If you are in a foreign country and meet an American, pretty much any American, you are likely to feel a sense of brotherhood.
The reason is that as Americans you have much more in common than you do with the people in a foreign country.
Of course in some cases this might not be true, but in general, especially for Americans that don't spend a lot of time in other countries, the sense of home permeates other Americans.
We share so much more than separates us that it becomes obvious in a place where they are, well, in-American.
We are also perceived that way in general by most foreigners, similar to how we tend to lump foreigners of specific nationalities together in our minds.
Growing up in a country imbues you with a set of values unique to that culture.
Consider Canada, which generally shares a lot with us both based on its origins and cultural background.
They still seem alien to our way of thinking, if less so than say a Russian.
Its obviously not insurmountable differences but a person from Ohio will generally have more in common with an American from South Carolina than with Canadians, even though Canada is closer to Ohio than many states.
To some extent you would expect these national differences to blur a bit with the internet and globalization, but if it is going to happen it is going pretty slowly.
Americans are in many way one big family and while families sometimes fight, they tend to band together when it matters.
Lets not forget who we are.
Monday, April 30, 2018
Sunday, April 29, 2018
Dueling Banjos?
We saw something of dueling events yesterday.
The Washington press corps held its annual self congratulatory dinner.
The dontard, unable to tolerate criticism, even as satire, gathered up a few thousand people and had his own rally.
I can't decide which one actually was more satirical.
The press corps can have all the dinners it wants, but just because there are a lot of them covering the Washington area, doesn't make them particularly important or anyone we should care about.
They may even be fairly clever and the jokes may or may not be funny, but the point of it is really a self congratulatory night out which I think they get reimbursed for, pretty sweet!
The other event was funny it its own right as we saw the Orange Julius of presidents talk about what a great job he is doing.
The crowd cheered as he listed how he is draining the swamp and fighting that very press corps which was celebrating back in Washington.
I could be wrong, but I'm willing to bet that a lot of the people were there because, well it was free, it was a bit of a freak show and they might get on TV if they were outrageous or ostentatious enough.
Some might be his true believers, but its pretty clear that most Americans are seeing his true colors by now, even those who think he is for some reason the best alternative.
Of course the chants that rang out at times were pretty clearly prompted, but that is the way things are done now-a-days, so that's simply part of the show.
I guess the reporters who had to cover that rally missed out on their free dinner back in DC.
Ironic.
The Washington press corps held its annual self congratulatory dinner.
The dontard, unable to tolerate criticism, even as satire, gathered up a few thousand people and had his own rally.
I can't decide which one actually was more satirical.
The press corps can have all the dinners it wants, but just because there are a lot of them covering the Washington area, doesn't make them particularly important or anyone we should care about.
They may even be fairly clever and the jokes may or may not be funny, but the point of it is really a self congratulatory night out which I think they get reimbursed for, pretty sweet!
The other event was funny it its own right as we saw the Orange Julius of presidents talk about what a great job he is doing.
The crowd cheered as he listed how he is draining the swamp and fighting that very press corps which was celebrating back in Washington.
I could be wrong, but I'm willing to bet that a lot of the people were there because, well it was free, it was a bit of a freak show and they might get on TV if they were outrageous or ostentatious enough.
Some might be his true believers, but its pretty clear that most Americans are seeing his true colors by now, even those who think he is for some reason the best alternative.
Of course the chants that rang out at times were pretty clearly prompted, but that is the way things are done now-a-days, so that's simply part of the show.
I guess the reporters who had to cover that rally missed out on their free dinner back in DC.
Ironic.
Saturday, April 28, 2018
Interest Rates
We see some increase in interest rates and it gave the stock market a bit of a shock. The rate on the US 10 year creeped over 3% but it has gone back below that threshold now.
These are still pretty low rates but there is a ripple effect of rate increases.
In general it makes money more expensive which makes debt more expensive and effectively has a negative impact on the money supply.
While the US Mint does in fact print currency, that is just a representation of the money in use.
The supply of money is determined by a number of fairly complex factors which simplistically can be equated to the value of all assets backed by US dollars.
Not all this money is readily available (liquid) but if I have a house (asset) with $50,000 of equity in it, I effectively have that much money to leverage.
Where it gets complex is in how that leverage works, and if credit gets more expensive it makes assets less valuable reducing equity and leverage reducing the money supply.
Now, it is in many ways more complex than that, but in the financial crises we saw credit become unavailable, equity crash, money virtually disappear and everyone felt the pain.
A firm can be valued in the billions one day and have effectively no value the next if they have high debt and declare bankruptcy.
This is why changes in interest rates that seem almost insignificant can have dramatic impacts.
Of course in rising interest environments, you might want to deleverage and put your money into instruments that benefit.
You might.
Friday, April 27, 2018
Respnsibility
A lot of times we `act like someone else is supposed to solve our problems.
Unfortunately we need to take control more often than not.
Society and governments have a role to play and of course when we are children our parents have responsibilities, but as we mature the burden is really ours.
Too many seem to shirk responsibility and blame someone else for their problems.
If you didn't study hard in school, you have no one to blame but yourself.
If you didn't save for retirement, even when money was tight, well its your own fault.
If you bought things you couldn't really afford because you really wanted them, it was your own fault.
Its not like you weren't warned or told.
Our society has become one where personal responsibility is becoming a lost concept.
Everything is because we have an addiction, or some mental flaw that prevents us from doing what we should.
There is acceptable behavior and actions and unacceptable ones, and we are responsible to do the former.
Most of us are able to spot flaws in other people but ignore our own.
Take responsibility and things will get better.
We used to blame the devil for temptation, now we don't blame anyone.
Not sure that's progress.
Unfortunately we need to take control more often than not.
Society and governments have a role to play and of course when we are children our parents have responsibilities, but as we mature the burden is really ours.
Too many seem to shirk responsibility and blame someone else for their problems.
If you didn't study hard in school, you have no one to blame but yourself.
If you didn't save for retirement, even when money was tight, well its your own fault.
If you bought things you couldn't really afford because you really wanted them, it was your own fault.
Its not like you weren't warned or told.
Our society has become one where personal responsibility is becoming a lost concept.
Everything is because we have an addiction, or some mental flaw that prevents us from doing what we should.
There is acceptable behavior and actions and unacceptable ones, and we are responsible to do the former.
Most of us are able to spot flaws in other people but ignore our own.
Take responsibility and things will get better.
We used to blame the devil for temptation, now we don't blame anyone.
Not sure that's progress.
Thursday, April 26, 2018
France
We seem to be developing a new relationship with the French, who not so long ago we considered barely friends.
Americans seem to have a somewhat distorted view of the French and admittedly, in this century they haven't been a truly dominant power.
Still they are a major economy and one of the leaders of the EU, especially with the departure of the UK.
Its a bit odd though that this president, considering his policies and followers would cozy up the French president.
This became sort of apparent when the speech he gave to congress pretty much was promoting policies this administration has opposed.
Still the thing with out dontard is that policy is secondary to him.
The fact that a foreign leader was willing to give him so much good press will go a long way with him.
It remains to be seen if this has much impact on the policies related to the Iranian Nuclear Deal or the trade agreements.
Still it might and maybe it will lead to a different policy related to the climate agreement which we withdrew from.
Probably not but making a vain man look good has a history of success.
Especially in France.
Americans seem to have a somewhat distorted view of the French and admittedly, in this century they haven't been a truly dominant power.
Still they are a major economy and one of the leaders of the EU, especially with the departure of the UK.
Its a bit odd though that this president, considering his policies and followers would cozy up the French president.
This became sort of apparent when the speech he gave to congress pretty much was promoting policies this administration has opposed.
Still the thing with out dontard is that policy is secondary to him.
The fact that a foreign leader was willing to give him so much good press will go a long way with him.
It remains to be seen if this has much impact on the policies related to the Iranian Nuclear Deal or the trade agreements.
Still it might and maybe it will lead to a different policy related to the climate agreement which we withdrew from.
Probably not but making a vain man look good has a history of success.
Especially in France.
Wednesday, April 25, 2018
Dreamers
Right now the Dreamers are in a state of limbo, seemingly forgotten about, at least in the media.
