend shopping sprees.

Corporate earnings, particularly those of multi-nationals, are padded as their foreign currency denominated earnings translate into more dollars when those earnings are repatriated. However, such gains are illusions, as companies merely earn more dollars of diminished value for the goods they sell. The actual volume of exports does not necessarily improve much, as evidenced by weak industrial production and manufacturing employment. When those additional debased dollars are paid out as dividends, they confer no real increase in global purchasing power to shareholders.
Similarly, just as inflation causes prices to rise for goods and services it causes stock prices to rise as well. Though such gains may be less than the actual increase in the cost of living, as long as the government gets away with using bogus CPI numbers which fail to fully reflect inflation, Wall Street takes credit for nominal gains as if they were real.

However, as ridiculous as the phony GDP number was, yesterday’s biggest joke was a report on global competitiveness put out by the World Economic Forum in Davos, Switzerland, which ranked the U.S. economy as the world’s most competitive. To arrive at this conclusion, the forum has obliterated the obvious under a mountain of theory. In determining country rankings, the WEF weighed strengths in their "12 Pillars of Competitiveness", including: institutions, infrastructure, macroeconomic stability, health and primary education, higher education and training, goods market efficiency, labor market efficiency, financial market sophistication, technological readiness, market size, business sophistication and innovation. Completely ignored however are the measurable results of competitiveness, notably a trade surplus and a strong currency.
It is as if the WEF decided to judge a weight loss contest without using a scale, by instead focusing only on mental attitude, dedication, perseverance, and nutritional education! As a result the prize is awarded to the fattest contestant. Based on the empirical evidence of a gargantuan trade deficit, staggering global indebtedness, and a declining currency, the United States is clearly not the most competitive economy in the world. In fact, it is TANKING.
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Old 11-08-2007, 01:12 PM
 
Location: South East UK
659 posts, read 1,270,318 times
Reputation: 137
The government says the economy is great - do you believe this?

Was listening to BBC world news just now and they say aid to Pakistan officially 6 billion dollars since 2000 but apparently CIA been dishing out one billion per month to Pakistan for the leaderships bribes to keep the army sweet in these difficult times.

So the US economy must be great to withstand this on top of it's other endeavours around the world?
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Old 11-08-2007, 02:03 PM
 
1,267 posts, read 3,028,525 times
Reputation: 191
Quote:
Originally Posted by G.Fawkes View Post
Good question. As the dollar fell to new record lows and oil and gold prices surged to new highs, Wall Street remained fixated on wholly meaningless government data that managed to report the lowest inflation in the last half century. These bizarre numbers were integral in allowing the Commerce Department to report 3.9% annualized GDP growth in the third quarter, which was heralded by the bulls as evidence that a resilient U.S. economy had shrugged off the problems in the housing and mortgage markets. However, the government’s ability to make “economic growth” magically appear is based purely on statistical finesse.

To arrive at this rate, the government had to assume that inflation during the quarter ran at an annualized rate of .8% (that’s less than 1%). That is the lowest rate of inflation used to calculate U.S. GDP since the Eisenhower administration. With oil priced at almost $100 per barrel, gold futures trading over $800 per ounce, the dollar hitting record lows, and the Fed printing money like it is going out of style, the government has the nerve to claim that current inflation is the lowest it has been in half a century. Unbelievable!
Just in case there is some confusion, the government adjusts nominal GDP gains using the GDP deflator, which represents the inflation rate during the time period being measured. This is done to strip inflation out of the GDP calculation so that only real growth gets counted: not nominal gains that result purely from inflation.

The consensus estimate for 3rd quarter GDP growth was 3.4%. The reason we beat that number was that the government adjusted the nominal 4.7% gain by a mere .8%. Had the government assumed a higher rate of inflation, say 2.6% (identical to the rate used to deflate second quarter GDP,) the 3rd quarter gain would have been only 2.1%, well shy of the consensus forecast. My guess is that inflation is actually running at an annualized rate closer to 10%. Therefore using a more honest deflator, the U.S. economy is actually contracting, which would explain the recent anecdotal evidence provided by various economic polls, voter dissatisfaction and consumer sentiment numbers. In fact, if one simply measures U.S. GDP using gold or any other currency, it is clear that we are already in a recession.
Similar illusions are created in other numbers, such as retail sales, corporate earnings, and stock prices, which are all rising merely as a result of actual inflation being higher than the official reports. For example, higher retail sales reflect consumers paying higher prices for the products that they buy. They may in fact be buying less stuff, but are paying more for it. Further, part of the gains result from tourists using their appreciated foreign currencies to buy products cheaper here than they can in the own countries. I have heard about Canadians checking into U.S. hotels with empty suitcases, crossing the border to indulge in weekend shopping sprees.

