patrick.net

Peter P says

Quigley says

Actually a lot of "educated" people are retraining blue collar so they can get decent jobs. I know that applies to me. I went from a $40k job to a $150k job by switching to blue collar.

Software can replace white collar workers way faster than robots can replace blue collar workers.

Still, it's a race against time. In another generation, most work, white or blue collar, will be automated.

Rin says

Still, it's a race against time. In another generation, most work, white or blue collar, will be automated.

Absolutely. But the perhaps oldest profession will be affected last. :-)

yodaking says

Now of course, Economics not being a natural science is open to debate - so I know there are no 'absolutes.' - I thought it was common knowledge that the majority of economist's view protectionism (and the overhead it brings) has a net deficit to the citizenry of the country.

OK--getting back to my question then--did you factor in the loss of income on the consumers who lose their jobs?
yodaking says

Of course no policy is Utopian, we are human after all and jobs theoretically lost, but you discount the jobs created as well. Again, we cannot fiddle with micro and discount the overall macro - It would be on par if I brought up Juche as a criticism of isolationism - an unfair assessment.

The jobs are created overseas--how exactly does that help US workers in the micro or macro?

yodaking says

As for your query: "Really? Re-educate them for what exactly? Are there lots of educated jobs that are going unfilled??"

Yes, there are:

Source: US News 10/30/2014

http://www.usnews.com/news/articles/2014/10/30/thousands-of-middle-skill-jobs-unfilled-in-new-york-city

10K jobs is a drop in the bucket.

sbh says

Why don't you reflect on our Patnet STEM brethren who put the lie to this:

http://patrick.net/?p=1245248

SBH - the chart that was displayed was 3 years outdated - in the midst of the "Great Recession" - of course it will face pressure -- all jobs did.

Here is data as of 2013 (2014 saw even greater rises in wages in STEM) but BLS is still catching up.

2013
http://www.bls.gov/opub/btn/volume-3/an-overview-of-employment.htm
$79,640

http://www.bls.gov/opub/mlr/2011/05/art1full.pdf
$77,880K

Quigley says

Actually a lot of "educated" people are retraining blue collar so they can get decent jobs. I know that applies to me. I went from a $40k job to a $150k job by switching to blue collar.

Definitely, especially if you combine this with entrepreneurship of a 'blue collar" tasks.

tatupu70 says

10K jobs is a drop in the bucket.

I believe that is just the city of New York - nationwide there is many STEM jobs unfilled.

tatupu70 says

OK--getting back to my question then--did you factor in the loss of income on the consumers who lose their jobs?

The labor market is elastic, all policies outside communism does not guarantee employment. A corporation's main task is to generate profit. At a certain point, X labor * y efficiency will generate z good/service.

Now if domestic labor > off-shore - it is in the best interest for said corporation to offshore (all other things being equal) - However many jobs simply cannot be offshored. For example - the Medical Field (Doctor, Nurse), Local Marketing, Finance (especially the big 4 auditing firms), legal, and entrepreneurship. tatupu70 says

The jobs are created overseas--how exactly does that help US workers in the micro or macro?

If the labor cost generates additional growth for said corporation, other roles domestically will be created. Apple is the best example of this. They 'off-shored' their manufacturing correct?

"Designed in California, Made in China"

Yet did this create 'less' domestic' employees through their growth or more?

Did the savings from offshoring reward current shareholders in the terms of stock buybacks?
(see apple stock chart)

sbh says

At least you started off on topic, but strayed into numbers of jobs created which doesn't have the vaunted effect it's supposed to have on wage growth.

Actually, the % of a person's paycheck that goes into health care is much higher now than say 30 years ago - and this is very real $$$ that a company pays per worker that would otherwise could have gone direct to a worker's pocket. As far as deregulation of the financial industry - it did create the disastrous "Great Recession" - however I believe it's pretty clear that Kenseysian capitalistic policies is what prevented the second Great Depression, and current capitalist policies what is slowly getting us out. Or do you infer that we should have abandoned capitalism to a different economic model?

yodaking says

The labor market is elastic, all policies outside communism does not guarantee employment. A corporation's main task is to generate profit. At a certain point, X labor * y efficiency will generate z good/service.

