Four Charts Prove The 'Economic Recovery' Is Just A Fed-Induced Entitlement Program For The Wealthy

"Economic recovery" in America no longer means what it used to mean.  Historically "economic recovery" was largely characterized by job and wage growth, distributed across the income spectrum, and a rebound in GDP growth to north of ~3%-5%.  These days, the notion of "economic recovery" has been hijacked by the Fed and bastardized in such a way that they celebrate "asset bubbles" rather than real growth in economic output.

Presented as 'exhibit A', here is the Fed's modern-day definition of "economic recovery" (chart per Bloomberg):

Of course, digging a little deeper you quickly realize that the problem is even worse than what the data in the chart above might suggest.  While overall average wage growth has been anemic since 2009, to say the least, it has been almost nonexistent for those on the bottom end of the income spectrum.

Soaring markets helped the top 1 percent of Americans increase their slice of the national wealth to 39 percent in 2016, according to the Fed’s Survey of Consumer Finances. The bottom 90 percent of families held a one-third share in 1989; that’s now shrunk to less than one-quarter.

 

The current one has helped millions of people find work; it’s also benefited asset-owners far more than people who trade their labor for a paycheck. Income distribution, already the most unequal in the developed world, is getting worse. And that’s starting to influence everything from America’s spending habits to its elections.

In fact, those in the bottom quintile of wage earners in the U.S. basically haven't experienced wage growth, on a real basis, since the late 1970's whereas those in the top quintile have nearly doubled theirs.

Of course, none of this should be particularly surprising to those who are paying attention as the top quintile of earners are the only ones financially positioned to benefit from Yellen's economic recovery asset bubbles...

Meanwhile, the growing wealth disparity has seemingly put America on a collision course with political chaos as fringe candidates on both the Left and Right increasingly promise to have an 'easy' solution for the seemingly inescapeable economic plight of the poorest households. 

Unfortunately, the sad truth just might be that there is no solution, absent some transformational technological advancements, and that the U.S. has just reached the maturity phase of it's 'business cycle'...and while the Fed may try to cover up that fact by repeatedly blowing assets bubbles, per the charts above, they're only making the problem worse with each successive iteration.

Comments

GUS100CORRINA FreeShitter Fri, 12/15/2017 - 18:48 Permalink

Observation: While it is good to see the GLASS as HALF FULL, there is another side to the story that this article does not present.I want everyone to go look at all the charts again before reading the next several lines.=============Have you looked at the charts again? If YES, now I want you to replace assets with liabilities and imagine that the DEBT picture is over 2 TIMES  what these charts are saying. So to get all of these pretty income and asset charts, it took over $2 of DEBT to achieve $1 of asset and income growth.WELCOME TO THE NEW AMERICA AND THE WORLD OF THE 21ST CENTURY.This situation is NOT SUSTAINABLE! MERRY CHRISTMAS!!

In reply to by FreeShitter

Endgame Napoleon GUS100CORRINA Fri, 12/15/2017 - 20:04 Permalink

So, are you saying that the Merry Christmas sent to the citizens and immigrants at the bottom of the income scale who have children, granting them yet around round of tax welfare to reward reproduction, with the wealthiest getting their marginal-rate cut to balance it out, is not worth an economic collapse via debt? The rest of us—i.e. the [individuals] living on earned-only income—that Republicans do not represent any more than Democrats will get $24 per paycheck.

That is a stab in the back for individual citizens, with rent that takes more than half of their pay, in the many states where per capita income is right at $18k. The max child tax credit is $6,444, roughly one third of per capita income in multiple states. And many of the citizens and noncitizens getting those tax-welfare checks likewise get free rent and free food.

We have an ever-increasing welfare state for citizen and noncitizen parents at the bottom, where part-time work at wages that keep recipients below the earned-income limit for welfare is incentivized. This translates into many workplaces, staffed with [nothing] but moms with unearned income from spouses or government or male immigrants with the same due to US-born children.

I switched parties, thinking that maybe the Republicans represented [individual citizens] with earned-ONLY income more, not just the single, childless women like me.

I thought they might represent the 28% of single, childless likely voters over 40 and noncustodial parents who are often underemployed males, competing with welfare-fueled immigrants.

