The Viral Economy

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malchior
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Re: The Viral Economy

Post by malchior »

LawBeefaroni wrote: Wed May 12, 2021 10:11 am As noted in the gas thread, prices for everything are going up but there is no inflation because price increases are caused by something other than inflation. Nothing to see here.
3% annualized core inflation was in range with what was expected. Headline came in higher than expected because of prices in volatile goods. But time will tell. It is way too early to jump on the inflation is scary bandwagon.

The numbers: Consumer prices rose sharply again in April and drove the rate of inflation to the highest level in nearly 13 years, signaling greater stress on the economy as businesses grapple with supply shortages that are raising the cost of many goods and services.
And last year this time it was sharply negative. Interesting how that isn't part of this story. Another side note: this "high inflation" was hardly an abnormal inflation level most of last century. It wouldn't have raised eyebrows.

But again the stress should be this was expected. The Fed told us this would happen and they have it under control. But who cares what the experts in charge of the economy say anymore.
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Re: The Viral Economy

Post by Kraken »

malchior wrote: Thu May 13, 2021 11:47 pm It is way too early to jump on the inflation is scary bandwagon.
Yeah, this is the first time we ever turned off the economy and turned it back on. The usual metrics don't mean much while it's still rebooting.
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Re: The Viral Economy

Post by malchior »

Kraken wrote: Fri May 14, 2021 12:43 am
malchior wrote: Thu May 13, 2021 11:47 pm It is way too early to jump on the inflation is scary bandwagon.
Yeah, this is the first time we ever turned off the economy and turned it back on. The usual metrics don't mean much while it's still rebooting.
Right but so far the best models we have essentially hit expected levels right. Core inflation was pretty much in line. The big miss was in volatile goods. Big whoop. You can't model for unexpected pipeline outages, airline pricing returning to normal, etc.

It verges into conspiracy theory but I strongly suspect this inflation is scary story is strongly tied to defeating the American Jobs Act. Corporate America may be playing tax rate defense. It strikes me that the cacophony of panic generally started right after the address to Congress.

Meanwhile, the Fed spent February and March laying out the case for inflation to run off the chain for a little while. Partially because we've persistently undershot the inflation target and partially because they really don't want to raise interest rates until they have a damn good reason to.

I also note this aligns strongly with Republican inclinations to attack Biden's handling of the economy. In other words, there are lot of interests who'd love to spark some inflation panic. My instinct is to cut through the propaganda and listen to the experts (especially at the Fed) who are the actual adults managing the situation.
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Re: The Viral Economy

Post by Kraken »

malchior wrote: Fri May 14, 2021 12:53 am
Kraken wrote: Fri May 14, 2021 12:43 am
malchior wrote: Thu May 13, 2021 11:47 pm It is way too early to jump on the inflation is scary bandwagon.
Yeah, this is the first time we ever turned off the economy and turned it back on. The usual metrics don't mean much while it's still rebooting.
Right but so far the best models we have essentially hit expected levels right. Core inflation was pretty much in line. The big miss was in volatile goods. Big whoop. You can't model for unexpected pipeline outages, airline pricing returning to normal, etc.

It verges into conspiracy theory but I strongly suspect this inflation is scary story is strongly tied to defeating the American Jobs Act. Corporate America may be playing tax rate defense. It strikes me that the cacophony of panic generally started right after the address to Congress.

Meanwhile, the Fed spent February and March laying out the case for inflation to run off the chain for a little while. Partially because we've persistently undershot the inflation target and partially because they really don't want to raise interest rates until they have a damn good reason to.

I also note this aligns strongly with Republican inclinations to attack Biden's handling of the economy. In other words, there are lot of interests who'd love to spark some inflation panic. My instinct is to cut through the propaganda and listen to the experts (especially at the Fed) who are the actual adults managing the situation.
Apparently our "hair on fire" smiley is gone, so please imagine it here.
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Re: The Viral Economy

Post by LordMortis »

