how soon before the US in same state as Greece?

[Geof Nanto]

This is an excellent website for informed economic analysis outside of mainstream commentary.

 

http://www.zerohedge.com/

 

From Zerohedge today.....

 

The Next Derivatives Implosion Just Started in Europe

 

For over 30 years, sovereign nations, particularly in the West have been buying votes by offering social payments in the form of welfare, Medicare, social security, and the like.

 

When actual bills came due to fund this stuff, Governments quickly discovered that current tax revenues couldn’t cover it (see the image below)… so they issued sovereign debt to make up the difference.

 

And so the global bond bubble was created.

 

As far back as 2009, most Western nations were completely bankrupt when you consider unfunded liabilities from their social policies. But Central Banks did everything they could to paper of this fact by soaking up as much bond issuance as possible while simultaneously maintaining zero interest rates......

[3bob]

I listened to Greg Smith and he sounds right on to me! 

[Apech]

When I was much younger I knew a young lady who had two very good points.

 

 

Here we are having an earnest conversation about global economics and you are making tit jokes.    

[Marblehead]

Here we are having an earnest conversation about global economics and you are making tit jokes.  

But a fair comparison none-the-less.  With tits, more than a mouthful is wasted, with global economics, more than what is best for the greatest number of people is wasted.  It goes to those who return no productivity to society.  At least a tit offers pleasure and comfort.

[liminal_luke]

I like to think of myself as intelligent enough but I haven´t the foggiest what this debate is about.  Hopefully following this conversation is not a prerequisite for developing myself as a qi gong/taoist meditation enthusiast.

 

Liminal

[Marblehead]

Hey Liminal, it's just a discussion between conservative and liberal ideals.  How the economy should operate because common people don't know how to engage in commerce.

[Apech]

Hey Liminal, it's just a discussion between conservative and liberal ideals.  How the economy should operate because common people don't know how to engage in commerce.

 

No, no it's about women's breasts ... it would be about men's breasts but we're all flat chested.

[Aetherous]

On the contrary, I've actually done the research

 

So have I.

 

See how much you care, and how little you believe me? That's similar to how I feel when you say that. It's not a discussion.

 

Neither of you would trust any sources I provided nor respect any analysis I offered

 

That's an assumption, and just so you know, it's a false one about me. There are no sources that I absolutely disrespect and distrust.

 

and, frankly, I don't care whether your paradigms get shifted.

 

Yeah it's not such a big deal.

[Geof Nanto]

I like to think of myself as intelligent enough but I haven´t the foggiest what this debate is about.  Hopefully following this conversation is not a prerequisite for developing myself as a qi gong/taoist meditation enthusiast.

 

Liminal

 

Yeah, this forum is probably not an appropriate place for this debate. Maybe it should be moved to "Off Topic"?

 

However the topic of economic sustainability is one that deserves much wider attention. It's an issue both the left and the right of politics shy away from. Democracy favours sugar coated policies from all sides. To my mind the world economy has gone the way of mainstream diet; namely, it's centred on junk food and stimulants. 

[Marblehead]

No, no it's about women's breasts ... it would be about men's breasts but we're all flat chested.

Damn!  You brought back a memory.

 

About fifteen years ago after I finished a good dead weight session (about three months) my body was looking really great.

 

I went to visit some friends, the daughter (in her late twenties) and I were talking and somehow the conversation went to breasts.  I said that my boobs looked better than hers did.  She responded, "I know.  And that pisses me off."

[3bob]

Some women here may not appreciate such jokes... while others may?

[Perceiver]

Maybe if we stopped spending more money than we have we wouldnt have a debt problem.

 

But this is never gonna happen with today's politicians who are fighting to keep a welfare system and state floating that we cant pay for to the same extent as before.

 

That being said though i think there are ways we might be able to pay for all of this and more, if we rethink our economic systems at the grand scale. But that too is never gonna happen with today's politicians who are not very visionary.

 

I think all if our countries are destined for a long slide into less fortunate times, regardless of who is in charge. The boat will keep floating, but not more than that.

 

The only thing that might permanently save us is an economic gamechanger of some sort, like the internet of things.

[Marblehead]

Some women here may not appreciate such jokes... while others may?

That would be their choice, wouldn't it?

[Jetsun]

Isn't the majority of the US debt owned by US banks? (I understand the Chinese own some but not the majority) if that is true I don't see how they could let the country fall, if it really came down to it they could cancel the debt. It is more an issue of erosion of democracy by a transfer of power to those banks I think.

[Brian]

California is likely to be the first state in the Union to default so we can watch to see what happens. Of course, the city of Detroit already defaulted.

[Brian]

So have I.

 

See how much you care, and how little you believe me? That's similar to how I feel when you say that. It's not a discussion.