I thought they might represent the single moms whose kids are grown who, at that point, are in the same boat as single, childless people—no longer having child support that covers their rent or welfare that covers rent and food and child tax credits that maxed out at $6,444 before Swamp CONgress added to the womb-productivity till with this tax bill.

I thought they might represent all of these single, childless-for-now Millennials who are also often [under]employed, with earned-only income from one source. They cannot get their lives started due to wage stagnation, while many of us Gen Xers are in situations every bit as bad due to a job market where dual, high-earner couples hoard two of the few good-paying jobs with benefits under fewer roofs, and, at the bottom, a job market that is RIGGED for citizen and noncitizen parents with unearned income from spouses or government, making it easier for them to accept low wages and part-time hours.

I discovered that the RepubliCONs [hate] individuals every bit as much as DemocRATs; it shows in every piece of policy that the Uniparty passes. Funny thing, most of the people I have met—and I met a lot in jobs—who get all of that tax welfare and monthly welfare for reproduction [do not bother] to stand in lines to vote.

Kentucky — per capita income — $18,093

https://en.m.wikipedia.org/wiki/List_of_Kentucky_locations_by_per_capit…

Tennessee — per capita income — $19,393

https://en.m.wikipedia.org/wiki/List_of_Tennessee_locations_by_per_capi…

Alabama — per capita income — $18,189

https://en.m.wikipedia.org/wiki/List_of_Alabama_locations_by_per_capita…

Mississippi — per capita income — $20,670

https://en.m.wikipedia.org/wiki/List_of_Mississippi_locations_by_per_ca…

South Carolina — per capita income — $18,795

https://en.m.wikipedia.org/wiki/List_of_South_Carolina_locations_by_per…

In reply to by GUS100CORRINA

JibjeResearch Fri, 12/15/2017 - 18:34 Permalink

Any stupid person can make a shitload of money.  Just buy any top 10 crypto and wait a year, you'll make some kind of profit. People are so dumb..., money is everywhere in the cryptos market.

Not Too Important Fri, 12/15/2017 - 18:45 Permalink

The only thing that matters is what happens when China introduces the gold-backed Yuan oil futures contract.

Will the fall of the US economy be fast or slow? A nuclear wasteland with a Zimbabwe economy is our future. The question is only one of how soon we get there.

Sudden Debt Fri, 12/15/2017 - 19:19 Permalink

This is just fuel for the left who are to lazy to move their asses.We're living in economic wonderfull times if you're willing to work and aren't going to give up on every little roadblock that passes your way.The number of people I've seen growing rich in the last decade alone, who all started from scratch is mindbogling.This summer we had a BBQ and we where making jokes that there was for 10 million euro's worth of cars in the driveway. If you like to play the victim, you can blame the world for being poor but if you want to make money and get rich, this is the moment.And if your big plan in life is flipping burger for McDo or working for Wallmart, you'll never reach that goal.Life is about taking risk and working your ass off for at least a decade if you want to make it and if I had more time, I would start a dozen other companies because the number of opurtunities is limitless these days. Rule 1 to strike it rich: Don't do anything everybody can do. Making sandwiches isn't a valuable trade. Trade & import is the best earning maker, services in marketing and communication is second, IT is third. And there's about 1000 difference types of businesses on each branch. The problem is that so many people are so fucking stupid and can't figure stuff out for themselves!!They'll maybe try to google some ideas and give up because that's not where you'll find those ideas.FUCKING DO SOMETHING WITH YOUR LIVES!! THERE'S NO SECONDS AFTER THIS ONE!IF YOU CAN'T MAKE IT IN A TIMEPERIOD WHERE THEY'RE ACTUALLY THROWING MONEY THROUGH THE WINDOW IF YOU WANT BUILD A BUSINESS, YOU'LL NEVER MAKE IT AT ALL!! AND THIS OPTION WON'T LAST FOREVER!IF YOU'RE HAVING A HARD TIME NOW, YOU'LL BE PISSING BLOOD WHEN THE ECONOMY WOULD TANK! 

