What Wage Growth? Real Earnings Tumble For Second Straight Month

Tyler Durden's picture

Despite the surge in consumer confidence and exuberance at what lies ahead, real wages for America's average joes declined year-over-year in February (down 0.3%). This is the first consecutive monthly drop in real wages since 2011 (which forced Bernanke to to hint at and then unleash QE2 later that year).



So not only is The Fed hiking into the weakest GDP growth outlook since 1987, noiw they are hiking into declining real wage growth (something tht has previously driven The Fed to a massvely dovish stance).

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E.F. Mutton's picture

"Wages? You want to be wage slaves? Answer me that! Of course not. What is it that makes wage slaves? Wages! I want you to be free." - Groucho

junction's picture

Suddenly, the word "stagflation" is showing up in the fake news.  If the whatever hits the fan, will Trump fold faster than Superman doing laundry?  Hiring crooked Wall Street bankers and hedge fund operators does not take much skill.  The next buzzword I expect to read is "internecine", as it describes the warfare in the Republican Party.  Luckily, the Republicans have two secret weapons: waste of skin Democrats Nancy Pelosi and Charles Schumer.

flicker life's picture
flicker life (not verified) junction Mar 15, 2017 9:59 AM

I'm making over $7k a month working part time. I kept hearing other people tell me how much money they can make online so I decided to look into it. Well, it was all true and has totally changed my life. This is what I do... http://bit.ly/2jdTzrM

MFL5591's picture

65 days in office and you arte suguesting this is Trumps work?  Are you out of your mind?

NugginFuts's picture

Chair Yellen: "It is a good day to die."

Erek's picture

"...first consecutive monthly drop in real wages since 2011..." This shit is hard to believe. On what island did these guys research these numbers? Couldn't have been in my neck of the woods.

flaminratzazz's picture

No shit, right after 2008 crash wages in construction were cut damn near in half. Some places still trying to get professionals for 13 an hour.

Erek's picture

Some days the supply of cuss-words is insufficient to meet my needs.

Erek's picture

Thanks for the help, but something better is needed.

WTFRLY's picture

WTFs per hour is a good standard measure. I trend in the 5-10 range generally.

Sky flyer's picture

This to is bullish.

Erek's picture

Don't you mean Bullshit?

ejmoosa's picture

Yes it is BS.

It's also what has to happen to get bubbles bursting.

Wages drop. Check!

Loans default. Check!

Home and vehicle values fall. Check!

Declining sales of new crap. Check!

Lower Federal Tax receipts.  In process

Lower State Tax receipts.  In process.

Add to that some record sized state budgets planning to spend dollars they do not have, and we are gonna have a serious situation here.

americanreality's picture

...and college kids starting out life at an AVG. of $30,000 in debt takes a big bite out of future consumption.  Its over, its been over, just waiting for the convulsions to stop.  

peterk's picture

Does Yellen or any other mainstream economist actually know what they are doing?

look what they have done,  increased  INFLATION and DECREASED  real wages.

They get paid to screw citizens lives.

MAkes you think  that if the  FED didnt exist prehaps  things would have been better.


FreeShitter's picture

They know exactly what they are doing....apparently most americans dont get it. Let me clue you in bro: Simply put, They are transferring the wealth to them and their goons. Usury is a motherfucker aint it?

flaminratzazz's picture

Squeeze play into living in a van down by the river.  Slow death by a thousand cuts.. Me thinks they know exactly what they're doing

small axe's picture

higher inflation + lower wages = job well done, in the Fed's eyes.

it's how us serfs pay off the debt that the Fed/government has issued in our names and the uber elite has profited from

the Fed wants its pound of flesh now

ejmoosa's picture

I talk to my friends about this all the time. 

But look at it from their POV.  They have created more money out of nothingness and 20 years ago we would have expected massive inflation.  So far we have not seen it.

In their eyes there has been no harm whatsoever.  Record number months of increasing employment to boot.


In their eyes, they have eliminated economic down cycles.  What they fail to acknowledge is that they have now limited the size of our economic "pie",  and they have in effect destroyed our economic potential.

ANd they cannot see that...yet.


But we do.


cowdiddly's picture

Yellen , Yellen Yellen. Your now an insignificant idiot with a folder full of charts and models that have no way to factor in the primal instincts of the herd.

You are now nothing more than a 15minute kneejerk reaction.