Kraken wrote: Fri May 14, 2021 1:09 am Apparently our "hair on fire" smiley is gone, so please imagine it here.
We never had one. You had to hijack it from somewhere.
malchior wrote: Fri May 14, 2021 12:53 am I also note this aligns strongly with Republican inclinations to attack Biden's handling of the economy. In other words, there are lot of interests who'd love to spark some inflation panic. My instinct is to cut through the propaganda and listen to the experts (especially at the Fed) who are the actual adults managing the situation.
I can't speak to republicans attacks on Biden but the expectation of inflation goes back to the increased unemployment and first round of "stimulus" checks. That very much pre-dates Biden.
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Re: The Viral Economy

Post by malchior »

LordMortis wrote: Fri May 14, 2021 7:03 amI can't speak to republicans attacks on Biden but the expectation of inflation goes back to the increased unemployment and first round of "stimulus" checks. That very much pre-dates Biden.
There are always inflationistas hanging in the eaves yelling that printing money leads to inflation. I can remember when the Greek chorus were screaming the Great Recession stimulus was going to lead to high inflation. It ended up being much too small and we ended up with a very long broad recovery. They've been consistently wrong. That wasn't exactly what I'm talking about but same mechanism. In this case, what I'm saying is that there is more alignment between the forces so the volume has been turned up to shrill. Inflation is one of the top googled words at the moment. "Buffet says prices are rising and people are accepting them! Inflation is nigh!" Well core inflation came in at 3% annualized. People need to really get a grip.
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Re: The Viral Economy

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coopasonic wrote: Thu May 13, 2021 4:27 pm
geezer wrote: Thu May 13, 2021 3:11 pm
Smoove_B wrote: Mon May 10, 2021 12:01 pm

I swear, I'm not picking on TX. :wink:
You should. This is a shit state with the government it deserves. I'd be outta here in a millisecond if my wife would leave.
Yeah the state and local govts can largely go to hell, but for me the combination of employment opportunity, weather and cost of living is hard to match plus in my area the schools are pretty good. My wife won't do snow and requires that I bring her piles of money.
I hear you. I would have said the same until not too long ago, but it just feels like the state is going in the wrong direction. I mean, a total f'n lunatic pulled 45% in a local school board election here in *Austin* (and not in the outlying 'burbs) by screaming about "Critical Race Theory" and how kids were being taught "postmodernist Marxism." (And my wife feels much like yours regarding snow, much to my disappointment.)
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Re: The Viral Economy

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Anecdotally, the worker shortage is real. My daughter got hired at $8 an hour with 1/2 of a phone interview for fast food. Applied Saturday night and was employed by Sunday afternoon. Starts training today.

McDonald's nearby is posting $9/hr to start. Austin has cook and server positions at $15-$17 and can't get anyone over three months... no applications. Men's Wearhouse (San Antonio) had 51 applications put in, 4 came in for interviews, and 0 acceptance.

There's some theories that a lot of these folks are working Amazon Warehouses which are paying around $15/hr.
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Re: The Viral Economy

Post by Octavious »

I'm shocked that people aren't flocking to $9 an hour jobs. Maybe just maybe this will cause companies to start paying a bit more? That would be horrible. Of course what will really happen is that all the benefits will get cut off and they will have to go back to the slave wages. :doh:
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Re: The Viral Economy

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Octavious wrote: Mon May 17, 2021 10:22 am I'm shocked that people aren't flocking to $9 an hour jobs. Maybe just maybe this will cause companies to start paying a bit more? That would be horrible. Of course what will really happen is that all the benefits will get cut off and they will have to go back to the slave wages. :doh:
Why did they "flock" to $9/hr jobs in 2019?

And while I'm not surprised about that, it is a bit surprising when it extends to $15/hr.

Of course the answer is pay more wages and raise prices... until you can't.
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"To wield Grond, the mighty hammer of the Federal Government, is to be intoxicated with power beyond what you and I can reckon (though I figure we can ball park it pretty good with computers and maths). Need to tunnel through a mountain? Grond. Kill a mighty ogre? Grond. Hangnail? Grond. Spider? Grond (actually, that's a legit use, moreso than the rest)." - Peacedog
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Re: The Viral Economy

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Octavious wrote: Mon May 17, 2021 10:22 am I'm shocked that people aren't flocking to $9 an hour jobs. Maybe just maybe this will cause companies to start paying a bit more? That would be horrible. Of course what will really happen is that all the benefits will get cut off and they will have to go back to the slave wages. :doh:
What will happen is that it will be an excuse to raise prices and inflation will happen, not actually making things better for the wage earners. Profits gotta flow to the top somehow. But for people and entities with large amounts of debt, this is a good thing, right?

