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Well,here we go again. Henwood, preferring to attack anyone who dares challenge the veracity of government statistics, and whoever might suggest that maybe, just maybe, the labor department’s methodologies have been lagging the dramatic changes that have been impacting the labor markets in recent years, has challenged my recent post on jobs…again. Rather than challenge his good buddies in the government bureaucracies, he prefers to play attack dog against those who do.

Let’s take a look at what he’s saying, and how he cherry picks and distorts my points.

First, how about the labor force participation rate, that’s his main topic. At the beginning of 2000 it was 67.3. It hit a low at 62.4 four years ago. That’s 4.9 percentage points. Or roughly five percent of the 164 million US labor force. Today, four years later it’s only 63.2 or 4.1 points. That’s still 6.7 million potential entrants to the labor force who aren’t in it. Presumably they’re adults and supporting themselves some way. Why then aren’t they in the labor force numbers. Better ask the bureau of labor statistics buddies of Doug, but they have no answer. Their explanation for the falling participation is that more workers are taking longer maternity leave or more of them are in jail. I don’t buy any of that. Nor do I buy other economists’ arguments that it has to do with decline of job training by companies. More likely, the BLS is simply not picking up the status of those not officially in the labor force because their methodologies for data collecting are deficient. The BLS doesn’t know where these workers are, just as they have no accurate picture of the undocumented and underground economy employment/unemployment.

More importantly, the falling participation rate reduces the labor force and thus understate unemployment. I believe I said in my article (not quoted by Doug) that it means more than 5 million are thus not counted. Doug can quibble about whether it’s 2015 or 2007 or 2000, but the point is there’s a dramatic decline in the participation rate and the BLS refuses to adjust its employment numbers to reflect it. Result: unemployment is under-stated.

My point about undocumented and underground workers is of course many are working but it is highly likely more are not working and the vast majority are working part time and temp jobs. That’s a net negative for the U-6 unemployment rate. Again, because the CPS conducts a phone survey that doesn’t pick up these groups (who don’t answer I’m sure), it under-estimates the net underemployment/unemployment of these groups.

What Doug refuses to address is how I estimate the real unemployment rate is likely 10%-12%. He just says it’s not accurate. I guess he thinks the ‘discouraged’ worker, ‘missing labor force’ worker, and ‘involuntary part time worker’ numbers offered by the BLS are accurate. I don’t. And I suppose he doesn’t believe that the million more who went on the SSDI roles after 2009 should not be counted as unemployed either.

Really Doug, you should stop trying to call people names and acknowledge that maybe the government is not always telling the facts. It’s not that they are outright lying. It’s just that the labor markets are changing faster than their methodologies can keep up and that they’re bureaucratically conservative. Or even purposely obfuscating, as in their latest report on the number of Gig workers, where they excluded Uber drivers as well as anyone for whom gig work was not their primary job.

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A reader of this blog recently asked an important question: what do I think is the actual unemployment rate in the US today, not the media’s 3.8% that is almost always quoted. Here’s my reply as to why I calculate the real, actual unemployment at minimum to be 10%-12%.

“The real unemployment rate is probably somewhere between 10%-12%. Here’s why: the 3.7% is the U-3 rate, per the labor dept. But that’s the rate only for full time employed. What the labor dept. calls the U-6 includes what it calls discouraged workers (those who haven’t looked for work in the past 4 weeks). Then there’s what’s called the ‘missing labor force’–ie. those who haven’t looked in the past year. They’re not calculated in the 3.7% U-3 unemployment rate number either. Why? Because you have to be ‘out of work and actively looking for work’ to be counted as unemployed and therefore part of the 3.7% rate.

The U-6 also includes what the labor dept. calls involuntary part time employed. It should include the voluntary part time as well, but doesn’t (See, they’re not actively looking for work even if unemployed).

But even the involuntary part time is under-estimated, as is the labor Dept’s estimate of the ‘discouraged’ and ‘missing labor force’.

The labor dept. also misses the 1-2 million workers who went on social security disability (SSDI) after 2008 because it provides better pay, for longer, than does unemployment insurance. That number rose dramatically after 2008 and hasn’t come down much (although the government and courts are going after them).

The way the government calculates unemployment is by means of 60,000 monthly household surveys but that phone survey method misses a lot of workers who are undocumented and others working in the underground economy in the inner cities (about 10-12% of the economy according to most economists and therefore potentially 10-12% of the reported labor force in size as well). The labor dept. just makes assumptions about that number (conservatively, I may add) and plugs in a number to be added to the unemployment totals. But it has no real idea of how many undocumented or underground economy workers are actually employed or unemployed since these workers do not participate in the labor dept. phone surveys, and who can blame them.

