Page 1 of 2 12 LastLast
Results 1 to 25 of 29

Thread: Economy soars 5.7 percent, fastest in 6 years

  1. #1
    God/dess
    Joined
    Sep 2006
    Posts
    7,964
    Thanks
    6,155
    Thanked 10,183 Times in 4,602 Posts

    Default Economy soars 5.7 percent, fastest in 6 years

    Economy soars 5.7 percent, fastest in 6 years

    WASHINGTON (Reuters) – The economy grew at its fastest pace in more than six years in the fourth quarter, surprising economists, as businesses curbed their aggressive cut in stocks and stepped up spending.

    The robust growth pointed to a sustainable recovery in a crucial period before government stimulus plans run out and was good news for an administration amid political difficulties.

    Gross domestic product expanded at a 5.7 percent annual rate, the Commerce Department said on Friday in its first estimate for the quarter. It was a strong end to a year in which the economy shrank by 2.4 percent -- the worst performance since 1946.

    Read more..

  2. #2
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    in the interest of equal time ...



    (snip)"Efforts to rebuild depleted inventories contributed 3.4 percentage points to GDP, the most in two decades. "(snip) ... meaning that ~60% of the supposed 5.7% increase was actually due to the 'one time' makeup for deep inventory reductions earlier in 2009.

    (snip)"Consumer spending, which comprises about 70 percent of the economy, rose at a 2 percent pace, more than anticipated following a 2.8 percent increase in the previous three months. Economists projected a 1.8 percent gain, according to the survey median.

    Third-quarter purchases received a boost from the government’s auto-incentive program that offered buyers discounts to trade in older cars and trucks for new, more fuel- efficient vehicles."(snip) ... meaning that a significant percentage of the new car ( and new home ) sales contributing to the consumer spending increase was actually due to the US gov't borrowing money and 'handing it out' to selected consumers !

    (snip)"Household purchases dropped 0.6 percent last year, the biggest decrease since 1974. "(snip)

    (snip)"Today’s report showed purchases of equipment and software increased at a 13 percent pace in the fourth quarter, the most since 2006. The gain helped offset a 15 percent drop in commercial construction, leaving total business investment up 2.9 percent over the past three months. "(snip) and also (snip)A report yesterday showed companies ordered more capital goods such as machinery and computers in December, indicating business investment will keep expanding.(snip) ... which is arguably the result of a deliberate acceleration of transactions into the 2009 tax year in order to avoid potential tax increases / loss of existing tax breaks being imposed in 2010 !

    and let's not forget this little tidbit ... (snip)The job market is one area where a rebound is still not evident. Payrolls fell by 85,000 last month after a 4,000 gain in November that was the first increase in almost two years. The U.S. has lost 7.2 million since the start of the recession in December 2007, the most of any slowdown in the post-World War II era.

    The jobless rate held at 10 percent in December, the Labor Department said on Jan. 8. A jump in the number of discouraged workers leaving the labor market kept the rate from rising."(snip)


    ... bottom line, as already discussed in many previous threads, is that the 'official' GDP statistic counts freshly created US dollars being spent by the US gov't as 'growth'. While it is certainly growth in terms of gov't spending / gov't debt accumulation / future US taxpayer liability, any associated growth in 'Product' i.e. real value is highly debatable !

  3. #3
    God/dess
    Joined
    Sep 2006
    Posts
    7,964
    Thanks
    6,155
    Thanked 10,183 Times in 4,602 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by Melonie View Post
    ... bottom line, as already discussed in many previous threads, is that the 'official' GDP statistic counts freshly created US dollars being spent by the US gov't as 'growth'. While it is certainly growth in terms of gov't spending / gov't debt accumulation / future US taxpayer liability, any associated growth in 'Product' i.e. real value is highly debatable !
    Again you're making things up. The US government doesn't spend "freshly created US dollars". The money spent by the government comes from tax dollars or selling Treasury Bills. The value of a road or bridge is the same whether it is built by the government or private company. The official GDP statistics are correct.

  4. #4
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    The US government doesn't spend "freshly created US dollars". The money spent by the government comes from tax dollars or selling Treasury Bills
    I'll give you the benefit of the doubt that you really don't know about or understand the concept of monetization ... i.e. the US FED creating 'credit' out of thin air, which FED primary dealer banks then use to purchase freshly printed Treasury Bills on the FED's behalf !