I don't know the right answer. We are so tied to making money for "stake holders" that labor costs are a stain.

CNBC keeps interviewing Kevin O'leary on the subject and he makes my blood boil. He's downright livid that he has to compete with government unemployment checks to pay people sustenance level wages to work.
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Re: The Viral Economy

Post by Octavious »

noxiousdog wrote:
Octavious wrote: Mon May 17, 2021 10:22 am I'm shocked that people aren't flocking to $9 an hour jobs. Maybe just maybe this will cause companies to start paying a bit more? That would be horrible. Of course what will really happen is that all the benefits will get cut off and they will have to go back to the slave wages. :doh:
Why did they "flock" to $9/hr jobs in 2019?

And while I'm not surprised about that, it is a bit surprising when it extends to $15/hr.

Of course the answer is pay more wages and raise prices... until you can't.
Because they had no choice. I have no doubt that there are a ton of people perfectly happy to sit and collect unemployment for more than they were making working. That's obviously not ideal, but a lot of that has to do with a lot of jobs pay dogshit and it needs to change.
Capitalism tries for a delicate balance: It attempts to work things out so that everyone gets just enough stuff to keep them from getting violent and trying to take other people’s stuff.

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Re: The Viral Economy

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LordMortis wrote: Mon May 17, 2021 10:33 am
Octavious wrote: Mon May 17, 2021 10:22 am I'm shocked that people aren't flocking to $9 an hour jobs. Maybe just maybe this will cause companies to start paying a bit more? That would be horrible. Of course what will really happen is that all the benefits will get cut off and they will have to go back to the slave wages. :doh:
What will happen is that it will be an excuse to raise prices and inflation will happen, not actually making things better for the wage earners. Profits gotta flow to the top somehow. But for people and entities with large amounts of debt, this is a good thing, right?

I don't know the right answer. We are so tied to making money for "stake holders" that labor costs are a stain.

CNBC keeps interviewing Kevin O'leary on the subject and he makes my blood boil. He's downright livid that he has to compete with government unemployment checks to pay people sustenance level wages to work.
We aren't "tied to making money for stake holders." We have a system where private individuals invest capital when they expect they can get a return. If they don't get that return, they can opt to sell. If their expenses exceed their income they go bankrupt. We even have laws set up so that you even get special protection if you don't want to turn a profit. You participate in this system. You're an investor. You talk about Ford all the time. Their profit margin is 3%. Is that unreasonable?

Kevin O'Leary is a jackass, but there's a point to be made. Unemployment benefits in Texas are above $13/hr. Why would anyone choose to work for less than that? It's all well and good to arbitrarily say "pay more" but the demand side of the equation doesn't change until some of it goes out of business. That may be what we want, but do understand that the demand side is what allows you to raise prices; not some arbitrary desire. We all know that if business could charge more; they would. It has nothing to do with labor prices.
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Re: The Viral Economy

Post by Kraken »

Several Republican states are reimposing poverty by refusing the expanded and extended federal unemployment benefits in order to drive their citizens into unwanted jobs. If their supposed worker shortages evaporate, that will lend credence to the argument that people aren't taking these jobs because they don't have to. If the jobs still go unfilled, it supports the argument that lack of child care, health fears, and better opportunities are keeping workers away. We should have data to argue over within a few months of these policies being enacted.
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Re: The Viral Economy

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LordMortis wrote: Mon May 17, 2021 10:33 am .

CNBC keeps interviewing Kevin O'leary on the subject and he makes my blood boil. He's downright livid that he has to compete with government unemployment checks to pay people sustenance level wages to work.
O'Leary is a joke. He made his money selling a bill of goods to Mattel and screwed the shareholders.