Corporate earnings, particularly those of multi-nationals, are padded as their foreign currency denominated earnings translate into more dollars when those earnings are repatriated. However, such gains are illusions, as companies merely earn more dollars of diminished value for the goods they sell. The actual volume of exports does not necessarily improve much, as evidenced by weak industrial production and manufacturing employment. When those additional debased dollars are paid out as dividends, they confer no real increase in global purchasing power to shareholders.
Similarly, just as inflation causes prices to rise for goods and services it causes stock prices to rise as well. Though such gains may be less than the actual increase in the cost of living, as long as the government gets away with using bogus CPI numbers which fail to fully reflect inflation, Wall Street takes credit for nominal gains as if they were real.

However, as ridiculous as the phony GDP number was, yesterday’s biggest joke was a report on global competitiveness put out by the World Economic Forum in Davos, Switzerland, which ranked the U.S. economy as the world’s most competitive. To arrive at this conclusion, the forum has obliterated the obvious under a mountain of theory. In determining country rankings, the WEF weighed strengths in their "12 Pillars of Competitiveness", including: institutions, infrastructure, macroeconomic stability, health and primary education, higher education and training, goods market efficiency, labor market efficiency, financial market sophistication, technological readiness, market size, business sophistication and innovation. Completely ignored however are the measurable results of competitiveness, notably a trade surplus and a strong currency.
It is as if the WEF decided to judge a weight loss contest without using a scale, by instead focusing only on mental attitude, dedication, perseverance, and nutritional education! As a result the prize is awarded to the fattest contestant. Based on the empirical evidence of a gargantuan trade deficit, staggering global indebtedness, and a declining currency, the United States is clearly not the most competitive economy in the world. In fact, it is TANKING.
thanks for a great post! a couple questions. what evidence do you see for your guess at an actual 10% inflation rate?

also, i've read that productivity is up and unemployment is down in the US: what does this really mean? i thought it was a measure of efficiency, as in amount produced and then purchased domestically and exported relative to amount spent on manufacturing in the first case, and low numbers in filings for unemployment benefits in the latter. am i correct? how does this fit with your comment on "weak industrial production" and "manufacturing employment"?

also, while i know it's a global economy, does weak currency or trade surplus necessarily translate? couldn't weak currency prime the exports and tourism pumps, and can't trade deficit help increase the value of our currency (if other industrials are valuing our purchasing power, e.g.)?

finally, how does the government use/justify such bogus inflation numbers and why do we never hear about this in the media, e.g.?

thanks.
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Old 11-08-2007, 02:47 PM
 
Location: South East UK
659 posts, read 1,270,318 times
Reputation: 137
Quote:
Originally Posted by hello-world View Post
also, i've read that productivity is up and unemployment is down in the US: what does this really mean?

thanks.
I suppose it all depends on when you start the comparison, so chose 1066 AD and you can get good results every time. Needless to say this is an exaggeration.
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Old 11-08-2007, 03:13 PM
 
310 posts, read 272,733 times
Reputation: 111
[/quote]finally, how does the government use/justify such bogus inflation numbers and why do we never hear about this in the media, e.g.?

thanks.[/quote]

Why do ya think?

The media and the government ARE one in the same.....in bed together....forever.......although it's a threesome when you throw in Corporate America

The government CAN justify anything it wants......don't you know this by now?

Bogus.....inflation numbers?
BOGUS....everything..... and it's BOTH the Republicans AND the Democrats!

The overall American economy had been in a tailspin for years......and the dot.com thing was NOT the same as American PRODUCTION....i.e (manufacturing).....exports.
Look at the trade deficit!
Look at the number of companies who have taken the mfg. overseas where slave labor boosts the bottom line a helluva lot more.....$$$$$ GREED, ya know!?
Why pay the American worker $9.00/hour or $15/hr. when they can have it done from people willing to do it for .50 cents/hour?