 

 

That's an assumption, and just so you know, it's a false one about me. There are no sources that I absolutely disrespect and distrust.

 

 

Yeah it's not such a big deal.

OK, I'll give you the benefit of the doubt here and provide a little of the research for your consideration:

https://mitpress.mit.edu/index.php?q=books/minimum-wages

http://www.cbo.gov/sites/default/files/44995-MinimumWage.pdf

https://www.epionline.org/wp-content/uploads/2015/05/Oakland_MW_Report1.pdf

http://www.slate.com/blogs/moneybox/2014/06/02/seattle_raising_its_minimum_wage_to_15_it_s_history_in_the_making.html

http://epionline.org/studies/EPI_SanFrancisco_Studyv4.pdf

http://www.nytimes.com/2013/12/05/business/15-wage-in-fast-food-stirs-debate-on-effects.html?pagewanted=all&_r=1

http://borderlands-books.blogspot.com/2015/02/borderlands-books-to-close-in-march.html

http://epionline.org/studies/EPI_TheImpactof980FederalMinimumWage.pdf

https://www.minimumwage.com/2014/06/new-survey-seattles-15-misstep

https://www.epionline.org/wp-content/uploads/2014/07/120228_EPI_CanRaisingtheMinWageReducePovertyandHardship.pdf

http://www.socsci.uci.edu/~dneumark/Neumark%20et%20al%20MW%20evaluation%20May%202013%20ILRR%20final%20rev.pdf

http://www-rohan.sdsu.edu/~jsabia/docs/Sabia_Burkhauser_Hansen_ILLR2012.pdf

http://www.socsci.uci.edu/~dneumark/min_wage_review.pdf

https://www.epionline.org/wp-content/studies/macpherson_06-2002.pdf

https://www.epionline.org/studies/r132

http://www.epionline.org/study/r131

http://www.epionline.org/study/r129

http://www.epionline.org/study/r128

http://www.people.vcu.edu/~lrazzolini/GR2010.pdf

http://www.census.gov/prod/2013pubs/p60-245.pdf

http://online.wsj.com/news/articles/SB10001424127887324616604578302153328738108

https://www.minimumwage.com/2015/05/raise-the-wage-sponsors-dont-pay-any-wage-to-their-interns/

http://www.cjr.org/the_audit/the_minimum_wage_and_the_danis.php?page=all&print=true

http://cdn.theatlantic.com/newsroom/img/posts/Sabia_Burkhauser_SEJ_Jan10.pdf

http://www.facesof15.com

http://thf_media.s3.amazonaws.com/2013/pdf/ib3866.pdf

[Jeff]

California is likely to be the first state in the Union to default so we can watch to see what happens. Of course, the city of Detroit already defaulted.

 

Illinois has more debt per capita and no where near as good weather. So I will take that bet.

[Brian]

Yeah, that's another good one to watch.

[gendao]

Isn't the majority of the US debt owned by US banks? (I understand the Chinese own some but not the majority) if that is true I don't see how they could let the country fall, if it really came down to it they could cancel the debt. It is more an issue of erosion of democracy by a transfer of power to those banks I think.

So, rob ants (including children & all post-Boomer generations) to pay grasshoppers again?

If any generation is entitled, it’s our parents’ and grandparents’ generation: the Baby Boomers.

True entitlement is tripling the national debt since the 1980s and using the proceeds to spend lavishly on tax cuts and government programs that primarily provided short-term economic boosts, while refusing to raise the Social Security age of retirement or to reduce benefits, even as the gluttonous program careens toward unsustainability.

So basically, if you don't believe in overunity economics, where output should miraculously exceed input (like where a country with 50% unemployed youth and lavish benefits should magically remain solvent)...then you simply have no understanding of economics! Like Looney Boomers, who ran up the largest debt in world history, obviously do!

We Are Seeing The Effects Of The Minimum Wage Rise In San Francisco

As we keep trying to point out to people there really isn’t anything even remotely resembling a free lunch when it comes to the discussion of wages and labor. Meaning that just because well meaning liberals wave their magic wand and decree that wages will rise there will indeed be countervailing effects.

A rise in wages will come out of either less labor being employed, lower profit margins (and fast food doesn’t have those wide enough to take the strain) or price increases to consumers.

A rough guide to the finances of the fast food industry is as follows. 30% goes on wages, 30% of revenues goes on ingredients and the other 40% is everything else. Rents, advertising, capital costs and, of course, profits. Those profits are pretty low. 5% of revenues isn’t an out of order estimation of the net profit margins in the business (and, of course, that’s an average, as some locations and some whole chains lose money).