The more someone appears on TV, they less they're out actually doing stuff. And he's on TV all the time.
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Re: The Viral Economy

Post by malchior »

noxiousdog wrote: Mon May 17, 2021 10:47 am
LordMortis wrote: Mon May 17, 2021 10:33 am
Octavious wrote: Mon May 17, 2021 10:22 am I'm shocked that people aren't flocking to $9 an hour jobs. Maybe just maybe this will cause companies to start paying a bit more? That would be horrible. Of course what will really happen is that all the benefits will get cut off and they will have to go back to the slave wages. :doh:
What will happen is that it will be an excuse to raise prices and inflation will happen, not actually making things better for the wage earners. Profits gotta flow to the top somehow. But for people and entities with large amounts of debt, this is a good thing, right?

I don't know the right answer. We are so tied to making money for "stake holders" that labor costs are a stain.

CNBC keeps interviewing Kevin O'leary on the subject and he makes my blood boil. He's downright livid that he has to compete with government unemployment checks to pay people sustenance level wages to work.
We aren't "tied to making money for stake holders." We have a system where private individuals invest capital when they expect they can get a return. If they don't get that return, they can opt to sell. If their expenses exceed their income they go bankrupt. We even have laws set up so that you even get special protection if you don't want to turn a profit. You participate in this system. You're an investor. You talk about Ford all the time. Their profit margin is 3%. Is that unreasonable?
Actually an interesting paper dropped recently on the subject. It is from a more liberal think tank but they ascribe policy to a 40% or so gap between productivity and wages since the 70s and identify multiple policy levers that led to it.

They essentially argue that government policy has been driving inequality. I read about half so far but the abstract was pretty interesting reading alone. The ;tldr is that economic policy has been indeed 'tied to making money for stake holders' or more classically through rent seeking. The abstract American worker was abandoned in the process left to compete with globalization forces, employment law geared entirely in the employers favor, skill mismatches without support, etc.

My take assuming this is directionally correct is that the result has been what we've seen: persistently low wages, lower than target inflation, economic inequality indicators blinking red, etc. This reality ran smack dab into a pandemic which is making people reassess everything. In anyt case, tying it to 'unemployment checks' is too simple too. It's complex but we're seeing something happening that is frankly unusual and will take time to process.

Edit:

Pulled out the money section.
As we will discuss, six factors can collectively explain most of the growth of wage inequality and the erosion of labor’s share that resulted in wage suppression over the last four decades (specifically 1979–2017):

1. Austerity macroeconomics, including facilitating unemployment higher than it needed to be to keep inflation in check, and responding to recessions with insufficient force;

2. Corporate-driven globalization, resulting from policy choices, largely at the behest of multinational corporations, that undercut wages and job security of non-college-educated workers while protecting profits and the pay of business managers and professionals;

3. Purposely eroded collective bargaining, resulting from judicial decisions, and policy choices that invited ever more aggressive anti-union business practices;

4. Weaker labor standards, including a declining minimum wage, eroded overtime protections, nonenforcement against instances of “wage theft,” or discrimination based on gender, race, and/or ethnicity;

5. New employer-imposed contract terms, such as agreements not to compete after leaving employment and to submit to forced private and individualized arbitration of grievances; and

6. Shifts in corporate structures, resulting from fissuring (or domestic outsourcing), industry deregulation, privatization, buyer dominance affecting entire supply chains, and increases in the concentration of employers.
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Re: The Viral Economy

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malchior wrote: Mon May 17, 2021 11:15 am It is from a more liberal think tank but they ascribe policy to a 40% or so gap between productivity and wages since the 70s and identify multiple policy levers that led to it.

WTF Happened in 1971



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Don't necessarily agree with the site's pro-crypto thesis but shit sure changed in the seventies, for whatever reason.
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Re: The Viral Economy

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That's a different concept. On the macro level all those things can absolutely be true; and especially true when you're talking about the multinationals or super capital intensive industries.

But on the individual business level, that's not how it works. In the US, firms with fewer than 500 workers accounted for 99.7 percent of the 5.6 million US businesses. It takes very little money (comparatively speaking) to open a business. Granted, the less capital you have, the harder it is, but it's done all the time. In those cases, it's extremely competitive for both labor and customers.

For instance, I was thinking what it would be like to retire from my job and take some of my money and run a bar. If I didn't want to be tied to it, I'd have to hire a manager and pay in salary at least $60k a year. That means I need to pull an extra $100k in profit per year (benefits) or nearly $2000 a week. That's not the rent or any other expenses I have, but a single employee.

