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Main Category => Discussions - Public => Topic started by: unix on May 26, 2018, 06:55:04 am

Title: so how is the economy?
Post by: unix on May 26, 2018, 06:55:04 am
I have my own opinion but wanted to hear other reports from the trenches.

I see a lot of sales, a lot of discounts on everything which suggests people aren't spending.

20% off on this, 25% off on that. On everything. Automotive, clothing, household and in private sales as well.



Title: Re: so how is the economy?
Post by: The Gorn on May 26, 2018, 07:55:24 am
My opinion is that we have a constantly-declining "new normal" with minor upticks. In other words, the centerline or baseline what is considered a good economy today is continually declining from what we expected in the past. The full employment economy of 2018 looks like a minor depression compared to the full employment economy of 1998.

All I know is what I see locally here in Ohio. A house that 10 years ago would have gone for 110 (maybe) closed on our street recently for 178K.  Nothing by DC standards but by flyover standards we have some strong real estate speculation going on here. I constantly get a post card from some slumlord company that wants to buy my house for a rental (most of my street is owner occupied by a wide margin so I am sure they would be eager to fuck up our neighborhood for a quick profit.)

And Ohio is meth junkie and poor education / low economic value central where nobody can make anything good or valuable.
Title: Re: so how is the economy?
Post by: unix on May 26, 2018, 11:53:15 am
There is in a contradiction in higher real estate prices and the 'new low'.

Weird. Wouldn't you think that as we establish a 'new low', real estate would suffer as a result? Yet a new bubble is forming, or seems to be.

Housing in DC area is all over 400K for anything. The salaries are higher than in the fly-over wasteland but not so much higher to make it cheaper.
Title: Re: so how is the economy?
Post by: I D Shukhov on May 27, 2018, 03:15:25 am
There is in a contradiction in higher real estate prices and the 'new low'.

Weird. Wouldn't you think that as we establish a 'new low', real estate would suffer as a result? Yet a new bubble is forming, or seems to be.

Housing in DC area is all over 400K for anything. The salaries are higher than in the fly-over wasteland but not so much higher to make it cheaper.
This will change at some point.  Remember how For Sale signs sprout up everywhere when the real estate market turns south? 
Title: Re: so how is the economy?
Post by: JoFrance on May 27, 2018, 03:24:35 pm
The real estate market is starting to heat up where I live, but it isn't there yet.  We have a new big company that will be coming into the area soon and that will boost property values, I hope .
Title: Re: so how is the economy?
Post by: unix on May 28, 2018, 11:37:02 am
Interesting.

The real estate market heating up does not make any sense - to me.
Title: Re: so how is the economy?
Post by: JoFrance on May 28, 2018, 02:34:22 pm
The reason it makes sense is now there are new jobs brought to the area.  We lost thousands of jobs out where I live when Merck moved out.  Now, we have a new, big company taking over their facility.  I think its Unicom.  People will want to live near where they are working and maybe I can sell my house.  Its a great place for someone younger.  I can't deal with all the property anymore.
Title: Re: so how is the economy?
Post by: The Gorn on May 28, 2018, 06:54:48 pm
Interesting.

The real estate market heating up does not make any sense - to me.

As Jo noted in her area, in my area (comparable in some ways to Central Jersey, a bit) a lot of factories relocate here and that drives jobs... a bit. But I honest don't see either jobs or wages driving wealth much in my area for the general public.

I have read that residential real estate appreciation is on a huge upward spike nationally.  My guess is that investors are simply deploying cash to investments other than the stock market or Bitcoin as a risk mitigation tactic.