The SSDI, undocumented, underground, underestimation of part timers, etc. are what I call the ‘hidden unemployed’. And that brings the unemployed well above the 3.7%.

Finally, there’s the corroborating evidence about what’s called the labor force participation rate. It has declined by roughly 5% since 2007. That’s 6 to 9 million workers who should have entered the labor force but haven’t. The labor force should be that much larger, but it isn’t. Where have they gone? Did they just not enter the labor force? If not, they’re likely a majority unemployed, or in the underground economy, or belong to the labor dept’s ‘missing labor force’ which should be much greater than reported. The government has no adequate explanation why the participation rate has declined so dramatically. Or where have the workers gone. If they had entered the labor force they would have been counted. And their 6 to 9 million would result in an increase in the total labor force number and therefore raise the unemployment rate.

All these reasons–-i.e. only counting full timers in the official 3.7%; under-estimating the size of the part time workforce; under-estimating the size of the discouraged and so-called ‘missing labor force’; using methodologies that don’t capture the undocumented and underground unemployed accurately; not counting part of the SSI increase as unemployed; and reducing the total labor force because of the declining labor force participation-–together means the true unemployment rate is definitely over 10% and likely closer to 12%. And even that’s a conservative estimate perhaps.”

(Addendum Note: The Labor Dept. monthly survey counts ‘jobs’ not workers employed. If in its survey it is counting 2nd and 3rd part time jobs for a single worker, then it is over-estimating employment levels and thus under-estimating the unemployment rate still further since the unemployment rate is a ratio of total employed to unemployed).

What’s the condition of the US working class on this Labor Day 2019? Wages and Jobs are of course the best indicators of that condition. So let’s look at wages and jobs today in America.

What we see is that—contrary to Trump, US government, and mainstream media hype and reporting—a growing number of independent surveys show that wages have not been rising as they claim. And 500,000 fewer jobs were actually created last year than initially reported.

The media’s oft-quoted figure for rising wages is about 3.1% over the past year. But there are at least five reasons why 3.1% is not accurate and in fact grossly over-estimated. First, the 3.1% is not adjusted for inflation. Second, it represents an average only, which reflects higher wages for the top 10% of the workforce and higher salaries for professionals, managers, and supervisors. Third, it applies to full time workers only and therefore leaves out the 60 million or so part time, temp, and gig workers. Fourth, it does not factor into the 3.1% average the fact that the millions of unemployed are getting no wages whatsoever. Fifth, it defines wage narrowly, excluding the lack of any increase in deferred wages (pension payments) and social wages (social security pay for retirees).

Why Wages Are Not Rising 3.1%

Considering the first point, the 3% figure is what’s called a ‘nominal’ wage. If adjusted for the 1.6% inflation rate, then the real wage gain is only 1.5% a year. (It’s even less real wage gain for workers at the median household income level ($50K/yr.) and below—where inflation is even higher than 1.6% due to housing and rent cost, local utility fees and taxes, medical insurance premiums and drugs costs escalation, education and other costs escalation).

The second problem overestimating the wage gains for the vast majority of workers in the ‘bottom 80%’ of the workforce is that the 3.1% represents an ‘average’. Averaging means the highest paid wage earners (which include most salaried workers) are getting more than the 1.5% and therefore, in turn, those at the median or below are getting much less than 1.5%. And in most cases they’re not even getting that 1.5%.

A survey by the finance site Bankrate.com found that “more than 60% of Americans said they didn’t get a pay raise or get a better-paying job in the last 12 months”. So if 60% didn’t get any wage increase at all, how could wages be rising 3.1% or even 1.5%? Unless of course workers in the best paid 10% of the labor force are getting 10% or more in wage increases last year. These are occupations like software engineers, data scientists, physicians assistants, professionals with advanced degrees, and of course middle and upper managers paid mostly by salary. Perhaps they were getting 10%+ last year, but that’s highly doubtful.

Here’s another mainstream respected survey that challenges the 3.1% wage increase myth peddled by the government and media: Focusing on the median wage—not the average wage—“according to figures from the PayScale Index…the median wage increases, when adjusted for inflation, were only 1.1% since last year and 1% over the past year”.

The Payscale survey is corroborated further by a recent study by McKinsey Global Institute which shows that median wages have not risen at all since 2007. By 2017 they were the same level as in 2007, rising less than 1.1%.