Putting that in perspective, if I sold a Jack and coke for $10, that's revenue of $170 (ignoring coke costs) leaving me $150 of profit. I then need 106 customers per week, (again ignoring all other expenses) to justify a single management employee.
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Re: The Viral Economy

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LawBeefaroni wrote: Mon May 17, 2021 11:38 am Don't necessarily agree with the site's pro-crypto thesis but shit sure changed in the seventies, for whatever reason.
Globalization and computers.
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"To wield Grond, the mighty hammer of the Federal Government, is to be intoxicated with power beyond what you and I can reckon (though I figure we can ball park it pretty good with computers and maths). Need to tunnel through a mountain? Grond. Kill a mighty ogre? Grond. Hangnail? Grond. Spider? Grond (actually, that's a legit use, moreso than the rest)." - Peacedog
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Re: The Viral Economy

Post by malchior »

noxiousdog wrote: Mon May 17, 2021 11:54 am
LawBeefaroni wrote: Mon May 17, 2021 11:38 am Don't necessarily agree with the site's pro-crypto thesis but shit sure changed in the seventies, for whatever reason.
Globalization and computers.
They discounted computers heavily in the paper I dropped. Automation was not a primary cause. In fact, they noted to other automation productivity improvements in other eras went to workers in a 'fair way'.
LawBeefaroni wrote: Mon May 17, 2021 11:38 amDon't necessarily agree with the site's pro-crypto thesis but shit sure changed in the seventies, for whatever reason.
The main driver in the paper I dropped ascribes a big factor in their view as the loss of labor unions and the erosion of labor leverage. Capital started chipping away at unions in the 50s to a significant degree so there is a mismatch. I'd think though that makes some sense. There probably is a tipping point. You chip away at unions. Union membership declines over time, wage pressure diminishes, etc. It isn't overnight. Much like the policy levers took decades to work in the other direction but even 20 years ago the wage/productivity gap was pretty wide.
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Re: The Viral Economy

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malchior wrote: Mon May 17, 2021 11:58 am
noxiousdog wrote: Mon May 17, 2021 11:54 am
LawBeefaroni wrote: Mon May 17, 2021 11:38 am Don't necessarily agree with the site's pro-crypto thesis but shit sure changed in the seventies, for whatever reason.
Globalization and computers.
They discounted computers heavily in the paper I dropped. Automation was not a primary cause. In fact, they noted to other automation productivity improvements in other eras went to workers in a 'fair way'.
Two different issues.

1) Corporate profit. <-- Globalization and computers.
2) Why aren't workers sharing. <-- your paper focuses on this.
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"To wield Grond, the mighty hammer of the Federal Government, is to be intoxicated with power beyond what you and I can reckon (though I figure we can ball park it pretty good with computers and maths). Need to tunnel through a mountain? Grond. Kill a mighty ogre? Grond. Hangnail? Grond. Spider? Grond (actually, that's a legit use, moreso than the rest)." - Peacedog
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Re: The Viral Economy

Post by malchior »

noxiousdog wrote: Mon May 17, 2021 12:04 pmTwo different issues.

1) Corporate profit. <-- Globalization and computers.
2) Why aren't workers sharing. <-- your paper focuses on this.
No - they linked both. It's bullet point 2 above. I'm not saying it's right and I'm still chewing through it. However, the framework feels compelling and it builds on Piketty. It is almost like a 'Grand Unified Theory' of wage inequality.
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Re: The Viral Economy

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I require a reminder as to why raining arcane destruction is not an appropriate response to all of life's indignities. - Vaarsuvius
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Re: The Viral Economy

Post by malchior »

stessier wrote: Thu May 20, 2021 9:14 am Hadn't heard about the drought effecting microchips on top of everything else. 360 days without noticeable rain. Wow.
Yikes. I hadn't heard about that either. This actually partially explains some of the issues one of my clients reported last week. They are partially based in TW. It is very helpful to understand because custom System on a Chip and other IC shortages may have impacts in industries that you would not expect. It really feels like there are major shortages all over the board right now.
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Re: The Viral Economy

Post by malchior »

It really feels like there are shortages of everything - now pool tablets. I thought it was weird I was hearing people complaining about this at my local pool store. I happen to have a huge bucket left over from last year.
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Re: The Viral Economy

Post by malchior »

Infrastructure talks breaking down.