Now if domestic labor > off-shore - it is in the best interest for said corporation to offshore (all other things being equal) - However many jobs simply cannot be offshored. For example - the Medical Field (Doctor, Nurse), Local Marketing, Finance (especially the big 4 auditing firms), legal, and entrepreneurship

Yes, but that doesn't answer my question unless you think there is enough demand for nurses, marketing, and finance to soak up all the lost jobs in manufacturing.

yodaking says

If the labor cost generates additional growth for said corporation, other roles domestically will be created. Apple is the best example of this. They 'off-shored' their manufacturing correct?

"Designed in California, Made in China"

Yet did this create 'less' domestic' employees through their growth or more?

Clearly less.

yodaking says

Did the savings from offshoring reward current shareholders in the terms of stock buybacks?

(see apple stock chart)

Of course. And that's one big reason for widening wealth disparity in the US.

You've shown exhibit A and exhibit B why offshoring is bad for the US. So, tell me again why it's good?

sbh says

nor worry the efficacy of the divergent course our FED took as compared to the ECB

How is this divergent?
http://www.bloomberg.com/news/2014-12-04/draghi-says-ecb-will-reassess-stimulus-measures-early-next-year.htmlsbh says

Or maybe you should abandon your complaint.

What complaint is that?
sbh says

immediately evidencing unmet labor demand,

Are those articles false?

Simple exercise - go to www.indeed.com - there are over 1/2 a million jobs posted in the last 7 days.

Are you inferring these are all fake jobs?

tatupu70 says

Yes, but that doesn't answer my question unless you think there is enough demand for nurses, marketing, and finance to soak up all the lost jobs in manufacturing.

well, yes.

Just taking healthcare by itself (nevermind the other industries I mentioned)
Source: Bureau of Labor Statistics

http://www.bls.gov/news.release/ecopro.nr0.htm

15.6 Healthcare jobs in the next 10 years - that's an annualized rate of 1.5 Million

The US lost about 6 Million factory jobs
Source:
http://www2.itif.org/2012-american-manufacturing-decline.pdf

Again, I'm just counting the healthcare industry - count the other industries and you've more then made up the loss.

Also more manufaturing jobs are experiencing are turn

tatupu70 says

Clearly less.

Actually Clearly More.

not just in America too (here they went from 10,000 to 50,000 in the last 10 years
https://www.apple.com/about/job-creation/

But worldwide
http://www.statista.com/statistics/273439/number-of-employees-of-apple-since-2005/tatupu70 says

Of course. And that's one big reason for widening wealth disparity in the US.

You've shown exhibit A and exhibit B why offshoring is bad for the US. So, tell me again why it's good?

I think the main reason for the widening wealth disparity is you have a population of highly educated professionals and those that were victims of our public school system.

yodaking says

Actually Clearly More.

not just in America too (here they went from 10,000 to 50,000 in the last 10 years

https://www.apple.com/about/job-creation/

But worldwide

http://www.statista.com/statistics/273439/number-of-employees-of-apple-since-2005/tatupu70 says

Well, we're talking about the US, not the world. Obviously, there are more jobs overseas.

Sure, Apple employs more people in the last 10 years, but that's not a fair comparison. How many jobs were lost in Apple competitors in the US? We're talking net jobs in the US.

yodaking says

I think the main reason for the widening wealth disparity is you have a population of highly educated professionals and those that were victims of our public school system.

Were public schools better in the 1970s? What happened in 1980 to reverse the trend of shrinking disparity and change to increasing disparity?

yodaking says

From my study of basic economics, protectionism is bad on the long term for consumers

You mean, like when they lose their job?

CaptainShuddup says

Just a little known fact, Libs deny.

Exactly what are you accusing liberals of this time?

“If you buy a T-shirt made in China for $4-5 cheaper than you can get here, you will eventually put the American T-shirt company out of business.”

We don't need Americans making t-shirts. We need Americans making
- software
- hardware
- biotech
- nanotech
- machinery

You know 21st century stuff. Exactly the kind of tech that gets outsourced to China and India.