Comparing McKinsey with Payscale, there’s been no wage change under Trump. In fact, the Payscale survey concluded that real wages from June 2018 to June 2019 have shrunk by -0.8% and by 9% since 2006.

But that’s still not the whole picture.

There’s another adjustment necessary, even to the 1.1% real wage. Whether 1.5% or 1.1%, that figure applies only to the full time employed workers. It therefore does not take into account the lower wages, and more typical lack of any wage increases, for the 60 million plus ‘contingent’ (part time, temp, gig) workforce that exists now in the US. That’s 37% of the total workforce of more than 160 million who are not factored into the 3.1% estimate at all!

And the numbers for the part time/temp/gig part of the total work force may be much larger than the government is estimating. US Labor Dept. statistics count part time, temp and gig workers for whom their work is a primary job. It doesn’t accurately account those who have a primary part time job (or a primary full time job) AND who have also taken on second and even third part time, temp, or gig jobs to make ends meet. The aforementioned Bankrate survey showed, for example, that while the government data estimates less than a fifth of all workers are part time, the Bankrate survey found 45% of all US workers had second or third jobs. That included 48% of Millennials, 39% of GenXers, and even 28% of Boomers.

The real picture that appears, therefore, is NOT one of traditional full time workers getting annual 3.1% wage increases in their base pay every year. That’s the US labor force of the 1950s and 1960s, not the 21st century.

The real picture is little or no wage increases for the vast majority those workers, especially those below the 80th percentile of the US labor force, and especially those at the median and below, who are being increasingly forced to take on second and third jobs to make ends meet. Meanwhile, a small percentage of the total workforce, likely well less than 10%, comprised of professionals, managers, tech, and advanced degreed special occupations are realizing wage gains well above the average. In fact, those at the very ‘top’, earning more than $150,000 a year may be getting exceptionally large wage increases. That’s because the US Dept. of Labor employs a methodology in which it ‘top codes’ weekly earnings. Top coding means any raises for those earning above $150,000 a year are not being recorded at all.

What all the foregoing analysis strongly suggests is that wages under Trump have not been rising anywhere near close to 3.1%, or even near the inflation adjusted 1.5%. They are not rising at all for the vast majority of the US workforce since 2016.

To repeat the Payscale survey: real wages have actually fallen by -0.8% between 2018-2019.

The disjoint between the 3.1% and the -0.8% is due to the averaging in wages and salaries for the very top occupations and salaries of managers and professionals; due to accounting for only full time employed; and by ignoring most of the part-time/temp workers—the numbers for whom are also much larger than the official government data now indicate.

Add to these reasons for the gap between 3.1% and -0.8% the fact that monthly pension benefits and social security retirement payments—i.e. deferred wages—are never included in the 3.1% figure by the government. They are really wages as well. They are ‘deferred’ wage payments which are foregone by workers while they were actively in the labor force, to be paid out upon retirement. These wage payments are fixed and are therefore constantly declining in real terms. Nor of course have official wage statistics ever considered calculating wages the millions of unemployed workers who, without jobs, get no wages and therefore no wage increases whatsoever. If deferred wages and unemployed with no wages were included in calculating total wage change for the working class, the Bankrate, Payscale, McKinsey and other independent surveys would show annual wage gains—for all but the very highest paid—have been contracting ever faster than -0.8% under Trump.

Business-Investor Tax Cuts Haven’t Created Jobs

A hallmark claim of Neoliberalism in general is that business tax cuts create jobs. This is part of the economic ideology notion called supply side economics. Cutting business taxes raises business disposable income, which it is assumed business then spends largely and instantaneously on new investment that boosts production and therefore hiring. But this is a deceptive misrepresentation (i.e. ideology) of reality. Businesses don’t necessarily spend the tax windfall on investment. They may divert the tax savings into investing in financial markets that don’t produce any jobs. They may distribute it to shareholders in the form of stock buybacks and dividend payouts. They may use it for buying up competitors via mergers and acquisitions. They may simply hoard the savings to boost their balance sheets. Or they may invest it on expanding production—but in their offshore subsidiaries. All this is what in fact actually happens, not that business tax cuts create jobs.