    (snip)"Seemingly everywhere he went on a recent tour of China, Dallas Fed President Richard Fisher was asked to deliver a message to Federal Reserve Chairman Ben Bernanke: 'stop creating credit out of thin air to purchase U.S. Treasuries.' The Chinese are rightfully worried that B-52's plan for all the newly-created U.S. sovereign debt is monetization through Treasury purchases, otherwise known as quantitative easing (which is failing by the way).

    China is talking more cautiously, yet still is long schizophrenia as the newest evidence shows they remain buyers of US government debt at a steady clip, though they have shifted their risk appetite to shorter-maturity paper. Is that a fear of U.S. hyper-inflation a few years hence?

    The most important story of the long weekend and short week is the WSJ account and interview with Dallas Fed President Richard Fisher (call him Mr. $99 trillion in unfunded liabilities, if you will). He's the inflation hawk on the Fed board and claims to see none percolating yet.

    He also reveals that he voted against the plan for quantitative easing (using money <credit> created from nothing in order to purchase U.S. government debt and thereby move interest rates lower). It is the only monetary option remaining to governments who have already pushed interest rates to zero. And as B-52 will tell you, it doesn't always work, at least for longer than 60 days. Not when the market sees $10 trillion in new debt issuance coming down the pike.

    Outstanding WSJ piece (free link) is after the jump.

    WSJ:

    "I think the trick here is to assist the functioning of the private markets without signaling in any way, shape or form that the Federal Reserve will be party to monetizing fiscal largess, deficits or the stimulus program."

    The very fact that a Fed regional bank president has to raise this issue is not very comforting. It conjures up images of Argentina. And as Mr. Fisher explains, he's not the only one worrying about it. He has just returned from a trip to China, where "senior officials of the Chinese government grill[ed] me about whether or not we are going to monetize the actions of our legislature." He adds, "I must have been asked about that a hundred times in China."(snip)

    from

  5. #5
    God/dess
    Joined
    Sep 2006
    Posts
    7,964
    Thanks
    6,155
    Thanked 10,183 Times in 4,602 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by Melonie View Post
    I'll give you the benefit of the doubt that you really don't know about or understand the concept of monetization ... i.e. the US FED creating 'credit' out of thin air, which FED primary dealer banks then use to purchase freshly printed Treasury Bills on the FED's behalf !


    (snip)"Seemingly everywhere he went on a recent tour of China, Dallas Fed President Richard Fisher was asked to deliver a message to Federal Reserve Chairman Ben Bernanke: 'stop creating credit out of thin air to purchase U.S. Treasuries.' The Chinese are rightfully worried that B-52's plan for all the newly-created U.S. sovereign debt is monetization through Treasury purchases, otherwise known as quantitative easing (which is failing by the way).
    Purchasing Treasury Bills does not increase GDP.

  6. #6
    God/dess threlayer's Avatar
    Joined
    Aug 2003
    Location
    Syracuse
    Posts
    5,921
    Thanks
    369
    Thanked 419 Times in 290 Posts
    My Mood
    Fine

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    When money starts flowing all the way down to Main Street, then I will call it recovery.

    But remember during the Bush years no net growth in jobs or income occured, except for the top 0.1% (millionaires and billionaires) and large corporations, but then that's what Republicans are for. Is it not so?
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

  7. #7
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Purchasing Treasury Bills does not increase GDP
    I will again attempt to give you the benefit of the doubt ... i.e. that you truly don't understand what monetization is all about !

    (snip)"Wednesday, 25 March 2009, was the day the Fed began buying US Treasury bonds. Britain is doing it already. So is Japan. Why shouldn't we? What's a few trillion extra...just between friends?

    The scope of the project is immense.

    Do you remember how it works, dear reader? When you buy a US Treasury bond, you pay for it with real money – or at least, as real as dollars get. Money changes hands. No net increase in the money supply.