But if you're going to blame someone for getting rid of low-tech good production like clothing, blame Walmart. They rose to power jacking off to the "Made in America" meme and then stocked only "Made in China" goods once they got power and money. Walmart is exactly what your beloved Fox is bitching and moaning about.

Dan8267 says

We don't need Americans making t-shirts. We need Americans making

- software

- hardware

- biotech

- nanotech

- machinery

Also, excellent furniture. Most of ours are made in USA or Canada. They are not much more expensive than particle-board crap.

We need to hire north korean hackers to take down the chinese t-shirt factories....bring back the cloth to the homeland.

Dan8267 says

We don't need Americans making t-shirts. We need Americans making

- software

- hardware

- biotech

- nanotech

- machinery

You know 21st century stuff. Exactly the kind of tech that gets outsourced to China and India.

We need to hire north korean hackers to take down the IKEA design centers in Sweden. Bring back sofa whittling to the states...

Peter P says

Also, excellent furniture. Most of ours are made in USA or Canada.

zzyzzx says

You mean, like when they lose their job?

Job loss is part of any capitalist society, the only instance this does not happen is in communism. This comment is a non-sequitur, every policy has positive as well as negative consequences - one cannot evaluate a policy as a net positive only when it yields a utopian outcome -

Our legal system can at times find an innocent guilty - does that mean the legal system is a net negative and should be scrapped in favor of anarchy and frontier justice?

yodaking says

however I believe it's pretty clear that Kenseysian capitalistic policies is what prevented the second Great Depression, and current capitalist policies what is slowly getting us out. Or do you infer that we should have abandoned capitalism to a different economic model?

The Keynesian policies and the associated leverage were the cause of the financial crisis, deregulation played a part as well, but it's negligible. Nothing regulates better than tail risk, but with the cheap money, low interest policy, the bailouts and the non-enforcement of existing fraud laws (= regulation) the tail risk has been and still is completely gone for the FIRE sector. You can paint over a great recession by printing money but in the long run you will make matters worse because math simply is and doesn't lie. You cannot print wealth. The standard of living for the middle class will keep declining as long as they print money. Without the reserve currency status, the petro-dollar and the helplessness of politicians worldwide joining in the global race of currency debasement this charade would have ended quite a while ago.

yodaking says

I believe it's pretty clear that Kenseysian capitalistic policies is what prevented the second Great Depression, and current capitalist policies what is slowly getting us out.

If Keynesian capitalistic policies are grabbing the nearest poorest middle class sap than you by the neck and shaking every last cent from their pocket and putting a dragnet on their finances that skimmed every last red penny from the dissapeard middle class. Then I suppose you're right. But that just means a Keynesian by another name is really just a strong arm heartless thug, and can give two fucks about who lives or dies.

Energy, Food and Healthcare bailed Wallstreet out, which is that stupid fucking thing you assholes like to do with your mouth when YOU call IT "adverting a Great Depression".

And F-Y-Fucking-I The Great Depression was Great because it made great people at the end. This last one would be the fucking "Moron Depression", because a)Morons like you called it a "depression", b)what ever it is, we never got out of it. We weren't "pulled out" of anything. We were "Thrown Under".

CaptainShuddup says

If Keynesian capitalistic policies are grabbing the nearest poorest middle class sap than you by the neck and shaking every last cent from their pocket and putting a dragnet on their finances that skimmed every last red penny from the dissapeard middle class. Then I suppose you're right. But that just means a Keynesian by another name is really just a strong arm heartless thug, and can give two fucks about who lives or dies.

So you would have favored the Government have done nothing? Would the economy be in worse shape or better shape of our markets seized and credit dried up?

***

While the actions did force us to fully surrender to "moral hazard" - the act was largely bi-partisan.

As long as we have Fiat Currency, everything is illusionary anyway - with the ultimate stop-gap as the "Full faith and credit of the United States"

Do I like that our debt has exploded? Hell no...

Do I like that the Fed has a crazy inflated Balance Sheet? Nope

But inflation is low and unemployment is going down - that's the Fed's Mandate no?

Would this have future repercussions? You Bet, I'm not naive to think the bill will come in (sooner rather than later)- but I do know having stabilized the economy puts us on much better footing to tackle our debt then one that would have no doubt been in a depression.

yodaking says

Job loss is part of any capitalist society, the only instance this does not happen is in communism. This comment is a non-sequitur, every policy has positive as well as negative consequences - one cannot evaluate a policy as a net positive only when it yields a utopian outcome -

Our legal system can at times find an innocent guilty - does that mean the legal system is a net negative and should be scrapped in favor of anarchy and frontier justice?

That's a good point. So, how do you think the positives of a free trade policy (lower prices) outweigh the negatives (unemployment and increased wealth disparity)?

News flash: loose monetary policy is not a tenet of Keynesian thought. Loose fiscal policy during GDP growth is also not a tenet of Keynesianism.

Thanks for you time!

sbh says

mell says

The Keynesian policies and the associated leverage were the cause of the financial crisis, deregulation played a part as well, but it's negligible.

Basically you think EVERYTHING BUT the free-market was to blame. Typical.

Actually in a mind-bending sort of "snake eating his tail" I agree partically with Mell - Many people (including myself) tried to understand the 'root' cause of the Great Depression. The consensus I've seen and agree with is it was not any ONE reason - like many great disasters it was the confluence of multiple factors that formed a "perfect storm"

Some Keynesian components that contributed were:

Greenspan keeping interest rates too long after 9/11
GSAs making good ol' uncle same the last guy holding the bag for companies such as Freddie Mae/Fannie Mac/etc
Government programs mandating banks lend to 'disadvantaged' groups
Tax Subsidies for Mortgages

I by no means am saying that these are the *only* reasons or even the *main* reasons - again it was the coming together of many factors - but mell is right that some Keynesian policies definitely contributed.

yodaking says

So you would have favored the Government have done nothing? Would the economy be in worse shape or better shape of our markets seized and credit dried up?

Objection you're leading the witness again. You led the witness the last time and this is what we got.

There's a million ways that could have played out and "Doing nothing" would have been the best option in retrospect for a myriad of reasons. For starters what was done was the best thing depending on how you look at it, and who you ask. For everyone that benefited marginally there are ten times that lost substantially. We have had not had middle class growth by any stretch of the imagination. And that has been the only barometer that America can be measured on.

Just one of the thousands of arguments I could make for "Doing nothing" or at least "Something else" is as the following.

If we didn't do anything and we allowed everyone to take their lumps like should have happened. The result would have been carnage and devastation. Like many had anyway. See I don't give a fuck about those companies who's lowest paid employees were making 150K a year.

The houses and assets didn't go away, neither did the business needs of all of those companies. The government if they were looking for any to benefactor, then small business or at least new players should have been created by chopping up the carcasses and distributing out the divisions and departments, and assets to the highest bidder backed by federal loans. Let a new batch take a turn. At least people would have been producing. The only creative way people have been producing in this government protected industry controlled environment has been to seek rent off of those that least afford it.

That's just one, I could think of a million ways that would have been better than watching what played out since 2007 to now that would have been better. I'm so happy OPEC is pulling the plug, you're about to see just how much Obama bailed anyone out, and just how much they benefited.
This time next year, your going to be hobnobbing with a lot of has beens that used to think they had the world by the balls, because gas was $4.00 a gallon.

tatupu70 says

yodaking says

Job loss is part of any capitalist society, the only instance this does not happen is in communism. This comment is a non-sequitur, every policy has positive as well as negative consequences - one cannot evaluate a policy as a net positive only when it yields a utopian outcome -

Our legal system can at times find an innocent guilty - does that mean the legal system is a net negative and should be scrapped in favor of anarchy and frontier justice?

That's a good point. So, how do you think the positives of a free trade policy (lower prices) outweigh the negatives (unemployment and increased wealth disparity)?

Great question, the only way to tackle unemployment is to support pro-business policies - that means reforming our tax code, lowering regulation, (yes, even environmental), and embrace not isolate oneself from the global economy.

Please refrain from ad-hominem attacks on how I hate the environment and hate workers etc.

As far as the wealth gap - only education can equalize that - our current school system is not properly equipping our population for the new economy....and I am no way insinuating that lack of money/funding is the *only* cause for this as is often repeated.

CaptainShuddup says

Objection you're leading the witness again. You led the witness the last time and this is what we got.

I have no love for what happened, but I see this as Monday morning quarterbacking. It sucks that we effectively socialized loss and privatized profit. I get it - but that frustration doesn't change the fact that many of the bailouts were for firms that serve as the 'grease' for our economy. Whether one likes it or not.

Yes, it's wrong that all these Wall Street guys got 'rewarded' for being stupid. It's the opposite of how things should work - I think everybody can agree with that. But I truly believe that if we didn't bail out Wall Street - main street would be in *much* more pain.

Can I prove my assertion? No. This is just my opinion. I don't have an alternate reality machine that can play my theory out. So while I hate what happened, I do by and large agree with the general bailouts instituted by not only Bush, but Obama.

yodaking says

but that frustration doesn't change the fact that many of the bailouts were for firms that serve as the 'grease' for our economy.

Example?

We hear that shit, but let's put it to the test.

HydroCabron says

News flash: loose monetary policy is not a tenet of Keynesian thought. Loose fiscal policy during GDP growth is also not a tenet of Keynesianism.

Thanks for you time!

I disagree,
Source:
https://en.wikipedia.org/wiki/Keynesian_economics

"Keynesian economists often argue that private sector decisions sometimes lead to inefficient macroeconomic outcomes which require active policy responses by the public sector"

Governmental interaction (public sector) and either (dovish or hawkish) as Keynesian

CaptainShuddup says

Example?

We hear that shit, but let's put it to the test.

Were you asleep all of 2008?

http://www.nytimes.com/2008/10/01/business/01auto.html?_r=0

yodaking says

Governmental interaction (public sector) and either (dovish or hawkish) as Keynesian

Keynes explicitly warned against stimulus during expansionary times - those periods of GDP growth which I referred to above.

Can you read?

yodaking says

Great question, the only way to tackle unemployment is to support pro-business policies

It doesn't have to mean Big business policies. Nor does it mean we should "Big Business" every aspect of life from the water you drink to the air you breathe.

I think we're saying the same thing. I'm just saying we need far more benefactors, for our economy to have rebounded as much you intend to give the false illusion that it did. What monopolies the current policy didn't create, they created new ways to necessitate new titles and roles with new appointed monopolies to service the voids, without actually creating jobs. The jobs as well as the people who didn't have one, just simply "Went away". Poof! vanished we don't even talk about them anymore. As their fresh baked self date expires our unemployment rate dropped. That's hardly anything to give any credit for as an achievement.

The government could have wrote Goldman Sachs a trillion dollar check or wrote out many million dollar checks to thousands of Goldman Sachs wanna bees, who have to restaff, retrain, reboom and reboot the economy.

If you give all the money to same evil bastards that caused this mess then they'll just take it and slither away to their cesspool and sit on it and let it rot. Or do something corner the Oil market and create undetectable inflation that the FED with all of their super powers will never notice.

HydroCabron says

yodaking says

Governmental interaction (public sector) and either (dovish or hawkish) as Keynesian

Keynes explicitly warned against stimulus during expansionary times - those periods of GDP growth which I referred to above.

Can you read?

The question is *can you* read?

Keynes advocated what has been called countercyclical fiscal policies, that is, policies that acted against the tide of the business cycle: *deficit spending* when a nation's economy suffers from recession or when *recovery is long-delayed and unemployment is persistently high*

Source: https://en.wikipedia.org/wiki/Keynesian_economics#Active_fiscal_policy

Your comment only makes sense if you are argueing that our unemployment is in good shape.

Your assertion that Keynes advocated spending to mirror GDP growth is largely simplistic.

yodaking says

Great question, the only way to tackle unemployment is to support pro-business policies - that means reforming our tax code, lowering regulation, (yes, even environmental), and embrace not isolate oneself from the global economy.

I disagree 100%. Lower taxes lead to higher profits, but not one job more. Companies don't hire because they make more money--they hire to meet demand. Lowering regulation is a race to the bottom--you have to agree that's not the correct policy decision. What does "embracing" the global economy mean exactly?

yodaking says

Please refrain from ad-hominem attacks on how I hate the environment and hate workers etc.

