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Astonishingly strong US jobs report sends stocks wavering

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Re: Astonishingly strong US jobs report sends stocks wavering

#111

Post by boringg »

cscurmudgeon wrote: post #40
lapcat wrote: post #12

Earlier quoted context omitted.

> The simpler reason is that it means that people believe Fed will read this as a license to not have to slow down rate increases But there's a direct relation, because the Fed has been very explicit that they're worried about employment and wage growth, and they're raising interest rates in order to depress those. The Fed operates according to the interests of the wealthy.

If you have a way of reducing inflation without hitting wages or jobs, please share that with world.

[flagged]

Re: Astonishingly strong US jobs report sends stocks wavering

#112

Post by dougmwne »

actually_a_dog wrote: post #98
dougmwne wrote: post #43

Earlier quoted context omitted.

Inflation benefits people in debt and light labor markets benefit people who earn a wage. It hurts people who already have accumulated capital in the form of bonds and stocks. The Fed acts to protect the interests of the very rich, at the expense of the lower and middle class. It is a balance. The government is a democracy and corporations need customers, but the wealth gap must be maintained, lest you lose the suppo…

> The government is a democracy... No, it isn't, and this isn't some "it's a reeeeepublic" rant, either. When half the population couldn't legally vote for most of the country's history, that's not very democratic. "Oligarchy" is a better fit, but apparently we only reserve that for countries we don't like. Average individuals working average jobs and making average incomes get next to no say in anything that happens…

That point I was trying to make is that if the economy were bad enough, people would vote out the incumbent government in droves. The vote is a safety value that prevents riots and armed revolution. Autocracies are brittle to changing public perception and can go the way of the guillotine.

Re: Astonishingly strong US jobs report sends stocks wavering

#113

Post by luckylion »

lazide wrote: post #94
gymbeaux wrote: post #65

Earlier quoted context omitted.

Actually, higher inflation doesn’t necessarily correspond to higher variable interest rates. Indirectly, yea, but only because the fed is raising the benchmark rate to “fight inflation”.

No one is going to write a mortgage for a lower rate than inflation unless they’re crazy (so the gov’t might, but even then not usually!). They’d be signing up to 100% burn their cash doing so. Inflation absolutely impacts mortgage rates, and all other lending.

So the standard mortgage rate is agreed on as "official inflation rate + x%"?

Re: Astonishingly strong US jobs report sends stocks wavering

#114

Post by looping__lui »

GAN_Game wrote: post #95
looping__lui wrote: post #79

Earlier quoted context omitted.

So you are mainly talking about passive income inequality? I was talking about income that is earned. Well, what do you want me to say: the country I live in we have a high tax on inheritance, capital gains etc. But to me personally: I am grown up enough to not care how many Porsches my neighbor has. How does this matter? There are resources that cover basic needs such as health, living, education and food. But in Eu…

> But to me personally: I am grown up enough to not care how many Porsches my neighbor has. How does this matter? When something I made is sold at a company, used raw materials are rebought, but then left over is the wealth I created. A portion goes to me in wages, a portion is mailed off in dividend checks to the heir who is expropriating my surplus time. It matters because the heir is expropriating surplus labor ti…

Then you have either negotiated your share in value creation poorly or your skills are easily sourced.

Irrespective of that you are assuming happiness is just associated to absolute monetary wealth - which I disagree with. If basic resources and needs are catered for and the rest is spent on luxury goods or extravagant lifestyles - how would I care? If you want to still play that game, just travel and ask yourself what a person living in India/Bangladesh/Laos would say about your first world problems. Being born into a wealthy society is the most important differentiator for wealth - and I assume you are totally ok with the luck you had there!?

Re: Astonishingly strong US jobs report sends stocks wavering

#115

Post by Ligma123 »

resuresu wrote: post #31

Just last month we were in a supposed labor shortage and now the jobs report is strong?

>we were in a supposed labor shortage

That's the routine justification for "we need to flood the country with cheap workers from the third world" to lower wages.

Re: Astonishingly strong US jobs report sends stocks wavering

#116

Post by mastax »

horsawlarway wrote: post #91
mastax wrote: post #39

Earlier quoted context omitted.