    But when the Fed buys a Treasury bond it creates the money to buy it...and thus the money supply increases. It's called "monetizing the debt" – or converting debt into currency. Given the size of upcoming Treasury purchases, the total size of the US monetary base is expected to increase 500% in the months ahead."(snip)

    from


    Put simply, your conclusion is true if, but only if, newly printed US Treasury Bonds are purchased by foreign governments, private sector individuals and businesses etc. who spend 'real money' to make the purchase ... which creates offsetting entries on the gov'ts balance sheet. Your conclusion is emphatically NOT TRUE if newly printed US Treasury Bonds are actually being purchased by the gov't itself via newly 'printed' dollars out of thin air with the help of primary dealer banks ... which in turn expands the gov'ts balance sheet thus adding to 'official' GDP. I agree wholeheartedly however that no 'productive' increase actually occurs !!!

  8. #8
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Let's see what it is fuirther along this year. Let's see what happens to unemployment.

    A LOT of the 5.7 % was built on government spendijng that is unsustainable for the long term.
    A LOT it was built on more profitable corporations having laid off a LOT of people.
    A LOT of it was built on companies rebuilding radically depleted inventories.

    The BIG problem is that the 5.7 % growth rate is compared to previous quarters that were LOUSY. It was so good because we stated from so LOW. Compared to years when the economy was humming along nicely like 1987, 1998 and 2006, it STUNK !

  9. #9
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by eagle2 View Post
    Again you're making things up. The US government doesn't spend "freshly created US dollars". The money spent by the government comes from tax dollars or selling Treasury Bills. The value of a road or bridge is the same whether it is built by the government or private company. The official GDP statistics are correct.
    WHo do you think has been BUYING those T-Bills, Notes and Bonds ? It ain't just the Chinese. And it ain't just the Social Security Trust Fund. It's the FED !!!!!
    As Melonie has patiently pointed out to you: WHAT do you think the Fed uses to buy that debt ? WHERE do you think that money comes from ? THEY PRINT IT !

    Have you looked at the Fed's balance sheet lately ? Do you know what M2 and M3 are ? Have you looked at those numbers lately ? Where do you think the multi-trillion dollar increase in THOSE numbers came from ?

    Just as we built a mirage of "prosperity" under Bush "43" built primarily on a bubble in housing prices, we are doing the same now with BORROWED money.
    Last edited by Eric Stoner; 02-01-2010 at 07:55 AM.

  10. #10
    God/dess
    Joined
    Sep 2006
    Posts
    7,964
    Thanks
    6,155
    Thanked 10,183 Times in 4,602 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    The government still has to pay that money back and it does not count towards GDP.

    You don't think any of the prosperity we had during the Reagan Administration came from the trillions of dollars of debt run up while he was President?

  11. #11
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by eagle2 View Post
    The government still has to pay that money back and it does not count towards GDP.

    You don't think any of the prosperity we had during the Reagan Administration came from the trillions of dollars of debt run up while he was President?
    Practicing your non sequitors are you ? That's MY argument and Melonie's too.

    You can't have it both ways. Goods and services purchased by governments count towards GDP. Sorry. We had this argument and I'll let you have a few of your own facts but NOT your own definition of GDP.
    WE are arguing that the recent 5.7% growth is illusional and built on the quicksand of debt caused by excessive government spending. You betcha that money has to be paid back. To the Fed or more likely to whom the Fed sells all that government paper it buys.

    Reagan hasn't been President for almost 25 YEARS ! The debt rung up during his Presidency was paid back, for the most part, a long time ago. The prosperity we had was from the 45 million NEW jobs created from 1980 to 2000; from the thousands of new businesses that were started. Obama hasn't created a single new job or helped start a single new business.
    Last edited by Eric Stoner; 02-01-2010 at 07:55 AM.

  12. #12
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Obama hasn't created a single new job
    actually, Obama policies HAVE created a number of new jobs ... government jobs ! The only problem is that the paychecks funding these jobs are being paid for by additional borrowed / newly printed money, and that these jobs arguably create zero real 'added value' in exchange for the (future) taxpayer money spent to fund them.


    As to the recent GDP report, despite the sleight of hand being used for GDP calculation, there is another huge caveat which has yet to be mentioned. The most recent GDP report is an early ESTIMATE. If previous quarter 'revisions' indicate a similar trend, the 5.7% figure will eventually be reduced to something in the 4.5% ballpark ...

