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Thread: Bad Economic News TriFecta Hits ...

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    Default Bad Economic News TriFecta Hits ...

    from

    (snip)"The economic data dump is here. In order of appearance, first we have jobless claims which rose from an upwardly revised (of course) 391,000 to 393,000, worse than expectations of 390,000. That is Seasonally Adjusted. Not Seasonally Adjusted claims exploded by 74,214: good thing nobody looks at the unfudged number. The bleeds from the 99 week cliff continued as a net of 7K people dropped from EUC and Extended Claims.

    Next we have durable goods which while on the surface were better than expected declining by just -0.7% on expectations of -1.2% (with the previous month revised massively lower from -0.8% to -1.5%), the orders ex volatile non-defense and air dropped by a whopping -1.8%, on expectations of -1.0%, and the revised September number collapsing from +2.4% to +0.9%. This means that not only will the final Q3 GDP be revised even lower, but that Q4 GDP rebound hopes have been all but dashed.

    Finally, in Personal Spending data, we learn that consumers spent less, with spending rising only 0.1% on expectations of 0.3%, while income increased (thank you Uncle Sam) from 0.1% to 0.4% on expectations of 0.3%. This was to be expected: after all the savings rate in September hit 3.3% - the lowest since August 2008. It had only one way to go, and so it did, with the October Savings Rate increasing to 3.5%. Expect this number to keep rising as consumer finally re-retrench yet again, in the process hitting the economy."

    Not Seasonally Adjusted Jobless Claims: (snip)




    Besides the obvious, the recent 'official' announcements of significant downward revisions to earlier estimates must lead to an inescapable conclusion that the 'official' stats are being 'fudged' with the intention of presenting an overly optimistic economic outlook.

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    Default Re: Bad Economic News TriFecta Hits ...


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    Default Re: Bad Economic News TriFecta Hits ...

    Jimboe I like your atttude....... Unfortunatly in what is now over two years of this recovery...... GDP, tax receipts, et all are awful...... This is the worst recovery from an economic bottom ever in this country.

    We needed extrodinary growth in this period..... and we got this...... I'm not blaming anyone..... It's the debt, and the way this country tries to inflate assets, instead of employment.
    The country has been looted.

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    Default Re: Bad Economic News TriFecta Hits ...

    Quote Originally Posted by mikef View Post
    Jimboe I like your atttude....... Unfortunatly in what is now over two years of this recovery...... GDP, tax receipts, et all are awful...... This is the worst recovery from an economic bottom ever in this country.

    We needed extrodinary growth in this period..... and we got this...... I'm not blaming anyone..... It's the debt, and the way this country tries to inflate assets, instead of employment.
    Mike, we are in the midst of a huge change in US and worldwide economic paradigns. Anytime there is change there will be fear and apprehension because things aren't like they used to be and there will also be lots of new opportunities because.....things aren't like they used to be.

    With the incredible advances we've made the last decade or two regarding communication, ease of moving funds, and access to and ability to distribute information and ideas, the entire playing field is forever changed. Many of the old measuring sticks that we used in the past are now obselete. Many people are caught in somewhat of a state of shock because such massive changes are happening so quickly and they are still looking to the old paradigns and are reacting with worry and fear. Many other people are adjusting rapidly and taking huge advantage of new opportunities. The media tends to focus a lot more attention on the worry-fear aspect as that tends to sell more papers. As seen in the link below there are hundreds of thousands of new, small-scale entrepeneurs who are doing fantastic and creating lifestyles better than anything they had previously.

    He is part of a robust entrepreneurial movement sweeping the nation. In 2010, nearly 565,000 businesses were started each month, the highest number in more than a decade...
    http://www.lasvegassun.com/news/2011...rt-businesses/

    In addition, as a result of this shift there are millions of jobs available that go unfilled because people and society have not reacted quickly enough:

    Data from the Bureau of Labor Statistics shows 2.7 million jobs remained unfilled in the U.S. in August, and employers are reporting having a hard time finding skilled workers to fill those jobs. How can that be? What is going on?
    http://mbahighway.com/2011/10/millio...w-can-that-be/

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    Default Re: Bad Economic News TriFecta Hits ...

    Jim, I think many employers will say a lack of skilled workers is why they outsource......

