Quote :

"Well here is the thing. Those people took risks. Taking economic risks is a big part of why they are more well to do than the average food stamp recipient. Yet, with risks come the possibility of losing. I don't know if it is the government's place to bail those people out. However, when the poorest of Americans, those who didn't make a dime off of the real estate bubble or the bull market in stocks, start finding even harder to scrape by thats a serious issue. "

well they took a risk to drop out of highschool or to pursue a career as a NBA player instead of getting a real profession. how exactly is raising food stamp privileges having a net benefit on the economy. Maybe it will benefit you if you own stock in BUD, F, or NKE.

The current hiccup in the economy is not really effecting the poorest americans. After all people still need their McD's and clothes dry cleaned.

1/9/2008 1:25:18 PM

Quote :

"And don't give me more bullshit about some companies disagreeing. They all have motives (even the ones pointing to a recession) just like the people who are saying there is no peak oil, there is no climate change, and jesus is coming soon."

SkankinMonky

Do you even think about what you're posting? Yes, they all have motives--so why do you continually overemphasize the negative in your posts? You have a motive, too--and I'm suspicious of it.

And don't start throwing in your kitchen sink filled with left-wing bile just because I so thoroughly owned you on the last page. It was actually painful for me to watch as it was occurring.

1/9/2008 1:34:56 PM

Quote :

"well they took a risk to drop out of highschool or to pursue a career as a NBA player instead of getting a real profession. how exactly is raising food stamp privileges having a net benefit on the economy."

Well, not to really get into this but dropping out high school is actually a low risk strategy. Dropping out and getting a job a McDonald's pays with probability 1, trying to finish school only pays in the event that you actually pass your classes and graduate. In short, dropping out of high school is to the labor market as a traditional low yield savings account is to investing. A extremely low risk strategy that people employ because they don't understand or are afraid of better opportunities.

Second, when unemployment spikes, it spike hardest for the least educated. Thats because educated workers tend to slide down the chain. The college worker takes a retail job to make ends meet. The high school graduate takes a job loading trucks. The drop out gets the unemployment line.

There is of course unemployment among the more educated but at much lower levels.


Also, on the aggregate effects of food stamps. The concern for many of us is that economy will experience a consumer driven recession. An increase in the purchasing power of some consumers will allay that. Because the spending has a multiplier effect it will spread throughout the economy.

[Edited on January 9, 2008 at 1:45 PM. Reason : spending]

1/9/2008 1:40:43 PM

^ Yes, but what about the opportunity cost?

1/9/2008 1:59:04 PM

Quote :

"Do you even think about what you're posting? Yes, they all have motives--so why do you continually overemphasize the negative in your posts? You have a motive, too--and I'm suspicious of it. And don't start throwing in your kitchen sink filled with left-wing bile just because I so thoroughly owned you on the last page. It was actually painful for me to watch as it was occurring. "

I emphasize the negatives because they're there and can be fixed. If you're at work and see a problem do you try to fix it or do you simply emphasize that other things do work? Seriously, get a reality check.

As far as being suspicious of my motives, have fun - I'm fairly open about my beliefs.

And as far as you owning me - saying that an organization isn't government owned (despite government funding) is not owning me in the least. It's like saying that a study isn't biased even though it was funded by the organization it was casting in a bright light.

1/9/2008 2:14:15 PM

Quote :

"Yes, but what about the opportunity cost?"

Of which part?

1/9/2008 2:33:36 PM

^ Are you kidding? The opportunity cost of foregoing the completion of high school to take a low-wage job. In addition, what grade in high school would the person be dropping out?

1/9/2008 2:38:01 PM

I am SURE the average welfare mom will usual the extra $15 / week she has from foodstamp hand outs to save money, buy basic necessities for her children


happy 10000 posts to me!!!!

I agree with Hooksaw ; dropping out of high school to flip burgers is NOT a safe economic investment in ones future. If it truely is then maybe that person really does not deserve to excel in life. Darwin in action.