So put your cork in the end of your toy gun and go pooop, it matters not, the damage is done.

peterk's picture

The Federal Reserve (FED) is a PRIVATELY OWNED, organization. Unbelievable? Check the ENCYCLOPAEDIA BRITANNICA.

b. Below is the list of the owners of the 12 Central Banks:
- Rothschild Bank of London
- Rothschild Bank of Berlin
- Lazard Brothers of Paris
- Israel Moses Seif Banks of Italy
- Warburg Bank of Amsterdam
- Warburg Bank of Hamburg
- Lehman Brothers of New York
- Kuhn Loeb Bank of New York
- Goldman, Sachs of New York
- Chase Manhattan Bank of New York

small axe's picture

the evil hides in plain sight


Federal Reserve Act Section 7. Division of Earnings

(a) Dividends And Surplus Funds Of Reserve Banks.

Stockholder Dividends.

  1. Dividend Amount. After all necessary expenses of a Federal reserve bank have been paid or provided for, the stockholders of the bank shall be entitled to receive an annual dividend on paid-in capital stock of--
    1. in the case of a stockholder with total consolidated assets of more than $10,000,000,000, the smaller of--
      1. the rate equal to the high yield of the 10-year Treasury note auctioned at the last auction held prior to the payment of such dividend; and
      2. 6 percent; and
    2. in the case of a stockholder with total consolidated assets of $10,000,000,000 or less, 6 percent. ... https://www.federalreserve.gov/aboutthefed/section7.htm
peterk's picture

In all, there are about 300 VERY POWERFUL, partly foreign individuals that owns the FED.

2. Although the FED is required to give back most of its PROFITS back to the Treasury Dept., there is NO ORGANIZATION that has the power to AUDIT the FED (not even the Congress or the IRS). This creates a HUGE opportunity for creative accounting to hide the profit that ROBS the US Tax Payers Hundreds of Billions of Dollars annually.

3. Every year, a few Congressmen introduce a legislation to AUDIT the FED; and every year, the legislation is defeated. The FED has the most powerful, invisible lobbying power there is.

4. The owners of the FED own the controlling interests in ALL major media in the US. Rockefeller, through Chase Manhattan bank, controls CBS and ABC and 28 other broadcasting firms. Each of the other owners of the FED also have controlling interest in the US media. This explain why the media have been silent about the FED scam. The FED fraud is the biggest and longest cover-up in the US today

peterk's picture


The US goverment runs a deficit annually. To cover this, the US goverment issues bonds which are bought by the FED.

Since the FED has the POWER TO PRINT MONEY, it can buy any amount of the US Government bonds at almost NO COST, save for the expense of printing money (approximately 3 cents per $100).

At this point, the owners of the FED already profit $99.97 for every 3 cents they invested to print the money. Basically, they exchange something that costs almost nothing to them with the US Government Bonds.

Since the FED can NOT be AUDITTED by the IRS (or even by Congress), most of this profit can go anywhere the FED owners want to. BTW, did I mention that the profit is TAX-FREE?

After buying the bonds, the owner of the FED can either:
1. Keep the bonds, and collect the interest the US Government now OWES them.
2. Sell the bonds to the US Tax Payers or foreigners.

In either case, the FED owners have profitted $99.97 for every 3 cents it invested to print the money. Remember, the FED is a PRIVATELY OWNED corporation, just like the Federal Express. The profit of the FED goes to the FED owners.

The US Government now owes the FED owners the interest on those bonds. Remember that the FED owners DO NOT EARN the bonds. They simply PRINT the money to buy the bonds. In other words, they created money out of thin air, and exchange it for the interest bearing bonds.

In order to pay for the bonds' interest, the US Government taxes the US population.

When a US Citizen holding US Government bonds receives his/her return of investment on the bonds, essentially the money he/she receives is the tax money he/she is paying to the Government.

When the OWNERS of the FED receive the interest on the BONDS they're holding, they are receiving that money for FREE (save the initial 3 cents per $100 investment to print the money)! Not only that, the FED owners receive the money TAX FREE.
Under the LAW, the FED is REQUIRED to RETURN its PROFIT back to the US Treasury. However, NEITHER the Congress NOR the IRS have the POWER to AUDIT the FED. The FED has used this obvious loophole to profit via creative accounting.

EmeraldWI's picture

Before QE it was interest rate swaps and before that it was repos and before that it was simply trading bonds and pair-offs before settlement. Nothing has changed since the invention of the nonregulated US Treasury market. The debt has always floated around in financial space with financial gains inflating the amount owed. Michael Milken made half a billion one year in the '80's and for cutting into their pie, they put him in jail for what banksters do every day.

