The numbers don't add up
Submitted by gjohnsit on Wed, 11/01/2017 - 4:37pm
Submitted for your consideration, two official reports from different planets.
On one planet there is confidence to spare.
U.S. consumer confidence rose more than expected in October to the highest in almost 17 years as Americans grew more confident about the economy and job market, according to figures Tuesday from the New York-based Conference Board.
...The University of Michigan’s consumer sentiment index climbed in October to the strongest since the start of 2004, while the Bloomberg Consumer Comfort Index is near the highest level of the expansion.
The share of respondents who say jobs are plentiful rose to 36.3 percent, the most since June 2001, while people reporting good business conditions increased to 34.5 percent, matching the highest since 2001.
Everything is awesome, and Gallup largely confirms this.
What more needs to be said?
Oh, yeah. There is just one tiny, little thing to mention:
Everything is terrible and has literally never been worse.
Almost two-thirds of Americans, or 63 percent, report being stressed about the future of the nation, according to the American Psychological Association’s Eleventh Stress in America survey, conducted in August and released on Wednesday. This worry about the fate of the union tops longstanding stressors such as money (62 percent) and work (61 percent) and also cuts across political proclivities. However, a significantly larger proportion of Democrats (73 percent) reported feeling stress than independents (59 percent) and Republicans (56 percent).
...A majority of the more than 3,400 Americans polled, 59 percent, said “they consider this to be the lowest point in our nation’s history that they can remember.” That sentiment spanned generations, including those that lived through World War II, the Vietnam War, and the terrorist attacks of Sept. 11.
The country is headed for a cliff and we are all doomed. Nothing could be more clear.
This is backed up by another survey.
Just 24 percent of Americans believe the country is heading in the right direction after a tumultuous stretch for President Donald Trump that included the threat of war with North Korea, stormy complaints about hurricane relief and Trump's equivocating about white supremacists. That's a 10-point drop since June, according to a poll from The Associated Press-NORC Center for Public Affairs Research.
The decline in optimism about the nation's trajectory is particularly pronounced among Republicans. In June, 60 percent of Republicans said the country was headed in the right direction; now it's just 44 percent.
So, everything is awesome and things have never been worse.
Got it? Nothing more needs to be said.
Well, just one thing: you can't trust the numbers.
The estimate of potential GDP suggests the economy is running above potential. The unemployment rate, at 4.2 percent, is lower than what the Federal Reserve considers full employment. Financial conditions as seen via risk premiums in financial markets are very loose. All of this suggests a mix of fiscal and monetary policy should be biased toward slowing the economy, perhaps significantly, in 2018.
But for those indicators to point toward slowing, when other markers show such problems, reveals how damaged the economy has become during and after the recession. Labor-force participation, even adjusted for demographics, remains lower than it has been in the past, suggesting a lot of workers have left the labor force without any explanation that should comfort policymakers. Housing construction and activity remains well below any historical level considered normal...
So we're left with two possibilities. Perhaps "the economy is bad" -- already at its potential even while labor-force participation and housing activity are well below the levels we're used to historically. Or perhaps the data is bad, and we're stumbling in the dark as we try to estimate full employment and the economy's potential.
There is a third possibility
Perhaps "the economy is bad" AND the data is bad.
That's how I'd vote.
Comments
We're creating working poor at a record pace.
"Religion is what keeps the poor from murdering the rich."--Napoleon
The goal.
Only a fool lets someone else tell him who his enemy is. Assata Shakur
The Stock Market is not a Solid Indicator
Except for stockholders. Now, there are folks with 401Ks who aren't rich and watching their mutual funds improve, but the tax plan with delays in its release to the public and scheduled for mark-ups on Monday, has some folks worried, especially in not having state and local taxes being deductible from Federal.
To look at other business indications, the National Association of Home Builders did not have a great deal of confidence either when they saw that mortgage interest deductions for homeowners being taken away from the tax bill. That's simplified of course, but when they're nervous, and with the Fed looking only at this Conference Board report, we know we're in trouble. Prime rate lending to go up with fueled housing price speculation--we've seen this before. Try 2006.
The corporatists in our political system always seem to get their way, and the American people see it to a certain extent. It's probably good that the corporates are at some loggerheadiness, but overall, with the GOP in charge, the middle class is going to get ripped off. A lot.
One equal temper of heroic hearts, Made weak by time and fate, but strong in will. To strive, to seek, to find, and not to yield.--Tennyson
A question
The state and local tax deduction only applies when you itemize. What percentage of people itemize? I only itemized once, when I had $12,000 in medical bills.
On to Biden since 1973
I do taxes for someone who has a really
good job. I just redid all her taxes for 2013, 14, 15, and 16. It’s worth it for her to itemize. She makes over $100,000 a year. She has plenty of deductions so I itemizr. She had to refile13 thru 15 because of ‘errors’. I didn’t have anything to do with that. I just redid everything to fix it so the IRS would accept her returns. (2016 was filed by itself and was a piece of cake.)
She’s going to be up Shit Creek when that mortgage interest deduction goes away. Millions of Americans will be hurt. This is NOT right.
I'm tired of this back-slapping "Isn't humanity neat?" bullshit. We're a virus with shoes, okay? That's all we are. - Bill Hicks
Politics is the entertainment branch of industry. - Frank Zappa
Everywhere around me is hiring rn
but nobody wants to pay more than minimum wage, and the ones that do won't talk to me. Then every time you get a new job you gotta start out at the bottom again and claw your way back up, which can take YEARS. Fuck that noise.
Truly the best of times, worst of times...best if you're a rick fuck, worst for everyone else.
This shit is bananas.
Well, I see a Ton
of "Help Wanted" signs around town. A ton! But, they're all for $10 an hour customer service type jobs like retail, fast food, gyms, yada, yada. Virtually none in the $20 an hour range. So, yeah, are there jobs? Yes! Many! Just none you can actually live on, and most likely 30 hr. /week part-time jobs just to drive the knife deeper.
"We hear the whining, but the truth is there are Tons of jobs out there, thank us very much. Tons! Just how do those Milenial slackers think we Billionaires got where we are? We didn't get here on Billionaire Blvd. by sitting on our fat asses, I can tell you that! My suggestion to all those whiners is grab one of our $10 an hour jobs while they still can, becuz if we get our way - and you know we will - those jobs will soon be $6 an hour."
the little things you can do are more valuable than the giant things you can't! - @thanatokephaloides. On Twitter @wink1radio. (-2.1) All about building progressive media.
And if you're a person with disabilities..
Sure, we porkies could certainly afford to pay more, but where's the fun in that? /s
Modern education is little more than toeing the line for the capitalist pigs.
Guerrilla Liberalism won't liberate the US or the world from the iron fist of capital.
Hard to believe those positive numbers
Over half the population makes $30K or less. Over half the population does not have the money to survive simply emergencies. Something like 8.5 million students in default over loans. Something like 30 million no medical insurance.
These surveys which go to the everyday lives of people tell a very different story.
On the topic of data...
I don't speak economics fluently, but I'm suspicious of the graphs in the last piece. It is a plot of ratios of GDP / potential GDP on the y-axis and the values are in the 0.96-1.04 range. Obviously a value of "1" would be the GDP was equal to the "potential GDP"...
Like I said, I don't do economics, but this sort of graph, with these values, feels like just noisy data. A small error in one value can change a ratio plot enormously when the values are so close to one.
That is bad data.
Or, there might be nothing really wrong with the data, but the plot as such can not be interpreted in any meaningful way.