Consumers boost borrowing in November
In normal times, consumer credit is growing at an annual rate of about 4 percent.
Here's a look at wages in normal times.
Click to enlarge.
I'm adjusting the "wages and other labor income" as seen in the Federal Reserve's Flow of Funds for inflation and showing the average annual growth over the previous decade. I am not adjusting for population growth (the typical paycheck is not growing that quickly).
I have included two trend lines.
The trend line in blue assumes that our problems are cyclical. It shows the median value over the period. It should disturb those in the cyclical camp that the dotcom bubble of the late 1990s and the housing bubble of the mid 2000s only managed to achieve typical wage growth.
The trend line in red assumes that our problems are structural. It shows the downward linear trend over the period. As you can probably guess, I am mostly in the structural camp.
Also note the decline in real wage growth in the 1970s compared to our current decline.
June 2, 2010
Kass: Cyclical Tailwinds vs. Secular Headwinds
Beyond my concerns regarding the troubling market manipulations, I continue to have a number of secular and intermediate-term fundamental concerns.
Source Data:
FRB: Flow of Funds
St. Louis Fed: CPI-U
Great game by the Hawks! I like underdogs but the Saints were expecting a walk over.......not so much!
ReplyDeleteI guess this proves that the FED has perfected their inflation models since the last era of stagnation--1966-1982, when they allowed real inflation in wages consumer prices, etc. This time they have only allowed it in banksta bonuses and commodity futures. God bless the chief crooks in charge--can you create a graph of their learning curve--it must be a mirror image of this chart.
ReplyDeletejshaef1
jshaef1,
ReplyDeleteThere has indeed been a learning curve. Just look how far we've come.
From the 1940s:
Income Tax Propaganda Cartoon
US Government propaganda cartoon from WWII era.
From the 1970s:
Trippy 1970s U.S. Propaganda Video
This trippy tribute to our country's 200th birthday was funded by a Bicentennial Project Grant and animated by Vincent Collins who made other psychedelic cartoons. This film was produced by the United States Information Agency -- the government's propaganda agency.
From the 2000s:
Ready.gov | "World Upside Down"
A TV spot for Ready.gov.
GYSC,
ReplyDeleteI like underdogs but the Saints were expecting a walk over.......not so much!
It probably had something to do with this.
Seahawks May Be Record Super Bowl Long Shot; Patriots Picked by Oddsmakers
The only way the Seahawks can finish with a winning record is by taking the Super Bowl title.
Good grief, lol.
It was a WILD card weekend indeed! Again, congrats on the win, the Hawks really put a great game together.
ReplyDeleteI made one of those weird Xtranormal videos, its up on the blog for a look.
This is why I've grown to hate minimum wage laws - they are always followed by periods of quantitative easing. The boost in minimum wage only makes up for the previous round of QE, but it always portends that another round will begin within a year or two.
ReplyDeleteThis is pretty much why I disregard anyone who stumps for a "living wage" or a bump in minimum wage - they are too simple-minded (or simply too lazy) to bother to understand what is actually going on.
GYSC,
ReplyDeleteI'm not sure the congrats applies to me.
It would be like congratulating me for keeping a crazy old aunt in the basement, lol. ;)
Note to police: I have no basement. It was just a figure of speech.
Charles Kiting,
ReplyDeleteI have grown to hate much of the government tampering of natural market forces.
They lost me when lawn darts were banned in 1988.
I figure if I can own a car, a rifle, a handgun, a bow, a sword, a knife, or even a baseball bat then I ought to be able to own a lawn dart. Maybe that's just me though.