In January 2018, once again, Trump and Congress ‘sold’ the economic lie that business-investor tax cuts create jobs. But there is no empirical evidence that such tax cuts causally result in job creation. In fact, even a correlation between Neoliberal tax cuts and job creation does not exist. Witness Trump’s massive $4.5 trillion tax cuts of 2017. (Yes, $4.5 trillion, not his reported $1.5 trillion). What has actually happened to investment in expanding plant and equipment and therefore employment? After a very brief boost in early 2018, business investment in the US fell to only 2.7% (10% rate is historically average). In 2019 it fell further into negative territory by mid-year, as ‘Business investment contracted in the second quarter for the first time since the first quarter of 2016”. That means if investment—i.e. the mechanism for job creation per the supply side theory—has not risen, then the claim cannot be substantiated in turn that business tax cuts, by creating investment, in turn create jobs.

But hasn’t there been actual job creation since Trump took office? Yes, there has. 1.1 million according to government official stats. However, its causation cannot be attributed to the tax cuts. So where have the 1.1 million jobs come from?

Are ‘Contingent’ (Part-Time/Temp/Gig) Job Greater Than Reported?

US Labor stats do not really report the number of workers finding employment when the Dept. reports job gains each month. It reports jobs—not people—growth. So jobs can be increasing (as second and third jobs added) but employment by real people may not be actually growing by the same number of jobs that were created. Jobs may be increasing by 1.1 million but those newly employed may be far less. Why? Because most of the 1.1 million jobs may represent already employed taking on second and third part time jobs. Recall the prior Bankrate survey which reported that 45% of all American workers indicate they are working second and third jobs to make ends meet! Or the Marketwatch survey that 33% need a gig side job in order to meet living expenses! But the Labor Dept. shows numbers not rising as high for part time and temp work. That may be due, however, to its reporting of part time/temp as the primary job of part time/temp workers. They may be working second and third additional part time jobs and the government is not picking that up—its only accounting for part time/temp jobs that are primary for the person.

Labor Dept. Revises Jobs Down 500,000 for Last Year

The confusion in the Labor Dept.’s job stats is perhaps further suggested by recent revisions in its job creation numbers. Annually the Labor Dept. adjusts its past year job numbers after more data is made available from States’ unemployment insurance records. In its just latest report, prior to the Labor Dept. downward revisions, the Dept. indicated it had over-stated 2018 jobs by no less than 500,000. That brings 2018 monthly job creation numbers well under 200,000, which is about the 180,000 monthly creation in 2017. In other words, no actual increase due to Trump’s tax cuts introduced in January 2018.

The Labor Dept. stats indicate employment rose from July 2018 through July 2019 by 1.1 million jobs. Does that mean the Labor Dept. had erred by nearly 50% in its job growth numbers? If so, it’s such a gross margin of error it makes Labor Dept. job reporting under Trump highly suspect or else something is fundamentally wrong with US job creation stats. What’s wrong is that the stats are failing to accurately reflect contingent job creation as second and third jobs.

Conclusions: A Much Different Wage & Job Picture Than Reported

A deeper look at the official wage and job numbers shows wages rising no where near the official 3.1%. In fact, most of the wage gains are highly skewed to the very top. At the median they’re barely rising, if at all. And certainly contracting below the median (except perhaps for the few millions in blue states where minimum wages have been adjusting some). When defined more broadly and therefore accurately, wages have been contracting under Trump—as they have been since 2006. Various independent surveys that are not based on the Labor Dept.’s questionable assumptions or definitions, or even errors, in its estimation bear this out that wages are not rising.

Reliability of official jobs data is also a growing concern. Changes in the US labor market structure in recent decades means the growing number of contingent and gig jobs that are second and third jobs are not being reflected in the official job numbers. The Labor Dept.’s recent adjustment reducing last year’s job gains by a whopping 500,000 raises further concerns about the methods by which it reports out monthly job gains. And actual job gains, after its adjustment, suggest that most of these may actually represent part time/temp/gig jobs that are second and third jobs taken on by workers who just can’t make ends meet any more with the first contingent job, or even current full time job. Yet Trump and friends keep peddling the myth that more business-tax cuts are needed to create jobs.

Jack Rasmus is author of the forthcoming book, ‘The Scourge of Neoliberalism: US Policy from Reagan to Trump’, Clarity Press, October 1, 2019, of which the preceding material is an excerpt. His website is https://kyklosproductions.com and twitter handle, @srjackrasmus. He hosts the Alternative Visions radio show on the Progressive Radio network weekly, podcasts available are available at http://alternativevisions.podbean.com.

Listen to my radio show of August 30, 2019 and discussion this labor day on independent surveys showing wages are not rising for the vast majority of US labor force, and jobs creation is half of 1.1m and mostly 2nd and 3rd jobs.