    Many of those starting businesses are from the ranks of the unemployed...... who now work longer hours, for less money..... With little or no healthcare insurance.


    http://economix.blogs.nytimes.com/20...self-employed/

    http://www.nytimes.com/2010/06/20/jobs/20search.html



    Anyway..... You have a great Thanksgiving.
    The country has been looted.

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    Default Re: Bad Economic News TriFecta Hits ...

    Quote Originally Posted by mikef View Post
    Jim, I think many employers will say a lack of skilled workers is why they outsource......
    Most of the jobs listed are for US employers with facilities on US soil- they would hire if they could but there aren't enough trained applicants.

    As for the articles on self-employment, I think a lot of them are doing very small start-ups and are largely under the radar. As I mentioned in the earlier post, it's the beginning of a new era. People don't need an office, equipment or even capital to start a business these days. There are thousands of firms on elance that are new start-ups from people who were previously working for companies. Some of them could be in business for less that a few hundred dollars. In addition, they are getting income from all over the world so it greatly reduces the need for things to be economically advantageous in their geographical region.

    You have a great Thanksgiving as well!.
    Last edited by jimboe7373; 11-23-2011 at 08:20 PM.

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    Default Re: Bad Economic News TriFecta Hits ...

    Many of the old measuring sticks that we used in the past are now obselete.
    This is technically true in part, but dangerously false in arguably much more important part. IMHO the key issue involves whether or not one is measuring true production of new or additional 'real value' ... which involves mining / drilling / farming / forestry i.e. extracting 'real value' from natural resources, or increasing the 'real value' of natural resources via manufacturing / chemicals / construction etc. ... versus attempting to measure 'apparent value' that originates from printed / borrowed currency i.e. new debt, or the 'recycling' of previously printed / borrowed currency i.e. pre-existing debt ... i.e. gov't jobs, banking, insurance, education, health care, most service based industries.

    America and Western Europe have less and less of the former, but more and more of the latter.

    From the full ManPower report at your link ...

    (snip)"When asked, “What is the one job you are having the most difficulty filling due to lack of
    available talent?” employers on a global basis named technicians, sales representatives and
    skilled trades workers to the top of the list for the fifth year in a row (Figure 5). Technicians
    moved to the top of the list from third place last year, and skilled trades workers dropped
    from first on the list to third. Engineers also remain in high demand (number four on the list),
    while laborers jumped to the fifth most difficult to fill position. Drivers have dropped off the
    list and been replaced by IT staff. Compared to 2010, laborer roles, management/executives

    and IT roles are more difficult to fill this year, while skilled trades, accounting & finance,
    production operators and secretarial/administrative roles are less difficult, but still presenting
    challenges to employers as they seek to add these employees."(snip)

    While this point can be made about every job on this list, focusing on the single example of 'laborers' probably best brings the point into fucus. Why are US employers having difficulty finding and hiring 'laborers' ... who don't need to possess any highly trained skill, and who basically only need to have legal US work status, show up on time, put forth a full day's work effort ( in an assumed dirty and non air-conditioned environment ) without screwing anything up, etc. in exchange for a ~$12-15 an hour ( non-union ) wage with less than 'wall to wall' employee benefits. Logically speaking, one would assume that there would be millions of Americans lining up for such an opportunity ... but they're not ! WHY NOT ?

    ~
    Last edited by Melonie; 11-24-2011 at 03:36 AM.

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    Default Re: Bad Economic News TriFecta Hits ...

    Quote Originally Posted by Melonie View Post
    This is technically true in part, but dangerously false in arguably much more important part. IMHO the key issue involves whether or not one is measuring true production of new or additional 'real value' ... which involves mining / drilling / farming / forestry i.e. extracting 'real value' from natural resources, or increasing the 'real value' of natural resources via manufacturing / chemicals / construction etc. ... versus attempting to measure 'apparent value' that originates from printed / borrowed currency i.e. new debt, or the 'recycling' of previously printed / borrowed currency i.e. pre-existing debt ... i.e. gov't jobs, banking, insurance, education, health care, most service based industries.

    America and Western Europe have less and less of the former, but more and more of the latter.
    This is pretty much my point. While mining / drilling / farming / forestry i.e. were the largest components of creating wealth in the 19th and 20th century- and will continue to make lots of money for a long time to come- we are now in the information/innovation age. Now, invention, innovation and the distribution of ideas, information and technology will become the new drivers of wealth creation. Improvements in technology will will allow us to mine, forest, farm and produce with exponentially more productiveness and those improvements will be rewarded in the marketplace as such.