IE - what does the money supply (M-numbers) indicate?
Title: Washington Post article on alarming economy statistics
Post by: I D Shukhov on May 29, 2018, 06:18:20 am
https://www.washingtonpost.com/news/wonk/wp/2018/05/25/the-alarming-statistics-that-show-the-u-s-economy-isnt-as-good-as-it-seems (https://www.washingtonpost.com/news/wonk/wp/2018/05/25/the-alarming-statistics-that-show-the-u-s-economy-isnt-as-good-as-it-seems)

According to two reports by the Federal Reserve and United Way:

* 40% of American adults don't have enough savings to cover a $400 emergency expense

* 43% of households can't afford the basics to live, meaning they aren't earning enough to cover the combined costs of housing, food, child care, health care, transportation and a cellphone

* 22% of adults aren't able to pay all of their bills every month.

Quote
We have a ‘Two Realities’ economy in America,” said William Rodgers, a professor at Rutgers University and chief economist at the Heldrich Center for Workforce Development. “One segment has truly recovered from the Great Recession and is at full employment. The other continues to experience stagnating wages, involuntary part-time employment, inflexible work schedules and weaker access to health care.

Quote
President Trump and many Republicans in Congress are focused on getting people back to work with the belief that once people have jobs they will be able to lift themselves out of poverty. But a growing body of research like the Fed and United Way studies and anecdotes from people working on the front lines at food banks and shelters indicates that a job is no longer enough.

Quote
Half of the people we serve are above the poverty level. They are working, but they are not making it,” said Catherine D'Amato, president of the Greater Boston Food Bank. “It’s a deep struggle for people to provide for themselves based on their wages.”

D'Amato has worked at food banks and pantries since 1979, but she says she's never seen it like it is today with so many people with jobs but still unable to survive. October and November were the highest food bank usage on record for her organization, a reminder that many are still not stable years after the Great Recession officially ended in 2009.
Title: Re: so how is the economy?
Post by: JoFrance on May 29, 2018, 02:55:16 pm
Its going to take years for the economy to improve.  The Great Recession decimated the middle and lower classes.  We were fleeced.  It killed the job market and drained everyone's savings.  The Obama economy was stagnant for 8 years and created a lot of lower paying, part-time jobs.  The ACA didn't help that situation with the 30 hour a week rule.  Companies made a lot of people part-time to avoid giving healthcare to their employees.

Obamacare was just too expensive and it didn't fix the real problems with healthcare.  The cost of drugs and treatment.

At least now we have a chance to get back to where we were with the growing Trump economy.  I'm not expecting overnight miracles, but things are improving.  My husband has more money in his paycheck and we did get more money back from income tax, so we benefitted from the tax cuts.  The IRA is doing better, so I'm seeing improvement.  I'm doing a little better financially than I've done in many years.  We want to retire, but can't yet because of the cost of healthcare.  We need his medical insurance.  Later this year we will both go on Medicare for everything and will retire.

Title: Re: so how is the economy?
Post by: unix on May 29, 2018, 03:59:33 pm

I think the real situation is far worse than being admitted on the forums, or anywhere. Aside from a few hotspots like DC.
Title: Re: so how is the economy?
Post by: I D Shukhov on May 29, 2018, 05:25:21 pm

I think the real situation is far worse than being admitted on the forums, or anywhere. Aside from a few hotspots like DC.
That's what the Federal Reserve and United Way reports referenced in the Post article say.  I've read about the large number of people who can't handle an unexpected $400 bill for a couple of years now.  It's hard to believe, but that's what the Fed is tracking:

Quote
One of the most widely watched statistics in the Fed's “Report on the Economic Well-being of U.S. Households” is how many adults say they could cover an unexpected $400 expense. When the survey was released for the first time in 2013, half of those surveyed said they didn't have enough savings to cover an emergency expense of a few hundred dollars.

Today that has fallen to 40 percent, a figure that is better but still troubling to many economists. It means nearly 48 million households aren't saving or are unable to save.

I.e. their cash flow is a net <= 0 and they have no way of borrowing money.








