Everybody is picking on the multi-billionaires. The beggars (aka "the takers") are always holding out their hand and constantly demanding more — a living wage or a minimum wage, healthcare insurance, paid sick days, vacation days, safety regulations, equal pay for women, pension contributions ... the list goes on and on. When will it ever stop? And can multi-billionaires even afford these unreasonable demands without tanking the entire economy?
Third quarter 2014 real GDP came in at a strong 3.5%. This is the second quarter in a row for solid economic growth. Q1 showed a contraction Take a good look for Q3 GDP will be revised and we estimate strongly downward as imports come into the Census for tabulation. Private inventories contracted, hence investment was much less than Q2. Consumer spending was also tamer. Overall Q3 GDP was surprisingly solid.
The rich get richer and income inequality in America continues to grow in 2013. The wage situation improved from 2012, but it's still pretty bad. The median wage was $28,031.02 in 2013 a paltry 1.9% increase from 2012. While the ratio of median wage to average wage improved, the 110 super rich are now earning 2595 times more than average workers.
The monthly Consumer Price Index increased 0.1% for September. CPI measures inflation, or price increases. September shows relief at the pump while steak lovers are hurting. Core inflation is below the Fed's target point. Yet while the monthly inflation number seems low, the situation is actually much more of a mixed bag, in part due to the way CPI is tabulated.
The existing home sales headlines blare this is the highest increase for 2014. That is true, yet the increase isn't much of a soar, more of a bounce back from last month's -1.75% decline. The NAR reported existing home sales increased 2.4% from last month and are down -1.7% from last year. This represents 5.17 million homes at annualized rates.
Enslaved through trade, That seems to be the agenda with trade agreements these days. Over and over again national law, the common good is overwritten through bad trade deals. Wikileaks has exposed yet another horror from the Trans-Pacific Partnership (TPP) trade agreement being negotiated. It seems freedom loving, Democratic United States is leading the charge to ensure life saving drugs are not affordable for most people.
As often as Carville's catch phrase has been recycled in its more popular form of "It's the economy, stupid" it doesn't quite hit the mark. While Carville's insight might lead to a political victory for a candidate, it does not necessarily lead to an economic solution. It is only an observation of the disease, not its cause. The cause, as we argued in "The Unraveling of Economics", is economic theory itself. In other words, our woes can be traced to the fact that there has never been a sound theory of economics.
The Federal Reserve Industrial Production & Capacity Utilization report shows a 1.0% increase in industrial production for September. Manufacturing alone grew by 0.5%, cancelling out last month's -0.5% decline. Utilities exploded with a 3.9% monthly increase. Mining grew by 1.8%, also a sizable amount for a month.
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