What does actually cause mass unemployment in the US?

Fried_Sushi
Fried_Sushi

What does actually cause mass unemployment in the US?

Globalization? Automation? Low demand?

Other urls found in this thread:

brookings.edu/blog/ben-bernanke/2016/04/11/what-tools-does-the-fed-have-left-part-3-helicopter-money/),
bloomberg.com/view/articles/2016-08-05/helicopter-money-is-coming-to-the-u-s).
cato-unbound.org/2009/09/14/scott-sumner/real-problem-was-nominal
themoneyillusion.com/?p=31617
cepr.net/documents/publications/dereg-timeline-2009-07.pdf
econlog.econlib.org/archives/2016/05/the_invisible_h.html
gesd.free.fr/kalecki43.pdf
moslereconomics.com/mandatory-readings/full-employment-and-price-stability/
chicagofed.org/~/media/publications/economic-perspectives/1988/ep-may-jun1988-part2-aschauer-pdf.pdf
dailysignal.com/2014/12/11/omnibus-bill-keeps-welfare-spending-massive-levels/
heritage.org/research/reports/2014/09/the-war-on-poverty-after-50-years
youtu.be/-83nEuXTjBE
youtu.be/-SCB1t28nDU
themoneyillusion.com/?p=27834

Nude_Bikergirl
Nude_Bikergirl

welfare

Crazy_Nice
Crazy_Nice

Bullshit. That's like saying hospitals cause illness.

Sir_Gallonhead
Sir_Gallonhead

antibiotic resistance superbugs evolved in hospitals

Evil_kitten
Evil_kitten

Wow... I've been asleep all my life.

haveahappyday
haveahappyday

I don't work now because of this. Why work when the government will pay me to not work?

likme
likme

Actually it mostly evolved on farms.

Carnalpleasure
Carnalpleasure

The main cause is a lack of spending. Private spending never wuite recovered from the GFC, and the government's reluctant to take on debt.

If the government stopped pretending the debt ever needed to be or would be paid off, and Congress abolished the debt ceiling, it would be pretty easy to get rid of mass unemployment.

TurtleCat
TurtleCat

current year
being this retarded

DeathDog
DeathDog

So you're proposing hardcore Keynesianism?

Say, why doesn't government debt need to be paid back? A lot of debt is held by private corporations and banks, regular people, foreigners, even China.

Sir_Gallonhead
Sir_Gallonhead

Redneck retards and niggers don't want to put any effort into education and want to be paid as much as a surgeon for menial unskilled labor. Asians are the only ones who are pragmatic enough to get degrees and at least spics are okay with being paid 1/4th of the minimum wage.

It's funny watching people jizz their pants when Trump says he's bringing back manufacturing. I don't think they realize they're still going to be out on their asses because American minimum wage is so high, it would be easier to just automate everything and hire one guy, with a degree, to run all the machines. So we'd be getting a handful of new jobs and in return everyone would be paying 20% more for the same stuff.

lostmypassword
lostmypassword

they TOOK MY JOOOB !

hairygrape
hairygrape

I mean, theoretically you could monetize the deficit in a helicopter drop (brookings.edu/blog/ben-bernanke/2016/04/11/what-tools-does-the-fed-have-left-part-3-helicopter-money/), which would eliminate the problem of paying back the debt

TreeEater
TreeEater

Monetarism in practice did it. Full employment isn't good for business because it decreases corporate profitably by driving up wages and makes businesses have to actually compete amongst themselves for labour. Central banks moved away from aiming at maximizing domestic employment in the 1970s towards maximizing the price of financial securities relative to wage levels instead which requires a high rate of unemployment.

The question is can you actually employ everyone profitably without destroying the economy. What would the effect of full employment be on the average rate of return?

If everyone puts effort into education than no one has any economically valuable skills since it's all only relative. If everyone can preform surgery it might make peoples lives better but it would have no real monetary value.

You're right that low wage levels prevent investments in technological innovation from occurring. If you want to spur innovation all you need to do is make it profitable.

Booteefool
Booteefool

Central banks moved away from aiming at maximizing domestic employment in the 1970s towards maximizing the price of financial securities relative to wage levels instead which requires a high rate of unemployment.
B-but why? What for?

And how did they secure full employment in the first place? I mean, we have the lowest interest rates in history, quantitative easing -- and still mass unemployment.

MPmaster
MPmaster

Wouldn't that pave the path for hyperinflation?

I mean, if everyone gets money for free, what is money worth then?

iluvmen
iluvmen

Education.

If you didn't get a good education, you're going to be dumb for life.
Hard to upskill when you don't know how to learn too.

I mean there are exceptions, high IQs, non-institutionalized learning.
But when you're asking some redneck in the ozarks to compete against someone who got an education in a cosmopolitan metropolis, has had access to libraries their whole educational career -- who do you think has the better chance of making something of themselves if they lose their job?

Poker_Star
Poker_Star

we have the lowest interest rates in history, quantitative easing
The goal was to keep inflation of the price of consumer goods positive but manageable, despite the fact that everything has been getting steadily cheaper to produce. Solution: expand the monetary base. This money has to go somewhere though and it's gone into inflating asset (investment assets) prices.

PackManBrainlure
PackManBrainlure

Kinda does, if there weren't any hospitals sick people would just die.

RumChicken
RumChicken

This policy makes sense, since consumer price deflation also means wage deflation and debt deflation.

What implied is that central banks (all around the world, at the same time, apparently) have deliberately chosen to make policies that benefit 1% of the population. Makes no sense to me.

5mileys
5mileys

Well yeah that's the major counter-argument to it since it opens up another can of worms. I'd just be in favor of an NGDP targeting regime with emphasis on QE.

w8t4u
w8t4u

Don't give them the real reason, that's not how we play here

Playboyize
Playboyize

This policy makes sense, since consumer price deflation also means wage deflation and debt deflation.
It does indeed make sense. Though whether or not the policy is sustainable indefinitely is a troubling matter. It's arguable that the crash of 08 was precipitated by the very policy.

May we be digging ourselves into a grave?

PackManBrainlure
PackManBrainlure

Wait wait actually I've been reading into this. This might have something to do with it (bloomberg.com/view/articles/2016-08-05/helicopter-money-is-coming-to-the-u-s).

"Developed-country central banks purchase government securities on open markets, not from governments directly. You might ask: "What’s the difference between the Treasury issuing debt in the market and the Fed buying it, versus the Fed buying securities directly from the Treasury?" The difference is that the open market determines the prices of Treasuries, not the government or the central bank. The market intervenes between the two, which keeps the government from shoving huge quantities of debt directly onto the central bank without a market-intervening test. This enforces central bank discipline and maintains credibility.

In contrast, direct sales to central banks have been the normal course of government finance in places like Zimbabwe and Argentina. It often leads to hyperinflation and financial disaster. (I keep a 100-trillion Zimbabwe dollar bank note, issued in 2008, which was worth only a few U.S. cents as inflation rates there accelerated to the hundreds-of-million-percent level. Now it sells for several U.S. dollars as a collector’s item, after the long-entrenched and corrupt Zimbabwean government switched to U.S. dollars and stopped issuing its own currency.)"