Of course the people live with the uncertainty and fears of not knowing if they can plan a future or if they have to face possible deportation to a place they probably don't remember and certainly don't know.
Imagine grabbing a teenage American and sending him to live in a foreign country, possibly with relatives, but no real roots.
Of course they would probably figure out something, we are as a species pretty adaptable, but it would be a cruel and inhumane thing to do.
There was a court decision that challenged the order abolishing the DACA program and said it was unconstitutional because it was vague.
Its not final and the thing about rulings like that is that they can be altered by reissuing the executive order with more rationale.
Still, we can't forget about the Dreamers or in fact about any of the undocumented people who are living in our country.
They aren't citizens but they still people trying to live their lives, support their families and be secure and happy.
I saw some interviews of voters in Arizona who speak as if the immigrants are stealing American jobs.
First, who are these unemployed Americans?
Second, do they even want the jobs performed by the undocumented immigrants?
Its a campaign message that doesn't stand up to scrutiny, but it apparently resonates with certain Americans who are either heartless or out of touch with economic reality.
Sad really.
Of course the people live with the uncertainty and fears of not knowing if they can plan a future or if they have to face possible deportation to a place they probably don't remember and certainly don't know.
Imagine grabbing a teenage American and sending him to live in a foreign country, possibly with relatives, but no real roots.
Of course they would probably figure out something, we are as a species pretty adaptable, but it would be a cruel and inhumane thing to do.
There was a court decision that challenged the order abolishing the DACA program and said it was unconstitutional because it was vague.
Its not final and the thing about rulings like that is that they can be altered by reissuing the executive order with more rationale.
Still, we can't forget about the Dreamers or in fact about any of the undocumented people who are living in our country.
They aren't citizens but they still people trying to live their lives, support their families and be secure and happy.
I saw some interviews of voters in Arizona who speak as if the immigrants are stealing American jobs.
First, who are these unemployed Americans?
Second, do they even want the jobs performed by the undocumented immigrants?
Its a campaign message that doesn't stand up to scrutiny, but it apparently resonates with certain Americans who are either heartless or out of touch with economic reality.
Sad really.
Tuesday, April 24, 2018
Jobs?
In the bible is the story of Joseph who interpreted Pharaoh's dream and advised him to store up grain during the 7 years of plenty to be used during the 7 years of famine.
It worked.
Its pretty sound economics.
Unfortunately it isn't followed frequently by many individuals and even fewer Governments.
The economy started to recover after the financial crisis and we saw the deficit shrink for a couple of years.
We then elected the bankruptcy king who wants to spend more than we have while reducing income via tax cuts.
It sort of explains his numerous bankruptcies.
Now for most of my life the Democrats have been described as the tax and spend party, whether warranted or not.
The Republicans are now the don't tax but spend party apparently.
Its a degree of fiscal irresponsibility that is hard to fathom.
One of the things they pretend to believe is that big corporations or small businesses will create jobs if they get to keep more of the money they make.
That's not how the economy works. You create jobs if the job is going to create more value than it costs you. Just getting a windfall might allow you to do some projects that might create some jobs, but you aren't going to create jobs just because you have some extra cash.
Now you could create jobs with infrastructure projects and because the Government cut taxes they don't have the money to pay for them. They are talking about public private partnerships, which have never worked tremendously well.
Its hard for a business owner to justify spending significant amounts of money on projects that benefit his competitors as much or more than they do his company. Its poor money management.
Of course jobs are being created in areas where there are customers, like health care and some other service industries, but those were being created anyways.
Jobs would have been created if the tax cuts went to consumers who would have spent it creating demand.
We didn't do that.
It worked.
Its pretty sound economics.
Unfortunately it isn't followed frequently by many individuals and even fewer Governments.
The economy started to recover after the financial crisis and we saw the deficit shrink for a couple of years.
We then elected the bankruptcy king who wants to spend more than we have while reducing income via tax cuts.
It sort of explains his numerous bankruptcies.
Now for most of my life the Democrats have been described as the tax and spend party, whether warranted or not.
The Republicans are now the don't tax but spend party apparently.
Its a degree of fiscal irresponsibility that is hard to fathom.
One of the things they pretend to believe is that big corporations or small businesses will create jobs if they get to keep more of the money they make.
That's not how the economy works. You create jobs if the job is going to create more value than it costs you. Just getting a windfall might allow you to do some projects that might create some jobs, but you aren't going to create jobs just because you have some extra cash.
Now you could create jobs with infrastructure projects and because the Government cut taxes they don't have the money to pay for them. They are talking about public private partnerships, which have never worked tremendously well.
Its hard for a business owner to justify spending significant amounts of money on projects that benefit his competitors as much or more than they do his company. Its poor money management.
Of course jobs are being created in areas where there are customers, like health care and some other service industries, but those were being created anyways.
Jobs would have been created if the tax cuts went to consumers who would have spent it creating demand.
We didn't do that.
Monday, April 23, 2018
Debt
The amount of debt the country is building is setting new records all the time, and worse is that the rate of growth is increasing due to the tax cuts and the increased spending.
Further, the low interest rates we have been experiencing are showing signs of increasing and if they do the amount required to service the debt will also increase.
Can the country afford it?
Well the simple answer is no.
The more complicated answer is still no, but we can party till the bills come due.
A basic rule of finances is you don't borrow to pay for current expenses, you borrow for extraordinary items, like a house, a car, or an education. If you have to borrow to buy milk, you probably have a problem. If your ordinary budget simply doesn't cover your regular expenses you definitely do.
The US budget doesn't cover its expenses.
Part of the problem is that we have to pay over $300 billion just to cover the interest on the debt we already have. We run a deficit of nearly $1 trillion so a third of that is for the interest.
That's a little bit like paying your credit cards with new credit cards.
Its actually a lot like that.
With the deficit and debt growing a relatively minor change in the interest rate is significant.
There is no real solution being proposed and the only real ones would be increased taxes or reduced spending.
Enjoy it while you can.
Further, the low interest rates we have been experiencing are showing signs of increasing and if they do the amount required to service the debt will also increase.
Can the country afford it?
Well the simple answer is no.
The more complicated answer is still no, but we can party till the bills come due.
A basic rule of finances is you don't borrow to pay for current expenses, you borrow for extraordinary items, like a house, a car, or an education. If you have to borrow to buy milk, you probably have a problem. If your ordinary budget simply doesn't cover your regular expenses you definitely do.
The US budget doesn't cover its expenses.
Part of the problem is that we have to pay over $300 billion just to cover the interest on the debt we already have. We run a deficit of nearly $1 trillion so a third of that is for the interest.
That's a little bit like paying your credit cards with new credit cards.
Its actually a lot like that.
With the deficit and debt growing a relatively minor change in the interest rate is significant.
There is no real solution being proposed and the only real ones would be increased taxes or reduced spending.
Enjoy it while you can.
Sunday, April 22, 2018
Earth Day
Today is Earth day which is a reminder that we all are totally dependent on the planet for our very existence.
Its impossible to know if we are unique in the universe. Our egos tell us we are, but the chances of that are incredibly slim considering how many planets there are.
It would be easier if the whole thing was the result of divine action and not the result of a series of random events.
Its in fact pretty unlikely but that's not a discussion for today.
Our obligation to take care of the earth is one of self preservation.
We know enough to know that mankind has been one of the most successful organisms on this planet and our ability to impact it has grown with our numbers and our technology.
We have very clear evidence that we have impacted the environment and those who deny it are ignoring a number of historical examples.
It wasn't that long ago that our use of DDT was threatening the existence of bald eagles as it made their eggs untenable and once it was eliminated the birds recovered.
Similarly we have seen positive results related to some of our waterways and fisheries as we reduced human pollution and overfishing.
Why then should we ignore the fact that we are polluting the atmosphere and threatening our future?
Yes it will inconvenience a few business owners, but mandating clean methods of production will benefit us all.
We all also need to do what we can, the changes are in fact harmless and ultimately life saving.
If not for us, for our children and grandchildren.
Its impossible to know if we are unique in the universe. Our egos tell us we are, but the chances of that are incredibly slim considering how many planets there are.
It would be easier if the whole thing was the result of divine action and not the result of a series of random events.