Of course. I don't know how you feel about the environment other than you seem to advocate policy decisions that would harm it.

yodaking says

As far as the wealth gap - only education can equalize that - our current school system is not properly equipping our population for the new economy....and I am no way insinuating that lack of money/funding is the *only* cause for this as is often repeated.

I believe more people are getting a college education than ever before. While the education gap (rich to poor) reflects the general wealth gap--it's a symptom not the root cause.

yodaking says

Your comment only makes sense if you are argueing that our unemployment is in good shape.

Here is what I said: " Loose fiscal policy during GDP growth is also not a tenet of Keynesianism."

I am not discussing our current economic situation, because it is not a period of job growth. I wasn't even thinking of the present.

I was only saying that fiscal stimulus during a time of GDP growth is not a Keynesian tenet.

The end.

yodaking says

Greenspan keeping interest rates too long after 9/11

GSAs making good ol' uncle same the last guy holding the bag for companies such as Freddie Mae/Fannie Mac/etc

Government programs mandating banks lend to 'disadvantaged' groups

Tax Subsidies for Mortgages

I don't think any of those are Keynesian. The early and mid 2000s were a good time economicially--Keynes would have advocated reduced spending, not increased.

Does Keynes say anything about advocating home ownership?

Regardless---if you truly think government programs mandating banks lend to disadvantaged areas had ANYTHING to do with the housing bubble then you are much less learned than I thought.

yodaking says

the only way to tackle unemployment is to support pro-business policies - that means reforming our tax code, lowering regulation, (yes, even environmental),

There have been periods of tremendous economic expansion in places with heavy environmental regulations. Job and wealth creation is never a reason to sacrifice public health.

tatupu70 says

Regardless---if you truly think government programs mandating banks lend to disadvantaged areas had ANYTHING to do with the housing bubble then you are much less learned than I thought.

This forum is admittedly tiring me out.

Source:
http://www.nber.org/digest/may13/w18609.html

Btw NBER is non-partisan and is used by both sides of the political aisle to determine when recessions start/end.

yodaking says

This forum is admittedly tiring me out.

You and me both. That link is weak at best--as it's a summary with no link to the actual paper. It uses a period from 1999 to 2009 and purports to show that loans in CRA areas are 15% more likely to default in 1 year. Even if that's true, which I don't believe to be the case, it has no bearing on the housing bubble. I would hope that you would agree that the housing bubble and bust were not primarily for houses in areas subject to the CRA. And I would hope that you would also agree that the biggest drivers of the mortgage fraud were S&Ls that are not even subject to CRA regulations.

tatupu70 says

You and me both. That link is weak at best--as it's a summary with no link to the actual paper. It uses a period from 1999 to 2009 and purports to show that loans in CRA areas are 15% more likely to default in 1 year. Even if that's true, which I don't believe to be the case, it has no bearing on the housing bubble. I would hope that you would agree that the housing bubble and bust were not primarily for houses in areas subject to the CRA. And I would hope that you would also agree that the biggest drivers of the mortgage fraud were S&Ls that are not even subject to CRA regulations.

I actually think the Great Recession was a combination of factors - that's what makes anybody claiming they "know" what caused it right and wrong at the same time.

1) Low Interest Rates
2) Greed by Wall Street
3) Lower requirements for getting a loan
4) Mortgage Fraud
5) Exotic Loans
6) CDS
7) MBS
8) GSE
9) Credit Rating Agencies
10) Repeal of Glass Stealgal
11) 2000 Omnibus Bill
12) CRA
13) Home Equity Loans
14) Bankruptcy of Lehman (no structured buyout like Bear Stearns)
15) Predatory Lending
16) Little to no down payments
17) Consumer borrowing - home equity loans/home equity extraction

I think it was truly a 'perfect' storm of events - with truly no 'one' or even 'main' reason - a real confluence of multiple factors. That's what made it so extraordinary. Wall Street has been doing shenanigans since the 1920's - and it will continue to do so...