    - [ showing 3rd Quarter GDP started at 3.5% revised to 2.8% revised again to 2.2% - sic ]

    ... given that 3.5% of the 5.7% 4th quarter early estimate is directly attributable to the 'one time event' of private sector businesses rebuilding depleted inventories, the future revisions should be very interesting. But future downward revisions non-withstanding, the fact remains that in the absence of actual increases in future sales / consumption, private sector businesses are not going to continue building inventory in future quarters.


    I would also interject yet another inconvenient truth ... that the 4th quarter GDP number was also 'boosted' by the fact that prices paid by consumers for the SAME basket of items increased by 2.1% during the 4th quarter. This is yet another sleight of hand being used for GDP calculation, which equates a 2.1% increase in US dollar denominated prices for a gallon of gas, a bushel of wheat etc. to 2.1% more gasoline and wheat actually having been produced / consumed.



    ~
    Last edited by Melonie; 01-31-2010 at 06:17 PM.

  13. #13
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by Melonie View Post
    actually, Obama policies HAVE created a number of new jobs ... government jobs ! The only problem is that the paychecks funding these jobs are being paid for by additional borrowed / newly printed money, and that these jobs arguably create zero real 'added value' in exchange for the (future) taxpayer money spent to fund them.


    As to the recent GDP report, despite the sleight of hand being used for GDP calculation, there is another huge caveat which has yet to be mentioned. The most recent GDP report is an early ESTIMATE. If previous quarter 'revisions' indicate a similar trend, the 5.7% figure will eventually be reduced to something in the 4.5% ballpark ...

    http://powip.com/2009/12/3rd-quarter...ownward-again/ - [ showing 3rd Quarter GDP started at 3.5% revised to 2.8% revised again to 2.2% - sic ]

    ... given that 3.5% of the 5.7% 4th quarter early estimate is directly attributable to the 'one time event' of private sector businesses rebuilding depleted inventories, the future revisions should be very interesting. But future downward revisions non-withstanding, the fact remains that in the absence of actual increases in future sales / consumption, private sector businesses are not going to continue building inventory in future quarters.


    I would also interject yet another inconvenient truth ... that the 4th quarter GDP number was also 'boosted' by the fact that prices paid by consumers for the SAME basket of items increased by 2.1% during the 4th quarter. This is yet another sleight of hand being used for GDP calculation, which equates a 2.1% increase in US dollar denominated prices for a gallon of gas, a bushel of wheat etc. to 2.1% more gasoline and wheat actually having been produced / consumed.

    http://www.bea.gov/newsreleases/nati...ewsrelease.htm

    ~
    Thank you Melonie. As usual, you are closer to the truth than our feathered friend.
    Government created jobs are being paid for with borrowed money.

  14. #14
    God/dess
    Joined
    Sep 2006
    Posts
    7,964
    Thanks
    6,155
    Thanked 10,183 Times in 4,602 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by Eric Stoner View Post
    Practicing your non sequitors are you ? That's MY argument and Melonie's too.

    You can't have it both ways. Goods and services purchased by governments count towards GDP. Sorry. We had this argument and I'll let you have a few of your own facts but NOT your own definition of GDP.
    You and Melonie are the ones who make stuff up on a regular basis. You're the ones who have come up with your own definition of GDP, where government spending does not count.

    Quote Originally Posted by Eric Stoner View Post
    WE are arguing that the recent 5.7% growth is illusional and built on the quicksand of debt caused by excessive government spending. You betcha that money has to be paid back. To the Fed or more likely to whom the Fed sells all that government paper it buys.
    No, you're just making stuff up to fit your ideology. For right-wing ideologues like yourself, growing the economy through massive deficits is acceptable, if it's a conservative president like Ronald Reagan, and the deficits come from tax cuts. It's only illusional if the deficits come from increased spending.


    Quote Originally Posted by Eric Stoner View Post
    Reagan hasn't been President for almost 25 YEARS ! The debt rung up during his Presidency was paid back, for the most part, a long time ago. The prosperity we had was from the 45 million NEW jobs created from 1980 to 2000; from the thousands of new businesses that were started. Obama hasn't created a single new job or helped start a single new business.
    Again, you're making stuff up. Most of Reagan's debt was not paid back. When Bush 43 became president, our country was in debt for approximately $5 trillion, with most of it coming from Reagan and Bush 41. It would have been even higher if President Clinton didn't greatly increase taxes after becoming president.