Its in fact pretty unlikely but that's not a discussion for today.
Our obligation to take care of the earth is one of self preservation.
We know enough to know that mankind has been one of the most successful organisms on this planet and our ability to impact it has grown with our numbers and our technology.
We have very clear evidence that we have impacted the environment and those who deny it are ignoring a number of historical examples.
It wasn't that long ago that our use of DDT was threatening the existence of bald eagles as it made their eggs untenable and once it was eliminated the birds recovered.
Similarly we have seen positive results related to some of our waterways and fisheries as we reduced human pollution and overfishing.
Why then should we ignore the fact that we are polluting the atmosphere and threatening our future?
Yes it will inconvenience a few business owners, but mandating clean methods of production will benefit us all.
We all also need to do what we can, the changes are in fact harmless and ultimately life saving.
If not for us, for our children and grandchildren.
Saturday, April 21, 2018
Its Still a Pigs Ear
If you happen to have a purse made out of a sow's ear but tell everyone its made of silk, well, you probably aren't fooling many people.
I realize this is an old example and people don't actually carry those type of purses much anymore, but the point is, fake is always fake, no matter how much you deny it.
Much of the narrative pushed by so called conservatives is actually simply false.
They are convinced there is a media bias which presents facts from a liberal point of view.
Take the rise in the earth's temperature.
The consensus of the vast majority of scientists is that this is caused by human behavior, to at least some extent.
This is not a liberal bias, its a fact.
Similarly, evolution is real, we have worldwide fossil evidence that supports it. Creationism isn't a valid scientific theory, its a religious belief. If you want to believe it, well its your right, but its not science.
We see some people now arguing that the earth is flat. It isn't.
This idea that facts are biased or no better than opinions is both wrong and harmful.
The internet has been a revolutionary development, similar to the impact of the printing press. Before that was invented, we saw access to information limited to a very few and after it opened up to anyone who could read.
It led to a great expansion of knowledge but also disrupted religions, governments and society.
Was it a good thing? I think we all agree it was.
We now see the internet further expanding not only access to information but also the ability to promote ideas.
Not all the ideas are valid and what it will require is individual responsibility to sort out the sow's ears from the silk purses.
Friday, April 20, 2018
Troubled Democracy
We now live in a world where every fact seems to be viewed from a purely political viewpoint.
That is a bit of an exaggeration, maybe, it just seems that way.
When the rising temperature of the earth as measured by many organizations around the world becomes a political debate, we need to demand some sort of common sense.
Its not OK for black to be called white or up to be called down.
We are seeing a bit of a fight over some memos written by the FBI director.
The memo's are consistent with what we already knew and aren't really of much significance, although they provide a bit of a distraction for a time.
There are ongoing investigations over potential criminal and other activities that will eventually come to an end, but it is already guaranteed that there will be no agreement on the facts, which will be viewed politically.
Of course some will plead guilty, others will be found guilty and some will be exonerated.
In each case, there will be allegations of political influence, and those allegations will live on since we are no longer able to let these things play out in our system of justice.
Investigations that have ended are brought up again because the outcome wasn't what some wanted.
Allegations that have no basis in law are made by people who should at least try to know what they are talking about.
Of course it isn't going to end, in fact it seems to get worse.
It is unfortunately a symptom that our democracy is troubled when the institutions that should be respected become viewed as purely partisan political forums which serve no purpose.
History has many examples, we should pay attention.
That is a bit of an exaggeration, maybe, it just seems that way.
When the rising temperature of the earth as measured by many organizations around the world becomes a political debate, we need to demand some sort of common sense.
Its not OK for black to be called white or up to be called down.
We are seeing a bit of a fight over some memos written by the FBI director.
The memo's are consistent with what we already knew and aren't really of much significance, although they provide a bit of a distraction for a time.
There are ongoing investigations over potential criminal and other activities that will eventually come to an end, but it is already guaranteed that there will be no agreement on the facts, which will be viewed politically.
Of course some will plead guilty, others will be found guilty and some will be exonerated.
In each case, there will be allegations of political influence, and those allegations will live on since we are no longer able to let these things play out in our system of justice.
Investigations that have ended are brought up again because the outcome wasn't what some wanted.
Allegations that have no basis in law are made by people who should at least try to know what they are talking about.
Of course it isn't going to end, in fact it seems to get worse.
It is unfortunately a symptom that our democracy is troubled when the institutions that should be respected become viewed as purely partisan political forums which serve no purpose.
History has many examples, we should pay attention.
Thursday, April 19, 2018
Economic Progress?
The economy is still doing well and the recovery has potentially picked up a little steam.
Giving the devil his due, might mean we should see what is the cause of this.
Of course the economy was doing well when the last administration ended, despite the campaign rhetoric and since then the main actions have related to tax cuts and regulatory reform.
These have had some impact but how much is still uncertain.
In addition business seems to be optimistic that they have a friend in the office and they are certainly excited about raking in extra profits.
Is this going to generate the type of jobs that were promised in the rust belt?
Not really, those jobs are gone and not coming back.
The jobs that might be created will require skills and there will be far less of them.
This is a good thing really unless of course you are one of the unskilled or lightly skilled workers who is forced to work for far less pay than previously.
Skilled workers have always been in demand and the places where a strong back is going to earn you a living wage are shrinking.
So is the economy better under this administration?
It has progressed along the same lines as previously and the rich are certainly benefiting, although working people, not so much.
The history of the human species is how we have learned to do things better and easier, thanks to our brain.
For much of our history the rewards of this were shared fairly evenly, although of course some benefited more than others.
The current economy and society though now have probably the most unequal distribution we have ever seen, at least among people who weren't enslaved.
Until the benefits of the economy are shared more equally, its hard to say its doing its job.
If the answer is supposedly trickle down, well, it isn't going to change much.
Giving the devil his due, might mean we should see what is the cause of this.
Of course the economy was doing well when the last administration ended, despite the campaign rhetoric and since then the main actions have related to tax cuts and regulatory reform.
These have had some impact but how much is still uncertain.
In addition business seems to be optimistic that they have a friend in the office and they are certainly excited about raking in extra profits.
Is this going to generate the type of jobs that were promised in the rust belt?
Not really, those jobs are gone and not coming back.
The jobs that might be created will require skills and there will be far less of them.
This is a good thing really unless of course you are one of the unskilled or lightly skilled workers who is forced to work for far less pay than previously.
Skilled workers have always been in demand and the places where a strong back is going to earn you a living wage are shrinking.
So is the economy better under this administration?
It has progressed along the same lines as previously and the rich are certainly benefiting, although working people, not so much.
The history of the human species is how we have learned to do things better and easier, thanks to our brain.
For much of our history the rewards of this were shared fairly evenly, although of course some benefited more than others.
The current economy and society though now have probably the most unequal distribution we have ever seen, at least among people who weren't enslaved.
Until the benefits of the economy are shared more equally, its hard to say its doing its job.
If the answer is supposedly trickle down, well, it isn't going to change much.
Wednesday, April 18, 2018
Worst President Ever?
You wonder if in the history of this country if the presidency was ever held in lower regard than it is right now?
History tells us that Andrew Johnson was considered a bit uncultured, but he was also a war hero who represented the frontier.
We have had presidents, like say Grant, who was probably overly fond of drink and who had a number of scandals but who was a hero of the Civil War.
Andrew Johnson almost got impeached, but that was because he wasn't hard enough on the south.
Clearly we had presidents who presided over financial crises, scandals and who also were known womanizers, but generally they had a record of some accomplishment either as president of before they became president.
The current occupant did host a reality TV show and was sort of a businessman, who got famous and sold his brand to a number of shady enterprises and presided over multiple bankruptcies.
Of course he also cheated on all his wives, including the current one, used racial profiling in his real estate business, has been nothing if not an opportunist in his political views, insults his opponents and is a well known liar.
Of course being president and commander in chief makes him a loose cannon to people abroad who undoubtedly think he's untrustworthy and sort of a clown, if admittedly a scary one.
His positions on almost everything are erratic and he somehow thinks building a wall will impact undocumented immigration, when clearly, it is already declining naturally.
One of the things about economics is that over time it corrects itself, meaning jobs go to where labor is cheap/
So that wasn't us and it did result in some pain that is unfortunate. We are still however the richest country on the planet, at least for now.