Sharpcharm
Sharpcharm

I don't think low interest rates are guaranteed to cause financial crashes. It took the efforts of. a whole industry of dickheads and the lack of efforts of regulators to do that.

SniperGod
SniperGod

Creating an environment where the only way to not lose 50% of your wealth in a decade is to invest it in assets of questionable value is a fairly good start to guaranteeing a financial crash.

BlogWobbles
BlogWobbles

Inflation wasn't even that high.

LuckyDusty
LuckyDusty

cato-unbound.org/2009/09/14/scott-sumner/real-problem-was-nominal

This explains it pretty well- monetary policy was too tight, not too easy

Low interest rates are typically a sign that money has been tight, as Milton Friedman once said

RumChicken
RumChicken

Maybe it's worth trying. Economists like Summers and Krugman advocate it, but then, they've been wrong on many things.

AwesomeTucker
AwesomeTucker

IMO the creation of a sovereign wealth fund of some sort would probably work better than a helicopter drop and it should really only be used as a last resort

This provides a pretty good perspective on the matter: themoneyillusion.com/?p=31617

Most support for helicopter drops is based on the flawed view that central banks are "out of ammo" given that interest rates are near zero and we had quantitative easing.

FastChef
FastChef

Inflation wasn't even that high.
Depends on what prices you look at

JunkTop
JunkTop

A profitability crises broke out in the 1970s and you had stagflation. This provided the opportunity for a full reorientation of policies towards deregulating the financial sector and the Fed spiked interest rates making long term fixed-capital investments, which actually employ people, look less profitable in comparison to financial speculation. Remember the financial industry was highly regulated until the end of the 1970s. Here's a report by the Center for Economic and Policy Research "A Short History of Financial Deregulation in the United States" showing a overview of these issues:
cepr.net/documents/publications/dereg-timeline-2009-07.pdf
Two important events were:
1978, Marquette vs. First of Omaha – Supreme Court allows banks to export the usury laws of their home state nationwide and sets off a competitive wave of deregulation, resulting in the complete elimination of usury rate ceilings in South Dakota and Delaware, among others
1980, Depository Institutions Deregulation and Monetary Control Act – Legislation increases deposit insurance from $40,000 to $100,000, authorizes new authority to thrift institutions, and calls for the complete phase-out of interest rate ceilings on deposit accounts.

Private debt levels have been exploding; what you have is just an asset-price illusion i.e. people feel that their net worth is rising even when their debt servicing obligations are also rising and the access price to housing and other property keeps on increasing. Inflating real-estate and stocks doesn't only just benefit 1% of the population, it "befits" (or appears to at least) everyone with property or a retirement plan of some sort.

GoogleCat
GoogleCat

this. its a tactic the "gov'ment " puts in order to make population depend on a free "gov'ment" check. when you get paid to do nothing it destroys ambition. ill stop here before i get too NWO-ish

SomethingNew
SomethingNew

I'll take "because welfare doesn't pay shit" for 500, Alex.

askme
askme

The most totalitarian states are far from welfare states. You actually gotta work in places like China if you're going to survive.
Welfare is lobbied for by (smart) businesses because it allows them to pay low wages and get high profits in return. Eliminate welfare or any safety net and profits will begin to fall when you have more people demanding higher wages and not afraid of unemployment and completely pauperised a section of your population who will become a bigger threat.

Methnerd
Methnerd

It's guaranteed to assume that a helicopter drop causes inflation. So the question is whether the increase of economic activity would boost the earnings of people enough to more than make up for this inflation.

And I guess there's no way to prove that, so helicopter money is truly a desperation measure when the inflation target absolutely cannot be reached.

Evilember
Evilember

Oh...? Oh! Yes of course, I meant to say it's the cryptoJews. Like Scarlet Johansson.

SniperGod
SniperGod

Exactly- it should only be pursued if all other measures (quantitative easing, interest rate cuts, etc. etc.) fail to stop deflation.

RavySnake
RavySnake

Wasn't the house price inflation the result of real estate speculation, not the cause of it?

Why would you lose wealth if you sit on your ass whilst your house price rises?

RumChicken
RumChicken

One of the dumbest posts I've ever seen on biz.

You think if great and high paying jobs were available to everyone, anyone would still stick to welfare?

BinaryMan
BinaryMan

The issue is that welfare and other benefits can guarantee a person a comfy enough lifestyle that there isn't enough incentive for them to look for work.

BunnyJinx
BunnyJinx

Every individual bondholder ALWAYS needs to be paid back in full and on time.
Except in the rare cases where it's held by a country that there's sanctions against, in which case payment can be delayed until the issue is resolved.

However, the debt as a whole does not have to be paid off. Old bonds can simply be replaced with new ones.

New_Cliche
New_Cliche

You mean the kind of welfare that makes the government pay private sector workers' wages and benefits, like Walmart? So this allows Walmart to have a higher profit margin?

There's also welfare for the absolutely unemployed and for the elderly. How does that benefit corporations?

Stupidasole
Stupidasole

Not saying I endorse this view, but how would you counter the viewpoint that increased budget deficits have an effect on the market? (pic related)

haveahappyday
haveahappyday

Okay, let's make it more digestible for people like me.

Stagflation breaks out, as result of trying to apply Keynesianism amidst an oil price shock. So you had a wage-price spiral.

This was used as a pretext (???) to start a deregulation program in favor of the financial industry and asset holders. This, (coupled with top rate tax cuts) made inequality in the US skyrocket.

What is still confusing me about this interpretation: even if these deregulations befitted everyone owning assets, half of the population doesn't own any assets at all. And 90% of the population depends on wages as sole source of income. So how could the whole western world adopt policies which undermined wage growth?

idontknow
idontknow

The population that owns assets still affects the segment of the population that owns no assets

Poker_Star
Poker_Star

nosocomial infections

Carnalpleasure
Carnalpleasure

Not necessarily in a positive way... It lowers the ability of the general population to buy houses, stocks and other financial assets to move upwards.

Skullbone
Skullbone

Hyperinflation is nearly always the result of countries holding the currency's official value above market value until they lose the ability to do so. Countries on the gold standard have to be very careful to avoid that situation, but any country with a freely floating currency is almost totally immune from the problem, as the currency's value is self correcting. If there's more money, the currency will devalue a bit, so the country will import less and export more.

It is possible for a country with a floating currency to have hyperinflation if it borrows from its own central bank to make foreign currency repayments, but no country has ever experienced hyperinflation as a result of borrowing from its own central bank to fund domestic spending. Indeed the last time a country with a floating currency experienced hyperinflation as a result of physically printing money purely for domestic spending was in the American war of independence!

Argentina, Venezuela and Zimbabwe were stupid enough to tie their currencies to the US dollar, and Zimbabwe committed economic suicide in several other ways too.

Emberburn
Emberburn

Futures contracts allow employers in the commodity industries to keep blue collar workers employed. There would've been more layoffs in the oil sector without the hedges provided by oil futures, you fucking communist.