    Yes, giving President Reagan credit for everything good that happened in the 30 years after he became president is very accurate. None of his successors had anything to do with it. Of course you leave out that Reagan lost millions of jobs his first year in office like Obama. That would go against your right-wing ideology.

    Since it's clear you're incapable of polite discussion and are only capable of your same standard condescending response about me "having my own facts", rather than actually refuting what I say, I have no more interest in carrying on this discussion with you. You can go on living in your own right-wing ideological universe.
    Last edited by eagle2; 02-01-2010 at 09:14 PM.

  15. #15
    God/dess Zofia's Avatar
    Joined
    Apr 2002
    Location
    Durham, North Carolina
    Posts
    2,417
    Thanks
    2,964
    Thanked 2,370 Times in 934 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    E2, you are correct that Mel and Eric generally pull things out of thin air to support their "world view." However, I am something of a skeptic when it comes to our economic recovery. Most of the rise in GDP was due to businesses rebuilding inventories and home buyers taking advantage of the first time home buyers credit. Further, I disagree with economists who say that the recession is over simply because we have one positive quarter. (Remember most economists think it takes two consecutive quarters of declining GDP to define the beginning of a recession.) When I see the economy growing on its own rather than simply reflecting some government programs (cash for clunkers, first time home buyers credit) then I will be willing to call this recession over and done with. Right now, I think we are at the bottom and I hope things are looking up.

    The focus now should be on reigning in the deficit. If someone subscribes to Keynesian economic theories, now is the time to reduce the deficit. The government has "primed the pump" enough. Good fiscal, as opposed to monetary, policy says now is the time to ease off a little. Reduce the future inflationary pressures that the big Obama deficits will bring in 2012 and later years. Let the private sector resume job growth rather than burdening it with a huge government deficit.

    My two cents worth anyway.
    Z

  16. #16
    God/dess
    Joined
    Sep 2006
    Posts
    7,964
    Thanks
    6,155
    Thanked 10,183 Times in 4,602 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Thanks Zofia. I wasn't trying to state that we've recovered from the crisis, only that we had economic growth this past quarter. Where I disagree with Melonie and Eric is that somehow the growth was invalid because some of it came from government spending. It took us a long time to get into this mess and I think it's going to take us a long time to get out of it.

  17. #17
    Veteran Member jadelady's Avatar
    Joined
    Dec 2009
    Location
    east coast
    Posts
    373
    Thanks
    48
    Thanked 57 Times in 41 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    I don't think we are on the way to recovery.. just going further downhill.

  18. #18
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Where I disagree with Melonie and Eric is that somehow the growth was invalid because some of it came from government spending.
    It is not only we who disagree on this point ... it is the essential difference between the Keynesian and Austrian schools of economics.

    Where the stimulative effects of government spending are concerned, it makes a huge difference if
    A. that spending is funded by current year tax revenues / royalty income on gov't 'owned' oil, gas, minerals / liquidation of actual gov't owned tangible assets, or
    B. that spending is funded by the issuance of new gov't bonds (which must be paid back with interest in future years) or by the 'printing' of new money out of thin air.


    Further, I disagree with economists who say that the recession is over simply because we have one positive quarter. (Remember most economists think it takes two consecutive quarters of declining GDP to define the beginning of a recession.) When I see the economy growing on its own rather than simply reflecting some government programs (cash for clunkers, first time home buyers credit) then I will be willing to call this recession over and done with. Right now, I think we are at the bottom and I hope things are looking up.
    Thank you. I hope so as well ( that things have bottomed ). Unfortunately, a detailed analysis of real economic data does not support this conclusion.

    In particular, ARM interest rate resets for Alt-A and prime mortgage holders are coming due in 2010 and 2011 which overshadow the ARM interest rate resets for subprime mortgage holders. In particular, purchases of new US Treasury bill offerings by both domestic and foreign investors ( other than the FED / treasury itself ) have declined severely, and show no indication of a reversal. In particular, the vast majority of US state gov'ts are functionally bankrupt in an environment of falling state and local tax revenues - with future state gov't costs of providing unemployment benefit payments, food stamp payments, medicaid payments etc. increasing with each passing month. In particular, with a handful of notable exceptions, corporate profit levels are still well below historical averages - with proposals on the table to further increase US taxes and US regulatory compliance costs on what profits do exist.

