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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

#181

Post by bjourne »

kspacewalk2 wrote: post #180
bjourne wrote: post #99

Earlier quoted context omitted.

Yes, savings are "intrinsically less moral" as savings are money not being used. And since wealth accumulates itself the more savings the more income inequality. It is intrinsically immoral that the wealth controlled by two dozen Western families is larger than the wealth of three billion people.

>Yes, savings are "intrinsically less moral" as savings are money not being used. Incorrect. Savings (i.e. bank deposits, financial instruments of various degrees of risk, from GICs to junk bonds) are very much being used, they are lent to other entities. Few people "save" by stuffing pieces of paper or gold coins under a mattress. >And since wealth accumulates itself the more savings the more income inequality. The…

> Incorrect.

Why did you ask the question if you thought you already knew the answer? By definition, savings are being saved. Investments are being invested. If you think that savings and investments are synonymous then you are wrong. According to https://www.marketwatch.com/picks/heres-exactly-how-much-ame... the median American has accumulated a measly $6,400 in their decade before retirement. Money they will then need to use when they are retired and without income. And that is in one of the richest countries in the world. So it is correct to talk about borrowers and savers as permanent classes.

Right now, profits are record high while real salaries are shrinking due to inflation (i.e. due to massively raised prices). You have to be a fool not to be able to connect the dots.

Re: Astonishingly strong US jobs report sends stocks wavering

#182

Post by cscurmudgeon »

swimfar wrote: post #102
cscurmudgeon wrote: post #51

Earlier quoted context omitted.

American workers are highest paid in the world. The same evil “wealthy” investor class is not responsible for Americans getting the highest wages but is only responsible for job cuts? https://en.m.wikipedia.org/wiki/List_of_countries_by_average...

And here's a list of countries ranked by median income based on data from the World Bank. The US is "only" 5th by this measure. https://worldpopulationreview.com/country-rankings/median-in...

1. 5th is still high. So, is the evil investor class responsible for even median wages being high? Are we really arguing that median income in the US is low?

2. The other deleted sibling comment had a valid point. The other higher ones are small nations.

Re: Astonishingly strong US jobs report sends stocks wavering

#183

Post by kspacewalk2 »

bjourne wrote: post #181
kspacewalk2 wrote: post #180

Earlier quoted context omitted.

>Yes, savings are "intrinsically less moral" as savings are money not being used. Incorrect. Savings (i.e. bank deposits, financial instruments of various degrees of risk, from GICs to junk bonds) are very much being used, they are lent to other entities. Few people "save" by stuffing pieces of paper or gold coins under a mattress. >And since wealth accumulates itself the more savings the more income inequality. The…

> Incorrect. Why did you ask the question if you thought you already knew the answer? By definition, savings are being saved . Investments are being invested . If you think that savings and investments are synonymous then you are wrong. According to https://www.marketwatch.com/picks/heres-exactly-how-much-ame... the median American has accumulated a measly $6,400 in their decade before retirement. Money they will the…

>Why did you ask the question if you thought you already knew the answer?

"Incorrect" referred to "savings are money not being used", i.e. the rationale for your answer, not your answer itself.

>If you think that savings and investments are synonymous then you are wrong.

You just need to think it through a few more steps. For example, what do banks do? They take your savings and invest them. Bottom line is, savings are absolutely, definitely, and crucially not "money not being used".

>the median American has accumulated a measly $6,400 in their decade before retirement.

No, that's not what the number is. The number is savings, but excluding retirement funds. So if I put money into my Roth IRA or 401k, it's not counted, even though that can be just money sitting in a bank account or a GIC, i.e. very straightforward savings.

>Right now, profits are record high while real salaries are shrinking due to inflation (i.e. due to massively raised prices).

Yes, we have a big problem with inflation, and the Fed (and other central banks) are addressing it.

Re: Astonishingly strong US jobs report sends stocks wavering

#184

Post by BurningFrog »

jacknews wrote: post #159
troad wrote: post #155

Earlier quoted context omitted.

> In what kind of world does a strong jobs number, implying a strong economy, sink stock prices? > There is a clear dichotomy between the 'financial' economy, and the actual economy. The pre-eminence of 'Shareholder value' should be relegated to the 20th century, and we should focus on making the economy serve society. Low unemployment means wage inflation (as companies compete for scarce labor), which means more inf…

You've provided an explanation (which I'm also completely familiar with) but not a rationale. What is really happening is that corporate profits are set to be squeezed (slightly) by rising costs, both labor and capital, and so that provides a reason why stock prices go down. But it doesn't answer the actual question, of why everything going great should be a bad thing.

That question is answered quite well in the post you're commenting.

Re: Astonishingly strong US jobs report sends stocks wavering

#185

Post by positr0n »

swimfar wrote: post #102
cscurmudgeon wrote: post #51

Earlier quoted context omitted.

American workers are highest paid in the world. The same evil “wealthy” investor class is not responsible for Americans getting the highest wages but is only responsible for job cuts? https://en.m.wikipedia.org/wiki/List_of_countries_by_average...