[Edited on January 9, 2008 at 3:46 PM. Reason : a]

1/9/2008 3:44:28 PM

Quote :

"Are you kidding? The opportunity cost of foregoing the completion of high school to take a low-wage job. In addition, what grade in high school would the person be dropping out?"

I didn't know if you meant of the stimulis.

The clear opportunity cost of dropping out is that you are foregoing the chance at higher earnings.

So sometimes, people mix up the concepts of low risk and prudence. I am not arguing that it is prudent to drop out of school. Just as it is not prudent to leave your life savings in a low yeild savings account. However, it is lower risk.

Completing school is not free. At a minimum there is the opportunity cost of working when you are otherwise in school or studying. Suppose you are considering droping out in 10th grade. If you stay for 2 more years you might graduate but in some cases you might not.

A crisis may pull you out of school or in some cases you may keep failing your classes or you might just decide at the last minute that this was a bad idea. In any case you spent nearly two years working on something that didn't pan out.

This tradeoff become even more stark when you talk about trying community college or a four year school. So dropping out and taking the basic job is low risk. Yet, it is also extremely low yeild.

This is important because getting people to stay in school is encouraging them to take risks and we should recongize that when we try to sell it.

1/9/2008 3:57:44 PM

Forgoing a high school or college degree is a much riskier "strategy" than obtaining a diploma.

If you were to use unemployment rates as a proxy for the probability of being unemployed at any given time, the marginal risk is much higher for a high school/college dropout

Unemployment rates per BLS
Less than a high school diploma 7.2
High school graduates, no college 4.3
Some college or associate degree 3.3
Bachelor's degree and higher 1.7

As you mentioned, high school dropouts are the first to lose their jobs during an economic slowdown. The opportunity cost of dropping out of high school all for the sake of 2 years of income is much higher when compared with the increased number of years one is likely to spend their life unemployed with zero income.

Further, comparing dropping out of high school with a low-yield savings account is a stretch. A low-yield savings account provides a near 100% probability of at least some nominal return. The probability of obtaining a job as a droppout is not equal to 1 as demonstrated above

[Edited on January 9, 2008 at 11:22 PM. Reason : .]

1/9/2008 11:13:53 PM

^

But the probability of not having to got to school is one, and lots of people hate school.

At at minimum you forgoe the opportunity of getting a full time job. However, much greater than that return for many people is the reward of not having to sit in class.

We know that this is true because if given the opportunity to

1) Go to school

2) Work and get paid

3) Hang out and do nothing

Many kids will prefer (3). Therefore, the immediate reward of (3) must be higher for those kids, since (3) has almost no future reward.


I like the analogy with the savings account because over much of the last decade for example, the return from having your money there was negative, quite negative for a while in real terms. The added risk from even a high yeild account of the sort offered by E-Trade is really very very tiny. Yet, the return was in many cases 5 times as high.


Any time you give up something today, to get something tomorrow you are taking a risk. Goofing off, having unprotected sex, using drugs, all pay off with probability one. If you avoid drugs but get hit by a car anyway then you may have (depending on your preference for drugs) given up something but received no return.

1/10/2008 11:16:04 AM

http://www.msnbc.msn.com/id/22592939/

Rates are going to get cut again at the end of the month. They think there's a chance of a half percent rate cut.

1/10/2008 1:53:00 PM

They're saying 2% if the recession is true and occurs for 3 or 4 quarters

1/10/2008 1:55:14 PM

They should be raising rates to quell inflation. The cowards don't have the guts, and they've painted themselves into a corner.