Forex hedges allow companies to maintain international presences and protect thousands of jobs that are tied to international commerce across a wide variety of sectors.

being this clueless

ZeroReborn
ZeroReborn

econlog.econlib.org/archives/2016/05/the_invisible_h.html

Hyperinflation, regardless of your quads, is a meme

Ignoramus
Ignoramus

Thanks a lot for the explanation. That's how Japan kept the value of their currency: the market still acknowledged its value, because it was covered by a trade surplus, right?

Related question: do you advocate deficit spending to boost the economy then?

Garbage Can Lid
Garbage Can Lid

I'm not saying that financial products are useless or to be shunned, user.

But how does inflating their worth, as well as the worth of real estate, help the general population?

Inmate
Inmate

During the Great Depression, the Federal Reserve never undertook anything similar to quantitative easing and tried to force liquidation of excess assets.

The result?

Banks could not liquidate and satisfy depositors' need for cash. The Fed's response caused the collapse of the money supply by 1/3.

In 2008, if the Fed let WaMu get seized by the FDIC and let Lehman and the others go under, what would be the result user?

Deposits and, by extension, depositors would've been wiped out. Investors in money market mutual funds would've been wiped out. These are savers who would've lost all their savings in the resulting evaporation of liquidity and market freeze.

The Fed, in 1933, by allowing monetary contraction through forced liquidation, caused the Great Depression. In today's world, if that were allowed to take place, it would make 2008, Greece, and the Great Depression look like a cake walk.

The only people who would benefit by this inaction would be the tiny fraction of people who would be able to purchase assets for pennies on the dollar and make huge returns. Is that beneficial for the rest of the population? Is it?

WebTool
WebTool

I'm not arguing for letting existing assets deflate or liquidate them on purpose, so everyone can buy houses for $29.99

What my initial question to was is how monetarism and financial deregulation are a more legitimate system than the priory existing Keynesianism, with its aim to maximize employment and wages.

Stupidasole
Stupidasole

Welfare is when the government takes money from one group and gives it to people who will spend it on buying goods... the alternative is government doesn't take the money and those people don't spend it on those goods i.e. it moves spending power around the economy. The money otherwise would have been probably more likely to have been saved (i.e. lending money with the expectation of a return i.e. creating debt for business) since the wealthy save instead of spend... if you have a welfare system you're probably going to have more spending going on and that's what a lot of business models are based around by purchasing goods you can internally finance out of profit if people are not you're going to be more dependent on using forms of external financing.

Most people think if the wealthy have more money and the stock market is exploding and housing prices are going up that means more jobs and improving living conditions for them.

Even "leftists" like Piketty cannot see what is really going on. He equates capital and wealth i.e. there's no difference between machines in factories, housing and shares in companies. From this his research shows that in recent years: return on wealth > rate of economic growth
He claims because of this you see rising inequality. But if he actually distinguished between different types of "capital" and striped out financial assets Piketty would see that the capital-output ratio has actually stayed roughly constant. The value of financial assets is what has rapidly increased which is causing the increasing concentration of wealth at the top of the scale. The lack of real investment in fixed-capital has resulted in low growth, shrinking wages and growing inequality. What is needed is more investment not a "wealth tax".

happy_sad
happy_sad

If you want full employment, then give infrastructure workers spoons rather than advanced machinery and modern-day equipment. You'll have full employment in no time.

Haven't you ever heard of creative destruction?

askme
askme

I'm not saying it's a more legitimate system just what historically happened. Keynesianism became politically infeasible because of the crises that broke out in the 70s and financial interests saw it as a chance to get the upper hand over industrial interests. Long term fixed-capital investments have a low rate of return and are risky; rentier interests are interested in short term capital-gains and don't care if they have to destroy the economies long term growth potential as long as they can get a bigger slice of the pie.

Deadlyinx
Deadlyinx

Keynesianism was the last era when we came close to full employment. Any other system failed to deliver this goal or abandoned it altogether.

Burnblaze
Burnblaze

What exactly was anti-Keynesian about the 2008/2009 stimulus package?

Firespawn
Firespawn

I'm trying to say that full employment is not a legitimate goal.

Economic theory should be judged by its results, not by its intentions. And the stagflation of the 1970s and the Obama Recovery should be clear arguments against Keynesian "shovel ready jobs" doctrine.

DeathDog
DeathDog

if you have a welfare system you're probably going to have more spending going on
That's also what I thought.
Why doesn't big business back Democrats then? Why did neoliberal reforms in Europe cut welfare during crisis times then, instead of increasing it?

For example, the German Agenda 2010 reduced unemployment benefits to the existential minimum and lowered wages for the working class.

And big business supported that. And it's argued to have positive effects on unemployment. So I guess the story with "business wants welfare" isn't as easy?

Nojokur
Nojokur

What is needed is more investment not a "wealth tax".

A wonderful conclusion, since everyone would benefit from it.

So, to be clear, what is a "financial asset", what is not a financial asset, and how did its value been "inflated" by monetarism in a way that Keynesianism didn't?

Garbage Can Lid
Garbage Can Lid

Have you considered that equality is neither possible nor desirable?

It's easy to say "more investment" is needed, anyone can realize that. What's more complicated is how the investment gets there. And some state-sponsored investment authority, as you seem to be suggesting here, isn't going to help it, in fact, it's probably going to make things worse.

Look at China as an example. China is essentially one big bubble waiting to burst, thanks to the government's "investment." Central planning doesn't work- whether it gets determined by some hippies in a Volkswagen or suits in Washington.

girlDog
girlDog

I'm trying to say that full employment is not a legitimate goal

That should be up for everyone to decide.
Market economies clearly delivered the very best results during the Keynesian era.

Then came the oil price stagflation that indeed undermined Keynesianism, so it's questionable today.

takes2long
takes2long

Why didn't the 1 trillion we shipped off to the White House for "shovel ready jobs" do anything? In fact, why did the transfer of this 1 trillion dollars coincide with the slowest economic recovery since the end of the Second World War?

iluvmen
iluvmen

You said it: recovery :}

We're currently discussing the reasons why. Monetarism has been named as potential cause.

lostmypassword
lostmypassword

Why would growth in the stock market and expansion of the money supply in any way hinder economic growth, especially when we aren't in a deflationary or a hyper inflationary situation?

And as for your "recovery," well- you're the one bitching about inequality- care to explain pic related?

hairygrape
hairygrape

It goes only up to 2011. Five year have passed since then, and only the last three or so were dubbed "recovery"

Sharpcharm
Sharpcharm

Sorry, looks like those shovel ready jobs really are working :^)

Skullbone
Skullbone

gesd.free.fr/kalecki43.pdf

moslereconomics.com/mandatory-readings/full-employment-and-price-stability/

Here.

Flameblow
Flameblow

Yay! :}

So the US truly never recovered after 2008.

RavySnake
RavySnake

false analogy
what else should I expect from Veeky Forums

RumChicken
RumChicken

In spite of the 1 trillion spent on a Keynesian binge for "Shovel ready jobs."