TO LISTEN GO TO:

https://www.alternativevisions.podbean.com

    SHOW ANNOUNCEMENT:

What’s the condition of Labor this Labor Day 2019? The official Trump estimate of 3.1% increase in wages this past year is really between -0.8% and 1.1% according to independent bank and other research companies. 3.1% is unadjusted for inflation, is an ‘average’ skewed by big gains for professionals and managers, and refers to only full time workers—leaving out the 60m plus ‘contingent’ part time/temp/gig workers. Independent surveys by Bankrate, Payscale, McKinsey Research, and EPI paint a different picture: 60% of labor force say they got no pay increase at all last year. 45% say they are working 2nd and 3rd jobs to make ends meet. Rasmus debunks with data the Neoliberal lie that business-investor tax cuts create jobs. Trump’s tax cut correlated with big investment collapse. 1.1 million jobs not due to tax cuts last year. US Labor Dept. just announces adjustment of 500,000 fewer jobs last year than previously reported. Monthly job creation no different 2018 than 2017 after tax cuts. Rasmus describes the continuing attack on unions, especially public sector. (Check out Dr. Rasmus’ blog for article on ‘Myths of Wages and Jobs Under Trump’ at jackrasmus.com). Show initially updates Argentina debt crisis, Trump’s fictional call with China, and NY Fed former district President, Bill Dudley’s, push back on Trump’s attack on the Fed.

Deutschebank admits today it has Trump tax returns. What will it show about Trump’s Russian Oligarch connections? Unable to get financing for his business from US banks, which he constantly bilked for decades, Trump borrowed heavily from the Oligarchs before 2016. The oligarch money was laundered through the German investment bank, Deutschebank. Will Congress get the documents now that US courts have ruled he can’t get them from the IRS?

Also my commentary on the recent G7 meeting in France and the mysterious phone call to Trump from China (denied by China) allegedly indicating they wanted to return to trade negotiations. Also, the significance of Bank of England chair, Mark Carney, publicly declaring that central banks should consider adopting or creating another currency besides the US dollar that is destabilizing the global economy.

To listen to my comments from an interview with the Critical Hour radio show…

GO TO:

https://drive.google.com/file/d/1AACEokDPaKvnwCPv2NyAJgzDsK-j6aOn/view

Trump’s Other Wall

Trump brags about the ‘wall of money’ now flowing into the US from abroad–from Europe, Asia, emerging market economies–as the global economy slides into recession there faster than in the US. He thinks that is great news for the US economy. But it’s quite the opposite.

Trump’s trade war, his provoking of a global currency war, his monetary policy of forcing the Fed to lower rates all exacerbate the Wall of Money inflow to the US which hastens the decline of the global economy.

Behind the Wall of Money inflow is $17 trillion in negative interest rates in Europe and Japan that is driving money out of those economies and into US Treasuries as a ‘safe haven’, causing a rise in the dollar relative to other currencies and causing currencies worldwide outside the US to fall in turn. As other currencies fall, capital flight from their economies (Europe, Latin America, Asia) sends still more dollars to the US–driving the dollar higher still. A vicious cycle ensues: declining currencies leads to more capital flight, to more demand for US$, to rising dollar value, to further decline in other currencies, etc. Investment collapses and recessions deepen further outside the US.

US Multinational corporations doing business in other countries see their profits rapidly eroding in those economies, as the currencies in the countries in which they’re doing business collapse. They then rush to convert their Pesos, Euros, Rupees, etc. into dollars as quickly as possible and repatriate their offshore profits back to the US. The result: the US$ rises still more.

Trump’s trade war has a similar negative compounding effect as negative rates offshore, capital flight, and multinational corporation repatriation: Today’s slowing global economy (already in a manufacturing recession everywhere including the US) is largely driven by business investment contracting in the face of uncertainty due to Trump’s trade war. That uncertainty and declining investment leads to central banks worldwide reducing their interest rates in a desperate effort to stimulate their economies, which is now happening. But lower interest rates in Europe, Emerging markets, etc. has the negative effect of depressing the value of their currencies still further–leading to even more capital flight to the US, buying up more US Treasuries, and driving up the US $ even more. In other words, Trump’s trade war is also driving the Wall of Money to grow further.

But the Wall of Money is a symptom and represents the global economy outside the US sliding deeper into recessions–a global economic decline that is now spilling over to the US economy.

