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Chart Of The Day: The Minimum-Wage (Non) Recovery
Yesterday we showed all those key economic criteria (that get so little airtime for obvious reasons), which were prevalent the last time the Dow Jones Industrial Average hit an all time high, back in 2007, all of which reflected a far more vibrant economy, and more importantly, an economy, and market, not propped up by a $14 trillion global central bank liquidity tsunami. Today, our chart of the day comes from BloombergBrief, which shows yet another aspect of the "low wage" recovery, namely that while the bulk of the jobs lost heading into the "recovery" were of middle and higher paying jobs, the offset have been part-time and other low-paying jobs, which explains also why the purchasing power of the average American, in real terms, declines with every passing day.
It is this that Ben Bernanke keeps slamming his head into the pavement over (metaphorically of course: everyone knows the Chairman's only purpose is to make his banker friends richer beyond their wildest dreams), because as long as his artificially imposed "wealth effect" refuses to trickle down in the form of better paying jobs and higher wages, nothing will change, and every periodic surge in "recovery" propaganda, usually taking place in the start of every year, will be met with the same failure as has been the case for the past 4 years.
From Bloomberg:
Recent analysis of current population survey data by the National Employment Law Project shows that 60 percent of job losses during the Great Recession were among middle-wage earners, with low-wage earners accounting for only 21 percent of job losses. During the recovery, those numbers have been flipped; only 22 percent of job growth occurred in the middle-wage occupations while 58 percent of job gains were for low-wage occupations.
The chart below needs no further explanation:
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Need more hamburger flippers & Wal-Mart cashiers when everyone is on food stamps...
Just hold down on the hours so we don't have to buy you heathcare....that crap is wicked expensive.
We'll raise your wage....but we're cutting your hours.
You're welcome.
'The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation.'
-Lil' Ilyich
"Lest we forget at least an over-the-shoulder acknowledgment to the very first radical from all our legends, mythology, and history (and who is to know where mythology leaves off and history begins -- or which is which), the first radical known to man who rebelled against the establishment and did it so effectively that he at least won his own kingdom -- Lucifer." - Saul D. Alinksy
Well if your goal is to help as many poor people as possible, the first step in that process to make a lot more people poor to begin with.
Lightbringers always get a bad rap when people want to keep their dealings in the shadows.
So that's why Rockefeller has a GOLDEN statue of Prometheus in the town square. Rockefeller wanted to shine the light of truth on all his dealings so everyone could see just how honest he was. Makes sense. /s
Never confuse the PR with their intent, son.
I think someone told George the game a long time ago.......his name was Joe Palmer
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I've been in Wal-MArt lately. Layoffs are comin'.
Really? You were in there? See all those SELF SERVICE check-out machines?
But, but, but, on MSNBC they say that the Obama Recovery is in Full Swing!
AMERICA IS BACK!
And anyone who disagrees is Talking down the Recovery and, well, is Talking Treason!
TRAITOR!
Ben Bernanke is the greatest man to walk the Earth since Jesus Christ. I heard it on CNBC.
Same in Japan. Nikkei.com headline...
U.S. Recovery, Weak Yen Bode Well For Japanese Stocks
The Dow Jones Industrial Average's close at an all-time high Tuesday bodes well for Japanese stocks, as it may be a sign the U.S. economy is on the road to recovery.
A stronger U.S. economy will tend to push the dollar higher, which in turn will help Japanese companies, especially those in the export sector, by improving their sales and profits.
Hopium.
Every time I think it's gotten so over-the-top absurd that surely we must be at the precipice, these fuckers trot out and reset my expectations for how utterly retarded the herd can be.
I knew Jesus Christ Vic, and Ben is no Jesus.
The only solution is to equip an army of civil servants in light blue uniforms, give them white vans and set them off to deliver Pottery Barn catalogs.
Oh... Never mind. We already have that.
obamacare
Wait until the doctors start getting paid minimum wage... We'll be back to using leeches & sawbones within a generation...