    But of all of this year's economic trends, unprecedented and accelerating US gov't debt levels are arguably the single most important impediment to true improvement in the US economy. Many are of the opinion that the 'unintended consequences' of the ongoing growth of US gov't debt will prevent a real recovery and in fact precipitate a 'double dip' recession ...



    ~
    Last edited by Melonie; 02-02-2010 at 10:23 AM.

  19. #19
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by eagle2 View Post
    You and Melonie are the ones who make stuff up on a regular basis. You're the ones who have come up with your own definition of GDP, where government spending does not count.


    No, you're just making stuff up to fit your ideology. For right-wing ideologues like yourself, growing the economy through massive deficits is acceptable, if it's a conservative president like Ronald Reagan, and the deficits come from tax cuts. It's only illusional if the deficits come from increased spending.




    Again, you're making stuff up. Most of Reagan's debt was not paid back. When Bush 43 became president, our country was in debt for approximately $5 trillion, with most of it coming from Reagan and Bush 41. It would have been even higher if President Clinton didn't greatly increase taxes after becoming president.

    Yes, giving President Reagan credit for everything good that happened in the 30 years after he became president is very accurate. None of his successors had anything to do with it. Of course you leave out that Reagan lost millions of jobs his first year in office like Obama. That would go against your right-wing ideology.

    Since it's clear you're incapable of polite discussion and are only capable of your same standard condescending response about me "having my own facts", rather than actually refuting what I say, I have no more interest in carrying on this discussion with you. You can go on living in your own right-wing ideological universe.
    You are deliberately misunderstanding what Melonie and I posted. Neither of us ever said that gov't spending does not count towards GDP. Quite the contrary. However we pointed out the downside and pitfalls of using increased government spending to try and promote economic growth.

    I NEVER posted in favor of deficit spending, regardless of who is President and whether he had a "D" or an "R" after his name. I have repeatedly posted that Reagan tolerated too much irresponsible spending. David Stockman, Reagan's former head of O.M.B., admitted in his infamous "Atlantic Monthly" interview that increased spending was the price paid for Reagan to get his tax cuts.

    Reagan's debt was accumulated the same way the current debt is being rung up: by selling 30 Day, 60 Day ; 90 Day etc. T-Bills; 3 yr. ; 5 yr. and 10 yr. Notes and 30 year Bonds. Repeatedly as interest rates went down, those instruments were called in and rolled over. The Treasury replaced them with new debt at lower interest rates. Is any of this seriously new to you ? When I say it was "paid back" I meant that the original holders of debt incurred under Reagan were paid back. Of course there was plenty of debt incurred under Bush 41, Clinton (despite a couple years of surplus) and of course Bush 43. Bush's last deficit was about $100 billion.Compare that, and previous deficits, to Obama's both in total dollars and "real" dollars. There is no comparison. And as a % of GDP Obama's deficits are breathtaking. Not just now but in the out years.

    As I pointed out and as even you have acknowledged, unemployment is a lagging indicator. The reasons for job losses while Reagan sat in the Oval Office occurred while CARTER was President. The recovery and job gains in Clinton's First Term started under Bush 41. The Bush recession had ended in the last Quarter of 1992. When Bush 43 took office the economy was well into recession which coupled with 9/11 drove down the economy. However you insist on ignoring what unemploymnet was when Reagan left office in January, 1989. You refuse to acknowledge how many jobs were CREATED under Reagan and how many businesses expanded and how many small businesses were started. In two decades after Reagan's tax cuts took effect our economy created over 45 million new jobs.

    You tried to claim that Taiwan's voucher program "worked". That something similar here in the U.S. would also work. I pointed out that Taiwan's program FAILED because A. I READ your link ( did you ? ) and B. I looked up Taiwan's GDP numbers for the 2d and 3rd Quarters of 2009. Remember the program went into effect in January 2009; and what happened ? Economic growth went DOWN a total over 8%
    in those two quarters. I couldn't find 4th Quarter numbers for Taiwan. Do you have them ? I'm guessing it's too early but if you have them , please post them.

