by MN Gordon
Finance ministers and central bankers from the Group of 20 leading nations met in Cairns Australia over the weekend. The clever fellows believe, with the right balance of fiscal and monetary policies, they can improve the global economy. This, of course, means greater stimulus and fabricated demand.
‘“We are determined to lift growth, and countries are willing to use all our macroeconomic levers – monetary, fiscal and structural policies – to meet this challenge,’ said Australian Treasurer Joe Hockey, who hosted the event.” The G20 leaders want to increase global growth by 2 percent. So far they can’t quite seem to get there.
The way things are going, it looks like they’ll fall (Read More....)
. . . → Read More: No Quick Fix for Structural Reforms
by MN Gordon
The world around us is a strange and wacky place. Even so, it becomes ever stranger and wackier by the day. Just when we think we’ve seen it all…something new appears and creeps us out.
For instance, have you seen Hillary Clinton’s face lately? Holy Toledo! What a fright that is. We can’t quite tell what happened. But whatever it is…its gawdawful.
Taking notice of the many absurdities out there is both the joy and misery of the objective observer. One moment you’re doubled over with laughter. The next you’re doubled over expelling your lunch with disgust.
Did you know the U.S government paid federal workers $400 million to do nothing? No kidding, they really did. In addition, the IRS provided $17.5 million in IRS tax relieve for brothels in Nevada. There was also $1.23 million of federal money spent on (Read More....)
. . . → Read More: Worshiping Utterances
Almost every store that you visit uses hidden camera technology in order to protect their merchandise, and it is also common to run into surveillance equipment at ATMs and banks. Additionally, there are some areas that have cameras in place to help local law enforcement officials monitor traffic violations such as running a red light, and it is now common for police cars to have cameras installed on the dashboard. It is understandable how someone can become uneasy when you consider how many different times a day you are probably being recorded. However, many people believe that the protection that these cameras provide is worth having their privacy invaded.
How Does Hidden Camera Technology Impact our Rights?
Although most people have gotten used to the idea that they will encounter hidden cameras throughout the day, this does not mean that each of them has been installed in accordance with the law. In fact, each state has its own guidelines about (Read More....)
. . . → Read More: Smile! Why Hidden Camera Technology Is Everywhere
by MN Gordon
Second quarter GDP, as reported in by the Bureau of Economic Analysis on August 28, grew at an annualized rate of 4.2 percent. This follows up a 2.1 percent decline in the first quarter. Just what is it that turned things around from one quarter to the next?
According to the BEA report, “this upturn in the percent change in real GDP primarily reflected upturns in exports and in private inventory investment, accelerations in personal consumption expenditures (PCE) and in nonresidential fixed investment, and upturns in state and local government spending and in residential fixed investment that were partly offset by an acceleration in imports.” Not bad, indeed. It sounds like the economy’s expanding at a very robust rate.
But it doesn’t feel like things are improving for most households. The amount of money Americans earn each hour after adjusting for inflation is (Read More....)
. . . → Read More: Why We Are All Doomed
by MN Gordon Economic Prism
“Stock prices have reached what looks like a permanently high plateau,” said Ph.D. economist, Irving Fisher, on October 17, 1929. “I do not feel there will be soon if ever a 50 or 60 point break from present levels, such as (bears) have predicted. I expect to see the stock market a good deal higher within a few months.”
At the time of Fisher’s prediction, the DOW was at 341.86…down from a high of 381.17. Several days after Fisher offered his “permanently high plateau” thesis, the stock market’s decline accelerated. So, too, did the reputation of America’s most famous economist.
On October 23, 1929, after stocks had dropped 20 percent, Fisher declared business was “fundamentally sound.” You can view early video of Fisher’s ill-fated statement here, if you are interested. Despite Fisher’s optimism and academic confidence, he was spectacularly wrong.
Neither business nor the stock market was (Read More....)
. . . → Read More: Holding the Permanently High Plateau
by MN Gordon Economic Prism
Markets were closed yesterday in observance of Labor Day. But here at the Economic Prism we labored on. There’s always something to contemplate. Where to begin?
One place, obviously, is this crazy stock market. Day after day, week after week, month after month, year after year…the broad barometer of man’s hopes and dreams keeps going up. Apparently, August was the S&P 500’s best month since February.
“The S&P 500 gained 3.8 percent for the month,” reported MarketWatch, “representing the bench mark’s best August performance since 2000. The S&P also achieved its largest monthly percentage jump since February, when it rose 4.3 percent.”
Something remarkable is going on here, for sure. After bottoming out at 666 on March 6, 2009, the S&P 500 is up over 300 percent. Simply for buying and holding an index of the stock market’s largest 500 companies, investors have tripled their money.
How (Read More....)
. . . → Read More: Musical Chairs Investing
by MN Gordon
An abundance of oil hides a lot of mistakes. Just think of Saudi Arabia. Oil accounts for 95 percent of their exports and contributes 70 percent of government revenue.
Unfortunately, the royal family’s taken this cash cow and squandered it. After years and years of pumping and selling this precious resource they’ve been unable to empower their people to stand on their own feet. Instead, their economy remains dependent on mass oil exports.
Oil contributes 45 percent of Saudi Arabia’s gross domestic product. When oil prices significantly declined in the 1990’s, per capita income fell from a high of $11,700 in 1981 to $6,300 in 1998. Conversely, when oil prices rose in the 2000s, per capita income rose to $15,000.
High oil prices, rather than helping Saudi Arabia, handicapped it. The revenue boost it provided masked over the economy’s limitations. Rather than diversifying its economy, Saudi Arabia continued to rely on its one great resource.
Now, Saudi Arabia and other oil export economies, (Read More....)
. . . → Read More: Why the U.S. Government Should End the 40-Year Crude Oil Export Ban