What’s Trump’s solution? Trump browbeats the Federal Reserve to get Powell, its chair, to lower rates, in the hope lower rates will discourage capital inflow to the US (i.e. the Wall) and thus slow the rise of the dollar. But global recession and the ‘wall of money’ now more than offset any Fed rate cuts effect on the US$. Meanwhile, Trump’s monetary policy (lower interest rates) accelerates the wall of money inflow further by forcing the central banks of other economies to lower their rates still further.

Trump policies have also set off a global currency war, which is about to intensify as he targets China’s Yuan-Reminbi. China is already responding by allowing the Yuan to slowly devalue to offset Trump’s tariffs on China exports. Devaluation of the Yuan forces other economies to devalue their currencies further, as their central banks lower their interest rates further, in Europe and Japan that means even deeper negative rates and more capital flight to US Treasuries and an even higher US$.

In short, Trump’s trade war, his provoking of a global currency war, his monetary policy of forcing the Fed to lower rates all exacerbate the Wall of Money inflow to the US and hasten the decline of the global economy.

Trump has not only clearly now lost control of trade negotiations with China. He has lost control of US monetary policy with the Fed that now refuses to be stampeded, he has lost control of any stabilization of the US dollar, and he has accelerated forces that are driving the global economy into recession.

And it’s only a matter of time–a short time–before it’s also clear he’s lost control of the US economy as well.

Jack Rasmus is author of the forthcoming book, ‘The Scourge of Neoliberalism: US Policy from Reagan to Trump’, Clarity Press, October 1, 2019. His website is http;//kyklosproductions.com and twitter handle @drjackrasmus.


For my further analysis and critique on these topics listen as well to my last friday, August 23, 2019 Alternative Visions radio show:

    To listen GO TO:

http:/alternativevisions.podbean.com

    SHOW ANNOUNCEMENT

Trump brags about the ‘Wall of Money’ coming into the US from abroad. But what it represents is a global economy deteriorating fast and offshore investors sending their money to US safe haven of Treasuries. How the ‘wall’ is driving up the $US, negating Trump’s tariffs, and negating any trade deal with China. Trump turns up the ‘blame game’ for economy weakening: tantrums against China’s new tariffs, the Fed’s Powell foot dragging on lowering interest rates, and Dems refusing to give more tax cuts to investors. Why Fed rate cuts won’t stimulate the economy. Why Trump’s new proposed tax cuts won’t either. Trump’s next desperate moves to manipulate currencies (US and China’s) that will intensify the emerging currency war. Other topics of the show: debunking Trump’s payroll tax cut idea, why US steel companies are laying off workers in Michigan, and what’s behind the Japan-So. Korea ‘pissing match’ (yup, it’s trade).

More and more we hear from business, and even mainstream academic economist, sources that the US economy is approaching closer to recession. The 800 pt. one day collapse of USstock markets and surge in government bond prices (and flattening of the yield curve) last week has focused attention on the topic in public discourse. The focus was important enough to have Trump’s economic advisor, Larry Kudlow, trot on stage for interviews over the weekend to deny the US economy was growing weaker, or that the China-US trade war was having an increasing negative impact on business confidence and investment. Trump himself gave an impromptu press conference on the Air Force One tarmac on Sunday to peddle the same theme. ‘All’s well in the US economy’. It’s ‘them other guys that’s in trouble’!

For my take on the state of the US economy, and my year long prediction that a recession is around the corner (and already here in key sectors like manufacturing and construction), listen to my hour long radio show, Alternative Visions, of last friday, August 16.

    TO LISTEN GO TO:

http://www.alternativevisions.podbean.com

    SHOW ANNOUNCEMENT:

As more and more independent research arms of banks, big investors, and even economists are now predicting recession is coming (as I have been for the past year), what we hear increasingly from the Trump administration and its apologists is that ‘the US economy is strong and doing fine’. Or, other sources less optimistic are increasing saying recession is coming, ‘but it will be mild this time’. There’s no housing bubble (2007), or tech dotcom bust imminent (2000), or no junk bond crisis (1989), so the coming recession will be mild. In today’s show we examine and discuss both themes—‘the US economy is strong’ and ‘the next recession will be mild, providing contrary evidence and arguments to both. New market sector candidates, contagion channels and transmission mechanisms for the next financial crisis are noted, the much weaker US and global economies as start points of recession are explained, and, how it is argued that monetary and fiscal policies will prove far less effective this time in trying to slow a contracting economy or stimulate recovery. A detailed explanation of what happened in Argentina earlier this past week, and its potential contagion, is addressed. (see my blog, jackrasmus.com, for an in depth analysis of Argentina’s financial asset implosion and what it means in the context of falling financial asset prices now globally).