Title: Re: so how is the economy?
Post by: JoFrance on May 30, 2018, 03:19:39 pm
Its going to take years to recover from the beating we took in 2008 and lack of good paying jobs since then.  Hopefully, that is coming back.  As the baby boomers retire, hopefully those jobs will go to American workers. We should keep the good paying jobs for Americans.
Title: Re: so how is the economy?
Post by: pxsant on May 30, 2018, 04:15:58 pm
It's going to take years to recover from the beating we took in 2008 and lack of good paying jobs since then.  Hopefully, that is coming back.  As the baby boomers retire, hopefully those jobs will go to American workers. We should keep the good paying jobs for Americans.

You are dreaming.   What good paying jobs are you talking about?    We are on a downhill slide regardless of what the stats say.   The unemployment raw numbers have dropped but what they don't tell you is the fact that the jobs out there are at a significantly lower wage than they were a few years ago.   Many people can't survive on what they make now.  And many people have simply dropped out of the workforce and are no longer counted in the unemployment numbers.

Also, American workers??  These large corporations don't give a rat's behind about American workers.   At the bank where I currently consult, I am one of the rare Americans there.   Most of the people are from India.

I am very close to hanging it up with corporate America.   I am simply fed up with the thieves that run these corporations.
Title: Re: so how is the economy?
Post by: I D Shukhov on May 30, 2018, 06:11:24 pm
You hear a lot about "lazy" millennials not going out and getting decent-paying jobs so they can support themselves.  Another possibility is that they can't because good jobs are in short supply. 

Although I suppose another explanation is that there was so much whining about working in a boss-worker environment by us baby boomers that they don't want any part of it.
Title: Re: so how is the economy?
Post by: JoFrance on June 01, 2018, 03:07:56 pm
Pxsant, if the labor market tightens, companies will have to offer workers better salaries and benefits.  Curbs are being put on immigration and visa over stayers.  This is good news for IT workers, finally.

https://www.zdnet.com/article/trump-administration-issues-new-h1-b-visa-guidelines/

Also, companies benefited greatly from the lowering of the corporate tax rate making the US more competitive in the world market.  There was a great jobs report for the last month and there is more employment.  Maybe all of the jobs aren't fabulous, but they're better than we've seen for a long, long time - and they're full time.  In a couple of years, P. Trump's policies are going to pay off, IMO.

I'm seeing a lot of small business "help wanted" signs now.  A lot of people just do everyday jobs, like waitressing, retail, hospitality or more blue-collar occupations.  Its an upward trend for them.

The "lazy" millennial son of my neighbor finally found some kind of a job and moved out of the basement.  Before that he was a "personal trainer", part time.  He rode his father's motorcycle to and from his "sessions".  They couldn't wait for him to go.  He was close to 27.  I think a lot of young people don't understand you have to work your way up to the job you want, you don't just walk into it because you have a college degree. 
Title: Re: so how is the economy?
Post by: unix on June 01, 2018, 04:23:13 pm

I think the real situation is far worse than being admitted on the forums, or anywhere. Aside from a few hotspots like DC.
That's what the Federal Reserve and United Way reports referenced in the Post article say.  I've read about the large number of people who can't handle an unexpected $400 bill for a couple of years now.  It's hard to believe, but that's what the Fed is tracking:

Quote
One of the most widely watched statistics in the Fed's “Report on the Economic Well-being of U.S. Households” is how many adults say they could cover an unexpected $400 expense. When the survey was released for the first time in 2013, half of those surveyed said they didn't have enough savings to cover an emergency expense of a few hundred dollars.

Today that has fallen to 40 percent, a figure that is better but still troubling to many economists. It means nearly 48 million households aren't saving or are unable to save.

I.e. their cash flow is a net <= 0 and they have no way of borrowing money.


Yes and that is the proverbial canary in the coal mine?