Now would be a good time to polish up on Civil War Field Hospital Medicine.
Take a shot of black jack, put a stick between your mouth, and out comes the hacksaw!
Open heart surgery will be kind of tough, though.
A lot of doctors will just switch to private pay only. No insurance accepted.
So ~ then only the .01% will have doctors... The rest ~ leeches & sawbones...
~~~
Trust me, I'm in pre-Law
But I thought you were in 'pre-Med'
Same thing...
Long barber shop doctors!
Obamacare = "Don't get sick" [but quite frankly ~ we prefer you dead]
Today it don't pay to get sick or die, I don't recommend either.
Free phone and free next-day burial at sea.
Fine by me... I was meaning to go visit my gold someday anyway...
Amen brother.
When will the doctors wake up from their sleep and realize what is coming their way. A doctor friend of mine has pretty much been for Obamacare because he was tired of insurance companies telling him how to "doctor." I told him 3 years ago, if he has a problem with insurance companies, wait till the bureaucrats start telling him how to practice.
I am now starting to feed him stories of those individuals starting to call Doctor's greedy (i.e. Time magazine) and that they should make less money. I mean after all, it is is healthcare and we all have a "right" to free healthcare. I think he and his fellow Doctors will wake up but I think it is going to be too late.
Makes me sick!
The AMA sold the doctors out to the insurance companies and the drug companies. The drug companies and insurance companies made the doctors dependent on THEM at the expense of BOTH the doctors and the patients. Because the doctors were the tools of the money coming from the drug companies and insurance companies, they have thrown their patients under the bus, feeding them unneeded drugs and giving them unnecessary diagnosis... all for the money.
Do I feel sorry for the doctors because their gravy train from the drug companies and insurance companies will be coming to an end? Not so much. Their pay was artificial to start and never would have gotten to where it is in a free market.The patients would not or cannot pay the doctors what the doctors have now been led to believe they are worth.
how do you not immediately understand the fact that an insurance company sets the price for your service? Or the federal government? State government? It's really, really simple. I know a heart surgeon that quit to do general surgery because reimbursements for his services were hacked and slashed and he could make a lot more money jacking off in general practice with little or no risk.
What needs to happen is that the payment function needs to be much more closely tied with the patient and at the time the services are provided. The co-pay and deductible system is broken... the medicare and medicaid system is completely broken (how about another ER visit and ambulance ride?)... the only place where anything is working is on the private pay side.
40 years ago, local doctors accepted pigs, ducks, canned jellies and jams, homemade soap, moonshine, and a myriad of other goods and services in exchange for medical services... AND MADE A GREAT LIVING DOING IT. I don't know why everyone is so scared of going back... they'll do less work (jamming out patient visits every 3 minutes) and have a higher standard of living...
again, oxygen for the markets. with better news, markets would drop.
Minimum Wage? That was a Fabian Socialist initiative from 1906, wasn't it?
Don't know if I should mention here that eurozone countries Austria, Germany and Italy have no minimum wage anymore...
see List_of_minimum_wages_by_country and the oldest think-tank of the world, the Fabian Society
+ 1 for reference to the patient Fabians. Minimum = Maximum, no ?
Really this article is dealing with the coming maximum wage. The max and min will slowly approach each other until the middle class is crushed and destroyed along with the entire country. Have a nice day!
Maximum wage? Oh, somehow this reminds me the new Banker Bonus Cap EU Law that the UK Chancellor is currently fighting against in the Financial Minister's council in Brussels
Indeed, but it looks like he's losing the battle.
Frankly, I don't agree with maximum wages or curtailing banker bonuses. They are a classic socialist attempt at *control* of yet another market for reasons of political dogma.
In their place, I'd like to see criminal action taken against bankers who break the rules. No ifs and buts. That would probably mean hundreds of bankers would be in the slammer today. I'm asking for the Rule of Law to be applied.