DeathDog
DeathDog

What do you mean by shovel ready jobs?
Most of the Obama recovery can be attributed to the low interest rates, not the Keynesian stimulus, which has been tiny relative to the amount of bailout money.

JunkTop
JunkTop

My question about these "easy solution to everything" suggestions like "let's offer anyone unemployed a public job" is: why hasn't it been done long ago?

CodeBuns
CodeBuns

That's monetarism at work, you dense fuck

Lunatick
Lunatick

Because over 1/3 of American adults do not own a home. As a micro issue this can be fixed with hard work, budgeting, and moving to cheaper areas. As a macro issue that cure won't work, as the economy takes a hit if everyone tries that, and those "cheap" areas aren't cheap anymore when 80 million additional people are looking for homes.

MPmaster
MPmaster

Wonderful. That's what I've been pointing out.

Then why has this recovery been so slow, as you've been pointing out?

farquit
farquit

What does actually cause mass unemployment in the US?

Labor Unions & artificially high pay for unskilled labor.

5mileys
5mileys

Labor Unions:
"pay us our artificially high wages, benefits, and pensions or else we will STRIKE and hold your company hostage!!!"

Jeff Bezos:

"llloooololololololololololololollolololololololo"

:middle finger:

lostmypassword
lostmypassword

Labor Unions & artificially high pay for unskilled labor.

And these same losers are trying their hardest to eliminate the few jobs that still exist for unskilled labor.

Want $15 minimum wage? Here's your replacement.

SniperWish
SniperWish

Probably because of taxes, regulations, and other federal interventions in the economy that hinder the marketplace?

BlogWobbles
BlogWobbles

also these

CouchChiller
CouchChiller

Which ones that weren't there already in 1945-1980, were added under Obama?

TechHater
TechHater

Did you read the first link? I posted it as an answer to that.

The short answer: Unemployment = Low demand for labour.

Since labour market does not clear, labour has low bargaining power. Which means higher bargaining power for capital. Which means higher portion of income as profits.

There is also the benefit of making the economy less dynamic. Running a small business in a low demand environment is hard, which means that the rich face less competition.

JunkTop
JunkTop

We have a more global interconnected world, some countries with more pro-business policies than ours, where companies can go to when fucks like you start peddling socialism to the masses

GoogleCat
GoogleCat

No-no, I fully understand the benefits of full employment for employees, that's not what I'm asking about. (Albeit the thesis that unemployment is a purely monetary phenomenon is far-fetched. Imagine a cripple that cannot hunt or gather more than he consumes in food and living space. He would be "unemployed", or, much rather, disposed off in a tribal society.)

What I'm asking is: if there's an easy solution to the daily worries of 90% of the population about low wages and unemployed, why isn't this easy solution applied yet?

StrangeWizard
StrangeWizard

Then why has this recovery been so slow, as you've been pointing out?

Costs are way too high. Period.

Immediately after the $15 minimum wage hike in Seattle, Washington DC, & California, McDonalds started rolling out automated payment kiosks in those markets.

Its like these brain dead liberals can't make the connection that they are literally killing their own unskilled labor jobs right in front of their eyes.

whereismyname
whereismyname

Which countries do you mean, in particular? What can the US, which always ranks very high in terms of competitiveness, learn from them?

Spazyfool
Spazyfool

A lot of jobs have been automated before and everyone benefitted from it.

Harmless_Venom
Harmless_Venom

The where-did-all-the-horses-go example is applicable here. It's 2016; cramming flesh and blood human beings into a factory isn't as efficient as muh robots. If using your welfare to shitpost on a Khmer sand-painting forum entertains the next great genius programmer enough to motivate him in his work, that's a lot more efficient for everyone than paying you to dig a ditch.

SniperWish
SniperWish

It depends wtf you mean by "Keynesian". Keynes didn't think a spontaneous restoration of balance between savings and investments is guaranteed by the market so S>I can arise and insufficient investment spending can persist for a long time.... with weak demand even low interest rates would not induce manufacturers to borrow and invest so the government in such a situations should step in and borrow the idle savings and spend them to close the savings–investment gap. That's not what happened in 08... but Keynes also thougth there were other options:
"The full employment policy by means of investment is only one particular application of an intellectual theorem. You can produce the result just as well by consuming more or working less. Personally I regard the investment policy as first aid. In US it almost certainly will not do the trick. Less work is the ultimate solution (a 35 hour week in US would do the trick now). How you mix up the three ingredients of a cure is a matter of taste and experience, i.e. of morals and knowledge." -- Keynes
"Big business" is more financial today than industrial, most big players see they have more to gain from saving the past paper value of their failed investments at all costs even if that means destroying the whole economy.
By financial assets I just mean stocks, bonds, real-estate, intellectual property rights, etc, etc... this paper is the real wealth of nations e.g. the land titles in new york city is worth more than all the physical fixed-capital in america today and apple owns hardly any physical assets just some people and buildings; their real wealth comes from monopoly rent extraction on intellectual property not real profit generation. Since the distribution of spending power is just a result of this captialization and the prime goal in a monetary economy is just the accumulation of this paper the actual supply and demand of real goods will never actually equilibrate

WebTool
WebTool

You can't use that use that excuse anymore, now that the Internet is being pushed all across America. If you really wanted to learn you would have learned by now.

TechHater
TechHater

Real investments actually tend to hurt the bottom line of most private capitalists so they do not like it because it decreases their income from their paper savings. If they want their assets to maintain their yield-value they must find ways to curtail further investments and real productivity increases.

"The most important confusion concerning the meaning and significance of the marginal efficiency of capital has ensued on the failure to see that it depends on the prospective yield of capital, and not merely on its current yield. This can be best illustrated by pointing out the effect on the marginal efficiency of capital of an expectation of changes in the prospective cost of production, whether these changes are expected to come from changes in labour cost, i.e. in the wage-unit, or from inventions and new technique. The output from equipment produced to-day will have to compete, in the course of its life, with the output from equipment produced subsequently, perhaps at a lower labour cost, perhaps by an improved technique, which is content with a lower price for its output and will be increased in quantity until the price of its output has fallen to the lower figure with which it is content. Moreover, the entrepreneur's profit (in terms of money) from equipment, old or new, will be reduced, if all output comes to be produced more cheaply. In so far as such developments are foreseen as probable, or even as possible, the marginal efficiency of capital produced to-day is appropriately diminished." - KEYNES

PurpleCharger
PurpleCharger

A lot of jobs have been automated before and everyone benefitted from it.

You know this. I know this.

Labor Unions know this. Which is why they are spreading fear about "muh dissapearing jobs" and fighting tooth & nail against automation.

MPmaster
MPmaster

Killing "unskilled labor jobs" is called progress, that should be a goal not something that is viewed as a bad thing. Keeping wages low only slowers the pace of development. A low wage economy is going to look like what China does today.
If costs are to high the question is what costs do you want to lower? Rents, profits or wages. Is lowering wages really the best way to lower the overhead expenses of conducting business? Remember lowering wages will also decrease aggregate demand and probably decrease R&D investments trying to find ways to automate processes if labour is made more cost-efficient of an investment. Advanced economies have traditionally had high wages and it worked good, why is a low wage model like China better?

Poker_Star
Poker_Star

such a situations should step in and borrow the idle savings and spend them to close the savings–investment gap
So you suggest we need more, not less government spending now, as proposed by, for example, Krugman?

What exactly should this stimulus be spent on?
Also, how should this debt eventually be repaid?

Neither Greece pre-2008, nor France today are glorious examples of high expenditure countries.

Burnblaze
Burnblaze

most big players see they have more to gain from saving the past paper value of their failed investments at all costs even if that means destroying the whole economy

You didn't answer my initial question, which I asked out of doubt about the statement that,"corporations lobby for welfare".

As the economy of Germany went into double-digit unemployment, less, not more welfare has been proposed by the industry. And it seemed to have mildly moderate effects.

RumChicken
RumChicken

. the land titles in new york city is worth more than all the physical fixed-capital in america today and apple owns hardly any physical assets just some people and buildings; their real wealth comes from monopoly rent extraction on intellectual property not real profit generation

Okay, now this is indeed horrible and I could confirm it after some research.

The two questions about this development I have left are:
1. What is the difference between the era Keynesianism (pre-1980s) and today which made "real" investment less profitable than speculation and
2. What should be done to strengthen real investment again?

Raving_Cute
Raving_Cute

it would be easier to just automate everything and hire one guy, with a degree, to run all the machines.

At least understand the cost of bleeding edge technologies before speaking, dumbass. It's the opposite, hence why we still have fast food and retail workers.

eGremlin
eGremlin

automation isn't bleeding edge you fucking mouth breathing cum guzzler

Nude_Bikergirl
Nude_Bikergirl

uh no they don't.

Food stamps is the only "free money" program. And it's at most $300 a month.

Tell me praytell, what are these "free money" programs you speak of?

viagrandad
viagrandad

Well, there are none in the US.

In Germany, the UK and France, there are monthly benefits of around $450-600, as well as help with housing and basic health care. That amounts to up to $1000.

I'm highly supportive of this measure, as unemployment is high these days.

massdebater
massdebater

All I'm saying is that Keynes himself didn't believe there was any reason to hope that the savings–investment gap would automatically solve itself by market mechanisms so just throwing more money out there or cutting taxes or something like that won't do anything positive in terms of real employment since it won't necessarily boost real investments... the response to the post-2007 economic downturn mainly focussed on CONSUMPTION and not investment. Also most of that EXPENDITURE by those governments is not actual INVESTMENT... you're not going to find many governments with high levels of investment in recent years. What public investments should be made and how they would be financed is a purely political question but there is a lot of real demand that's not being meet out there not because it doesn't exist but simply because it's not being signaled because people don't have the funds to spend to signal the demand.

Certain businesses (say something like Walmart) do benefit from welfare programs but there doesn't exist a monolithic lobbying bloc explicitly for it... but maintaining unemployment at a "manageable" level is the explicit policy of central banks to prevent inflation i.e. the phillips curve. The actual effects of decreasing or increasing welfare programs has different effects on different sectors of the economy obviously. The role business actually plays in forming these policies is an empirical question so you look into it

chicagofed.org/~/media/publications/economic-perspectives/1988/ep-may-jun1988-part2-aschauer-pdf.pdf

PurpleCharger
PurpleCharger

Killing "unskilled labor jobs" is called progress, that should be a goal not something that is viewed as a bad thing

Exactly.

And Liberals don't want that. They want to keep doing the same unskilled work while getting paid MORE for it.

Artificially paying these losers more money for the same unskilled labor that can be automated is ass backwards.

If you minimum wage losers don't learn any real skills or change with the times, we WILL end up exactly like China.

Lord_Tryzalot
Lord_Tryzalot

Automation is generally a response to rising labour costs. Lowering wages isn't going to result in more automation but less. The reality is most of the population is largly unskilled so you need serious ways of dealing with what's inevitability going to unfold... technological innovation isn't going to stop, you can control the pace a bit but it's still going to happen.

TreeEater
TreeEater

Whilst I definitely read the things you've listed this far, (the process of financialization and monetarism) how can one be sure that this phenomenon and not

1.) automation
2.) globalisation, offshoring

Are what's causing wage suppression and, therefore, low growth?

Emberfire
Emberfire

Lack of a skilled populace. Lack of opportunity to business and innovation

The amount of technology and knowledge surrounding us these days is outstanding.

Yet half the population has a sub-100 IQ.

The solution to this goes into the realm of politics.

But one thing is for sure. Artificially inflating the population by open borders is not going to improve things.

Playboyize
Playboyize

(Albeit the thesis that unemployment is a purely monetary phenomenon is far-fetched. Imagine a cripple that cannot hunt or gather more than he consumes in food and living space. He would be "unemployed", or, much rather, disposed off in a tribal society.)
No he is not. Those unable to work are not considered unemployed, and that is not relevant to the discussion.

Involuntary unemployment, which rarely exists in non-monetary economies is different and is a monetary phenomenon.

The kids, the sick, the elderly are might be taken care of by the society at large or not, but they can't generally work.

Deadlyinx
Deadlyinx

What I'm asking is: if there's an easy solution to the daily worries of 90% of the population about low wages and unemployed, why isn't this easy solution applied yet?
Of right. Because it is not in the interest of the ruling classes. In case of the US is also helps keep races segregated.

The working people are rather stupid and think of the national economy like a household. So they will vote for austerity. And the people in the top 10-20% like to lord over the poor.

Nude_Bikergirl
Nude_Bikergirl

what would lower unemployment?
government spending
hurr being this retarded

It's one way to do it and he's right. Stop sperging out for no reason

Methshot
Methshot

No factory or company is going to invest if the investment isn't going to be profitable. You need people to buy the products they make. I've been out of the loop for the US market, but didn't personal consumption drop a bit?

Firespawn
Firespawn

Don't even bother arguing with these people. They're jealous and short-sighted. You're not going to get through logically when their problem is rooted in emotion and insecurity.

takes2long
takes2long

I meant more along the lines of, there are additional markets out there. You look at a lot of the explosive growth after WW2 and in the 1990s when we had Keynesians in charge and taxes going higher, respectively, a lot of would've had economic growth regardless of these impediments. In the case of WW2, America was essentially the only one left standing so we would've needed to go basically full communist in order for us to fuck that up. In the case of the 1990s, America was in the middle of the internet boom- you would've had growth no matter what direction the tax rate went.

Today, we can see that most EMs have been hyped up- BRICS has been basically reduced to IC, and even then the former still has massive problems with corruption and the latter has those same corruption problems (in a different manner) plus a bubble economy.

iluvmen
iluvmen

Are you saying that Bush bailing out the banks and, more importantly, Obama's stimulus package- were not Keynesian? I'm emphasizing the latter here, but what exactly isn't Keynesian about Obama spending one trillion dollars, if not more, on infrastructure spending to create "shovel ready jobs." If Keynesianism is the answer to all our problems, why haven't the shovel ready jobs been created? I can understand there not being a recovery due to other reasons in your interpretation, but seriously- why weren't the jobs created? Where are the jobs we were promised from all this spending? How do you spend that much money and yet our labor force participation rate is so low- beyond the decrease that can be naturally assumed from retirees and students entering the labor market?