Title: Re: so how is the economy?
Post by: ilconsiglliere on June 07, 2018, 04:55:33 am
You cant believe anything from the Federal Reserve. These are the same people that have the most bizarre inflation and unemployment calculations known to man. They literally make no sense. Realize that that the Fed has caused every recession and depression via them messing with the money supply.

https://www.statista.com/statistics/200017/state-unemployment-rate-in-the-us/

Here in the PRNJ (People's Republic of NJ) I am not seeing any recovery at least not in IT. The IT job market here has been stagnant for years. It has never stopped being stagnant. Basically everywhere you go now the entire IT department is foreigners.

Though my client has recently posted external job ads. I was told that they got 3000 resumes for 5 openings. I submitted on one and got nothing even though I work there. I know the Wall Street guys (traders and investment bankers) are doing very well. Not so the IT people though in their companies.

What I am seeing though is the real estate market is very hot. I have some friends that are realtors and as soon as a house is put on the market people are bidding them up. The market here for houses that are below 600K is crazy. A normal sized house (not a mcmansion) in a very good town will sell in literally 3-4 days. Even houses in not as good towns are selling quick. A lot of this is being driven by millennials and speculators.

Realize that the cost of houses in NJ is very high relative to most of the country except for places like CA and DC which it seems to be about the same.
Title: Re: so how is the economy?
Post by: The Gorn on June 07, 2018, 08:55:40 am
I've always considered the area around me here in SW Ohio near Cincinnati to be semi-depressed. BUT, we've observed home sale closings that are far higher than I'd expect.

I bought my current house (at the time a bit of a dump, and around 1000 SF) for $83K in 1994. It has a basement. Since then we've totally updated it.

A house of similar age and size, no basement, no detached garage, with a nice looking flagstone exterior, a few houses up the street recently went for $179K.

This street is middle blue collar. Kind of amazes me what people around here with the shitty wage scales here can afford.

I read a day ago or so that analysts expect VERY strong home price inflation due to rising costs of lumber and supply demand, particularly at the low level. In other words those dumpy blue collar houses will be rising the fastest in price.

I think the overvalued stock market has to do with it. I get postcard ads from investors to buy our house. Therefore rental housing investment is helping to drive lower end home prices.

Those prices nudge higher priced houses upward, too. a $179K house around here 10 years ago was in a NIIICE new development. Now it's on this older street.
Title: Re: so how is the economy?
Post by: unix on June 07, 2018, 12:50:40 pm
I've come to realize, some years ago that there is nothing good about a boom and a recession isn't all that bad. Maybe the opposite.
Consider:

 Boom times:
    * Everything gets more expensive
     * Real estate goes into the stratosphere
      * Everyone has jobs
     

Recession:

   * Sales sales sales on everything - including real estate
    * Deals everywhere on things.

Just yesterday Ebay had a 20% off on everything sale. To stimulate the economy. You know why? 'cause people ain't buying.

Anytime you see massive sales on things, you know a recession is either right here, right now or just around the corner


Title: Re: so how is the economy?
Post by: JoFrance on June 10, 2018, 01:52:23 pm
That's very true, unix.  I get ebay emails now pushing products that I never got over the past few years.  My house gained a little value.  There are a lot more jobs, but I don't think we'll see any kind of dramatic recession.  Maybe a mild one that puts the brakes on a little.
Title: Re: so how is the economy?
Post by: The Gorn on June 10, 2018, 07:08:49 pm
Of course you guys are smart enough to know that:

Recession, depression and other measures of economic health are broad judgements of the overall economy's state.

In a recession a lot more people are out of work. Unix and I know about this first hand. So those savings on slightly depressed product prices are theoretical because a larger part of the public can't afford anything anyway.

In a recession, business investment slows down dramatically so there is less momentum yet for hiring.

If I have a wad of money in the bank or an assured job, then hell yes, a recession is good news.

If I really need a job during a recession, not so much.

In boom times, everything just seems easier. Even at an individual level.

Your own stocks are rising, and your job feels more secure, so you can relax and buy what you need, albeit at slightly higher prices.
Title: Re: so how is the economy?
Post by: unix on June 11, 2018, 03:50:52 pm
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