IMV that would be far more effective at solving "the banker problem" than trying to control something that cannot really be controlled (higher salaries and perks will replace bonuses).
I have a different view on the matter
The way fiat banking system function, what both national bank and the affiliated fractional-reserve banks do is administrate the public credit
It belongs to the sovereign (as in seignourage) and so to the people
whenever one of those top-shots makes millions in bonuses, it's because he is hyper-leveraging his bets with a very small amount of private shareholder money and immense amounts of public credit - something that was not possible when banks were segregated, btw
further, the very fact that he is incentivated by the current bonus system to seek short-term gain does increase public risk
and yet the truth is even uglier - even continental europeans are unwilling to dismantle those financial dreadnoughts as long as the others have them
and so a serious reform of the banking system's way (perhaps a reset to the regulatory framework we all had before) has to wait until the hegemon of this world wakes up and takes action
I know, it's a very continental view - banking as facilities - and so this EU law is a feeble attempt to change the way people think about banking
meanwhile the right honourable Corzine is legally untouchable because his gains from public credit grease political wheels
No. Private banks are private banks and it's not for government or Brussels to dictate what salaries or bonuses banks pay their staff. If government wants to exercise control (which is what the Brussels-crats want), they should nationalise the banks and make state ownership/control visible. As it is, banks are at the centre of the corporatist political regime whilst govt peddles the lie that they're private and independent of govt. ho-ho. If that were remotely true we would not have seen huge $billions in bailouts.
If government is concerned that bonuses are earned by banksters through using public credit as you claim then regulate such practices, not attempt to control bonuses which will never work. Salaries and expensive perks will partly replace bonuses.
IMHO :-)
they are private as much as their capital goes - which is a small fraction, with the rest made up by "state capital", i.e. what the central lender of last resort guarantees (since it's made up from thin air), who is usually backed by the "social capital" of taxes not yet collected
they are definitely not private when they are bailed out with further tax money, present or future
yes, the is a cancer among them - centered in the US/UK and spreading - where they have hijacked politics in a way that makes them a corporativist regime - though they are flanked in this by other great and strongly lobbyied interests - Big Biz
I understand you - you don't like the method, perhaps it smacks you of socialism
and yet politics is full of strange marriages - just look how a conservative Juncker like Bismarck founded governmental controlled pension funds
sometimes it's better to have the wierd & embarassing first step in the right direction than not have the super cool radical and ideological correct solution at all
well said...payng banksters to game governments should not only result in a return of the entire amount paid to bankstes to government, but should be a criminal act if a bankster shelters it in another domicile or claims it is part of "working for god" or "adding value"..
whoever works for Him should report at His desk immediately - you know the way, you've watched "Groundhog Day"
Fabian Society. To heat up the world in order that they may shape it....
It's for your own good really.
Whatever the minimum wage is now, it should doubled, no, wait...tripled! Why not? Why wait?
Why not go the other direction? I mean...they can still afford the gas to get to work now...and that ain't right.
How can workers compete to offer their wages at the lowest rate to capital if minimums are set? It hobbles competition. Real competition.
Why should they? If you want to steal your fellow man's labor...step up and steal it, bitch.
Nature is red in tooth and claw.
End.
Yes, you are a proponent for a beastial future at best.
Assuming you got your way, what would improve (besides business bottom lines, of course)?
We already have a black market.
My weary, defeated, sardonic whimper didn't come through, did it?
Sorry.
Austria, Germany, and Italy are near the top of the Gini Index.
Yes but all they need to do is buy MOAR stocks in their Etrade account with their after tax savings from the $9.75/hr job and they too can make $16/hr - POOF BAM, its like they had the same job they did in 2004
Pretty soon minimum wage will be 100.00 per hour to compensate for hyperinflation. Zimbabwe had the best performance in their market in 2007
Surging Zimbabwe Stocks - A Look At Things To ComeSubmitted by Tyler Durden on 12/11/2009 16:53 -0400
Flip a few houses - get RICH
If wiping out the middle class is the plan (which it is) they are right on track, all thanks to to warrior of the middle class B.O
Straight from Jeremiah Wright's sermons to B.O.'s and Michelle's addled auditory cortexes, for twenty years.
Short, right here and right now.
The primary dealers use the shorts to run up the market. So, we should get out of the game altogether....if you really want to short the market then buy gold, real estate or whatever else you feel will survive a real market collapse.
While some would argue that 2007 was a vibrant economy, it wasn't sustainable. It was propped up by financial innovation and passing risk off like musical chairs. So in essence, this time isn't different for the all time high in 07, but more of the same with reality exposed for what it is.
There's nothing "vibrant" about an economy that is based on fraud and massive expansion of private debt...just eating tomorrow's lunch today.
This has been going on more like 40 years.... longer really... but 40 years ago was the the first dramatic sign of the collapse. Closing the gold window was the metaphorical "all in" on absurdity. Our existence, since that time, has been a mirage. It's hard to notice it when you are in the middle of it, but this isn't real.
1970 was the last year the U.S. economy still had even the potential to produce real & durable incremental units of value-added goods & services.
After the "Nixon Shock" of '71, it was all speculatory emissions in "stocks," pets.com, real estate bubbles & facefuck from thence on...forever more...
Yup... that's the summary, more or less.
The world nearly collapsed in 2007. Is anyone prepared to argue that was a Vibrant economy?
Perhaps you can now see what the minimum wage has acheived? Instead of putting a line in the sand where a decent liveable wage should be, it was put into quicksand instead. That quicksand is corporate greed and it swallows up all manner of better paid jobs that re-surface at minimum wage (because having a minimum wage allows them to have a guilt-free conscience).
Who cares about aggregate demand when you can claim "recovery" based on seats warmed.
At least they can still be demonized as "the 47%" despite working as many hours as they can get.
Obamacare built that.
curious model of reality you have there where effect comes before cause.
ADP annoucnes partnership with moddys Zandi on Oct 24. The report has consistently beat expectations since then. Avg beat vs. consensus since 2010 ~45K. Since Survey changes to Moodys - +75K.
The beatings will continue until morale improves. Then you can get back to work.
Mar 6 (Reuters) - Poland's central bank cut interest rates by a bigger-than-expected 50 basis points on Wednesday, signalling that policymakers' concern over rapidly slowing growth had trumped their fear of inflation.
http://www.reuters.com/article/2013/03/06/poland-rates-idUSW8N0BS00P2013...
Don't blame the poles for trying to keep up in the great debase race by making an even groszer zloty.
Poland is still preparing to join the eurozone by 2018 - their government was very emphatic about that. soon it's not nice to be a small currency when all the increasingly humungus waves of digital thingies slosh around in search of a fast speculative profit
size gives protection - for both currencies and debt - see King Dollar
Will there still be an EZ to join by then? ;)
http://www.youtube.com/watch?v=eSte_c82p6U
Poland is still preparing to join the eurozone by 2018
Rushing right into it I see. By that time Germany might have it's gold and pull out. Poland can just slide right into their spot.
We'll call it the "hedonic teutonic" adjustment.
So we now have lower wages, reduced hours to avoid healthcare, higher food and energy costs due to QE, no income on any savings due to ZIRP - and the MSM thinks we will have a sustainable recovery?
In their defense, they haven't actually left the studio in five years; they have minimum wage gophers for that.
I actually watched the CBS evening news (my daughter fell asleep on me and I couldn't reach the remote). The Dow was the lead story. You'd think it was a victory lap for economic recovery. "They said it would never happen."
It's about that time to sell when the lead story on the CBS evening news is the all-time high in the Dow.
Funny: they gave all these percentage increases about how 4 years to the day, blah blah blah. And they highlighted American express as having gained 600% since march 2009. Not only is it bullshit that a credit card company is in an industrial index, but also a credit card company is leading the index increase.
You don't always need a complicated technical chart to explain to people how fucked up this is.
"As the economy has slowly improved, lenders are increasingly comfortable writing auto loans for those with subprime or weak credit ratings. In the fourth quarter, there was a 30.9 percent increase in the number of new vehicles sold to those with deep subprime credit scores under 550. Loans to those with subprime credit scores between 550 and 619 jumped 11.5 percent."
"43.2 percent of new car loans in the fourth quarter were written for those with subprime credit scores, according to Experian. That is the highest percentage of new car loans going to subprime buyers since late 2007."
http://www.cnbc.com/id/100522157
Of course the car company's finance arms have no concerns about this because of course they know full well that when people default they will get bailed out... again... and again... and again....
So it's a part-time low-wage recovery with record number of people on food stamps and $4.00 gasoline.
What can possibly go wrong?
Mid wage Americans are surplus to requirements in a global economy.
What %age of DJIA earnings is originated in the USA? The truth is that the global economy is bigger than it was in 2007.
Besides the nominal price of the DJIA does not correlate with the economy because it is priced in USD which is a currency and is being aggressively erroded in value. In real terms (the only terms that matter) the DJIA is still 11% off the 2007 high.
Grind the mid wage earners up and mix them with horse meat to make meatballs?
It doesn't matter. It still counts as a job in the numbers.
It still makes the market go up.
Cheering the DOW is like cheering that you and your family finally able to afford to eat at the sizzler for the month, while your next door neighbor drives home in his new Bentley (his 12th new car this year).
No surprise and we are headed in the US where the top 20% (likely less) will maintain or see their standard living although if they have a serious medial incident or a layoff in their 50s they are screwed. My father saw this coming 20 years after NAFTA passed and saw his own company doing it. He quit and wound up creating his own HR software package for small US companies to use.
Why bother moving jobs to the South and still having to deal with federal labor, safety, and environmental laws? Instead you move stuff right over the border in Mexico or if the cost-savings are greater enough on the overall cost of production ultimately to China. Organized labor in the US is largely irrevalant and it simply can't link forces in countries with authorianian regimes. We are too far gone and too far along at this point to reverse the trends which have been in motion since the end of the Cold War.
With each passing year, I see the US moving more and more along the lines of a country like Brazil where wealth is extremely concentrated along with economic oppotunity due to the lack of educational access and access to quality public services. It's sad but it require a fundamental change for most Americans to wake up including questioning our extreme militarism & massive military budget ($1T annually if you really add everything up) and a hard reevaluaton of what we spend on the elderly through wealth transfers because the federal gov't is spenidng at a ratio of 4:1 on seniors compared to children now.
My guess is we don't and that we double-down on current policies which ultimately produces a country that looks a lot like Brazil where some extreme pockets of wealth that largely rely upon private services for everyone (since they can afford it) while letting most of the public scurry and hustle relying on the decrepit and aging carcass of what has been built. In a lot of cases from an infrastructure standpoint, we are already starting to see this.
If you think corruption is bad now too, just wait. It's going to get a hell of a lot worse including regarding even the most basic local services. I can tell from the comments on here that audience is overwhelming American and hasn't traveled abroad much to countries where that is the norm to get almost everything done. In India or Brazil, it is pretty much a way of life.
Why do you think every credit card and bank now highlights that you actually get to talk to someone when you call?
Wife works for Toyota Financial Service. No bailouts for them. (None needed). They have a bigger problem with Russians buying Lexuses and dismantaling them to ship back to the Motherland.
As long as we have a welfare state, minimum wage is a non-issue. Most people making min wage (other than kids in school) receive massive benefits for daycare, healthcare, etc etc....their real subsidized wage is probably around $40/hr or more.
We should focus on the big problem - corrupt government in league with the money lenders.