    My remark about your "having your own facts" was clearly tongue in cheek and at worst was a very gentle dig. It was in response to your apparent refusal to accept the classical and common definition of GDP which actually goes back months in this forum. For the last time, goods and services purchased by government COUNT in the overall GDP number. In order to get counted in GDP something can't just be made or even put on a shelf, it has to be SOLD ! Somebody has to BUY it ! You seemed to disagree with this definition sometime back in another thread and I was forced to correct you. What Melonie and I were critiquing in THIS THREAD was our government doing its BUYING with borrowed money.One reason I AGREE with you about infrastructure spending by GOVERNMENT is because it's multiplier effect in the overall economy is far, far greater than just keeping a teacher on the payroll. Along with other corollary benefits of building things like high speed rail and maintaining our existing roads, bridges, tunnels airports and power grid. In other words: if we are going to borrow to spend,
    then AT LEAST we should be spending it on infrastructure and NOT on an AFSCME and NEA Relief Act. I hope we can at least agree on this one point .

    I also hope you don't join many of your liberal brethren in being incapable of taking a joke or even having a sense of humor. I take your remarks about my "ideology " in stride and I'm trying to follow Deogol's advice about trying not to personalize. Won't you join me by trying to do likewise ?

  20. #20
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by Zofia View Post
    E2, you are correct that Mel and Eric generally pull things out of thin air to support their "world view." However, I am something of a skeptic when it comes to our economic recovery. Most of the rise in GDP was due to businesses rebuilding inventories and home buyers taking advantage of the first time home buyers credit. Further, I disagree with economists who say that the recession is over simply because we have one positive quarter. (Remember most economists think it takes two consecutive quarters of declining GDP to define the beginning of a recession.) When I see the economy growing on its own rather than simply reflecting some government programs (cash for clunkers, first time home buyers credit) then I will be willing to call this recession over and done with. Right now, I think we are at the bottom and I hope things are looking up.

    The focus now should be on reigning in the deficit. If someone subscribes to Keynesian economic theories, now is the time to reduce the deficit. The government has "primed the pump" enough. Good fiscal, as opposed to monetary, policy says now is the time to ease off a little. Reduce the future inflationary pressures that the big Obama deficits will bring in 2012 and later years. Let the private sector resume job growth rather than burdening it with a huge government deficit.

    My two cents worth anyway.
    Z
    You, and Eagle, and anyone else, are absolutely free to disagree with anything and everything I post. But please don't say that I "pull things out of thin air" to support my positions. I do nothing of the sort. Everything I post is backed up by facts and figures. Please cite one, just one example where I made something up. Not where I posted something in error and ACKNOWLEDGED it. Which Eagle NEVER does by the way. Cite just one case where something I posted belied the actual facts. That runs counter to what's in the history books.

    I'm tired of posting that:" there is one set of facts for everybody". That the numbers are what they are. Melonie is the one who critiques SOME economic stats and SOME methods of quantifying various economic data. Regardless of whether or not her links make valid points regarding same at present; eventually the figures get sorted out and a consensus emerges as to what the "true" numbers are.

    What those numbers mean; what caused them; what we should or shouldn't do to change them and make them better ( presumably, as I'm willing to ascribe goodwill to Obama no matter how misguided I think his policies are) are all fair game afaic and legit fodder for debate and discussion.

    In contrast, it is Eagle who has repeatedly posted links that he claims say one thing. I read them and found that they in fact said something entirely different so that I felt entitled to legitimately ask him more than once whether HE had actually READ them. If anyone can be fairly accused of plucking things out of thin air it is him. Exhibit "A" is his claim that consumer spending vouchers "worked" in Taiwan.
    The actual GDP numbers say that they most certainly did NOT. It's hardly the only example of his links NOT saying what he claimed.

    I don't even really want to go as far as I have in rebutting some of the personal stuff. I'd rather we just agree to disagree. If you have "BETTER" numbers or data that is "closer" to the truth than something I or anyone else posts, please do so. I much prefer that to accusations that I'm making things up. Wouldn't you ?