Sharpcharm
Sharpcharm

dailysignal.com/2014/12/11/omnibus-bill-keeps-welfare-spending-massive-levels/

heritage.org/research/reports/2014/09/the-war-on-poverty-after-50-years

We've spent 22 trillion dollars on these fucks, it's time to make work no longer an option. As far as I'm concerned, you should have to work for entitlements.

Burnblaze
Burnblaze

Nice argument there

I'm totally based on emotion

Like I seriously hate the poor, why can't they just die off

I'm probably just some white racist sociopathic conservative who worships the Trinity of Jesus Christ, Halliburton, and Ronald Reagan, right?

There's no logical reason to oppose the current welfare programs in this country and there's no logical connection between increasing the level of handouts and having an increasing number of people reliant on them as their only source of income.

Evilember
Evilember

We've had government spending though.

What is TARP
What were the bailouts
What are shovel ready jobs

Do you think we accumulated 20 trillion dollars from Iraq and Afghanistan alone? Or is it Bush's fault that Obama has added more debt than every president before him combined?

Fuzzy_Logic
Fuzzy_Logic

he literally said in the next paragraph

If the government stopped pretending the debt ever needed to be or would be paid off, and Congress abolished the debt ceiling, it would be pretty easy to get rid of mass unemployment.

so yes, if the US hadn't accumulated so much debt and if the debt ceiling was abolished, it would be pretty easy to get rid of mass unemployment.

That's why I said you're sperging out. Because you only see government spending and you get autism overload.

Stark_Naked
Stark_Naked

How would government spending be altered under his plan to create jobs? Currently, the most common solution and the most common one brought up by Keynesians in general is spending money on infrastructure or spending money on defense, but given his clear left wing bias it's unlikely to be the latter.

I'm saying that we had fiscal stimulus after 2008- if it didn't work under those conditions, why would it work all of a sudden differently? I'm asking him to differentiate between the failed fiscal stimuli after 2008 and his own fiscal stimulus plan.

I'm not opposed to government spending or even Keynesianism. I have a lot of respect for Greg Mankiw, who is basically a New Keynesian. I just want an explanation for why his plan would differ from that after 2008.

Snarelure
Snarelure

That's how Japan kept the value of their currency: the market still acknowledged its value, because it was covered by a trade surplus, right?
Right. And after Fukushima the Yen's value fell because of the change in their balance of trade.

Related question: do you advocate deficit spending to boost the economy then?
Yes, when the economy needs boosting.

After the economy recovers, I advocate using fiscal policy to control inflation, reducing the deficit (or once it passes zero, increasing the surplus) instead of raising interest rates. I acknowledge the government could run continuous deficits for ever, but I don't think it should.

TurtleCat
TurtleCat

Deficit spending automatically creates jobs. It's just that there wasn't enough of it in 2008, at least in the USA. But the Rudd government's stimulus package kept Australia out of recession.

ZeroReborn
ZeroReborn

I have experience in this. Not saying my opinion holds more value, but I'm able to make a more educated guess.

Emotion has a part to play in unemployment or at least it amplifies it. For example, the fat acceptance movement. Ignores actual issues that need solving and allows complacency in one's failures. This applies here too and allows us to segue into welfare. Welfare is akin to fat acceptance. I'm NOT talking about people with genuine issues that need support. That's understandable. Life is not easy, especially at the start when you're getting yourself on your feet. However, what welfare does is it creates complacency. If you give people a reason to not work, they'll take it. They accept that they'll never do anything in life, which is not true, but they see it that way, and they have just enough to live on. So, they do. Which brings me to my other point. These people have issues that are not being solved. Throwing money at them changes nothing and just drags out their life. It's like addiction. I believe recently the government has started a program where people on welfare can work for three years while still receiving welfare. Seems like they've seen that it's not helping anyone and they want to give people a push out the door. If I'm not mistaken that is. Example: youtu.be/-83nEuXTjBE

Also, the #FeelTheBern crowd that wants everything handed to them and want free school. It's greed. People in these positions only want their pain to go away. They don't care about others. Same as those people asking for minimum wage to be raised. They don't care about anyone else. They only care because they're stuck in that position (probably their own fault) and want things done for them. If they weren't working for minimum wage, they wouldn't care about it. Besides, raising the minimum wage is an awful idea anyways that helps no one. There's a reason minimum wage exists. It creates balance. Example: youtu.be/-SCB1t28nDU

AwesomeTucker
AwesomeTucker

But shouldn't Obama's contraction of the deficit post-2010 have collapsed the economy or at least triggered a recession if fiscal stimulus as important as you say it is?

I'm saying that monetary policy is a better tool for the government than fiscal policy at recession prevention. Looking at it, post-2010, the United States still grew regardless of Obama's reduction in the deficits, which you Keynesians should've opposed, whereas the Europeans, who contracted both fiscal AND monetary policy (with rate hikes in 2011), encountered the European sovereign debt crisis and have stagnated worse than the United States.

Fuzzy_Logic
Fuzzy_Logic

Furthermore, a lot of jobs are gone due to the fact of the industry changing. Before vehicles there were horses. Lots of horse "maintainer" jobs, I'm sure. Don't see many of them these days, but yet somehow people got by and found other work. I believe people who make excuses are probably just lazy or don't believe in themselves. If you've EVER had to actually struggle you'd find that it's actually quite easy to find another job. When it's live or die, you'll find a different career.

A lot of people are unemployed because they can't do anything. Lots of poor people are poor because of themselves. Excluding 'real' poor people obviously. For example... Let's say you slacked off in high school. Dropped out because you're going to be the next Bill Gates, of course, and you don't need no education. Didn't get your GED. Couldn't go to community college... Like you'd do anything there anyways. Now, you're stuck working at McDonald's. The clock is ticking, but you're too lazy and the mountain of work ahead of you is terrifying so you get stuck and angry. Then, McDonald's replaces their workers with robots because you wanted the minimum wage raised and you're out of a job... Now, you can't go anywhere because even minimum wage jobs don't want you... Well... There's your life.

On the other hand... Someone that goes to a university... Talks to people, gets lots of resources at their disposal, and has a valuable education is completely fine. Minimum wage jobs should not be careers and they're minimum wage for a reason. You have no value doing them. Hence why they pay the MINIMUM they can. I don't know what people want. Maybe taking responsibility for your actions would help.

That's all there is to it. And on top of that people probably didn't look far ahead and create a backup plan or saved money like they should have so now they're in trouble. Quite simple.

whereismyname
whereismyname

That concept of crowding out wrongly assumes a fixed money supply. In reality the money supply depends on how much is borrowed. And when the government spends the money it borrows, private savings actually increase as a direct result.

Make sure you understand the above.

As the economic cycle progresses, it's likely private savings will fall again, as people and businesses gain the confidence to borrow more. But how much they borrow depends on how much the banks can lend profitably, not how much has been saved.

Crazy_Nice
Crazy_Nice

Ah okay, thanks. Was just curious on the subject.

