Friday, October 7, 2016
Since this blog is most definitely not an election-free zone:
You can add "lack of endorsements" to "he goes out of his way to piss off nonwhite nonmale voters" and "he hasn't raised a penny of money that's not his own" and "he doesn't have a ground staff manning phones for him" and "he doesn't know when to stop digging a hole" as reasons why I don't think this election is even remotely a close call.
Those 5 things, above, are simply the opposite of what you do when you campaign for political office. I'm sorry, Bob Lefsetz, but politics isn't Apple, and Trump isn't transforming & transcending the 20th century.
Here's some reading for you on a Friday afternoon.
New Deal Demoncrat - indian summer. Data is still positive. Though I still wouldn't be surprised to see the SPY fall 10% in the next little while, although then again I'm sure everyone else is saying that right now too. Frankly, the market is populated with panty-piddlers.
Tim Duy - hard to say that November is really "live". He sees through all the crap so you don't have to!:
Of course she wants November to be "live." She wanted to hike rates at the last meeting. And I suspect she believes that unless the hawks can push up rate hike expectations to something closer to 50% (from the current 13% or so), they have no chance of pushing through a rate hike. Not that I think they have much of a chance even then. Seems that his amounts to trying to manipulate market expectations to obtain an advantage at the FOMC meeting. I sense this is what hawks have attempted more than once this year. In my opinion, this too is not a good communications strategy.Basically, the November talk boils down to silly infighting, and you can ignore it from now on. And it's also counterproductive to Fed expectations management, since the more the hawks talk about it, the more they destroy their own credibility. Especially, I might add, when their dots on the dot plot have continuously proven them to be clueless idiots with utterly no idea what's coming even three months from now.
NY Times - why are politicians so obsessed with manufacturing? Precisely:
Manufacturing retains its powerful hold on the American imagination for good reason. In the years after World War II, factory work created a broadly shared prosperity that helped make the American middle class. People without college degrees could buy a home, raise a family, buy a station wagon, take some nice vacations. It makes perfect sense that voters would want to return to those times.The "let's bring back manufacturing!" refrain is just an illusion spun by the kleptocrats who want to turn your attention away from the real problem: worker's wages have stagnated, not because of Mexican immigrants or Chinese competition, but because politicians have spent the past 35 years skewing the tax and legal system against workers while waging constant attack on unions, minimum wages, overtime pay, or even defined-benefit pensions.
From an economic perspective, however, there can be no revival of American manufacturing, because there has been no collapse. Because of automation, there are far fewer jobs in factories. But the value of stuff made in America reached a record high in the first quarter of 2016, even after adjusting for inflation. The present moment, in other words, is the most productive in the nation’s history.
Basically, manufacturing workers are suffering because of 35 years of right-wing class war. Anyone who tells you otherwise is a liar.
But no, you go ahead and keep reading that Gary Wordsalad twit who calls the nonexistent "manufacturing collapse" a sign of the nation's impending apocalypse - and then suggests you buy AMAT which has moved its operations to China.
Polemic's Pains - noise signal in the Pound. There's nothing like a good hit of sarcasm to get the blood flowing:
Oh look, the Pound is at levels not seen since the last time and the FTSE is at a number.That outdoes anything I've ever written. +1 internets!
Tuesday, October 4, 2016
I've got my first calc midterm today, so I'm just going to spend a bit of time online. In fact, I have another midterm on Thursday, then next week I have off but I'll have to spend it studying like nuts for 3 midterms when I get back, so I'll be quite busy for a bit.
Meanwhile, for those who said it could never happen....
Tim Taylor - China flexes toward consumption. Quote:
Nie and Palmer discuss the evidence from economic research on what caused China's consumption to fall so low, and whether the modest rise of the last few years seems likely to continue. They focus on a few factors that have been evolving over the decades: the age distribution and "dependency ratios" in China's population, the trend to urbanization, and China's housing boom since around 2000--which is about when the consumption/GDP ratio plummeted even lower. I'd summarize their story this way.
The "dependency ratio" refers to what share of the population is either too young or too old to work, as opposed to being working age. The dependency ratio and consumption tend to rise and fall together. Thus, the dramatic fall in birthrates in China as a result of economic growth (and greater education and incomes for women) along with the one-child policy meant a lower dependency ratio. Basically, fewer children means less consumption spending on children, and more saving.
China has seen a dramatic rise in urbanization. As Nie and Palmer write: "Over the past five decades, the share of China’s population living in urban areas has more than tripled, rising from 18 percent in 1960 to 56 percent in 2015." The common pattern is that people moving to urban areas in emergin economies increase both their production and their consumption, but they increase production by more, and so their rate of saving rises.
Nie and Palmer look at patterns of dependency ratios and urbanization across a "sample of 24 countries including most Asian countries and large developing countries." Based on the common patterns, they find that China's fall in consumption/GDP ratio from 1970-2000 is almost completely explained by changes in its dependency ratio and urbanization.
More at the link, read it.
I'd like to add that the reason consumption was so "low" a share was because investment in infrastructure and capital was so high. Which is why today Chinese megacities aren't ringed by massive slums.
It helps to actually know some economics.
Gold breaks below the summer's support level, and now it looks like GDX might drop a good deal of the way, because Whitey has no commitment to gold stocks after all.
Look at it on the bright side... you'll be able to buy all the B2Gold you want at $1.80 in a few weeks.