  21. #21
    God/dess Deogol's Avatar
    Joined
    Dec 2003
    Posts
    5,493
    Thanks
    120
    Thanked 50 Times in 35 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Now that we know credit card interest is considered as part of consumer spending as part of GDP...
    and we know that people have been getting their interest rates jacked up into the 18% to 30% range...
    and we know all that debt is from the previous economic cycle...

    I think we can pretty much write off this GDP number as a ruse of merely forcing people to pay more on debt they incurred when times were good - not that times are getting better.

    (Throw in the coming three quarter of million jobs revision and we can pretty be pretty assured GDP, like the DOW, no longer represents what is happening on Main Street.)

  22. #22
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    ^^^ check out the 'real' spending versus 'FIRE' spending thread / graph. I was astounded to see that more than 1/3rd of all US consumer spending is going into the pockets of bankers via ever increasing interest payments ! Of course, in terms of 'real world' economic growth, this means that more than 1/3rd of the spending being counted as official US GDP is NOT purchasing anything 'real' ... it is merely servicing already existing debt on already booked consumer purchases. And as you point out the 30% credit card interest rates only exacerbate this 'non-productive' diversion of consumer spending away from the purchases of 'real' goods.

  23. #23
    God/dess threlayer's Avatar
    Joined
    Aug 2003
    Location
    Syracuse
    Posts
    5,921
    Thanks
    369
    Thanked 419 Times in 290 Posts
    My Mood
    Fine

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by Eric Stoner View Post
    Thank you Melonie. As usual, you are closer to the truth than our feathered friend.
    Government created jobs are being paid for with borrowed money.
    In a real sense of your statement everything the government has done for decades has been on borrowed money, if you consider that at no time has our government had an accumulated surplus, though a few individual recent years have had such.

    Many people also live that way via their home mortgages that loom over their asset valuation. It's the American way. Most other democracies are in similar situations.

    So what? Is the world going to explode or the sky fall in on us?

    As long as debt eventually pays more than it takes, in the end, all is forgiven. Apparently.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

  24. #24
    God/dess threlayer's Avatar
    Joined
    Aug 2003
    Location
    Syracuse
    Posts
    5,921
    Thanks
    369
    Thanked 419 Times in 290 Posts
    My Mood
    Fine

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by eagle2 View Post
    Thanks Zofia. I wasn't trying to state that we've recovered from the crisis, only that we had economic growth this past quarter. Where I disagree with Melonie and Eric is that somehow the growth was invalid because some of it came from government spending. It took us a long time to get into this mess and I think it's going to take us a long time to get out of it.
    It has been pretty well recognized, even by conservatives, I may add, that the government spending has averted an even more serious financial crisis.

    In any case what did the conservatives offer instead? Reduce corporate taxes and see if anything trickles down. And that is after the conservatives acted to deregulate the corporate financial wizards that essentially caused this whole sordid mess.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

  25. #25
    God/dess Zofia's Avatar
    Joined
    Apr 2002
    Location
    Durham, North Carolina
    Posts
    2,417
    Thanks
    2,964
    Thanked 2,370 Times in 934 Posts

    Default Re: Economy soars 5.7 percent, fastest in 6 years

    Quote Originally Posted by Eric Stoner View Post
    You, and Eagle, and anyone else, are absolutely free to disagree with anything and everything I post. But please don't say that I "pull things out of thin air" to support my positions.
    That's exactly what you do. Whenever a number does not support your world view you claim it's fraudulent. You only quote "articles" that support your world view. And, when all else fails you just grab something from thin air.

    That's the way it is sweetie.
    Z

Page 1 of 2 12 LastLast

Similar Threads

  1. where do believe money comes fastest?
    By bubblebutt8o8 in forum Club Chat
    Replies: 9
    Last Post: 10-15-2011, 10:49 PM
  2. Replies: 4
    Last Post: 09-29-2011, 06:31 PM
  3. Dancers: What Percent Do You Like?
    By jack0177057 in forum Customer Conversation
    Replies: 44
    Last Post: 07-09-2009, 07:15 PM
  4. Service Economy vs Manufacture Economy
    By xanfiles1 in forum Dollar Den
    Replies: 20
    Last Post: 05-04-2008, 03:36 AM
  5. Fastest way to whiten teeth?
    By tasteebars in forum Body Business
    Replies: 19
    Last Post: 12-04-2007, 12:35 AM

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •