Global Economy Bursting?

[Restrain]

The meteorologists were forecasting continuing drought for Texas, and a dry winter. We have had record rains for January, February and March, the lakes are full and the salmon are swimming upstream in my back yard. If they cannot get a short term trend right, they have no credibility in terms of "man-made global warming".

 

[Mike Garrett RAA]

And the ability to print money...at will.

 

[nm505]

On a lighter note, Bankers and sex....the bankers are losing.
http://www.rt.com/news/spain-banks-escorts-sex-198/

Maybe there is a way to get money flowing in the economy again after all.

 

[Terrel L. Shields]

Bankers and escorts

2 groups with the most experience screwing people.

 

[Randolph Kinney]

Europe set to speed up building of new bailout

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2012/03/28/financial/f050344D69.DTL#ixzz1qPzxAHXy

 

[Randolph Kinney]

California Still Doesn't Get It

http://www.forbes.com/sites/toddganos/2012/03/28/california-still-doesnt-get-it/

Nine years ago, the Cato Institute published a study of the State of California’s spending during the preceding 25 years. It noted that since the passage of Proposition 13 – which limited increases in property taxes – State spending had increased 25 percent more than the State’s economy grew during that same period. The Cato Institute posited that the State’s economy could not support the level of spending at that time and the State would ultimately experience a budget crash. The Cato Institute’s findings showed the orgy of spending occurred under both Democratic and Republican leadership. Beginning in 2008, the State has experienced significant budget challenges each fiscal year.

While Proposition 13 held property taxes increases in check, sales tax and income tax revenues have skyrocketed to fuel the State’s spending. In the mid-1960s, the sales tax rate was 5 percent. Today, the sales tax rate is as high as 10.75 percent in certain counties. It’s acknowledged that sales tax affects lower income families the most. And, since the enactment of Proposition 13, income tax brackets have been adjusted by only one-half the amount of inflation, thus causing “bracket creep”. As this has worked out, it has affected lower income families the most.

During the past four budget cycles, the State’s legislature has had to engage in smoke and mirror games to make the numbers appear to work out. It is a safe statement to say that no one believes the State of California’s finances are okay. In spite of this, the State’s Legislative Analyst’s Office notes the legislature intends to increase spending by 5 percent per year over the next 5 years. This is roughly twice the current rate of inflation. Where is this money coming from? On top of this and new to the budget, legislators are proposing a $1 billion per year college scholarship program. Where is this money coming from?

Let’s say that every line item in the State’s budget is a worthy program. Let’s also say that there are hundreds of other worthy programs not yet funded but should be funded. Where is this money coming from? What can the State afford? A line needs to be drawn. The State’s economy can only support so much taxation and so much spending. In spite of all that has happened, California – rather, its legislators – still don’t get it.

 

[Couch Potato]

80 Percent Of Americans Say That They Are Not Better Off Than They Were Four Years Ago

http://theeconomiccollapseblog.com/...-not-better-off-than-they-were-four-years-ago

Are you better off today than you were four years ago? If not, then you are just like most other Americans. According to a CBS News/New York Times poll that was released a few days ago, 80 percent of Americans say that their financial situation is not "better today" than it was four years ago. But if you turn on the television and listen to what the "pundits" are saying, you would be tempted to think that we were in the midst of a robust economic recovery.

Yes, the stock market is doing really well for the moment, but the truth is that more than 50 percent of all stocks and bonds are owned by just 1 percent of the U.S. population.

Meanwhile, much of the rest of the country is deeply suffering.

It was recently reported that 1.5 million American families live on less than two dollars a day (before counting government benefits).

According to the U.S. Census Bureau, the percentage of Americans living in "extreme poverty" is now sitting at an all-time high.

All across this country poverty is exploding. Food banks are experiencing more demand than ever before and those offering free healthcare are absolutely swamped.

The federal government is trying to convince us that the unemployment rate is going down, but that is not really true.

The key is to look at the percentage of working age Americans that actually have jobs. During the last recession that percentage fell dramatically as you can see from the chart below. After every other recession since World War II the employment to population ratio has always bounced back. But it has not happened this time. Instead, the employment to population ratio has remained between 58 and 59 percent since the end of 2009....

The prior "bounce backs" were strongly influenced by women entering the workforce as is seen here. (men are the blue line, women are the red line, and the black line is total participation)

 

[nm505]

http://finance.fortune.cnn.com/2012/03/09/unemployment-leveling-off-or-just-a-retirement-influx/

A possibility to partially explain the graph above:
"Between the fourth quarter of 2007 and the same period in 2011, the labor participation rate fell 2.1 percentage points -- the majority of which reflects workers 55 years old and older leaving the labor pool.
This steady decline isn't anything new. For the past 45 years, retiring workers have largely driven down the unemployment rate. And the number of workers in the labor pool fell sharply following the Great Recession as employers slashed jobs. Since the recession, the labor participation rate fell to 64%, compared with 66% between 2003 to 2008."
"The implications are both good and bad. With workers retiring, it's safe to assume most won't return to the job market. This takes pressure off the economy in the sense that it can create fewer jobs and still keep unemployment stable......

But the onslaught of retirees adds pressure to the nation's retirement system, as lawmakers debate an overhaul of the Social Security system. "It means there's less people working and more people retiring,""

Boomers are a biggie and might influence the population:employed ratio as we go forward if not already. Bad for productivity measures as well according to BofA:

http://articles.businessinsider.com/2012-03-26/markets/31239147_1_productivity-boomers-job-market

I remember reading a book quite a long time ago that predicted a stock market crash as boomers pulled out their money for safer returns. Of course with the current interest rates in CDs..maybe that hasn't happened yet.

 

[Terrel L. Shields]

They would like to keep you in speculative stocks because it pumps up the market and you (the average Joe) are easy meat for the professional traders...a sort of "What you come here with is ours, what you leave here with is yours" attitude.

As I recall by 2030 only 2.2 working people will have to support 1 retiree...this is a chronic problem in Japan where the population has boomed and the baby boomers are just getting to retirement age and high health costs.

 

[Randolph Kinney]

US government debt growing 4 times faster than GDP

http://www.mybudget360.com/expandin...-gdp-fed-public-debt-stock-market-flow-funds/

Even going back to 2001 we realize that government debt has been growing at a much faster pace than GDP. During the crisis, the government stepped in to bailout the massive financial industry and grew public debt by over 20 percent while GDP contracted by 5 percent. In this sense, the justification was that the recession was on verge of becoming a depression. Although for 46,000,000 Americans on food stamps today this is still a depression.

The recession has been officially over for some time now but government debt is growing at over 8 percent while GDP is growing below 2 percent. Government debt is growing 4 times faster than GDP! This is why federal government debt has grown like this:

Even though the stock market has rallied by over 100 percent since the 2009 lows little of this has trickled to most households. In fact, most of this filtered up to the top one percent and many that are in the financial sector. Most Americans realize the game is rigged and have been pulling money out of the stock market: