Spending is Key

Fun with supply and demand.
Tom Palven
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Spending is Key

Post by Tom Palven » Wed Jun 12, 2019 1:01 pm

"Investors should guard against tunnel vision on trade wars" is the headline for an Associated Press article on the front page of the Money section in the Times-Union, Jacksonville, FL, today.

The last paragraph reads:
"The bright spots for the U.S. economy are still clear: The job market is solid, as long as Friday's disappointing report doesn't herald something more lasting. The unemployment rate at 3.6% is at its lowest level since 1969, and consumers are feeling relatively confident. That's key when consumer spending accounts for two thirds of the economy."

That's key when consumer spending accounts for two thirds of the economy?

What, in the name of Sweet Baby Jesus accounts for the other third of the economy, waste and mismanagement?

Comprehension of basic economics has become extinct in the U.S. This Keynesian nonsense on steroids, worth nothing more than a few chuckles, is now common knowledge. :lol:
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Re: Spending is Key

Post by bobbo_the_Pragmatist » Wed Jun 12, 2019 3:07 pm

I don't know anything...............but even I can imagine categories of spending other than Black Friday.

.............but its a nice touch to clothe your ignorance and lack of a second think in such overconfidence.
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Re: Spending is Key

Post by OutOfBreath » Wed Jun 12, 2019 9:34 pm

Well, Tom, top of my head would be "public spending" that makes up the rest. Many ways to slice national economic indicators. Key factors in indicators regarding economic activity is growth numbers for industrial production, various investments and various sector consumptions. However, it seems that 2/3 number conflates all "private sector" spending as "comsumer spending" which doesnt sound right, I'd agree. Wouldnt be the first time journalists misunderstood statistics.

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Re: Spending is Key

Post by Gord » Thu Jun 13, 2019 1:21 am

https://www.mprnews.org/story/2008/10/2 ... r_spending
More than two-thirds of the nation's Gross Domestic Product derives from everyday stuff like dining out, buying a new shirt or visiting the dentist. About 14 percent stems from private investment, for instance companies purchasing new machinery or building new factories. And the rest comes from government spending on things like bridge building, schools, and defense.
...for example. That's from over 10 years ago.
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Re: Spending is Key

Post by Tom Palven » Thu Jun 13, 2019 2:37 am

bobbo_the_Pragmatist wrote:
Wed Jun 12, 2019 3:07 pm
I don't know anything...............but even I can imagine categories of spending other than Black Friday.

.............but its a nice touch to clothe your ignorance and lack of a second think in such overconfidence.
YMMV, but why the hostility?
If one can be taught to believe absurdities, one can commit atrocities. --Voltaire
I may not agree with the what you say, but I will defend your right to say it. --Voltaire
Mankind will not be free until the last king is strangled with the entrails of the last priest. --Denis Diderot
I haven't abandoned my vices. My vices have abandoned me. --Denis Diderot

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Re: Spending is Key

Post by Tom Palven » Thu Jun 13, 2019 2:58 am

Gord wrote:
Thu Jun 13, 2019 1:21 am
https://www.mprnews.org/story/2008/10/2 ... r_spending
More than two-thirds of the nation's Gross Domestic Product derives from everyday stuff like dining out, buying a new shirt or visiting the dentist. About 14 percent stems from private investment, for instance companies purchasing new machinery or building new factories. And the rest comes from government spending on things like bridge building, schools, and defense.
...for example. That's from over 10 years ago.
The sign in the link, below, "Trenton Makes, The World Takes" was placed on the Trenton bridge in 1935, during the US economic heyday.
https://www.bing.com/images/search?q=tr ... ORM=IQFRBA

Now the sign might read "China Makes, Trenton Spends, the US Borrows, and Everything is Hunky-Dory."

I'll stand by my unpopular opinion that this doesn't make sense and can't last. :oops:
If one can be taught to believe absurdities, one can commit atrocities. --Voltaire
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Mankind will not be free until the last king is strangled with the entrails of the last priest. --Denis Diderot
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Re: Spending is Key

Post by bobbo_the_Pragmatist » Thu Jun 13, 2019 10:51 am

Tom Palven wrote:
Thu Jun 13, 2019 2:37 am
bobbo_the_Pragmatist wrote:
Wed Jun 12, 2019 3:07 pm
I don't know anything...............but even I can imagine categories of spending other than Black Friday.

.............but its a nice touch to clothe your ignorance and lack of a second think in such overconfidence.
YMMV, but why the hostility?
Happy to answer both issues but only after the dialectic is joined: do you recognize there is more to the economy than consumer spending?
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Re: Spending is Key

Post by Tom Palven » Mon Jul 08, 2019 5:46 am

"Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one."
--Charles Mackay (1841)

If you want a negative economic prediction, this is the link for you:
https://www.peakprosperity.com/bizarro- ... -gone-mad/
If one can be taught to believe absurdities, one can commit atrocities. --Voltaire
I may not agree with the what you say, but I will defend your right to say it. --Voltaire
Mankind will not be free until the last king is strangled with the entrails of the last priest. --Denis Diderot
I haven't abandoned my vices. My vices have abandoned me. --Denis Diderot

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Re: Spending is Key

Post by landrew » Mon Jul 08, 2019 2:33 pm

Tom Palven wrote:
Mon Jul 08, 2019 5:46 am
"Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one."
--Charles Mackay (1841)

If you want a negative economic prediction, this is the link for you:
https://www.peakprosperity.com/bizarro- ... -gone-mad/
The economy is always sliding into recession, when it's not recovering.
The 60s and 70s were the heydays of doomsday books, and I read a few of them.
Some of it came true in some measure, but most of it was hogwash.

Even after the hard lessons are learned, and controls have been put in place,
the sociopaths always find a way to sink the boat again.
The job of a skeptic is to investigate the unexplained; not to explain the uninvestigated.

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Re: Spending is Key

Post by Tom Palven » Tue Jul 09, 2019 2:45 am

landrew wrote:
Mon Jul 08, 2019 2:33 pm
Tom Palven wrote:
Mon Jul 08, 2019 5:46 am
"Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one."
--Charles Mackay (1841)

If you want a negative economic prediction, this is the link for you:
https://www.peakprosperity.com/bizarro- ... -gone-mad/
The economy is always sliding into recession, when it's not recovering.
The 60s and 70s were the heydays of doomsday books, and I read a few of them.
Some of it came true in some measure, but most of it was hogwash.

Even after the hard lessons are learned, and controls have been put in place,
the sociopaths always find a way to sink the boat again.
I, as a confirmed Chicken Little disciple, think it's gonna be worse than you think, not just an economic downturn, but a collapse similar to that of the Soviet Union empire.

Just how long will the world extend credit to the profligate US deep state bully?

But, I've been wrong many times before. Maybe things will just keep on keepin' on. We'll see.
If one can be taught to believe absurdities, one can commit atrocities. --Voltaire
I may not agree with the what you say, but I will defend your right to say it. --Voltaire
Mankind will not be free until the last king is strangled with the entrails of the last priest. --Denis Diderot
I haven't abandoned my vices. My vices have abandoned me. --Denis Diderot

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Re: Spending is Key

Post by landrew » Tue Jul 09, 2019 2:36 pm

Tom Palven wrote:
Tue Jul 09, 2019 2:45 am
landrew wrote:
Mon Jul 08, 2019 2:33 pm
Tom Palven wrote:
Mon Jul 08, 2019 5:46 am
"Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one."
--Charles Mackay (1841)

If you want a negative economic prediction, this is the link for you:
https://www.peakprosperity.com/bizarro- ... -gone-mad/
The economy is always sliding into recession, when it's not recovering.
The 60s and 70s were the heydays of doomsday books, and I read a few of them.
Some of it came true in some measure, but most of it was hogwash.

Even after the hard lessons are learned, and controls have been put in place,
the sociopaths always find a way to sink the boat again.
I, as a confirmed Chicken Little disciple, think it's gonna be worse than you think, not just an economic downturn, but a collapse similar to that of the Soviet Union empire.

Just how long will the world extend credit to the profligate US deep state bully?

But, I've been wrong many times before. Maybe things will just keep on keepin' on. We'll see.
You seem to be admitting that you enjoy being pessimistic.
Better than a tiresome optimist, I suppose.
But why not try for realism, somewhere in the middle?
The job of a skeptic is to investigate the unexplained; not to explain the uninvestigated.

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Re: Spending is Key

Post by Tom Palven » Wed Jul 10, 2019 8:26 am

landrew wrote:
Tue Jul 09, 2019 2:36 pm
Tom Palven wrote:
Tue Jul 09, 2019 2:45 am
landrew wrote:
Mon Jul 08, 2019 2:33 pm
Tom Palven wrote:
Mon Jul 08, 2019 5:46 am
"Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one."
--Charles Mackay (1841)

If you want a negative economic prediction, this is the link for you:
https://www.peakprosperity.com/bizarro- ... -gone-mad/
The economy is always sliding into recession, when it's not recovering.
The 60s and 70s were the heydays of doomsday books, and I read a few of them.
Some of it came true in some measure, but most of it was hogwash.

Even after the hard lessons are learned, and controls have been put in place,
the sociopaths always find a way to sink the boat again.
I, as a confirmed Chicken Little disciple, think it's gonna be worse than you think, not just an economic downturn, but a collapse similar to that of the Soviet Union empire.

Just how long will the world extend credit to the profligate US deep state bully?

But, I've been wrong many times before. Maybe things will just keep on keepin' on. We'll see.
You seem to be admitting that you enjoy being pessimistic.
Better than a tiresome optimist, I suppose.
But why not try for realism, somewhere in the middle?
I think that I'm just trying to call things as I see them, which, admittedly, is not through rose-colored Associated Press glasses.

Why should major chronic deficit spending be any more sustainable for Uncle Sam than it would be for Uncle John Doe living high on the hog while running up huge debts in Las Vegas?

It just doesn't compute.
If one can be taught to believe absurdities, one can commit atrocities. --Voltaire
I may not agree with the what you say, but I will defend your right to say it. --Voltaire
Mankind will not be free until the last king is strangled with the entrails of the last priest. --Denis Diderot
I haven't abandoned my vices. My vices have abandoned me. --Denis Diderot

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Re: Spending is Key

Post by TJrandom » Wed Jul 10, 2019 9:03 am

OK, I read the link, and observed the ads - and not a single one said 'buy gold' - what gives?

EDIT... OK, not believing it, I went back for a second look - and those buy precious metals ads are all over the site. Shoulda' known. :roll:

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Re: Spending is Key

Post by landrew » Wed Jul 10, 2019 4:46 pm

Tom Palven wrote:
Wed Jul 10, 2019 8:26 am

I think that I'm just trying to call things as I see them, which, admittedly, is not through rose-colored Associated Press glasses.

Why should major chronic deficit spending be any more sustainable for Uncle Sam than it would be for Uncle John Doe living high on the hog while running up huge debts in Las Vegas?

It just doesn't compute.
But Chicken Little wasn't seeing reality.
The job of a skeptic is to investigate the unexplained; not to explain the uninvestigated.

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Re: Spending is Key

Post by bobbo_the_Pragmatist » Wed Jul 10, 2019 5:38 pm

government just prints more money. Default is avoided by inflation and blaming immigrants.
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Re: Spending is Key

Post by landrew » Sat Jul 13, 2019 3:26 pm

Increasing the money supply is easy when your currency is the default world currency in lieu of the gold standard.
Because of relativity, other countries don't see the inflation as long as they devalue their own currencies to keep pace with the leader.

For example: you double the money supply, thereby devaluing the currency to half it's value. But it becomes meaningless when all the other countries do the same. The effect is nearly invisible to the average person. Hyperinflation happens when other countries don't follow suit.
The job of a skeptic is to investigate the unexplained; not to explain the uninvestigated.