The Fed did raise rates during the good years before this. And that was with a certain president threatening to fire the Fed chair for raising rates.

raised 225 points in the years between 2015 & 2018 (very slow return to some sanity after the cuts in 2008 down to nearly 0) Immediately dropped by 75 points in 2019 due to trade war concerns (pre covid), then dropped another 150 points in 2020 due to covid. So back to 2008 levels. Raised by 450 points at the threat of "wage growth" and hot employment causing inflation over the last 11 months. --- So yes, they were e…

I'm no economist, but I think it's fair to raise rates slowly after a long slow economic recovery where you're barely seeing any inflation even when markets and jobs are hot. I also think it's fair to raise rates quickly when there's a huge spike in inflation due to at least partly to excess money supply,which does not go away after waiting a few months.

Re: Astonishingly strong US jobs report sends stocks wavering

#117

Post by lapcat »

cscurmudgeon wrote: post #106
lapcat wrote: post #73

Earlier quoted context omitted.

> I wasn’t talking about wage inflation. But you were, because inflation includes wage inflation. > I don’t want to age either. This is a non sequitur.

Is wage inflation the only part of inflation? You are not answering the question. Let me reformulate: How do you reduce general inflation without hitting jobs? It is okay to admit this is logically not possible. > This is a non sequitur It isn’t :)

> Is wage inflation the only part of inflation?

No, there are many factors. The supply chain plays a big part, as we've seen during the pandemic.

Corporate profiteering also plays a big part.

> How do you reduce general inflation without hitting jobs?

I'm not answering the question because I'm not committed to reducing "general" inflation.

I'm happy to increase wage inflation, especially at the lower end.

I would like to reduce specific forms of inflation, for example, health care cost inflation and school tuition inflation.

Whether costs should go up, down, or stay the same all depends on the specific product.

Re: Astonishingly strong US jobs report sends stocks wavering

#118

Post by boringg »

tedd4u wrote: post #80
Loughla wrote: post #35

Earlier quoted context omitted.

Context, for those that were interested like I was. According to Investopedia, based on SSI data. Top .1% is $3,212,486/year 1% is 823,763 5% is 342,987 10% is 173,176 I am waaaaay under that. Education is a joke.

That’s income. Regarding wealth (“net worth”) [1] Median: $121,411 p90: $1,219,126 p95: $2,584,130 p99: $11,099,166 p99.5: $17,557,208 p99.9: $43,207,732 [1] 2020 federal reserve data https://dqydj.com/average-median-top-net-worth-percentiles/

You should probably look at "net worth" with a normalization for age as it would be unfair to compare the 20-40 range vs the 60-80 range. Taking on debt vs paying off debt.

Now to be fair I am not sure you can normalize this as we don't know what the future holds but it's worth noting for anyone sub 30 years old.

Re: Astonishingly strong US jobs report sends stocks wavering

#119

Post by lazide »

luckylion wrote: post #113
lazide wrote: post #94

Earlier quoted context omitted.

No one is going to write a mortgage for a lower rate than inflation unless they’re crazy (so the gov’t might, but even then not usually!). They’d be signing up to 100% burn their cash doing so. Inflation absolutely impacts mortgage rates, and all other lending.

So the standard mortgage rate is agreed on as "official inflation rate + x%"?

Nope. But ‘cost of money’ + x% (where x% is based on risk of repayment, and cost of money includes inflation) is a hard rule for a lender to avoid without going bankrupt.

Lenders who go bankrupt tend to not be lenders very long.

Re: Astonishingly strong US jobs report sends stocks wavering

#120

Post by willcipriano »

horsawlarway wrote: post #91
mastax wrote: post #39

Earlier quoted context omitted.

The Fed did raise rates during the good years before this. And that was with a certain president threatening to fire the Fed chair for raising rates.

raised 225 points in the years between 2015 & 2018 (very slow return to some sanity after the cuts in 2008 down to nearly 0) Immediately dropped by 75 points in 2019 due to trade war concerns (pre covid), then dropped another 150 points in 2020 due to covid. So back to 2008 levels. Raised by 450 points at the threat of "wage growth" and hot employment causing inflation over the last 11 months. --- So yes, they were e…

Wage increases lag behind inflation. There was a serious lack of concern about inflation with the MMT folks at the Fed and the White House telling us, with daily news reports and articles its "transatory" and not to worry about it, then wages start to tip up and it's a five alarm fire and something has to be done. It's utterly transparent.
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