We do however have the worse ever president I think.
History tells us that Andrew Johnson was considered a bit uncultured, but he was also a war hero who represented the frontier.
We have had presidents, like say Grant, who was probably overly fond of drink and who had a number of scandals but who was a hero of the Civil War.
Andrew Johnson almost got impeached, but that was because he wasn't hard enough on the south.
Clearly we had presidents who presided over financial crises, scandals and who also were known womanizers, but generally they had a record of some accomplishment either as president of before they became president.
The current occupant did host a reality TV show and was sort of a businessman, who got famous and sold his brand to a number of shady enterprises and presided over multiple bankruptcies.
Of course he also cheated on all his wives, including the current one, used racial profiling in his real estate business, has been nothing if not an opportunist in his political views, insults his opponents and is a well known liar.
Of course being president and commander in chief makes him a loose cannon to people abroad who undoubtedly think he's untrustworthy and sort of a clown, if admittedly a scary one.
His positions on almost everything are erratic and he somehow thinks building a wall will impact undocumented immigration, when clearly, it is already declining naturally.
One of the things about economics is that over time it corrects itself, meaning jobs go to where labor is cheap/
So that wasn't us and it did result in some pain that is unfortunate. We are still however the richest country on the planet, at least for now.
We do however have the worse ever president I think.
Tuesday, April 17, 2018
Foreign Relations
More sanctions, not more sanctions, what to do about Russia which supports cyber attacks as well as murder and tyrants around the world.
The idea of some sort of consistent approach would be new method for the current administration which apparently likes to keep what it is going to do a secret, even from itself.
At the current time we seem to have decided not to impose sanctions,
That could change again as it did since yesterday.
Of course imposing sanctions is not always effective, in fact it seems like it works best when it is a coalition doing it.
That of course would require coordination and a certain consistency that our allies, if we still have any can rely upon.
I guess the only real consistent thing about this administration is that they manage to fight with just about everybody sooner or later.
They upset our NATO allies and our major trading partners early on.
They seem to be getting critical of Russia, although it owes them a lot.
It has insulted most African nations and certainly the Arab ones.
Its relations with China aren't going very well.
North Korea might be warming up to it though.
Gotta give credit where credit is due I guess.
The idea of some sort of consistent approach would be new method for the current administration which apparently likes to keep what it is going to do a secret, even from itself.
At the current time we seem to have decided not to impose sanctions,
That could change again as it did since yesterday.
Of course imposing sanctions is not always effective, in fact it seems like it works best when it is a coalition doing it.
That of course would require coordination and a certain consistency that our allies, if we still have any can rely upon.
I guess the only real consistent thing about this administration is that they manage to fight with just about everybody sooner or later.
They upset our NATO allies and our major trading partners early on.
They seem to be getting critical of Russia, although it owes them a lot.
It has insulted most African nations and certainly the Arab ones.
Its relations with China aren't going very well.
North Korea might be warming up to it though.
Gotta give credit where credit is due I guess.
Monday, April 16, 2018
Democracy
We saw the ex-director of the FBI describe the current president of the United States as a liar who is morally unfit to be president and most of us said to ourselves, so?
The general attitude towards politicians in general and this one in particular is already so bad that a day in which there isn't an outright scandal is probably a good one.
Not sure if there is anything that politicians can do in the short term, but in the long term we need more regular people and less professional politicians in office.
I don't favor term limits but people should vote in new people who better represent the real world.
One of the factors that helped the dontard was that his opponent was viewed as part of the Washington establishment and he wasn't.
True, but he was a corrupt business and media person who represented the worst of both worlds.
In this country people often decide to be politicians as a career and work their way into office only to stay there unless they can move higher.
This isn't that different than what people do in regular careers except they are supposed to represent the people who vote for them, not cater to donors and special interests.
The way candidates are selected and the campaigns run strongly favor insiders, even if the insiders aren't crooked.
Insiders don't know what the people really are going through and who they hear from normally represent specific constituencies without much contact with the world most of us inhabit.
I think that with modern technology we would be better off if we could have more referendums, but I also realize that most people wouldn't know or care about the details of many important issues.
The solution of course is to have involved citizens who participate and vote.
Simple enough, but its been that way a long time.
The general attitude towards politicians in general and this one in particular is already so bad that a day in which there isn't an outright scandal is probably a good one.
Not sure if there is anything that politicians can do in the short term, but in the long term we need more regular people and less professional politicians in office.
I don't favor term limits but people should vote in new people who better represent the real world.
One of the factors that helped the dontard was that his opponent was viewed as part of the Washington establishment and he wasn't.
True, but he was a corrupt business and media person who represented the worst of both worlds.
In this country people often decide to be politicians as a career and work their way into office only to stay there unless they can move higher.
This isn't that different than what people do in regular careers except they are supposed to represent the people who vote for them, not cater to donors and special interests.
The way candidates are selected and the campaigns run strongly favor insiders, even if the insiders aren't crooked.
Insiders don't know what the people really are going through and who they hear from normally represent specific constituencies without much contact with the world most of us inhabit.
I think that with modern technology we would be better off if we could have more referendums, but I also realize that most people wouldn't know or care about the details of many important issues.
The solution of course is to have involved citizens who participate and vote.
Simple enough, but its been that way a long time.
Sunday, April 15, 2018
What's the Plan?
So we hit Syria with some missiles, doing damage to the places where they manufacture chemical weapons, and think that resolves it?
It really didn't accomplish much considering the fact that the Syrian Government has pretty much quashed most resistance and the need to use chemical weapons is probably not an urgent thing right now.
They also most likely have some in inventory.
The last time we had a president declare mission accomplished it led to a conflict that we are still engaged in.
This response isn't a solution, although its hard to have a solution without a plan.
What are we trying to accomplish in Syria, the middle east or the world in general?
Apparently if someone use chemical weapons on their own people we will react.
Everything else is OK?
The stated plan is America first, whatever that means.
Its also not a plan that is going to be appealing to our allies per se.
Despite statement by the dontard, it was always America first, although what that means is part of the problem.
We need to protect our citizens by reducing terrorism but what is the best strategy to do that?
We can try to guard everything but we know that's not really possible.
This is the anniversary of the Boston terrorist attack and that put pressure cookers in the cross hairs, although I'm sure there are other common items that can be turned into weapons.
Of course we have had the mass shootings, which weren't generally terrorist acts, but certainly could have been.
Guns are pretty readily available in much of this country.
We can play whack a mole or try to blame migrant workers for things they never did, but a real coherent plan is just beyond the capability of this administration, they can't keep team members on board long enough.
Its a pure crap shoot!
It really didn't accomplish much considering the fact that the Syrian Government has pretty much quashed most resistance and the need to use chemical weapons is probably not an urgent thing right now.
They also most likely have some in inventory.
The last time we had a president declare mission accomplished it led to a conflict that we are still engaged in.
This response isn't a solution, although its hard to have a solution without a plan.
What are we trying to accomplish in Syria, the middle east or the world in general?
Apparently if someone use chemical weapons on their own people we will react.
Everything else is OK?
The stated plan is America first, whatever that means.
Its also not a plan that is going to be appealing to our allies per se.
Despite statement by the dontard, it was always America first, although what that means is part of the problem.
We need to protect our citizens by reducing terrorism but what is the best strategy to do that?
We can try to guard everything but we know that's not really possible.
This is the anniversary of the Boston terrorist attack and that put pressure cookers in the cross hairs, although I'm sure there are other common items that can be turned into weapons.
Of course we have had the mass shootings, which weren't generally terrorist acts, but certainly could have been.
Guns are pretty readily available in much of this country.
We can play whack a mole or try to blame migrant workers for things they never did, but a real coherent plan is just beyond the capability of this administration, they can't keep team members on board long enough.
Its a pure crap shoot!
Saturday, April 14, 2018
Syria Strikes
It remains to be seen whether the air strikes in Syria accomplish anything, probably not but maybe it will be some deterrence.
Thee is also no doubt that the regime in Syria is managing to survive unlike dictators in places like Libya and Egypt.
The so called Arab Spring didn't seem to result in a lot of democratic institutions springing up.