It wasn't factories and manufacturing that made American wages better than the rest of the world, it was organized labor who bargained with institutions in order to improve America's standard of living for working people. It isn't unions that are bringing down retail in America, it's a consumption based system that treats labor as a commodity. Treating land, labor and money as commodities instead of capital only leads to it's destruction. False assumptions in an economic system make for false results.

A rope leash's picture

Thanks for the rundown. This explains a lot to the novice...I might pass it around okay?

redtie's picture

So now bad is good

south40_dreams's picture

The fed has launched a thousand generation debt bomb. Slavery in our time

jamesmmu's picture

This is a very bad news, it means todays rate hike could be a big mistake! The hike is due to the recent inflation, but wage inflation is actually negative. And inflation not equal to growth, it undercuts growth, GDP reduced when inflation goes up. Its bascially all asset inflation, when fed hike rate, it impact to little people too, credit reduce, mortgage, and make bigger payments.... and it caps stock growth too as its more costly to buyback shares. Thats why today's could be a start of a new trend in stock market.

silverer's picture

I wonder how many people "felt good" when the Titanic was sinking?

BrutusTheBomber's picture

I got a raise this year. It was the first one in 3 years. But I did get one. Almost no one else at my company got one, they must really want to keep me around, once all they layoffs start in qtr 3 or 4  this year.

hendrik1730's picture

Then, why don't you resign and see how much they want to increase your wage just to keep working for them? Go find another job first ( to have a plan "B" ), have the contract signed by the other employer and the drop the bomb at your present employer. I made the same mistake at the time - knowing very well I was one of the people which were very hard to replace, but I hoped to get "something" in the future given the importance of my job within the business. Hell no, I got nothing, until the bosses thought they could do without me ( since they were closing down the business unit I worked in ). At THAT time, they just kick you out. If you are sure to be very needed, resign with a plan "B". 

QQQBall's picture



You are now the first to go in the cost cutting round that is sure to follow.

Iconoclast's picture

Inflation at 2.2%, wage 'growth' at -0.3%. "Boy, that escalated quickly, I mean, that really got out of hand fast!"

hendrik1730's picture

Inflation is NOT at 2.2%, it is at 11%. See Chapwood index, previous article in ZH.

Go shopping and keep the bills for a year, THEN you will know.

Silver Savior's picture

I am a firm believer inflation is around 11% see it everyday. It just pisses me off so I end up buying nothing. 

Elco the Constitutionalist's picture
Elco the Constitutionalist (not verified) Mar 15, 2017 9:17 AM

A clear signal we need more immigrants to do all of the jobs that Americans won't do for free.

Make America Slaves Again!

Last of the Middle Class's picture

Are we al QE'd up? Wage growth will never happen, the whole idea of QE was to bring on inflation to cover massive government debt (spending). Using inflation to cover government debt is exactly the same thing as using inflation to destroy consumer buying power. You can't do one without the other. Well, that is unless you just don't talk about it. QE was the real "reset button". It reset your dumb ass back to purchasing power of the 70's so every gain in purchasing power, wage growth, standard of living has been wound back. You can't go forward in time, but you damn sure can go backward economically and QE was engineered to do just that. It placed money where the Fed wanted it placed and it damn sure was not placed to help the American consumer. The whole idea that it raises the "water level" for everybody is absolute bullshit. The ones who got the money will do everything they can to make sure no one else gets it thus the velocity of the money is zip and we end up with an even more classed society. Shit, Stalin would have used QE if he had thought about it.

bond006's picture

just another symptom of the moral hazard resulting from the US trade policies and the experimental fed policies practiced over the past 30 years...as RP said in 1992 the giant sucking sound you hear will be the good american jobs leaving our country as a result of nafta...I guess those who voted for BC and GWHB have only themselves to blame.


Silver Savior's picture

Every year I get a raise of 40 or 50 cents an hour. Inflation eats that aways and then some. So I actually degrade myself by the year. Yeah man the incentive to work is all roses. Now I know why millions don't want to work and put up with everyone's bullshit.

P'Od_Accountant's picture

Wage growth.  That depends on the chart time duration.  Wage growth have been negative when the REAL inflation rate is used.  

tbone10's picture

This fucking Trump economy is about to crash get some dip shitz get some