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Re: The Viral Economy

Post by Carpet_pissr »

malchior wrote:It really feels like there are shortages of everything - now pool tablets. I thought it was weird I was hearing people complaining about this at my local pool store. I happen to have a huge bucket left over from last year.
Pro tip: switch to liquid bleach. Easier to find, cheaper, and much better for your pool water health.
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Re: The Viral Economy

Post by malchior »

Carpet_pissr wrote: Tue May 25, 2021 10:41 am
malchior wrote:It really feels like there are shortages of everything - now pool tablets. I thought it was weird I was hearing people complaining about this at my local pool store. I happen to have a huge bucket left over from last year.
Pro tip: switch to liquid bleach. Easier to find, cheaper, and much better for your pool water health.
I use both - open with liquid bleach and supplement with tablets when I travel or need a bit higher level of CYA. Liquid bleach is actually *way more expensive* here for most folks. My local store carries it in 5 gallon tubs with a great volume discount (approximately $10 for 5 gallons). My BIL drives 45 minutes down here to get it. His alternative is Leslies/price club at $15-16 for 4 gallons. Nearly double the cost. Anyway, for me the tabs are holdovers from when I traveled for work. Also, my CYA levels tend to be low - we actually have a local ammonia phenomenon that tends to drive it down over the winter so I use them to help bring the CYA levels up to a reasonable level.
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Re: The Viral Economy

Post by Smoove_B »

So who is out and spending money right now? It's not people that are vaccinated:
The vaccinated are “proceeding with cautious optimism,” said Derrick Fung, chief executive of Cardify. “They’re still not really comfortable doing live entertainment where there’s crowds of people.”

People who aren’t vaccinated, on the other hand, tend to be more risk tolerant and are already living a relatively normal life, Mr. Fung added. “As places open up, they’re the ones leading the charge.”

Spending at entertainment venues was up 20% among consumers who don’t plan to get the vaccine in April compared with January 2020. It was up just 10% among vaccinated people during that same period, according to Cardify.

Across the country, foot traffic—a proxy for spending—at many providers of in-person services such as airports, hotels and theaters is still below pre-pandemic levels. But it is up from the winter, and has climbed more rapidly in states with Covid-19 vaccination rates below 45% as of May 3 than in states with higher rates, according to an analysis by data company Earnest Research.
Maybe next year, maybe no go
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Re: The Viral Economy

Post by LawBeefaroni »

Smoove_B wrote: Tue May 25, 2021 11:34 am So who is out and spending money right now? It's not people that are vaccinated:
The vaccinated are “proceeding with cautious optimism,” said Derrick Fung, chief executive of Cardify. “They’re still not really comfortable doing live entertainment where there’s crowds of people.”

People who aren’t vaccinated, on the other hand, tend to be more risk tolerant and are already living a relatively normal life, Mr. Fung added. “As places open up, they’re the ones leading the charge.”

Spending at entertainment venues was up 20% among consumers who don’t plan to get the vaccine in April compared with January 2020. It was up just 10% among vaccinated people during that same period, according to Cardify.

Across the country, foot traffic—a proxy for spending—at many providers of in-person services such as airports, hotels and theaters is still below pre-pandemic levels. But it is up from the winter, and has climbed more rapidly in states with Covid-19 vaccination rates below 45% as of May 3 than in states with higher rates, according to an analysis by data company Earnest Research.
Definitely not the case here. Everyone I know is vaccinated and they are spending with abandon. It may make a difference the we still have indoor masking and other restrictions. We'll see in June-July when we go completely weapons free.
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LordMortis
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Re: The Viral Economy

Post by LordMortis »

I took some time off after the holiday. I hope to go eat at a restaurant outdoor with my parents for lunch on one of those days. That will be the first time in over a year and a half. Does that count? By then most the mandate will have been lifted here but my mother still refuse to get inoculated so I won't be eating indoors with her. She can make that choice on her own but I won't be contribute to her getting ill. And who knows, maybe my stance will help nudge her in the right direction.
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Re: The Viral Economy

Post by malchior »

This disingenuous bullshit is what Manchin is enabling. The GOP will say $1T when it is essentially money already committed in existing baseline budgeting. In comparison, Biden's original $1.7T was almost all new spending and would help to fill the output gap from last year. The GOP has moved up $30 Billion overall but is claiming a headline number jump of $600B to nearly $1T. It's a shell game as they lump in additional programs with high existing baseline spending. SIgh.