And here's a list of countries ranked by median income based on data from the World Bank. The US is "only" 5th by this measure. https://worldpopulationreview.com/country-rankings/median-in...

And of the 4 above the US, 2 are smaller oil producing nations, one is Switzerland, and the other is Luxemburg.

Re: Astonishingly strong US jobs report sends stocks wavering

#186

Post by lazide »

gymbeaux wrote: post #174
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.

I don’t think so… I mean which inflation figure are you talking about? The one that happens to be about what a 30-year mortgage would also be right now? That’s not usually the case. Mortgage rates are “fed benchmark” + a couple percentage points. Beyond that, correlation to inflation is coincidental.

See my other comments - the fed has been intervening as part of QE since ‘07-‘09 and until recently. they gradually tapered then stopped Dec ‘22. No surprise that mortgage rates started doing weird stuff about then eh?

The relationships to the fed funds rate is also because that is the rate a bank or other big entity can always borrow at, and the fed is happy to ‘print’ as much money as necessary to satiate all qualified applicants at that rate.

Re: Astonishingly strong US jobs report sends stocks wavering

#187

Post by throw0101c »

kspacewalk2 wrote: post #180
bjourne wrote: post #99

Earlier quoted context omitted.

Yes, savings are "intrinsically less moral" as savings are money not being used. And since wealth accumulates itself the more savings the more income inequality. It is intrinsically immoral that the wealth controlled by two dozen Western families is larger than the wealth of three billion people.

>Yes, savings are "intrinsically less moral" as savings are money not being used. Incorrect. Savings (i.e. bank deposits, financial instruments of various degrees of risk, from GICs to junk bonds) are very much being used, they are lent to other entities. Few people "save" by stuffing pieces of paper or gold coins under a mattress. >And since wealth accumulates itself the more savings the more income inequality. The…

> Incorrect. Savings (i.e. bank deposits, financial instruments of various degrees of risk, from GICs to junk bonds) are very much being used, they are lent to other entities.

No, they are not lent to other entities. When a bank creates credit/load, they simply type something into a computer and the entity gets a credit in their account.

The lending of savings and bank reserves and the multiplier has not been a thing for decades. Tobin called this the "Old View" in 1963:

* https://elischolar.library.yale.edu/cowles-discussion-paper-...

* https://www.pragcap.com/r-i-p-the-money-multiplier/

For the modern world see:

* https://www.bankofengland.co.uk/explainers/how-is-money-crea...

* https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/m...

* https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1905625

Re: Astonishingly strong US jobs report sends stocks wavering

#188

Post by xnx »

ashwagary wrote: post #165
zelias wrote: post #6

Considering that most of the growth was in leisure/hospitality, I interpret this move as the official "end" of the lockdown era. We have achieved full reopening/replacement of the bars, restaurants, and hotels that shut down during COVID, who proceeded to hire back all their low wage service workers. This explains the explosion in job growth with a stagnant avg hourly earnings rate - the new jobs are mostly low wage…

I have a feeling a revision to the downside is in the near future. Jobs number games get played during interest rate raise periods.

Games get played by whom and for what purpose?

Re: Astonishingly strong US jobs report sends stocks wavering

#189

Post by Godel_unicode »

anonymouskimmer wrote: post #171
looping__lui wrote: post #56

Earlier quoted context omitted.

Income from capital is generally lower in low-interest regimes. We probably saw inflation in asset classes such as housing and stock as a result of monetary oversupply and cheap access to capital. Not factoring in such things into inflation is a question the Fed would have to address. With a sufficient social net and minimum wages, even poorly qualified have good negotiation power. No offense, but I’m also not sure h…

Unless they are disabled, people should be doing their own house cleaning, doing their own shopping, and etcetera. Service jobs should be limited to corporations. In your home, you (or your children) do it. Otherwise it's a waste of human talent to have another human dedicate their life to doing a menial task.

I don’t understand your point. It’s not a zero-sum game where some people are forced to clean houses. If they want to not clean houses they can change career.

If you don’t pay them you’re not somehow freeing them up to realize their potential, you’re just giving them fewer customers. At least where I live a lot of professional house cleaners are small business owners.

Re: Astonishingly strong US jobs report sends stocks wavering

#190

Post by anonymouskimmer »

Godel_unicode wrote: post #189
anonymouskimmer wrote: post #171

Earlier quoted context omitted.

Unless they are disabled, people should be doing their own house cleaning, doing their own shopping, and etcetera. Service jobs should be limited to corporations. In your home, you (or your children) do it. Otherwise it's a waste of human talent to have another human dedicate their life to doing a menial task.

I don’t understand your point. It’s not a zero-sum game where some people are forced to clean houses. If they want to not clean houses they can change career. If you don’t pay them you’re not somehow freeing them up to realize their potential, you’re just giving them fewer customers. At least where I live a lot of professional house cleaners are small business owners.

Sure, I'm probably going to extremes. There are definite economies of scale to specialize in house cleaning and the like. I'm thinking more about the stereotypical rich person type of service with multiple dedicated servants for a single household.
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