Certainly I don't think we see a lot of pro-Western governments.
Fundamentally, most Arabs support the Palestinians in the dispute with Israel and generally still oppose the existence of Israel itself.
Since we are clearly considered a main supporter of Israel we don't have a lot of friends in the region.
We also get blamed to some extent for stealing their oil wealth and of course for introducing wicked Western culture to many of their young people.
Back during the Bush administration their was a certain belief that removal of dictators like Saddam Hussein would lead to more democratic and therefore more Western friendly states.
We then saw some additional dictators eliminated during the Arab Spring where Egypt and Libya got rid of their dictators. It looked a lot like Syria was going to be next, but it was not to be as the spread of Isis sort of killed that momentum.
Clearly with the support of Russia and Iran Syria's government looks safe and we are not engaged in trying to overturn it.
Outside of supporting Israel and opposing terrorist organizations we don't seem to have much of a policy there right now.
Of course that's pretty much par for this administration.
Thee is also no doubt that the regime in Syria is managing to survive unlike dictators in places like Libya and Egypt.
The so called Arab Spring didn't seem to result in a lot of democratic institutions springing up.
Certainly I don't think we see a lot of pro-Western governments.
Fundamentally, most Arabs support the Palestinians in the dispute with Israel and generally still oppose the existence of Israel itself.
Since we are clearly considered a main supporter of Israel we don't have a lot of friends in the region.
We also get blamed to some extent for stealing their oil wealth and of course for introducing wicked Western culture to many of their young people.
Back during the Bush administration their was a certain belief that removal of dictators like Saddam Hussein would lead to more democratic and therefore more Western friendly states.
We then saw some additional dictators eliminated during the Arab Spring where Egypt and Libya got rid of their dictators. It looked a lot like Syria was going to be next, but it was not to be as the spread of Isis sort of killed that momentum.
Clearly with the support of Russia and Iran Syria's government looks safe and we are not engaged in trying to overturn it.
Outside of supporting Israel and opposing terrorist organizations we don't seem to have much of a policy there right now.
Of course that's pretty much par for this administration.
Friday, April 13, 2018
Reasonable People
One of the things that history teaches us is that unreasonable people often get there way.
Of course that's because what is reasonable is simply something we all agree on.
Take some of our popular media, willing to make accusations based on little or no evidence.
Its become so common that we see the credibility of the media under serious attack.
Of course we have had this issue before maybe most prevalently during the yellow journalism years the late 1800s and early 1900s.
Maybe it never really ended.
What is factual, real news, and what is "fake" news?
Sometimes its hard to say, but we do have some indicators.
Some facts are clearly witnessed by so many people with so much real and photographic evidence that to question them is simply outrageous.
The holocaust did happen, we had survivors, liberators and oppressors who verified it.
The mass shooting also happened.
In fact this idea that there is a group of people, ostensibly run by the Government that is perpetrating hoaxes about these terrible events for some political gain is so outrageous its almost ludicrous.
Except some people believe it.
The number actually seems to be growing.
Take vaccines or GMO foods. There is pretty irrefutable evidence that the first doesn't cause autism and the second is perfectly safe. However many people believe exactly the opposite.
Pretty much everyone gets vaccinated and therefore everyone with autism was probably vaccinated. However, everyone without autism was also vaccinated.
Its simply not reasonable to equate the two. Reason however is becoming a rare commodity in today's world.
Of course that's because what is reasonable is simply something we all agree on.
Take some of our popular media, willing to make accusations based on little or no evidence.
Its become so common that we see the credibility of the media under serious attack.
Of course we have had this issue before maybe most prevalently during the yellow journalism years the late 1800s and early 1900s.
Maybe it never really ended.
What is factual, real news, and what is "fake" news?
Sometimes its hard to say, but we do have some indicators.
Some facts are clearly witnessed by so many people with so much real and photographic evidence that to question them is simply outrageous.
The holocaust did happen, we had survivors, liberators and oppressors who verified it.
The mass shooting also happened.
In fact this idea that there is a group of people, ostensibly run by the Government that is perpetrating hoaxes about these terrible events for some political gain is so outrageous its almost ludicrous.
Except some people believe it.
The number actually seems to be growing.
Take vaccines or GMO foods. There is pretty irrefutable evidence that the first doesn't cause autism and the second is perfectly safe. However many people believe exactly the opposite.
Pretty much everyone gets vaccinated and therefore everyone with autism was probably vaccinated. However, everyone without autism was also vaccinated.
Its simply not reasonable to equate the two. Reason however is becoming a rare commodity in today's world.
Thursday, April 12, 2018
Republican Retirements
You see a rotation in the republican party where those who grew up in a party that believed in America are deciding they've had enough.
It should be noted that generally things in America continue to go reasonably well.
Of course we have problems, one of which is the amount of gun violence in this country, and we know that while companies are doing well the people at the top benefit far more than the workers, most Americans who want to be employed are.
Immigration isn't really any issue as much as some want to say it is, the great majority of documented and undocumented immigrants simply work and live like their neighbors to the extent possible.
We still have issues with our health care system and despite attacks on the Affordable Care Act, we see more people with coverage than before it existed.
Almost everything started under the last administration has helped the recovery along and the attempts by the current one to disrupt these initiatives are not very effectual, at least yet.
You see some of the uncertainty reflected in the way stocks have started behaving as potential trade and military conflicts cause uncertainty.
Of course we see that civil liberties for many Americans are taking a hit although the opposition of this administration to minorities and the LGBT communities isn't reflective of the broader views in America.
The real question is when will there be a tipping point?
Considering the expressed viewpoints of the millennial generation as well as the view of most of the rest of us, social progress in America is going to continue.
The last election was influenced by a series of events that will be unlikely to reoccur and the core supporters of our oligarch will be forced back under the rocks they generally live under.
They drove out the real republicans in so doing.
Good riddance, they mostly turned into hypocrites.
Forced to run an election supporting the ridiculous positions of the current administration is just too much to accept.
It should be noted that generally things in America continue to go reasonably well.
Of course we have problems, one of which is the amount of gun violence in this country, and we know that while companies are doing well the people at the top benefit far more than the workers, most Americans who want to be employed are.
Immigration isn't really any issue as much as some want to say it is, the great majority of documented and undocumented immigrants simply work and live like their neighbors to the extent possible.
We still have issues with our health care system and despite attacks on the Affordable Care Act, we see more people with coverage than before it existed.
Almost everything started under the last administration has helped the recovery along and the attempts by the current one to disrupt these initiatives are not very effectual, at least yet.
You see some of the uncertainty reflected in the way stocks have started behaving as potential trade and military conflicts cause uncertainty.
Of course we see that civil liberties for many Americans are taking a hit although the opposition of this administration to minorities and the LGBT communities isn't reflective of the broader views in America.
The real question is when will there be a tipping point?
Considering the expressed viewpoints of the millennial generation as well as the view of most of the rest of us, social progress in America is going to continue.
The last election was influenced by a series of events that will be unlikely to reoccur and the core supporters of our oligarch will be forced back under the rocks they generally live under.
They drove out the real republicans in so doing.
Wednesday, April 11, 2018
Predictably Unpredictable
In what should be no surprise to anyone, the current administration is both ineffective and chaotic.
The number of people who come and go is setting records and because the dontard thinks the world revolves around him, his policies don't accomplish what he thinks they will.
Take his trade war with China. China has been aggressive in growing certain industries and possibly some retaliatory actions were justified. However, unilaterally announcing a set of tariffs that will create very few jobs and increase cost for everyone else is simply irrational.
Follow that up by a couple of rounds of retaliation and you are looking at destroying a lot of red state farm economies which will result in surplus commodities, expansion of competition in other countries and less exports.
Of course it may not go that far as, at least for now, cooler heads may prevail, but if he thinks the American farmer is willing to bite the bullet because the dontard says they should, well, he should think again.
We have cabinet members who in addition to being inept and unqualified are also trying to milk the taxpayer for everything they can. The EPA director is the latest of them to be disclosed, but I suspect its pervasive.
He is now talking about undoing the compromise spending bill he recently signed because it increased spending. DUH?
The estimates of the impact of the tax cuts with the spending bill are dire indeed and raise some issues about the future credit worthiness of the country.