I Write Code Sudden Debt Fri, 12/15/2017 - 19:33 Permalink

You're very right, and you're very wrong.  There are indeed oceans of excess cash sloshing around looking for something to do.  If you can write a competent business plan people will bury you with cash, and all you have to do then is make good on your plan.But these are not skills that 90% or 95% of the people have ever done or are likely to do, and even if they did that volume of entrepreneurship would probably bust the pipes somewhere else. And that's exactly why the numbers look like they do.  There's plenty of money, but it's not accessible to 90% or more of the population.  It calls for new kinds of economics, that to the old school types is going to look like nine kinds of socialism, or communism, or Obamanation, or something.  A lot of people are going to be given modest sums of money for nothing, pretty much literally.  I can't see any way around it.

In reply to by Sudden Debt

3-fingered_chemist Sudden Debt Fri, 12/15/2017 - 19:56 Permalink

I'd say most people do not want to chase the money because really it is not worth it. All people want is a fair shake so that they can raise a family and put food on the table and save a little for retirement. Like you said, life sucks and then you die. I know plenty of rich people that hate themselves. All they do is chase more money to drown out their self-hatred. How many material things can one person want? This has been exemplified by all the sex scandals coming out of the elite circles. These people had everything and all they did was treat everyone around them like trash because that's how they view themselves.

In reply to by Sudden Debt

rent slave Sudden Debt Fri, 12/15/2017 - 21:24 Permalink

How about forcing the Jews to let us bet on sports nationwide online?NJ passed a law 6 years ago allowing their citizens to wager,but the Jews went to Court,stopping them cold.Now,just when the Supreme Court opens for its fall term,they kill 58 goyim at a concert to threaten 9 on the Court.I'm certain that there are many other areas in which these vipers block humans as well.It's not always the victim's fault,especially with these vermin around.

In reply to by Sudden Debt

devo Fri, 12/15/2017 - 20:05 Permalink

Desperate, low IQ retards in WV and those shit States voted for this idiot thinking he'd get them coal jobs. Yeah, coal in the stockings maybe. So duped (again). He's funnelling money up from your poor asses into old fuddy duddysy' wallets. Wake the fuck up that Replubicans are not on your side. They're very against you -- total contempt.

moonmac Fri, 12/15/2017 - 20:09 Permalink

These cocksucking thieves would condone muggers robbing little old ladies as long as a small portion of the stolen loot went into their investment accounts!

atlasRocked moonmac Fri, 12/15/2017 - 21:57 Permalink

Only a liberal would blame the rich person getting the money, instead of the gov't PAYING THEM the money. Classic lefiist deception - use gov't money to addict the rich to gov't funded profits so everyone has "acces" to their products, then blame the rich person for taking the money the liberal advoated months early .  

In reply to by moonmac

JailBanksters Fri, 12/15/2017 - 20:16 Permalink

Seen it all before and before and beforeThe more a companies sales drop, the less staff are needed being paid less so the CEO's can get paid 2x or 3x more and so the share prices go up.This is the new business model, not sure if it's a business though, it's just a Entity with a Stock Price. 

moonmac Fri, 12/15/2017 - 20:37 Permalink

Jesus told us to forgive the people who sin against us. One exception was the Money Changers he beat and bull whipped out of the temple.‎

xrxs Fri, 12/15/2017 - 20:43 Permalink

If things keep going this way, one of these election cycles, the proletariat are going to go full MBS at the Riyadh Ritz on the 1%

moonmac Fri, 12/15/2017 - 20:49 Permalink

Selling livestock at a premium in the Temple because you've paid extra for a Competitive Advantage?‎Jesus goes ballistic turning over all the tables beating the shit out of everyone. ‎Manipulating Money on totally rigged markets?‎Jesus gives His Blessings...

moonmac Fri, 12/15/2017 - 21:19 Permalink

My name is Helicopter Ben. I cried in front of Congress about my son owing a half million in student loans. Next thing you know I bail out Wall Street and the Big Banks pay me $500K a speech. Praise Jesus!‎

redmudhooch Sat, 12/16/2017 - 09:57 Permalink

Small business cannot compete when the game is rigged by those with all the $$$ and political influence.Govt. should not be picking winners.Fuck China and fuck NAFTA. End the Fed, end the monopolies, only way to MAGA.