    The degree to which countries and individuals adjust to the new realities will determine the degree to which they experience success and failure. There are hundreds of thousands of web designers in India, Bangledesh, Poland and other places that are getting millions of jobs from people all over the world and bringing $billions in to their local economies that was not coming in before. The US has the ability to be the leading innovator and developer of many of the new technologies that will be in demand and generating wealth in the coming decades, we can even manufacture a lot of it if we play our cards right. In order to capitilize however we will need to embrace these changed worldwide concepts and look forward and take action united as opposed to never-ending quarreling and trying to fit "what used to work" into a box that no longer exists.
    Last edited by jimboe7373; 11-24-2011 at 12:27 PM. Reason: grammar correction

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    Default Re: Bad Economic News TriFecta Hits ...

    There are hundreds of thousands of web designers in India, Bangledesh, Poland and other places that are getting millions of jobs from people all over the world and bringing $billions in to their local economies that was not coming in before
    Yes but ... for every new billion of web design income flowing to India etc., there is a 2 billion 'loss' of former web design done in America or Western Europe. This IS a matter of relative productivities of sorts, i.e. the same web design can be done for 1/2 the price. It could still be done in America or Western Europe, but they would have to reduce costs to equal the 1/2 price availability. Doing so would involve reduced taxation, as well as reduced pay and benefit levels.

    The US has the ability to be the leading innovator and developer of many of the new technologies that will be in demand and generating wealth in the coming decades, we can even manufacture a lot of it if we play our cards right
    agreed on the innovation and development, disagree on the mass production ... for the same reasons as above. There is already an established history of the US developing important new technology products, from AC variable frequency drives to Compact Flourescent lighting, which were first offered by US manufacturers with limited success. But true success only occurred when offshore manufacturing with resulting massively lowered prices led to widespread adoption / large volume sales.

    In order to capitilize however we will need to embrace these changed worldwide concepts
    agreed in principle ... with a couple of those 'changed world' concepts being that unskilled labor on a global basis is NOT worth $8 an hour, that business taxes on a global basis are far lower than the US 40% rate, etc. Arguably, the latter is the reason that many new US innovators are now forming and registering their companies in Ireland or other 'business friendly' countries rather than in the US.

    However, all of this is beside the point I was trying to make about the actual origin of ''earnings''. Today provides an ideal example of this point ... black friday shoppers are estimated to be spending 1/2 trillion dollars this weekend. What proportion of the 1/2 trillion dollars they will be spending stems from profits which result from producing 'real value', versus what proportion of the 1/2 trillion dollars stems from borrowed / printed / previously taxed money i.e. money paid to individuals by some gov't agency ? By official GDP measure, as well as at retailer cash registers, these moneys are interchangeable. But from the standpoint of true US economic ( future )health, they are definitely NOT interchangeable !

    ~
    Last edited by Melonie; 11-25-2011 at 04:30 AM.

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    Default Re: Bad Economic News TriFecta Hits ...

    Quote Originally Posted by Melonie View Post
    Yes but ... for every new billion of web design income flowing to India etc., there is a 2 billion 'loss' of former web design done in America or Western Europe. This IS a matter of relative productivities of sorts, i.e. the same web design can be done for 1/2 the price. It could still be done in America or Western Europe, but they would have to reduce costs to equal the 1/2 price availability. Doing so would involve reduced taxation, as well as reduced pay and benefit levels.
    You missed my point, my point was that countries that react correctly will gain and those that don't will lose. In my example India and the others set up training programs and made an effort to attract this new business and was rewarded at the U.S. designers loss. Lamenting that loss or trying to figure out ways to get that money back is "old paradign thinking" and won't work- that work and money is largely gone. Better to focus on new methods that are now viable- very few if any countries have the resources in place to do large scale research and innovation on these new technologies better than the US does- that is where the energy, time and focus should be put.


    agreed on the innovation and development, disagree on the mass production ... for the same reasons as above. There is already an established history of the US developing important new technology products, from AC variable frequency drives to Compact Flourescent lighting, which were first offered by US manufacturers with limited success. But true success only occurred when offshore manufacturing with resulting massively lowered prices led to widespread adoption / large volume sales.
    Once again, old paradign thinking. We can make technological leaps in this new age that can drastically alter the current economies of scales. If we keep that technology proprietory, the savings or value to the end user can very well be sufficient to where we can retain production here if we choose to. That depends on the manufacturers of course. If they chose not too in sufficient numbers, then much of manufacturing may be lost too as part of the new economic models in which case we should just adjust further into what works now and away from what used to work. For every door that closed there is another that opens- unless you remain in front of the closed door banging to get in.