Gold and silver are breaking out on the news.

the dollar dips further on helicopter Ben's talks of rate cuts
http://www.marketwatch.com/news/story/dollar-dips-further-bernanke-signals/story.aspx?guid=%7B5453D19A%2D7F4D%2D4D59%2DAAAB%2D35935A6D7C8F%7D&siteid=yhoof


---

http://en.wikipedia.org/wiki/Hyper_inflation

"The main cause of hyperinflation is a massive and rapid increase in the amount of money, which is not supported by growth in the output of goods and services."

And they think this is going 'stimulate' growth ?

1/10/2008 4:59:41 PM

1970s stagflation followed by 1980-1982 recession ahoy!

[Edited on January 10, 2008 at 6:23 PM. Reason : .]

1/10/2008 6:22:26 PM

^ Yeah, the real problems came during the presidency of one Jimmy Carter--Democrat.

misery index

Quote :

"noun an unofficial indication of a nation's economic health, derived by adding the percentage rate of inflation to the percentage of unemployed workers: With inflation running at 15 percent and unemployment at 8 percent, the misery index is 23 percent. [Origin: 1975–80]"

http://dictionary.reference.com/browse/misery%20index

And why didn't you tell the whole economic story of the Reagan years? Why did you stop at 1982? The economy bounced back under Reagan, didn't it? And that was impressive--then as it is now.

Quote :

"Liberal critics of the 1980s who argue that the middle class withered are half right for the wrong reasons. The proportion of middle class Americans did indeed decline, but this reflected an upward movement of households into the high income category. Meanwhile, the proportion of low income households declined, as more became middle class. The income growth of the Reagan years boosted the fortunes of Americans at all income levels. Christopher Frenze Chief Economist to the Vice Chairman, [Joint Economic Committee of Congress]"

[Edited on January 11, 2008 at 2:39 PM. Reason : ]

1/11/2008 2:20:14 PM

^ interesting chart

1/11/2008 2:36:56 PM

^ I thought so.

1/11/2008 2:38:03 PM

since when is 50k high income? what about inflation of that period?


i'm always skeptical of 'actual income' charts. stuff needs to be adjusted for inflation/purchasing power etc.

1/11/2008 2:44:12 PM

^ Chart: "(1989 dollars)." FYI.

1/11/2008 3:03:21 PM

Yea, which means it's not adjusted. I was 7 in 89 and therefore have no real knowledge of the value of 50k in 1989.

1/11/2008 3:05:20 PM

i wonder what that chart would look like stretched out to today and normalized....

1/11/2008 3:05:56 PM

that chart also assumes the dollar in 1980 is the same as 1989 which is my main beef with it.

1/11/2008 3:08:43 PM

unlikely, since it says it's in 1989 dollars that usually means it's been adjusted for inflation retroactively

1/11/2008 3:10:16 PM

^^^^ (1) Wrong--damn. (2) It's $50K+, dummy. (3) The point is not the actual value of $50K--Jesus! It's the numbers relative to one another and to other periods (you can't be that stupid). And (4) there is no reason to adjust the 1989 numbers to today's dollars, because the issue currently at hand is economic conditions during the Carter-Reagan years.

^ Exactly.

FYI: $50K today puts you above the earnings of half the households in America.

http://www.bankrate.com/brm/news/retirement/20071101_American_wealth_a1.asp


[Edited on January 11, 2008 at 3:21 PM. Reason : .]

1/11/2008 3:15:39 PM

I don't know if I would blame Carter for the economic problems of the late 70s/early 80s. That was mostly the fault of the Vietnam War/highest oil and gas prices ever/severe loss of manufacturing jobs. Kind of the same way Bush can't be blamed for the economic hardships we are about to face in the next couple of years (if you actually believe we are going to go through hardship). Reagan did a good job of restoring confidence and helping the free market but it's hard to give him too much credit as well. If you actually believe that America works on a free market system, then the president should really get very little blame/credit for the economy during his term.

1/11/2008 4:32:08 PM

^ Presidents get the credit and the blame for a number of things over which they have very little or no control.

1/11/2008 5:20:06 PM

True, but they probably have the least direct control over the economy.