His decision to announce a troop withdrawal in Syria may or may not have led to the chemical attack or the Israeli raid but its at least a little bit contributory. What can he do now, its so complex it must be hurting his brain.
Meanwhile the FBI is raiding his attorneys office which he considers and attack on America. No, America is rooting out potential obstruction.
Its likely he will lash out some more with additional unintended consequences, it may have already happened. He's unpredictable, yet very predictable that way.
The number of people who come and go is setting records and because the dontard thinks the world revolves around him, his policies don't accomplish what he thinks they will.
Take his trade war with China. China has been aggressive in growing certain industries and possibly some retaliatory actions were justified. However, unilaterally announcing a set of tariffs that will create very few jobs and increase cost for everyone else is simply irrational.
Follow that up by a couple of rounds of retaliation and you are looking at destroying a lot of red state farm economies which will result in surplus commodities, expansion of competition in other countries and less exports.
Of course it may not go that far as, at least for now, cooler heads may prevail, but if he thinks the American farmer is willing to bite the bullet because the dontard says they should, well, he should think again.
We have cabinet members who in addition to being inept and unqualified are also trying to milk the taxpayer for everything they can. The EPA director is the latest of them to be disclosed, but I suspect its pervasive.
He is now talking about undoing the compromise spending bill he recently signed because it increased spending. DUH?
The estimates of the impact of the tax cuts with the spending bill are dire indeed and raise some issues about the future credit worthiness of the country.
His decision to announce a troop withdrawal in Syria may or may not have led to the chemical attack or the Israeli raid but its at least a little bit contributory. What can he do now, its so complex it must be hurting his brain.
Meanwhile the FBI is raiding his attorneys office which he considers and attack on America. No, America is rooting out potential obstruction.
Its likely he will lash out some more with additional unintended consequences, it may have already happened. He's unpredictable, yet very predictable that way.
Tuesday, April 10, 2018
Talking Heads
The world is a complex place, which was apparently a surprise to the dontard.
He seemed to believe that he could just tell people what to do and they would do it.
This may have been one of the reasons he had so many bankruptcies, of course it may have been because they did do what he asked.
His judgment is based on what people call talking heads, especially the ones on one particular news network.
Talking heads are not news people, they are opinion people who find facts that sort of support what they want to say.
A lot of these so called facts are really opinions of other people or half-truths that can be twisted like a balloon animal to resemble a real animal.
They aren't real animals and a lot of these facts aren't real facts.
The fact that they get repeated a number of times doesn't make them true, simply persistent.
Even reputable journalists don't get a lot of things right, although what they publish or say has some credibility.
Real events are complex and we always prefer simple answers.
The entire war in Iraq was based on misinterpretation of evidence. It was misinterpreted because the people saw what they wanted to see. When they didn't see real "proof" it was easy to assume it was there anyways, just well hidden.
This is pretty much the way some of our media operates, making leaps of faith and drawing conclusions, at least the talking heads do.
They simplify the complex and our dontard buys it.
Watch out folks!
He seemed to believe that he could just tell people what to do and they would do it.
This may have been one of the reasons he had so many bankruptcies, of course it may have been because they did do what he asked.
His judgment is based on what people call talking heads, especially the ones on one particular news network.
Talking heads are not news people, they are opinion people who find facts that sort of support what they want to say.
A lot of these so called facts are really opinions of other people or half-truths that can be twisted like a balloon animal to resemble a real animal.
They aren't real animals and a lot of these facts aren't real facts.
The fact that they get repeated a number of times doesn't make them true, simply persistent.
Even reputable journalists don't get a lot of things right, although what they publish or say has some credibility.
Real events are complex and we always prefer simple answers.
The entire war in Iraq was based on misinterpretation of evidence. It was misinterpreted because the people saw what they wanted to see. When they didn't see real "proof" it was easy to assume it was there anyways, just well hidden.
This is pretty much the way some of our media operates, making leaps of faith and drawing conclusions, at least the talking heads do.
They simplify the complex and our dontard buys it.
Watch out folks!
Monday, April 9, 2018
Syria
The war goes on in Syria, or should I say the wars.
ISIS still has a presence although diminished and they are fighting everybody else more or less.
The rebel groups are still fighting against the Syrian regime.
The Russians are supporting the regime and fighting the rebels and ISIS.
IRAN also supports the regime although it also supports some Sunni groups.
The Israelis oppose the regime but don't really want a strong Syria.
You have the Turks and the Kurds who fight whoever they think is threatening their interests this week.
We are there but its a bit unclear what we are doing right now, although defeating ISIS is the stated objective.
We used to support the rebel groups but then we didn't unless of course chemical weapons are used.
Of course right after we announced a withdrawal to come, chemical weapons were used and attributed to the regime.
That's probably true, but it seems sort of convenient in its own way as one of the only ways to get us to stick around.
Should we stick around, not without some clear objectives.
We can certainly have advisers there if we know who we want to advise.
Leaving probably leaves it open for the Russians and Iranians to have a major foothold in the area, which is quite strategically situated.
Regime change is seeming unlikely right now so we might want to think about what we are trying to accomplish.
Of course, we have the Syrian people who have to live amid all this.
Just people in distress, many fleeing their homes, but we don't want them, they are Arabs and you know how the administration feels about them.
ISIS still has a presence although diminished and they are fighting everybody else more or less.
The rebel groups are still fighting against the Syrian regime.
The Russians are supporting the regime and fighting the rebels and ISIS.
IRAN also supports the regime although it also supports some Sunni groups.
The Israelis oppose the regime but don't really want a strong Syria.
You have the Turks and the Kurds who fight whoever they think is threatening their interests this week.
We are there but its a bit unclear what we are doing right now, although defeating ISIS is the stated objective.
We used to support the rebel groups but then we didn't unless of course chemical weapons are used.
Of course right after we announced a withdrawal to come, chemical weapons were used and attributed to the regime.
That's probably true, but it seems sort of convenient in its own way as one of the only ways to get us to stick around.
Should we stick around, not without some clear objectives.
We can certainly have advisers there if we know who we want to advise.
Leaving probably leaves it open for the Russians and Iranians to have a major foothold in the area, which is quite strategically situated.
Regime change is seeming unlikely right now so we might want to think about what we are trying to accomplish.
Of course, we have the Syrian people who have to live amid all this.
Just people in distress, many fleeing their homes, but we don't want them, they are Arabs and you know how the administration feels about them.
Sunday, April 8, 2018
Weather and Climate
Weather has been a bit strange in the last couple of years but the bigger question concerns changes in climate.
Weather is the way we observe climate most dramatically, but any given day's weather doesn't mean much.
It does mean something when you start to see weather events that are extremely rare start to happen more frequently.
The forces that impact our weather are driven by a series of complex factors and many of these factors are impacted by energy.
More energy in the environment represents more dramatic events.
Of course the vast amount of energy comes from the sun.
The earth is bombarded by solar energy constantly and much of it gets used by living organisms but a certain amount gets reflected away.
The amount retained versus the amount reflected away .depends on many factors, one of which is the amount of carbon in the atmosphere.
The more energy we retain, the warmer the earth gets and its a pretty simple equation that converts heat into energy.
So does that explain the recent weather?
Its most likely related but we could have unusual weather and not have climate change.
Unless it persists, meaning we have in fact changed the climate.
To some extent climate is the average of weather. If we have a lot of unusually hot days, the average daily temperature will change.
The link below details what's happening. What will happen still depends on us.
https://climate.nasa.gov/evidence/
Weather is the way we observe climate most dramatically, but any given day's weather doesn't mean much.
It does mean something when you start to see weather events that are extremely rare start to happen more frequently.
The forces that impact our weather are driven by a series of complex factors and many of these factors are impacted by energy.
More energy in the environment represents more dramatic events.
Of course the vast amount of energy comes from the sun.
The earth is bombarded by solar energy constantly and much of it gets used by living organisms but a certain amount gets reflected away.
The amount retained versus the amount reflected away .depends on many factors, one of which is the amount of carbon in the atmosphere.
The more energy we retain, the warmer the earth gets and its a pretty simple equation that converts heat into energy.
So does that explain the recent weather?