Edit: Big credit to Jennifer Epstein for not falling for this 3-card monty garbage.



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Re: The Viral Economy

Post by malchior »

Senator Schatz's cryptic tweet here is the breakdown in what is claimed as the headline move and the bottom number is the actual increase in spending they proposed. A sham. Capito et. al. are playing a very disingenuous game. I saw her on CNBC this morning talking all reasonable but she is an absolute viper.



Edit:

My prediction is that Biden is going to accept some compromise without any tax increases on corporations. Biden is being forced to play up Manchin's call for bipartisanship. If he does, he better be able to trade that for something substantive from Manchin because this will in essence be a defeat for the agenda he announced. Progressives are going to rightly howl at the moon since in real terms any agreement along these lines is essentially window dressing.

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Re: The Viral Economy

Post by malchior »

Why Are Democrats Falling for Republicans fake negotiations again
President Biden's infrastructure package is bogged down in fake negotiations with Republicans. After weeks of haggling with Sen. Shelley Moore Capito (R-W.V.) and five other GOP senators, the talks are reportedly on the verge of collapse. But if you were worried about something getting passed, fear not! Another group of GOP senators are reportedly preparing another fake deal to take its place and waste more time.

As Eric Levitz argues at New York, this entire effort is pointless. Bipartisanship has ceased to be. Worse, every moment of delay raises the risk of neurotic Democratic members of Congress derailing the process with frivolous or corrupt objections, or the party losing its Senate majority outright from an untimely death. This dithering could ruin Biden's presidency.

The total lack of good faith even among so-called Republican moderates can be seen in the White House's negotiations with the Capito group. Biden (who has long boasted of his ability to cut deals with the other side, and is plainly eager to get some stamp of bipartisanship) lopped off $500 billion in his latest proposal, taking it down to $1.7 trillion. The Republicans, who have been demanding the middle and working class shoulder the cost with user fees instead of tax increases on the rich, responded by reportedly upping their bid by just $50 billion — that is, one tenth as much. Biden has already categorically ruled out the user fees idea, erasing any possibility of agreement. (Besides, there aren't even enough senators in the Capito group to overcome a certain filibuster.)

At time of writing, Biden has set a deadline of Memorial Day on negotiations, and Republican senators are reportedly scrambling to put together a $1 trillion plan that would supposedly be paid for with unallocated pandemic relief money. There may actually be that much money that hasn't been spent yet, but redirecting it would require defunding previous Democratic priorities.

Let's be real: Republicans obviously don't want Biden to pass anything. They want to string him along with fake promises of bipartisanship, running out the clock on the Democratic majority, until they get a chance at taking control of Congress in the 2022 midterms. If that happens, they will try to strangle the economy by demanding massive austerity every time the government needs to pass a budget or raise the debt limit — trying to create a recession that Biden will be blamed for, so that the Republican nominee (probably Donald Trump) will be elected in 2024.

This is exactly what Republicans like Sen. Chuck Grassley did the last time Democrats controlled Congress and the presidency — promise an illusory bipartisan compromise to make proposals worse and eat up time, then vote against them anyways. Senate Minority Leader Mitch McConnell openly proclaimed his priority of winning above all else in 2010, and he's saying the same thing now. "One-hundred percent of our focus is on stopping this new administration," he said in early May.

Even more ominously, the Democratic conservative wing is finding more and more complaints about the tax hikes in the infrastructure bill. Sen. Joe Manchin (W.Va.) doesn't like the corporate tax hike. Reps. Cindy Axne (Iowa) and Ritchie Neal (Mass.) don't like the inheritance tax increase on the ultra-rich. Sens. Bob Menendez (N.J.) and Mark Warner (Va.) don't like the capital gains hike. A whole bunch of others want to cut taxes on the rich by repealing the cap on the deduction of state and local taxes.