1/11/2008 5:22:54 PM

^ Yes, but the fact remains.

1/11/2008 5:25:54 PM

lol like clinton gets credit for the late nineties, and bush gets the blame when the bubble burst, whoever is elected next will get blamed for the impending down swing, won't be as big as the .com implosion but it will be 'noticeable'

1/11/2008 6:42:06 PM

Quote :

"that was mostly the fault of the Vietnam War/highest oil and gas prices ever"

but you can blame those courses of events on policy, be it Presidents' or lawmakers' faults

1/13/2008 9:03:35 PM

This is actually a good thread to read from start to finish. It shows how the opinions of regular contributors to the thread have changed from the start of November to current.

1/17/2008 5:48:47 PM

Quote :

"Top House Democratic leaders have been discussing plan proposals that include tax rebates for individuals, breaks for businesses and more money to help food stamp recipients and the unemployed. A"

OMFG the stock market is fucking fumbling and all the other economic problems yet the democrats are still trying to increase food stamps handouts as part of the "solution" to fix the economy. This does absolutly NOTHING except maybe help the bottom line for budweiser, altira, or the chrome rim company.

1/17/2008 7:05:06 PM

^forget those gamblers, all they do is sit around and gamble with their money, so what if they lose
are you against feeding people who are hungry?

anyways how serious are ya'll taking this recession, how bad do you think it can get?

1/17/2008 7:49:31 PM

how about those awesome bush economic policies.

1/17/2008 7:53:32 PM

The tax cuts were good for the economy, but the irresponsible spending both on a personal and federal level is about to bite us in the ass.

1/17/2008 8:17:37 PM

1/22/2008 2:00:34 PM

1/22/2008 3:03:13 PM

I fail to see a correlation

1/22/2008 3:07:11 PM

As the housing market destroys any value the dollar once had, exports go up.

1/22/2008 4:07:15 PM

To all the economic experts, what should I be doing with my money right about now? I only have a couple of investments (money market, I believe), but my primary concern is my checking account. Should I close out my account and just hide all my money under a mattress? What should I do to prepare for the coming recession?

1/22/2008 6:26:17 PM

buy gold

1/22/2008 6:28:49 PM

Buy guns.

1/22/2008 6:30:34 PM

^^ and ^

1/22/2008 7:29:59 PM

We're due for a correction. We should also end this dumb war. We should also end our need for foriegn oil/middle east.

1/22/2008 7:51:39 PM

Quote :

"how about those awesome bush economic policies."

skokiaan

So Bush is to blame?

1/22/2008 7:56:29 PM

let's see.

we can start with tax cuts (good) coupled with increased spending(bad).

I think it would be fun if everyone just lists one bad economic policy by the bush administration and see how many pages we can get to.

1/22/2008 9:33:00 PM

bad

Quote :

"Expanding Homeownership. The President believes that homeownership is the cornerstone of America's vibrant communities and benefits individual families by building stability and long-term financial security. In June 2002, President Bush issued America's Homeownership Challenge to the real estate and mortgage finance industries to encourage them to join the effort to close the gap that exists between the homeownership rates of minorities and non-minorities. The President also announced the goal of increasing the number of minority homeowners by at least 5.5 million families before the end of the decade. Under his leadership, the overall U.S. homeownership rate in the second quarter of 2004 was at an all time high of 69.2 percent. Minority homeownership set a new record of 51 percent in the second quarter, up 0.2 percentage point from the first quarter and up 2.1 percentage points from a year ago."

1/22/2008 9:49:22 PM

I didn't even know that. It immediately places in my Top 10 worst moves of his Presidency. Not an easy list to break into, mind you.

1/22/2008 10:00:22 PM

Liberals were lapping that homeownership shit up too. Americans are fucking stupid and would punish any politician who was against all those homeownership initiatives. Everyone wants a handout.

1/22/2008 10:04:11 PM