KEEP SHOPPING at WAL MART.......a LOT of slaves depend on it!

Sorry....but there has NOT been ANYTHING REALLY produced and/or manufactured in THIS country....to provide any REAL job base for ANY American worker in many, many years.....and to think investing in real estate, "flipping" houses was ever your meal ticket.....think again! It only contributed to the mess we're in today.
American stocks.....FOR SALE to ANY foreigner.
American real estate......FOR SALE to ANY foreigner.
America's business.....FOR SALE....to ANY foreigner.
Statue of Liberty.......FOR SALE!.......a plaster ***** in NY Harbor.

America's LUST for WAR.....the war machine, defense spending, continuation of a multi-billion/year long-LOST "War on Drugs".....and the massive scale of corruption that it has fostered for over 35 years.....is another good indicator where our government's PRIORITIES have been for FAR TOO LONG!
WAR on its OWN citizens since about 1970....Nixon-era.
Couldn't STOP those pesky drugs......or people from using them!
Couldn't STOP illegal immigration.....or they would have SHOT a LOT dead by now!
Can't STOP terrorists from entering the country either.....and NO amount of "Homeland INsecurity at MORE taxpayer WASTE of money will prevent another attack on American soil......'cause "where there's the will......there's the way."
And NOW....more than ever.....America has MILLIONS of enemies......just buying time scoping out another "plan."

The back was turned on the average American citizen a very long time ago.....and since, in today's world.....everything has gone completely global....with India and China now......ever-competing for that precious oil....among other things.....the bill is due for America.

It's OK....though.....the answer MUST BE......Build MORE jail cells, govt. contracting out to those willing to continue constructing these "SuperMax" prisons......gotta lock up a LOT more of society to get the rest to CONFORM.......not to mention......it EMPLOYS a LOT of people when you got a LOT more locked up.
Same with Defense spending......can't forget about that Military Industrial Complex anymore than the Prison Industrial Complex.
Besides.......all they have to do is KEEP instilling FEAR.....in the people and the people will always "go for it."
FEAR......Such the opposite has happened since FDR's famous speech!

Corporate America AND the Government ALL KNOW something....the people don't.........THEY ARE JUMPING SHIP on THIS country, it's PEOPLE... and headed for "greener pastures" wherever that might be?

GREED......CORRUPTION, lies, deceit and ALL the foreign aid America has provided other countries and the HUGE WASTE of TAX dollars on futility have all contributed to the downfall of a once....GREAT nation, IMO.
The priorities have seriously been skewed for a long, long time and it goes back....many administrations......NEITHER of which....really cared for the citizens of this country.....just the corporations and anyone else who would help back THEM (politicians).......rendering BOTH parties EQUALLY worthless at truly "taking care of its own."

Just imagine how much BETTER off this country could be.......IF our elected leaders actually "listened" to ALL of its citizens and addressed EACH issue with a RATIONAL and realistic perspective.....instead of following the money and taking bribes.

Our demise and implosion was seen coming a mile away by economists and many others.
History has shown that a functioning society has to actually be run by people who.....(give a SHI*T) and are NOT out to destroy it or other nations.....for their own, individual gain...but since peace is impossible and war is forever.....it was inevitable and we WILL collapse.

MAYBE.......THEY ALL KNOW SOMETHING.......they don't want the REST OF US to KNOW ABOUT........hmmmm.......wonder what that might be?
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Old 11-08-2007, 03:13 PM
 
Location: Near Manito
19,489 posts, read 20,806,021 times
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Quote:
Originally Posted by famenity View Post
I suppose it all depends on when you start the comparison, so chose 1066 AD and you can get good results every time. Needless to say this is an exaggeration.
Whoah. Tough year for the Anglo-Saxons.

"Harold heard the thunder of their coming as he fought. He turned his head and saw the Cross. A sword struck him across the brow uneseen. His axe fell from his hand. He sank down on his knee. His foemen shouted. They heard his battle-cry and saw him rising. A Knight bent from the saddle and hewed to the thigh-bone before the shields could close, crying 'God Help!'"

(from The Golden Warrior, by Hope Muntz)
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