Its most likely related but we could have unusual weather and not have climate change.
Unless it persists, meaning we have in fact changed the climate.
To some extent climate is the average of weather. If we have a lot of unusually hot days, the average daily temperature will change.
The link below details what's happening. What will happen still depends on us.
https://climate.nasa.gov/evidence/
Saturday, April 7, 2018
Marginal Economics
The official jobs report was disappointing and it was quite a bit off from what the ADP report said.
One month doesn't make a trend and we'll have to see if there is a slowdown in hiring.
Some of the reports had short term impetus from tax cuts anticipation but it always ultimately depends on whether there is a market for what you are selling.
When more money goes into buying gas or energy because of a cold spring and multiple storms it reduces some spending.
Of course we are seeing economic policies being deployed that are not likely to increase demand with the imposition of tariffs that will increase costs.
Most of the things that economists measure are really marginal factors.
Take the difference between high unemployment and low unemployment.
If unemployment was to rise to 10% from the current levels it would mean an additional 6% of the workforce was unemployed with that impact on taxes, unemployment benefits, consumption, etc.
Yet 90% of us would still be working as opposed to the previous 96%.
Still a change like that would most likely be the result of a recession or would tip us into one.
Most people live through recessions and upticks in the economy without actually much change to their regular lives.
They may read about the issues and possibly see changes in prices or other things like interest rates, but unless you are one of the 6% it hardly matters.
It is of course pretty devastating for that 6%, but its still only a small number of the total.
If no one told us things were bad we might not even notice.
One month doesn't make a trend and we'll have to see if there is a slowdown in hiring.
Some of the reports had short term impetus from tax cuts anticipation but it always ultimately depends on whether there is a market for what you are selling.
When more money goes into buying gas or energy because of a cold spring and multiple storms it reduces some spending.
Of course we are seeing economic policies being deployed that are not likely to increase demand with the imposition of tariffs that will increase costs.
Most of the things that economists measure are really marginal factors.
Take the difference between high unemployment and low unemployment.
If unemployment was to rise to 10% from the current levels it would mean an additional 6% of the workforce was unemployed with that impact on taxes, unemployment benefits, consumption, etc.
Yet 90% of us would still be working as opposed to the previous 96%.
Still a change like that would most likely be the result of a recession or would tip us into one.
Most people live through recessions and upticks in the economy without actually much change to their regular lives.
They may read about the issues and possibly see changes in prices or other things like interest rates, but unless you are one of the 6% it hardly matters.
It is of course pretty devastating for that 6%, but its still only a small number of the total.
If no one told us things were bad we might not even notice.
Friday, April 6, 2018
Bad Economics
It really seems like the dontard is determined to cause a recession.
He is going down a path where no one wins, despite his erroneous belief that all he has to do is talk tough.
Its also problematic that he doesn't realize he is representing a party that has always favored free trade because it helps wealthy donors more than anyone else.
When Bill Clinton went along with the Republican congress and signed NAFTA it was opposed by most Democrats at the time, who wanted to protect the workers.
Free trade moves jobs to where they are the cheapest which in the case of entry level manufacturing, is not the US.
It helps sell agricultural products and services as well as some high end products but those jobs are often not in the rust belt.
The people who own businesses tend to do well, while workers see a negative impact on wage growth, because they are now competing on a wider scale.
Of course, the rust belt also lost a lot of jobs to non-union states for the same reason, the cost of labor is less.
From an economic standpoint, we were probably overpaying for certain labor, especially low skilled labor, so it had to equal itself out.
Economic theory tells you that eventually the playing field levels off and everyone sees benefits.
Before that happens though there are winners and losers and the losers are the people who had good paying, high benefit union jobs while not having significant skills.
They compete against almost everybody.
The owners and consumers benefit as prices of products go down or increase less slowly and from an economic standpoint it is better, unless you lost your job or have to work for half your old salary.
The tariffs being imposed are not gong to reverse this, we are too far down the road, but they can hurt other sectors of the economy.
The rest of us also get to pay more.
He is going down a path where no one wins, despite his erroneous belief that all he has to do is talk tough.
Its also problematic that he doesn't realize he is representing a party that has always favored free trade because it helps wealthy donors more than anyone else.
When Bill Clinton went along with the Republican congress and signed NAFTA it was opposed by most Democrats at the time, who wanted to protect the workers.
Free trade moves jobs to where they are the cheapest which in the case of entry level manufacturing, is not the US.
It helps sell agricultural products and services as well as some high end products but those jobs are often not in the rust belt.
The people who own businesses tend to do well, while workers see a negative impact on wage growth, because they are now competing on a wider scale.
Of course, the rust belt also lost a lot of jobs to non-union states for the same reason, the cost of labor is less.
From an economic standpoint, we were probably overpaying for certain labor, especially low skilled labor, so it had to equal itself out.
Economic theory tells you that eventually the playing field levels off and everyone sees benefits.
Before that happens though there are winners and losers and the losers are the people who had good paying, high benefit union jobs while not having significant skills.
They compete against almost everybody.
The owners and consumers benefit as prices of products go down or increase less slowly and from an economic standpoint it is better, unless you lost your job or have to work for half your old salary.
The tariffs being imposed are not gong to reverse this, we are too far down the road, but they can hurt other sectors of the economy.
The rest of us also get to pay more.
Thursday, April 5, 2018
Panic Attack?
So there are approximately 1500 Honduran refugees making their way through Mexico hoping to escape the dangers in that country. You can read about them here
https://71republic.com/2018/04/03/1500-honduran-refugees-headed-north/
Whatever you think about us accepting refugees, this is certainly not much of a threat to anything. The situation in Honduras is pretty bad and I'm not sure how it is going to get better. If we were to let all 1500 into the country it would potentially open the doors to more such efforts, so I would think they need to be processed like any other such group, but they aren't an invading Army that requires us to mobilize the National Guard.
Is the dontard having a panic attack over this?
It was covered on his favorite cable channel and therefore it got his attention. I imagine they overdramatized it, they generally do so it is now getting an overreaction.
Take troops out of Syria and send them to the Southern Border?
In Syria we are still fighting an oppressive regime as well as the remnants of ISIS both of which represent real threats to our National Security or the security of our close allies.
On the Southern Border we are dealing with potential service industry employees.
Panic over nothing much?
https://71republic.com/2018/04/03/1500-honduran-refugees-headed-north/
Whatever you think about us accepting refugees, this is certainly not much of a threat to anything. The situation in Honduras is pretty bad and I'm not sure how it is going to get better. If we were to let all 1500 into the country it would potentially open the doors to more such efforts, so I would think they need to be processed like any other such group, but they aren't an invading Army that requires us to mobilize the National Guard.
Is the dontard having a panic attack over this?
It was covered on his favorite cable channel and therefore it got his attention. I imagine they overdramatized it, they generally do so it is now getting an overreaction.
Take troops out of Syria and send them to the Southern Border?
In Syria we are still fighting an oppressive regime as well as the remnants of ISIS both of which represent real threats to our National Security or the security of our close allies.
On the Southern Border we are dealing with potential service industry employees.
Panic over nothing much?
Wednesday, April 4, 2018
Simple Tariff
There's no doubt that some of the rules imposed by the Chinese government requiring in-country partners for access to markets result in the transfer of certain technology.
Its the very point of the program.
To the extent this expertise is stolen and then use to compete with the original company might violate certain provisions of those agreements which seem like a civil matter.
Companies eager for access to the vast Chinese consumer market were easy victims of these deals and they should have realized what they were getting themselves into.
I think they did.
I could certainly see us prohibiting any products here that infringe on copyrights or patents, but the real issue is that these products are sold in China.
That would require the Chinese court system to stop them and that is unlikely.
Imposing tariffs that end up costing consumers isn't really much of a solution.
Even worse they impose tariffs that hurt our producers.
The trade deficit with China and many other countries is to a large extent the result of our great prosperity in comparison to most of the world.
Other countries like China and India, among others, are simply cheaper places to produce goods because they have much lower labor costs.
Tariffs aren't going to change that.
They will just increase the cost of a lot of products and reduce our exports as the retaliatory tariffs hurt our producers.
Its all more complex than that, but we aren't dealing well with complexity in this country now-a-days.
