The Trump Economy

[Buffalo_Gal]

Twitter is all aflutter this morning. They blamed Trump for crashing the economy for no reason since March. Now that Pence and Trump are on the offensive that the economy is coming back better than "experts" predicted, those blamers are pissed. ?‍♂️  This is with some very large states still shut down simply to hurt Trump. The bankruptcies happening and to come will also hurt the labor market as these Governors still keep people on lock down.

Initial Jobless Claims: 963k (act) vs 1.12M (est)
Continued Jobless claims: 15.486M (act) vs 15.898M (est)

[BillStime]

 

[transplantbillsfan]

Oy... not  good 

https://apnews.com/d0dc7c4719667d1a7f69cc9b8ab204c9

In addition to people who applied last week for state benefits, nearly 489,000 others sought jobless aid under a new federal program that has made self-employed and gig workers eligible for the first time. That figure isn’t adjusted for seasonal trends, so it is reported separately.

 

Counting those receiving aid under the new program would bring to 28.2 million — roughly 18% of the U.S. workforce — the number of Americans now receiving some form of unemployment benefits.

 

With confirmed virus cases still high, it’s not clear when business owners will be able to reopen or will have enough customers to rehire.

[Doc Brown]

17 hours ago, BillStime said:

 

A fair criticism of Trump is he signed massive spending bills that only added to the deficit despite a great economy before Covid.  It's bs criticisms like this that drove me crazy when Republicans were complaining about the high unemployment numbers the day Obama took office. 

[Buffalo_Gal]

U.S. manufacturing production rises more than expected in July
 

U.S. factory output increased more than expected in July, boosted by a surge in motor vehicle production.
 

The Federal Reserve said on Friday manufacturing production rose 3.4% last month after advancing 7.4% in June. Economists polled by Reuters had forecast manufacturing output increasing 3.0% in July.
 

</snip>

[ComradeKayAdams]

On 8/3/2020 at 7:50 AM, Tiberius said:

 Seems like they did a lot to help small businesses and have been for years, both parties. Both parties here in US both support big corporations, and that';s ok. Corporations are the gooses laying golden eggs, so of course you protect them, with Dems wanting more restrictions on them.

 

But disproportionately helping big corporations relative to whatever help small businesses receive can have a similar effect as directly harming the small businesses, right? The same mechanisms that lead to oligopolies in poorly regulated markets go into play. We’ve known about these mechanisms since the Teddy Roosevelt trust-busting days of the post-Gilded Age, and we should have learned again from history during the Great Recession economic fallout. Too many voters in this country apparently haven’t over the past 12 years, which makes me feel very sad. No one else sees the power consolidation in certain critical sectors of our economy? Finance, media, communication tech, info tech, transportation, metal materials, fossil fuels, pharmaceuticals?? Over the next few months to couple years, we’ll know for sure how well our politicians actually protected small businesses during the Covid-19 pandemic. If they collapse and get swallowed up at the numbers I fear, then it will be additional evidence of the two-party corporate oligarchy theory.

 

Regarding the special relationship between big corporations and government: yes, big corporations are golden egg-laying geese, but I’m sure we can figure out a happy compromise between job production and market monopolization. And besides, government can and should allow large companies to fail in most instances, in accordance with the intent of truly competitive capitalist systems. Bankruptcy filings for major corporations often lead to asset restructuring where very few jobs end up lost and the only people negatively impacted are major equity holders and senior executives (but they usually have the money and connections and golden parachutes to survive okay, so don’t shed too many tears for them!). And for the cases where we determine that it’s preferable to bail out big companies because the economy can’t absorb the big loss of jobs, we need proper government oversight to make sure payrolls are maintained and the bailout money isn’t being siphoned off predominantly for share repurchases.

 

On 8/3/2020 at 9:21 AM, 3rdnlng said:

I think you have discounted the way improvements tend to get harder to attain the closer one gets to the best scenario. Let's say that 100 is the goal. It's pretty easy to go from 0 to 50 and fairly easy to go from 50 to 75 and so on. When trying to go from 95 to 100 it is generally quite difficult. Trump was operating in the 95-100 range in the stock market, growth rate and unemployment rate. Comparing Obama's statistics to Trump's on a straight line basis is just wrong. Look at it this way: it's a lot easier for a new football coach to take a team that was 2-14 to an 8-8 record than it is for him to take a team that was 8-8 to a 14-2 record. 

 

That’s an interesting take on the Obama-versus-Trump economic debate, 3rdnlng. Kinda like how it’s much easier to train for a 6-minute mile run from an 8-minute-pace starting point, versus going to a 4-minute mile run from a 6-minute one. I don’t agree at all, however, that the Trump economy was operating at a close-to-optimal level. Now it would be difficult for me to persuade you that you’re wrong without offering an alternative presidential performance of my own preferred choice, since we haven’t had such a president in at least the past 50 years of American government…or not ever, actually. I could make references to presidents from other modern Western democracies, but that’s too much of an apples-to-oranges economic comparison to be convincing. So maybe I’ll suspend that line of thought for the time being and try this another way…

 

What I’ll do instead is first point out the inherent limitations in the common economic metrics you mentioned (which I’m sure you already know, but I’ll remind anyway!): unemployment, GDP, and stock market. Official unemployment percentage is one of the few numbers where the Trump economy was clearly performing at near-optimal levels, but this acknowledgment also masks the limitations of such a simple number (underemployment, part-time employment, gig workers, job satisfaction, counting those who have given up looking for jobs, etc.). GDP growth rates, meanwhile, have all sorts of limitations of their own. Aside from the obvious of not accounting for off-the-books labor, it lumps in all the many nuances of the economy into dumb aggregate numbers for private consumption, business investments, government expenditures, exports, and imports. So two economies structured drastically different from each other can have the same GDP numbers. Economy “HC,” for example, could be a “haute couture” goods-and-services economy heavily reliant on the fashion industry and might be something I value immensely but most of the people on this message board could not possibly care less about. Economy “HT,” meanwhile, could be a GDP-equivalent one based on “high-tech” manufacturing that would have much greater future GDP growth potential than the high-fashion one as well as be much more consequential to the human condition. And stock market growth is just a psychological corollary to anticipated GDP growth, with about 50% of adult Americans not having any ownership stake in it whatsoever and the top 10% of income earners owning about 90% of the total stock market value.

 

Now honing in on that GDP metric: we’re an economy driven by consumer spending to the tune of 70%. The economic fortunes of the lower and middle classes matter a great deal to consumer-driven economies. So my argument is that optimally performing American economies (assuming you value stand-alone GDP numbers above all else) should be ones where the lower and middle classes have the most economic success. That is partly why I lean more toward macroeconomic numbers like adjusted wage growth in reference to costs of living, as well as upward socioeconomic mobility ratings. In that respect, the Trump economy has been performing somewhat poorly relative to the rest of the industrialized world and a little bit worse than Obama’s (standard sources: IMF, BLS).

 

And because y’all know that I’m a wacky lefty who is all about “muh feelings,” I care about measurable socioeconomic happiness indices too (such as UN World Happiness Reports)! After all, we only get about 80 years on this planet…if we’re lucky. What’s the point of generating amazing GDP-per-capita numbers if so many of us are so bleeping depressed and anxious while doing it (also see: Japan’s social crises)?! But alas, we Americans continue to get mediocre scores in those metrics as well.

 

On 8/3/2020 at 1:10 PM, Buffalo_Gal said:

Q1 forecast an annual decrease of 4.8%, Q2 an annual rate of 32.9%. These are not what happened in that particular quarter.  It gets very skewed because they are annualizing the rate based upon a quarterly rate (well, plus some compounding).  Now, is the Q2 number good? Hell no. But it is not -32.9%  in the quarter (as was tweeted) and we are unlikely to see that rate for a whole year (an annual).   California alone being fully open would help tremendously... which means it ain't gonna happen until November 4th.

 

This minor economic controversy from a couple weeks back only highlights the importance of language precision. Any reference to the -32.9% GDP number should be prefaced with the “annualized” qualifier, as should the -9.5% GDP number with the “quarterly” qualifier. I’ll cut certain Twitter laypeople some slack on the sloppiness, but journalists and politicians ought to know better! I was going to clarify my thoughts on the difference between “intentionally misleading” and “lying,” but I suppose it’s a tautological waste of time on an already extremely BORING and tired topic.

 

Yep, we agree on the absurdity of the second California shutdown! Note that my super negative U.S. economic outlook is simply a prediction based on the evidence that’s presented to me and the reality as I see it. I’m not necessarily endorsing the collective way our society perceives the pandemic’s health dangers or the collective way we have managed the economic response.