This mobilization to keep down taxes on the rich is of course baldly corrupt, but it's also characteristic of the Democratic personality. As a rule, the deciding votes in the party caucus are anxious, fussy, and above all terrified of doing anything. Their primary objective is to avoid blame, not accomplish things. Hiding in a closet while Republicans plot to gerrymander you out of power is a good way to lose, but at least you can generally avoid negative media attention and say "it wasn't my fault," even if it's not true.
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Re: The Viral Economy

Post by Smoove_B »


The U.S. economic recovery is unlike any in recent history, powered by consumers with trillions in extra savings, businesses eager to hire and enormous policy support.
Article here:
Usually in the months or years after a recession, the labor market remains slack as job seekers vastly outnumber job openings. High unemployment and weak wage growth hinder consumer spending and discourage businesses from expanding. The longer it takes for spending to rebound, the greater the risk that businesses will fold and workers will leave the labor force, taking with them the human and organizational capital needed to restore growth.

The economy appears to be dodging that vicious cycle. “The fact that it has recovered so quickly has limited the scope for a lot of scarring relative to, say, in the Great Recession,” said Stephanie Aaronson, an economist at the Brookings Institution.
Looking forward to seeing how the GOP tries to sabotage this one.
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Re: The Viral Economy

Post by Zarathud »

This was an economic disruption not a downturn. Demand and capacity of goods, services and labor are all impacted differently. Many are not going back to work because they now have different life priorities.
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Re: The Viral Economy

Post by Carpet_pissr »

Zarathud wrote: Wed Jun 02, 2021 2:35 pm This was an economic disruption not a downturn.
Well put. The company I used to work for who did market analyses relevant to what we are seeing now, just published a paper. Lots of the top manufacturers on the panel, and they are all saying the same thing essentially: this is a supply/demand problem that was in big part caused by the pandemic slowdown of....well everything. But consuming picked up much faster than producing, and they are just REALLY behind. As more people show up to work, and if they can continue to find employees (kinda big "if" though), this should work out in a few months.

Hint: if you are into investing, buy some manufacturing ETF's or funds! :P Margins *should* be pretty fat for manufacturers for the foreseeable future.

I'm not really sure what to think if the labor shortage continues to be a problem for months, but I suspect that will correct itself as well, as government stimulus slows or stops, and/or manufacturers raise wages to attract workers. We are seeing evidence of both those things happening together already.
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Re: The Viral Economy

Post by malchior »

I think we're in for long-term (6+ months) of continuing disruption at least. There are going to be continuing supply/demand mismatches for some unknown period of time. Plus, our supply chains are global and despite everyone thinking America is the center of the universe the pandemic is still very challenging even in some developed economies. It isn't just workers and economic policy - we have all sort of changes to churn through socially in this country as well and like it or not our politics are going to be a problem too. Things aren't going to just bounce back as much as people want to wish it even with a lot of money primed.
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Re: The Viral Economy

Post by LordMortis »

Carpet_pissr wrote: Wed Jun 02, 2021 3:17 pm Hint: if you are into investing, buy some manufacturing ETF's or funds! :P Margins *should* be pretty fat for manufacturers for the foreseeable future.
Materials, logistics, and supply chain costs are up up. However, administrative costs are down down down and the cost of having stock on hand is the lowest... ever, so the cash is a flowing. What will be interesting is to see what capital expenses look like when the year shakes out.

CNBC reported this morning TMMNA have stock on hand currently at around 9 days. 9 DAYS! Some of that stock on hand is in transit for much of that 9 days. A typical roaring good market when everything is turning up roses is about 3 months inventory.
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Re: The Viral Economy

Post by malchior »

LordMortis wrote: Wed Jun 02, 2021 5:28 pmCNBC reported this morning TMMNA have stock on hand currently at around 9 days. 9 DAYS! Some of that stock on hand is in transit for much of that 9 days. A typical roaring good market when everything is turning up roses is about 3 months inventory.
It is an interesting factoid but lacks a lot of crucial context to understand what is actually happening. Top of mind questions: Are most sales to consumers? Government? Rental companies? Are they substitute purchases due to shortages in other manufacturers? What types of vehicles are selling? In any case, I found the segment where they talked about this; like a lot of stuff on CNBC it is all surface level.
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