Its the very point of the program.
To the extent this expertise is stolen and then use to compete with the original company might violate certain provisions of those agreements which seem like a civil matter.
Companies eager for access to the vast Chinese consumer market were easy victims of these deals and they should have realized what they were getting themselves into.
I think they did.
I could certainly see us prohibiting any products here that infringe on copyrights or patents, but the real issue is that these products are sold in China.
That would require the Chinese court system to stop them and that is unlikely.
Imposing tariffs that end up costing consumers isn't really much of a solution.
Even worse they impose tariffs that hurt our producers.
The trade deficit with China and many other countries is to a large extent the result of our great prosperity in comparison to most of the world.
Other countries like China and India, among others, are simply cheaper places to produce goods because they have much lower labor costs.
Tariffs aren't going to change that.
They will just increase the cost of a lot of products and reduce our exports as the retaliatory tariffs hurt our producers.
Its all more complex than that, but we aren't dealing well with complexity in this country now-a-days.
Tuesday, April 3, 2018
Debt
Economies run along fairly smoothly at times, as long as their is a level of trust that tomorrow will be similar to today.
This means there is widespread belief that bills will be paid, items will retain value and credit can be extended.
Credit is to a large extent what economies depend on, since without it we would have to satisfy all our obligations when they happen.
Credit is of course also a dangerous thing when you use more of it than you can afford.
The obligation to pay in the future requires income in the future, enough income to cover current requirements and credit payments.
Many companies and individuals can't afford to do that without getting additional credit.
In fact that's the situation the United States is in.
To pay the notes and bonds coming due it has to borrow more money, which it promises to pay in the future.
Our debt has been rising since the Clinton years, the last time we had a budget surplus. With the recent tax cuts and spending increases it is increasing much faster.
Right now there are plenty of buyers willing to buy our debt, its still considered safe, but how long is that going to last?
Let's be clear. Ultimately, the debt can be paid since we control the value of our money.
It is still something of a house of cards since if uncertainty enters, interest rates will rise, making the debt more expensive, creating more uncertainty, causing interest rates to rise, etc. etc.
You see this happen to companies (Toys-r-Us) fairly frequently where the downturn in their business wasn't by itself enough to ruin them, but the high debt levels were.
We could be fast approaching a tipping point as we see trade wars added to a situation where less taxes are being collected while spending increases.
Maybe not yet, maybe.
This means there is widespread belief that bills will be paid, items will retain value and credit can be extended.
Credit is to a large extent what economies depend on, since without it we would have to satisfy all our obligations when they happen.
Credit is of course also a dangerous thing when you use more of it than you can afford.
The obligation to pay in the future requires income in the future, enough income to cover current requirements and credit payments.
Many companies and individuals can't afford to do that without getting additional credit.
In fact that's the situation the United States is in.
To pay the notes and bonds coming due it has to borrow more money, which it promises to pay in the future.
Our debt has been rising since the Clinton years, the last time we had a budget surplus. With the recent tax cuts and spending increases it is increasing much faster.
Right now there are plenty of buyers willing to buy our debt, its still considered safe, but how long is that going to last?
Let's be clear. Ultimately, the debt can be paid since we control the value of our money.
It is still something of a house of cards since if uncertainty enters, interest rates will rise, making the debt more expensive, creating more uncertainty, causing interest rates to rise, etc. etc.
You see this happen to companies (Toys-r-Us) fairly frequently where the downturn in their business wasn't by itself enough to ruin them, but the high debt levels were.
We could be fast approaching a tipping point as we see trade wars added to a situation where less taxes are being collected while spending increases.
Maybe not yet, maybe.
Monday, April 2, 2018
Skill vs Luck
Well China imposed some tariffs on American products and we are seeing the beginning of the harmful trade war that ultimately will hurt us.
Many of the products involved are agricultural and will hurt the heartland, where a lot of people just vote republican.
It seems that China is just demonstrating what it could do as it didn't hit some the biggest trade items, like soybeans.
The odds are though that this will just escalate considering the fact that we don't have a coherent policy.
The net impact will be increased prices and less overall jobs, even if they create a few jobs in the steel or aluminum industries, since the increased cost will lead to reduced sales (demand).
Now of course, we see some American exports threatened which might reduce production and once again less jobs.
These type of impacts are complex and sometimes hard to calculate until they happen as sometimes what seems like a minor factor becomes a critical one.
We know this is too complex for the man in charge so he makes his decisions based on the most simplistic data, which is still sometimes too complex for him.
One hypothetical but possible scenario that should be considered is when our steel and aluminum get more expensive because of the tariffs do we lose export sales to countries still getting the lower costs? Well of course we do.
If an American made product costs more than say a Japanese or German one, why would someone but the American one?
It may in fact make imported end products cheaper here, depending on how the tariffs are calculated.
Lots of complex economic issues involved, which means we didn't do any of them.
Pray for luck, we don't have any skill happening there.
Many of the products involved are agricultural and will hurt the heartland, where a lot of people just vote republican.
It seems that China is just demonstrating what it could do as it didn't hit some the biggest trade items, like soybeans.
The odds are though that this will just escalate considering the fact that we don't have a coherent policy.
The net impact will be increased prices and less overall jobs, even if they create a few jobs in the steel or aluminum industries, since the increased cost will lead to reduced sales (demand).
Now of course, we see some American exports threatened which might reduce production and once again less jobs.
These type of impacts are complex and sometimes hard to calculate until they happen as sometimes what seems like a minor factor becomes a critical one.
We know this is too complex for the man in charge so he makes his decisions based on the most simplistic data, which is still sometimes too complex for him.
One hypothetical but possible scenario that should be considered is when our steel and aluminum get more expensive because of the tariffs do we lose export sales to countries still getting the lower costs? Well of course we do.
If an American made product costs more than say a Japanese or German one, why would someone but the American one?
It may in fact make imported end products cheaper here, depending on how the tariffs are calculated.
Lots of complex economic issues involved, which means we didn't do any of them.
Pray for luck, we don't have any skill happening there.
Sunday, April 1, 2018
White House Parrot
It is amazing how wrong the tweets issued by the Dontard can be, especially since he relies on a show that has little connection to real anything.
Its perfectly acceptable for people to voice opinions on a cable entertainment channel, we are in favor of free speech, but if you simply believe whatever they say, without realizing they are pushing certain agendas, well that's on you.
Amazon and the post office have agreements which are in the best interests of both companies.
Amazon because of its size can insert packages for delivery at the last stage, bypassing the rest of the mail distribution system, so the cost of delivery is much less than the average cost of a regular package.
Of course some commentators will compare the higher number to what Amazon pays and distort the deal, which is clearly helping reduce the post offices losses on its other services.
Naturally, instead of relying on any facts, the Dontard simply repeats bad information.
Similarly he attacks pardons given out in California by the Governor, relying on bad information.
This is just mean spirited as the people involved did obviously break the law, albeit years ago, but despite the fact that they served their time and were now law abiding the prior convictions made them subject to deportation.
The pardons make that less likely and allow them to pursue citizenship.
The Governor of the state gets to make this decision and who cares what the Dontard thinks about it?
He is really just a parrot about a lot of this anyways.
Its perfectly acceptable for people to voice opinions on a cable entertainment channel, we are in favor of free speech, but if you simply believe whatever they say, without realizing they are pushing certain agendas, well that's on you.
Amazon and the post office have agreements which are in the best interests of both companies.
Amazon because of its size can insert packages for delivery at the last stage, bypassing the rest of the mail distribution system, so the cost of delivery is much less than the average cost of a regular package.
Of course some commentators will compare the higher number to what Amazon pays and distort the deal, which is clearly helping reduce the post offices losses on its other services.
Naturally, instead of relying on any facts, the Dontard simply repeats bad information.
Similarly he attacks pardons given out in California by the Governor, relying on bad information.
This is just mean spirited as the people involved did obviously break the law, albeit years ago, but despite the fact that they served their time and were now law abiding the prior convictions made them subject to deportation.
The pardons make that less likely and allow them to pursue citizenship.
The Governor of the state gets to make this decision and who cares what the Dontard thinks about it?
He is really just a parrot about a lot of this anyways.
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