 

On 8/7/2020 at 10:56 AM, GG said:

There's a lot to unpack here.

 

Thanks for reading and replying, GG! I ran out of time this morning, but I’ll be sure to respond to your post tomorrow morning.

[Buffalo_Gal]

July building permits: 1.495M (act) vs 1.32M (est)

July housing starts: 1.496M (act) vs 1.24M (est)

Link

[BillStime]

4 minutes ago, Buffalo_Gal said:

July building permits: 1.495M (act) vs 1.32M (est)

July housing starts: 1.496M (act) vs 1.24M (est)

Link

Trump inherited the longest economic expansion in history....and like everything else he inherited, he ran it straight into the ground.  ??? Kamala Harris

[Kevbeau]

5 minutes ago, Buffalo_Gal said:

July building permits: 1.495M (act) vs 1.32M (est)

July housing starts: 1.496M (act) vs 1.24M (est)

Link

Real estate is still on fire. Ultra low interest rates combined with a shift in workplace culture. I’m under contract for a house up in TN and everything we wanted to look at went pending first day on the market. 

[Magox]

The economy is steaming ahead.

 

Looks like Democrats are losing their negotiating leverage when it comes to the stimulus bill.   If I were Trump, I wouldn't budge one bit at least not until Pelosi comes back to the table with drastically reduced expectations.  Because even without, Trump was able to add $300 for UI benefits which is perfectly reasonable and will undoubtedly accelerate job gains much more so than $600 UI federal benefits.

[Buffalo_Gal]

5 minutes ago, Kevbeau said:

Real estate is still on fire. Ultra low interest rates combined with a shift in workplace culture. I’m under contract for a house up in TN and everything we wanted to look at went pending first day on the market. 

I hope you enjoy your new home. ?

[Kevbeau]

Just now, Buffalo_Gal said:

I hope you enjoy your new home. ?

Thanks! New job about 3 hrs from current home so just need a reasonable place to sleep during the week. Everyone else is staying in GA for now. Couldn’t believe how expensive and how quick the market was. (Knoxville area)

[Koko78]

2 hours ago, Kevbeau said:

Thanks! New job about 3 hrs from current home so just need a reasonable place to sleep during the week. Everyone else is staying in GA for now. Couldn’t believe how expensive and how quick the market was. (Knoxville area)

 

Just don't ***** around in Knoxville.

 

This is the mayor:

[Bray Wyatt]

2 hours ago, Kevbeau said:

Thanks! New job about 3 hrs from current home so just need a reasonable place to sleep during the week. Everyone else is staying in GA for now. Couldn’t believe how expensive and how quick the market was. (Knoxville area)

 

Congrats! I just moved to TN in April, i am further East than you though, out near Murfreesboro

[Deranged Rhino]

 

[B-Man]

 

 

 

CNBC reported, "U.S. homebuilding picked up for a third straight month in July in the latest sign the housing sector is emerging as one of the few areas of strength in an economy suffering a record slowdown because of the covid-19 pandemic.

"Housing starts increased by 22.6% — far more than expected — to a seasonally adjusted annual rate of 1.496 million units last month, the Commerce Department said on Tuesday. Data for June was revised up to a 1.22 million-unit pace from the previously reported 1.186 million.."

 

 

 

 

[BillStime]

Ladies and Gentleman - your President:

 

 

[RochesterRob]

3 minutes ago, B-Man said:

 

 

 

CNBC reported, "U.S. homebuilding picked up for a third straight month in July in the latest sign the housing sector is emerging as one of the few areas of strength in an economy suffering a record slowdown because of the covid-19 pandemic.

"Housing starts increased by 22.6% — far more than expected — to a seasonally adjusted annual rate of 1.496 million units last month, the Commerce Department said on Tuesday. Data for June was revised up to a 1.22 million-unit pace from the previously reported 1.186 million.."

 

 

 

 

  People getting away from cities plagued by violence and vandalism.  Lumber prices are reported to be up considerably as the supply tightens.  There are going to be sectors that do well in spite of the shutdown and sectors that will struggle or worse.  The credit industry is bracing for a wave of defaults as stimulus money decreases.

[BillStime]

Everything Trump touches has...

Wisconsin farmer: Results of trade deals have 'been disappointing'

 

[BillStime]

Amazing - Q-Tips won’t denounce Trump advising Americans to boycott an iconic US company.