patrick.net

marcus says

Yes, ideally nobody would even remember that markets can go down.

Markets are a function of a business cycle and a business cycle tracking is much different than big demographic stories, Japan is a great example of this... But I stress always..

U.S.A. is a freak of nature because it had a immigration boom for decades giving it a productive advantage edge .. hence why it's 324 Million can still be ahead of China's over 1.3 Billion

There are a lot of workers in the world putting downward pressure on wages, higher paid American workers have to compete with labor in cheaper parts of the world. This should make "stuff" less expensive.

At the same time we have the wealthy with huge amounts of capital, looking to invest rather than stay in cash. It seems like simultaneous inflationary and deflationary forces. Inflationary forces for financial assets and rentable property. Deflationary forces from workers that don't have much money to spend. Also deflationary forces from excessive amounts of debt still out there). The question is, how long can that continue ? (without prices literally going down ?)

I don't see why your demographics story answers that question. Are you predicting inflation ? And if so, will interest rates keep up ? Or will real interest rates go negative ? And if they do, what would that mean for financial assets ? I think it would simply lead to a rapid acceleration of wealth into the hands of the few, as people with good enough credit borrow money at interest rates lower than the rate at which prices are going up ? Such craziness could not go on for long. Who can realistically lend in such an environment ? What would happen if inflation kicked in and real interest rates were allowed to stay at say 2 or 3% ? That would at some point cause an exodus out of equities.

At least I know that I don't know. These are just the idle ramblings of someone that doesn't make his living trying to know what's going to happen with the economy. But at one time, I was in that situation. Actually even then, I knew that I didn't know.

Real wages have been growing for decades, only conditioned to think other wise

marcus says

(without prices literally going down ?)

Inflation has been rising for decades just split up in different categories but core as always been growing

PCE and Core have been deviating from each other over time, that is the big change

Logan Mohtashami says

Inflation has been rising for decades just split up in different categories but core as always been growing

So therefore real incomes (purchasing power) is dropping. What gives ? To what extent does consumption drive the economy ? Will there be a tipping point ? I guess there's always home equity loans to pay off credit cards. What's next after that ?

Logan Mohtashami says

So therefore real incomes (purchasing power) is dropping. What gives ?

U.S. consumption are at a world historic high today

Consumption itself still has a demographic factor in it

Older people don't consume like they did when they were young

So the countries all over the world will have to deal with this reality

The demographic wars are here already and in this war.. we have an edge over everyone that is a big country

Logan Mohtashami says

U.S. consumption are at a world historic high today

That wasn't my question. Who's talking about the past here ?

marcus says

So therefore real incomes (purchasing power) is dropping. What gives ? To what extent does consumption drive the economy ? Will there be a tipping point ? I guess there's always home equity loans to pay off credit cards. What's next after that ?Have we seen this movie ?

marcus says

That wasn't my question. Who's talking about the past here ?

I just gave you the model of consumption

It's labor force growth ...

In fact we are going to kick the worlds ass so bad that I expect another waive of immigration ...here in the U.S.

Our wealth is bigger than all the countries total GDP put together .... which is why I say don't worry about debt ... those with the highest nominal debt have the highest incomes and assets

The lower class, least education and skill that group needs wage inflation to keep up with the cost of living ...

Just remember, when the country doesn't have a deflationary collapse or a horrible recession, you all know why it never happened

2007 was a peak prime age labor force year, unlike the 1980's and 1990's and this in a few years will be back positive again.

The counter thesis to mine if I were you guys is that inflation goes a lot higher and leading rates higher ..

But none of you guys believe that ....

So, its a mute point, only time will prove that I am right, I can wait

Also headline payrolls still too high relative to labour force growth,

In fact I am bring down my monthly creation numbers down 60K next year from 190 to 130 low base level

Logan Mohtashami says

mute point

Is that where you just don't say it ? Just kidding.

Actually I think inflation may happen. I know that's what a lot of people would like to cause. "LEt's pay off that debt with dollars that are worth less than the ones that were borrowed." I think that is essentially the reason why so much outstanding debt is deflationary. It's sort of as if all those borrowers are short bonds.

marcus says

Actually I think inflation may happen

Just the first early phase of it, minor blimp from the bottom, though ECI wage inflation for job switchers running at 4.2% now

Logan Mohtashami says

Do you think they invite loan officers to national economic conferences or do nationally housing market previews?

Don't you love it when a guy tries to explain to someone how important he is?

Logan Mohtashami says

Real wages have been growing for decades, only conditioned to think other wise

Okay, this chart doesn't divvy everything up. For all we know this could be a country of one person, who has an army of robots.

As always, you guys have a lot economic theories that haven't panned out

To be honest, you guys can't read data properly, that is your problem, it's because you had no training in this

Wages move with inflation

The baseline theory that this isn't a real thing shows a lack of a economic background

But it's ok ... this isn't what you guys do for a living so it's ok to be off by a lot....

Data Miners vs Anti American Trolls

A battle we want to have.. all part of a bigger plan, each doing their own part...

21 year war...

:-)

#USA

by the way MASI hit $60 bucks

But.. I do get why you guys love cash and ARLP ...

I always respect heavy cycle investment game plan, its shows a lot discipline and patience ... kids these days lack that, always trying to hit a home run

Go for you guys!

These charts are far more clear and direct.

And it's not the UniParty/Globalist/Corpratist Elite's "Education" that is the problem. Low Wage workers are stunningly more educated than in the previous generation.

Amazing what happened when we had a tariff, regulation, unions, and a declining number of foreign born citizens.

thunderlips11 says

This has been one of the most worthless charts ever

This is why the real left is as bad as the real right

They can't read data right

The big movement in productivity came in manufacturing and this is now the smallest work force we have in the U.S.

But output is high

So, the baseline theory is that we wanted a dying employment industry to reverse trends and have 90 million Americans out of work for the sake of producing this chart

3.3 Million workers get paid $7.25 a hour

min wage which was never created to be a primary single work job .. hence why majority are 2nd wage earners with no college education

As always, you can see why the left and right have got it wrong on America

They can't read data properly and they try to manage a low multiplier into a big one

You're going to lose because you're not versed in demographic economics

It's a myth

Low rates isn't a bad thing

Labor force growth matters.... why America is the most power economic force ever... people!

Brazil is tiny compared to us

dollar moving up has minimal impact on us, only oil states

thunderlips11 says

thunderlips11 says

This is a failure of capitalism, plain and simple. If capitalism worked remotely as well as its proponents claim then the median household income today would be $88k/yr based on the information provided in the graphs posted by thunderlips.

Clearly capitalism hasn't worked. Technology, not capitalism, increased productivity 250% since 1950, but today a dual income family barely makes ends meet while in the 1950s a single income allowed people to own their house outright and have a vacation home.

When you realize that capitalism is letting a greedy bunch of parasites control production and distribution -- and has nothing to do with private property rights -- then it comes at no surprise that these greedy parasites screw up the economy for everyone else in order to lock in short term gains for themselves. Capitalism is not the opposite of communism. It's communism with a different nomenclature. Call the party leaders executives and you have capitalism.

Dan8267 says

... today a dual income family barely makes ends meet while in the 1950s a single income allowed people to own their house outright and have a vacation home.

That's dual income, college educated, professionals in most case. Yes, I believe the majority of the parents I have been meeting on return to school are exactly in this boat. Amazing. I am such an anomaly : single income family and a home owner.

I didn't do that off my salary either. I just got stupid lucky in tech (stocks). The new college hires today I don't think have a prayer to have something similar happen to them.

Edit: Loagn's convinced we are all going to be mega rich selling each other coffee and Chinese food though.