So, if we by legislative fiat raise the price of one of those inputs then something, somewhere, has to give. Those profit margins are already pretty thin and so they’re not going to be where that extra cost comes from. More than that if we reduce the returns to capital in a particular line of business then less capital will be invested in that line of business in the future. This means fewer jobs in that line of business: This is one of the ways that a rise in the minimum wage destroys jobs. Fewer will be created in the future than would have been in the absence of the rise in the minimum wage.

There really is no such thing as a free lunch. Only lunches of variable cost. And if we increase the cost of one of the major inputs into such lunches then something else will give. Here, as a result of the rise in the minimum wage Chipotle has raised prices in that specific location where the minimum wage rise occurred.

As we’ve been saying all along: a rise in the minimum wage really does destroy jobs.

 

Memo To The Fight For $15: Puerto Rico Happens With A Too High Minimum Wage

Bad things happen to an economy when the minimum wage is too high for the output and productivity of the labour force. And they’ve happened to Puerto Rico.

So, they definitely think that high labour costs ( in benefits) and the high minimum wage are a problem.

We’re told that a higher minimum wage will reduce inequality. Puerto Rico has that higher minimum wage, relative to average wages, yet PR’s inequality, measured by the gini, is at .57 higher than any US State and significantly higher than the US as a whole. We’re told that a higher minimum wage will reduce poverty: which will produce hollow laughter in Puerto Rico. We’re told that a higher minimum wage will produce more jobs: not the experience of Puerto Rico, is it?

In fact, in a place that does have a higher minimum wage, under pretty much the same laws as the rest of the US, a high minimum wage doesn’t seem to be delivering any, not one single one, of the things that it is claimed a high minimum wage will achieve for the United States as a whole.

Edited July 7, 2015 by gendao

[JohnC]

 

 

Seriously though....

Maybe never. Maybe tomorrow. No one really knows.

 

While we are speculating on things that we can't know, when you will become enlightened, when we will all give up on war, when you will win the lottery, or when cold fusion will be developed.

 

Or on the negative, consider when you will die, when an asteroid will hit the earth or when a black hole will swallow our solar system.

 

John

[3bob]

John, I don't see your analogy working that way with all things, especially with material things and money related to it.  Why - because material things are not so nebulous in other words and for instance you either work to earn money so you can buy food or you work as a gardener or farmer so you can have food - and a person can not go very long without doing one or the other.  (Btw. when populations were small you could harvest directly from nature yet you still had to work at it under varying conditions, such are givens)

[CloudHands]

You're a master troll. *deep bow*

 

(humour)

[gendao]

Looney Boomer accounting to go along with Looney Boomer Debt Junkie economics:

The Pentagon Doesn’t Know What it Spent 8.5 Trillion Dollars on

When government is completely dysfunctional and seems not to serve the people’s interests, we have to wonder where our tax dollars are going. Thanks to a Reuters investigation by Scot Paltrow, we have an answer—or, rather, a non-answer. Apparently, the Pentagon has made use of $8.5 trillion of our tax money handed over by Congress since 1996—but don’t ask what was done with the money. The Department of Defense doesn’t have a clue.

Audits of all federal agencies were mandated by law beginning in 1996, but the Pentagon is unique in never having complied. In almost 20 years, the Pentagon has never accounted for trillions it spent, in part because “plugging”—fudging the numbers—is standard operating procedure.

When it was announced that the military’s budget would be cut by $52 billion in 2014, Secretary of Defense Chuck Hagel had a fit, telling a defense conference: “[The cuts are] too deep, too steep, and too abrupt. This is an irresponsible way to govern and it forces the department into a very bad set of choices.” This is quite befuddling to the rest of us, as the $581 billion budget that year was more than the total of the next 10 biggest spenders combined

Edited July 7, 2015 by gendao

[Marblehead]

That's probably because the operation and maintenance costs at Area 51 are out of this world.

[ralis]

I certainly hope this is reinstated!

 

http://www.democraticunderground.com/10026950453

 

http://thehill.com/policy/finance/247093-warren-mccain-introduce-bill-to-bring-back-glass-steagall

 

 

 

Sens. Elizabeth Warren (D-Mass.) and John McCain (R-Ariz.) are reintroducing legislation to revive the Glass-Steagall Act, which would force big banks to split their investment and commercial banking practices. 

Glass-Steagall was first passed in 1933 but repealed during the Clinton administration, leading many progressives to argue that it contributed to the 2008 financial collapse. 

Warren and McCain, along with their cosponsors, Sens. Angus King (I-Maine) and Maria Cantwell (D-Wash.), said in a statement that the legislation would make big banks that are "too big to fail" smaller and safer and minimize the likelihood of a government bailout. 

The bill, which they first introduced in the last Congress, would separate traditional banking with checking and savings accounts from financial institutions that offer services such as investment banking, which are riskier.