I don't have like an irrational hatred of budget deficits, I just think that monetary policy is better than fiscal policy at preventing recessions. I'd favor some kind of an NGDP targeting regime as opposed to inflation targeting and overall I support fiscal austerity, monetary stimulus, and structural reforms to solve the kinds of financial issues like the one we're in.

Methshot
Methshot

I've got some stories on top of this. Aside from the YouTube videos above, I have anecdotes.

I was a complete loser. I do mean a complete loser. Even McDonald's wouldn't hire me. On top of that, partially due to being a loser, I was a complete douche. Just a shitty person that was projecting his failure on others. After being bored with that... and tired of being a loser. I decided to do something about it. It was hard because I didn't do the things I was supposed to at the time I should have. After years I living relatively awfully which was my fault and I deserved I was able to make myself a better person overall. Wasn't easy, but was worth it. Now, I have no problem getting employed. In fact, I have too many offers that I never have to worry. You know that happens right? There's a point in life you can get to where people are fighting to hire you. Shocking, I know. A bit ago I couldn't even get McDonald's to look at my shitty resume. I won't go into detail, but there's a fun story for you.

Here's another... I knew two people... One was just too stupid for his own good. The other did EVERYTHING right from the start. The first one is stuck in debt, working a minimum wage job (more importantly a dead end one), and miserable. I believe he's addicted to something and is just distracting himself from his pain. All his fault mind you. So, no pity there. The second one got excellent grades in school and worked really hard... And he's doing fine now. Really fine actually. The first one, always talks shit about people like him and acts like he's just unlucky. You know, being a victim. The second one just takes care of business and does what he's supposed to.

This is just an example of a greater issue, but to put it simply, unemployment statistics are bullshit for one and it's probably the unemployed people's fault. This excludes people with actual mental illnesses and issues that can't work, which I'm sure they don't include anyways. Simple.

Nojokur
Nojokur

In most circumstances, fiscal policy and monetary policy are equally effective. But when interest rates are near zero, cutting then is ineffective. "Pushing on a string" is a common analogy, but the actual reason is that the interest rates banks charge businesses has two components: the base rate (set by the central bank) and a markup to cover risk, operating costs and profit. So the lower official interest rates are, the less influence they have on commercial interest rates.

Lunatick
Lunatick

Government meddling in the market

Inmate
Inmate

The effect of the government's actions should not be considered in isolation. Contracting the deficit after 2010 was economically damaging as the private sector was still rather weak, but it was still strong enough to avoid being pushed into recession.

eGremlin
eGremlin

I've got a fucking masters degree and yet only afterwards, in the last 12 months I only just learned about things like:
Kolmogorov complexity
Discount Cash Flow Analysis
Weibull distribution
The Biafra war in Nigeria
What an 'Akyl' and an 'Amine' and other chemical compounds are defined as
Godel's Incompleteness Theories

I've missed out on SOOOOO MUCH learning even though I'm a white, post-graduate, from one of the world's wealthiest countries (not America). I've learned how to learn, I've learned how to go to primary sources if I really want to digest a subject and understand why the interpretation that is mainstream about it comes from... you telling me a manual laborer, high-school drop out has the same opportunity as me.

And I'M failing as well, look at all the basic shit I didn't know that I've learned in the last 12 months of self-education... there are people out there who don't even understand the rhetorical devices of language, who can't observe subtext and theme in news articles - you expect them to be able to see through all the bullshit and upskill to a white collar job just because of the internet?

SniperGod
SniperGod

If you had monetary stimulus picking up with QE at the same time as budget contraction and you still had economic growth, shouldn't that suggest that monetary policy is more significant than fiscal policy? Paul Krugman himself has pointed this out.

And quick question- why do you call increased federal spending "fiscal stimulus?" Why did prominent Keynesians applaud Obama's higher taxes when these should run contradictory to fiscal stimulus.

Firespawn
Firespawn

econlog.econlib.org/archives/2016/05/the_invisible_h.html
Relies on the false assumption that bank lending depends on reserves.

Hyperinflation, regardless of your quads, is a meme
...and nothing more!

GoogleCat
GoogleCat

QE has more in common with fiscal policy than other monetary policy. And of course the significance of nearly everything depends on the amount of it.

I use the term "fiscal stimulus" to specify that I don't mean "tax and spend". I don't know what "prominent Keynesians" you refer to, as I live outside the USA. But I can think of four possible reasons
• Because they're not considered in isolation but rather would be implemented at the same time as a spending increase.
• Because they're aimed at upper income earners who would save their money or spend it overseas rather than domestically.
• Because tax increases have a slower contractionary effect than spending cuts.
• Because they thought that what the government was spending the money on was worthwhile.

New_Cliche
New_Cliche

The rest of the world stopped being a complete shit hole that you couldn't hire profitably for any price.

What happens to the glazier when all the broken windows have been repaired?

Raving_Cute
Raving_Cute

underemployment

ftfy

inb4 some retard comparing U6 to previous U3

Booteefool
Booteefool

After years of unemployment I finally got a job at Mcdonalds. Only got the job since I was willing to work graveyard shift which barely anyone wanted.

Sadly it's only part time work and sometimes I think they don't have any full time positions unless your a shift manager probably.

farquit
farquit

depends on the state and sometimes city in which people live. as for federal programs, it's pretty sparse.

Emberburn
Emberburn

I've learned how to learn

elaborate on this please I'm frustrated as fuck with my ability to learn right now.

ZeroReborn
ZeroReborn

QE has more in common with fiscal policy than other monetary policy

themoneyillusion.com/?p=27834

farquit
farquit

American minimum wage is so high
Only the absolute shittiest of manufacturing jobs pay minimum wage; most places are in the $10+ range at the minimum, and labor at that wage is not nearly costly enough to justify a brand new machine over a bunch of humans every single time, otherwise most manufacturing facilities in the US who haven't already super-automated their process would have done just that by now.

it would be easier to just automate everything
heavily depends on the work, as there are many things that machines/robots can't do very well right now, or a bunch of humans can still be flat out cheaper than a new machine.
There is also the issue that you need more than just "one guy" to run all the machines.
You need
1.) person who runs machines
2.) person who runs machines on another shift
3.) person who runs machines on yet another shift
4.) person who can do more-difficult-than-basic repairs on machines that machine runners either can't or don't have time to do, and otherwise does regular maintenance while not having anything to repair
5.) an entire quality control department to make sure the product is coming out correctly
... and none of those jobs necessarily requires a college degree to perform, as it doesn't take much to teach people how to press buttons, machine maintenance and basic repair can be learned on the job or from a few-months certification course, and it doesn't take much to teach people how to use their quality inspection tools

iluvmen
iluvmen

NAFTA

BlogWobbles
BlogWobbles

themoneyillusion.com/?p=27834
I'm not sure what your point is.

If it's that QE isn't an efficient policy then I agree.

Supergrass
Supergrass

Combination of all

Crazy_Nice
Crazy_Nice

It's arguable that the crash of 08 was precipitated by the very policy.