    However, all of this is beside the point I was trying to make about the actual origin of ''earnings''. Today provides an ideal example of this point ... black friday shoppers are estimated to be spending 1/2 trillion dollars this weekend. What proportion of the 1/2 trillion dollars they will be spending stems from profits which result from producing 'real value', versus what proportion of the 1/2 trillion dollars stems from borrowed / printed / previously taxed money i.e. money paid to individuals by some gov't agency ? By official GDP measure, as well as at retailer cash registers, these moneys are interchangeable. But from the standpoint of true US economic ( future )health, they are definitely NOT interchangeable !
    Once again, still "old" thinking, if we get very big into the technology innovation and exportation business, we could have $billions coming in from other countries (as opposed to going out as it is now). All we need do is provide value and export that technology and possibly license it. Here is an article today stating that pollution costs the EU in exess of $134 Billion http://www.boston.com/business/artic...d_134_billion/ There is a big value in inventing and implementing ways to cut those expense. All of that money that could flow into the U.S. by exporting this technology and in some cases finished products is "source" money that is not "borrowed, printed, taxed or from a gov't agency".

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    Default Re: Bad Economic News TriFecta Hits ...

    ^^^ I do agree with your sentiments and hopes, in theory. But where the real world is concerned, there is a very big divide between 'new' thinking and 'wishful' thinking. For example, the easiest method for a European corporate executive to control high EU pollution costs is to relocate polluting production facilities / power plants etc. to Poland, as opposed to spending billions on high technology methods of 'cleaning up' production facilities / power plants in EU countries !!!

    As to keeping newly developed US technology innovation proprietary, that's only as useful as the 'intellectual property' laws which protect that technological innovation. As it is, it's a virtual certainty that within one year after a significant US technological innovation product is introduced, it will be reverse engineered, slightly redesigned, and put in production in a low cost, low tax, low regulation country where the resulting product can be sold at a profit for less than the actual cost of production for the US facility. This is precisely what happened to other US technological innovations I mentioned earlier, and continues to happen right up to Solyndra's high efficiency solar cell design. So does a US corporate executive take the 'gamble' that a competing foreign 'rip-off' manufacturer will make their huge investment in US production facilities non-profitable within 2 years, or does that US corporate executive decide to cut out the 'rip-off' competitor possibility by investing in Asian etc. production facilities from the start ?

    The arguable common thread throughout all of your points is a presumption that every country in the world can be forced to operate on a 'level playing field' in regard to a ton of issues from intellectual property laws being enforced to environmental / worker safety / employee benefit standards being equalized to business and personal tax rates being equalized. Unfortunately, in the 'real world', this is clearly not the case ... meaning that many corporate executives will make 'real world' decisions that will provide the lowest costs / highest potential rates of return for their corporation's investors, most of which involves legally 'evading' EU / US mandated costs that do not exist or are far lower in other countries.

    And again, all of this has drifted far from the original point of this thread, which is that in the near term nothing 'real' seems to actually be improving for the US economy.

    ~
    Last edited by Melonie; 11-25-2011 at 12:05 PM.

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    Default Re: Bad Economic News TriFecta Hits ...

    Quote Originally Posted by Melonie View Post
    ^^^ I do agree with your sentiments and hopes, in theory. But where the real world is concerned, there is a very big divide between 'new' thinking and 'wishful' thinking. For example, the easiest method for a European corporate executive to control high EU pollution costs is to relocate polluting production facilities / power plants etc. to Poland, as opposed to spending billions on high technology methods of 'cleaning up' production facilities / power plants in EU countries !!!
    You make good points, I will however mention, there is really nothing wishful about it- the changes I mentioned are occuring and will continue to occur, the only question is going to be who gets on board early and figures out creative ways to profit from it and who doesn't and by defualt becomes a victim. As to the EU pollution issue, by and large European are better long-term thinkers and also less profit obsessed than people in the US. It is very likey that while some of the pollution problem will be exported substantial efforts will be made for a long term sustainable fix even if it sacrifices short term profit. Also, as time goes on with the current rate of technological advancement, it very well make short-term economic sense to deal with the problem with new technology as opposed to just shuffling it out of site and allowing the problems to continue somewhere else.