It isn't arguable at all. Insanely leveraged securities, non-existent regulation and predatory lending caused the crash.

Deutsche Bank is being reamed out for similar behaviour as we speak. Not that they give a fuck because governments will always bail out a major bank if it goes under.

whereismyname
whereismyname

But you still do agree that the job market condition generally worsened since 1980?

askme
askme

we were riding chinese demand for ore, rudd's one weird trick was the icing on the cake, and iirc it didn't have much longevity to it

New_Cliche
New_Cliche

Not everyone can cope on the same level against life and modernity

Ignoramus
Ignoramus

It was the regulatory system which motivated the risky business.

Fried_Sushi
Fried_Sushi

Many things simultaneously
over abundance of labor
outsourcing
high energy prices
high tax burden
overregulation
uncertainty regarding taxes and regulations
low interest rates and other policies intended to increase stock market investing

King_Martha
King_Martha

This, food stamps, section 8, etc.

I grew up poor, and my family has had many opportunities at a good promotion or job. But they quit every job once they started making too much to keep food stamps or in our section 8 apartment. EVERYBODY's family I grew up around was the same way.

These programs do nothing but enable the poor to stay poor. Why would they get a hard working job when the government would stop holding them up?

girlDog
girlDog

Yes. I grew up and saw it all around me.

5mileys
5mileys

I'm just wondering what your basis for that claim is. Are you referring to direct central bank purchases of stocks and corporates like in Japan/EU, or are you referring to the Fed buying T-bonds on the open market?

5mileys
5mileys

People just don't have respect for job anymore, back in days people fight for shitty jobs.

eGremlin
eGremlin

You think if great and high paying jobs were available to everyone, anyone would still stick to welfare?

You seem very sheltered. I'm guessing you don't live in an urban city with large black populations.

One day, you'll learn that there are people out there that just don't care to make an effort to achieve more when they have the minimum handed to them for nothing.

Its just one of those life lessons you have to experience for yourself to understand.

Fuzzy_Logic
Fuzzy_Logic

One day, you'll learn that there are people out there that just don't care to make an effort to achieve more when they have the minimum handed to them for nothing.

It also doesn't help that we have liberals keep telling these "disadvantaged" people that everything is someone else's fault, and they can only be helpless victims in society...

And voila... you create a large underclass of people who not only depend & rely on welfare, but think that it's their only option in this world.

Illusionz
Illusionz

I think that harboring the belief that there is a decent job for everyone, lying around to be picked up, is far more sheltered.

BinaryMan
BinaryMan

Trump shill, please.

cum2soon
cum2soon

the Fed spiked interest rates making long term fixed-capital investments, which actually employ people, look less profitable in comparison to financial speculation
But interest rates are at their lowest today, so according to you - arguing that unemployment is a purely monetary phenomenon - it should be at 0% right now.

massdebater
massdebater

NAFTA wouldn't have been bad if we hadn't given China favored trade status at the same time.

LuckyDusty
LuckyDusty

I understand what he is saying.

It used to be that projects with long term capital investments would receive a return higher than the rate for treasuries (which were historically high and showed that the government thought tax revenue was going to increase). Now that the interest rate is zero it shows that no matter what happens the Government does not believe that revenue will increase meaning that any investment is risky because the Government does not believe that the economy will grow and actually increase tax revenue.

w8t4u
w8t4u

You seriously believe when jobs go over seas they're paying those third worlders American wages? Lmfao, what a fucking dumbass.

The chinks doing the manufacturing overseas (the jobs going to be ""brought back"") aren't making over $10\hr .
They're making pennies, because the jobs that are being sent over can be and are done by literal children.

If a protectionist tariff is set on foreign labor; minium wage is the most they'll pay Americans for manufacturing jobs because that's already 10x more than were paying before and they have a duty to stock holders to maximize profits and unskilled retarded labor like manufacturing just isn't worth shit.

askme
askme

No one's arguing about the correlation between government bonds and growth expectations.
The implications of his postings, though, are far, far more severe, as he puts the blame for stagnating wages and growth solely on monetarist policies.

idontknow
idontknow

Well they do control the alternative investment.

I can either make a zero return and preserve my money in a "safe" investment or I can risk it all for 1% in the market.

lostmypassword
lostmypassword

How does monetarism increase the security (and value) of financial assets in comparison to "real investment" though?

Deadlyinx
Deadlyinx

Which is also causing an artificial stock market bubble because those returns are reinvested and very little is being invested in physical assets. Our economic numbers exist solely on paper.

Sharpcharm
Sharpcharm

By decoupling it from physical objects and investments and instead focusing on the entire market.

SniperWish
SniperWish

I believe you that his is happening, but how exactly does monetarism, the policy of increasing money supply in times of crisis, shift investment towards assets?

LuckyDusty
LuckyDusty

Funny enough, illigal immigrants. Theres only so many jobs and Juan will do them for half the price. Also minimum wage increases, increased taxes its like they don't want you to own your own buisness, and realistically if you're being fucked every time you turn around you cant pay for employees to just do one job anymore

Not to mention obamacare, i dont know the logistics of it but what i gathered from shooting the shit my former boss (my friends dad) if he employed more than a certain ammount of employees he would pretty much immidiately bankrupt or would have to sell off most of his more valuable assets just to stay afloat and build his company. Appearently it's serious enough issue that he literally had to fire over half of his workforce and the remainding employees had to pick up their slack until he could slow his contracts down. Shits really fucked here, for more jobs you need more/larger buisnesses, but by making this buisness/expanding past a certain point the owner gets completely fucked from any angle imaginable, and on the off chance they survive that they basically have to start from the ground up as far as profeit goes.

Sir_Gallonhead
Sir_Gallonhead

Also, funny story about illigayylamaos. I was working on this job site for a few months (pipefitter), and osha showed up (technically they have more authority than even the police have on job sites) and they all started yelling shit, this huge army of aylaymos go into this sort of room that wasnt built yet and their boss comes around and basically puts up the walls all around them, they stayed quiet and just stood in this makeshift room for at least 2 hours until they left. Also the fuckers worked what seemed like the same hours we did at the time (there as soon as the jobsite opened and left between like 9pm-2 am) (also worth noting this job was on the beach durring spring break in a major party town in a non residential neighborhood, so no noise complaints.)

Lunatick
Lunatick

By raising interest rates. But we've gone too far and doing that will cause the bubble to pop. The market should have gone through its correction, but our shit policies to stave off the crash prolonged it.

Evilember
Evilember

It would need to make safe investments deliver a return that would make riskier investments look safer.

That causes bubbles though.

Flameblow
Flameblow

It's not. Welfare as in pensions and additional employment costs. Anything not replaced by automation is given over to labor on global market. Then people who are college level + experienced they tried replacing with Indians/ Chinese everything went to shit so they came back after 5-6yrs shill RnD. This excludes researchers in medical Indian bust especially the Chinese are making breakneck medical contribution analysis every month.

CouchChiller
CouchChiller

lend profitably. Explain how DB alone amass 54.7 Trillion USD in debt neck deep in derivatives along with Everything this side of the Atlantic. Mind it's not called a traunch now.