    As to keeping newly developed US technology innovation proprietary, that's only as useful as the 'intellectual property' laws which protect that technological innovation. As it is, it's a virtual certainty that within one year after a significant US technological innovation product is introduced, it will be reverse engineered, slightly redesigned, and put in production in a low cost, low tax, low regulation country where the resulting product can be sold at a profit for less than the actual cost of production for the US facility. This is precisely what happened to other US technological innovations I mentioned earlier, and continues to happen right up to Solyndra's high efficiency solar cell design. So does a US corporate executive take the 'gamble' that a competing foreign 'rip-off' manufacturer will make their huge investment in US production facilities non-profitable within 2 years, or does that US corporate executive decide to cut out the 'rip-off' competitor possibility by investing in Asian etc. production facilities from the start ?
    For sure it will happen, but there is more than enough market to return $billions and $billions to the U.S. from countries and companies that do play above board. There are thousands of factories that make knock-off Nikes, there are full scale bogus Apple stores scattered throughout China- even with all that large scale fraud both companies still post impressive revenue. Also, this technology is going to get developed and it is going to get implemented, if we don't do it now, it will take longer but someone else somewhere else will- and they will get to get the profits and ecomic benefits.

    The arguable common thread throughout all of your points is a presumption that every country in the world can be forced to operate on a 'level playing field' in regard to a ton of issues from intellectual property laws being enforced to environmental / worker safety / employee benefit standards being equalized to business and personal tax rates being equalized. Unfortunately, in the 'real world', this is clearly not the case ... meaning that many corporate executives will make 'real world' decisions that will provide the lowest costs / highest potential rates of return for their corporation's investors, most of which involves legally 'evading' EU / US mandated costs that do not exist or are far lower in other countries.
    There is no presumption whatsoever in my thread- the world is how it is and it will be how it will be. You protect yourself as best you can and try to limit the knock-offs and intellectual propert rip-offs as best you can but you move forward. As mentioned if we don't do it someone else will. Even if you can't find ways to manufacture a lot of it, you can certainly manufacture some of it and that is better than nothing. You can also do very large projects like Solar arrays that beam energy back down- not very easy to reverse engineer or copycat that one. US auto-companies are currently selling a lot of cars in China, if we can sell cars there we can sell other products as well.

    The bottom, bottom line is that while a lot of people will be constantly broadcasting and focusing on how bad things are and how much worse they are going to get- other people will be focused on opportunity, making moves and making fortunes. Both groups are right, you will find ample evidence to support both mindsets, it all depends where you decide to look.

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    Default Re: Bad Economic News TriFecta Hits ...

    Well, feel free to stay focused on optimism and opportunity. In the meantime, I'll stay focused on my SDS shares ...







    (snip)"Dow, S&P Log Worst Thanksgiving Week Since 1932

    Stocks closed in negative territory in thin, shortened trading Friday as investors were reluctant to go long ahead of the weekend and amid ongoing worries over the euro zone.

    The Dow and S&P posted their worst Thanksgiving week since the Great Depression on a percentage basis.

    The Dow Jones Industrial Average erased their gains to finish lower, led by H-P [HPQ 25.39 -0.39 (-1.51%) ] and Chevron [CVX 92.29 -1.46 (-1.56%) ].

    The S&P 500 and the Nasdaq also ended lower, logging a seventh consecutive decline. Some traders are watching for 1,150 on the S&P as the next key level.

    The CBOE Volatility Index, widely considered the best gauge of fear in the market, ended above 34. "(snip)

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    Default Re: Bad Economic News TriFecta Hits ...

    Quote Originally Posted by Melonie View Post
    Well, feel free to stay focused on optimism and opportunity. In the meantime, I'll stay focused on my SDS shares ..
    Lol, fair enough.

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    Default Re: Bad Economic News TriFecta Hits ...

    How can there truly be a trifecta of bad economic news without inflation?

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