The Economy Still Stagnating As The 10 Million Plus Jobs Gap Widens — Videos

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Story 2: The Economy Still Stagnating As The 10 Million Plus Jobs Gap Widens — Videos

Making Sense of Today’s January Jobs Report

February 7th 2014 CNBC Stock Market Squawk Box (January Jobs Report)

gdp_large

sgs-emp

non-farm-payrolls-wide-201312

Employment Level

145,224,000

Series Id:           LNS12000000
Seasonally Adjusted
Series title:        (Seas) Employment Level
Labor force status:  Employed
Type of data:        Number in thousands
Age:                 16 years and over

employment_level
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 136559(1) 136598 136701 137270 136630 136940 136531 136662 136893 137088 137322 137614
2001 137778 137612 137783 137299 137092 136873 137071 136241 136846 136392 136238 136047
2002 135701 136438 136177 136126 136539 136415 136413 136705 137302 137008 136521 136426
2003 137417(1) 137482 137434 137633 137544 137790 137474 137549 137609 137984 138424 138411
2004 138472(1) 138542 138453 138680 138852 139174 139556 139573 139487 139732 140231 140125
2005 140245(1) 140385 140654 141254 141609 141714 142026 142434 142401 142548 142499 142752
2006 143150(1) 143457 143741 143761 144089 144353 144202 144625 144815 145314 145534 145970
2007 146028(1) 146057 146320 145586 145903 146063 145905 145682 146244 145946 146595 146273
2008 146378(1) 146156 146086 146132 145908 145737 145532 145203 145076 144802 144100 143369
2009 142152(1) 141640 140707 140656 140248 140009 139901 139492 138818 138432 138659 138013
2010 138451(1) 138599 138752 139309 139247 139148 139179 139427 139393 139111 139030 139266
2011 139287(1) 139422 139655 139622 139653 139409 139524 139904 140154 140335 140747 140836
2012 141677(1) 141943 142079 141963 142257 142432 142272 142204 142947 143369 143233 143212
2013 143384(1) 143464 143393 143676 143919 144075 144285 144179 144270 143485 144443 144586
2014 145224(1)

Civilian Labor Force

155,460,000

Series Id:           LNS11000000
Seasonally Adjusted
Series title:        (Seas) Civilian Labor Force Level
Labor force status:  Civilian labor force
Type of data:        Number in thousands
Age:                 16 years and over

Civilian_Labor_Force_Level

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 142267(1) 142456 142434 142751 142388 142591 142278 142514 142518 142622 142962 143248
2001 143800 143701 143924 143569 143318 143357 143654 143284 143989 144086 144240 144305
2002 143883 144653 144481 144725 144938 144808 144803 145009 145552 145314 145041 145066
2003 145937(1) 146100 146022 146474 146500 147056 146485 146445 146530 146716 147000 146729
2004 146842(1) 146709 146944 146850 147065 147460 147692 147564 147415 147793 148162 148059
2005 148029(1) 148364 148391 148926 149261 149238 149432 149779 149954 150001 150065 150030
2006 150214(1) 150641 150813 150881 151069 151354 151377 151716 151662 152041 152406 152732
2007 153144(1) 152983 153051 152435 152670 153041 153054 152749 153414 153183 153835 153918
2008 154063(1) 153653 153908 153769 154303 154313 154469 154641 154570 154876 154639 154655
2009 154210(1) 154538 154133 154509 154747 154716 154502 154307 153827 153784 153878 153111
2010 153404(1) 153720 153964 154642 154106 153631 153706 154087 153971 153631 154127 153639
2011 153198(1) 153280 153403 153566 153526 153379 153309 153724 154059 153940 154072 153927
2012 154328(1) 154826 154811 154565 154946 155134 154970 154669 155018 155507 155279 155485
2013 155699(1) 155511 155099 155359 155609 155822 155693 155435 155473 154625 155284 154937
2014 155460(1)

Labor Force Participation Rate

63.0%

Series Id:           LNS11300000
Seasonally Adjusted
Series title:        (Seas) Labor Force Participation Rate
Labor force status:  Civilian labor force participation rate
Type of data:        Percent or rate
Age:                 16 years and over

labor_participation_rate

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 67.3 67.3 67.3 67.3 67.1 67.1 66.9 66.9 66.9 66.8 66.9 67.0
2001 67.2 67.1 67.2 66.9 66.7 66.7 66.8 66.5 66.8 66.7 66.7 66.7
2002 66.5 66.8 66.6 66.7 66.7 66.6 66.5 66.6 66.7 66.6 66.4 66.3
2003 66.4 66.4 66.3 66.4 66.4 66.5 66.2 66.1 66.1 66.1 66.1 65.9
2004 66.1 66.0 66.0 65.9 66.0 66.1 66.1 66.0 65.8 65.9 66.0 65.9
2005 65.8 65.9 65.9 66.1 66.1 66.1 66.1 66.2 66.1 66.1 66.0 66.0
2006 66.0 66.1 66.2 66.1 66.1 66.2 66.1 66.2 66.1 66.2 66.3 66.4
2007 66.4 66.3 66.2 65.9 66.0 66.0 66.0 65.8 66.0 65.8 66.0 66.0
2008 66.2 66.0 66.1 65.9 66.1 66.1 66.1 66.1 66.0 66.0 65.9 65.8
2009 65.7 65.8 65.6 65.7 65.7 65.7 65.5 65.4 65.1 65.0 65.0 64.6
2010 64.8 64.9 64.9 65.2 64.9 64.6 64.6 64.7 64.6 64.4 64.6 64.3
2011 64.2 64.2 64.2 64.2 64.2 64.0 64.0 64.1 64.2 64.1 64.1 64.0
2012 63.7 63.9 63.8 63.7 63.8 63.8 63.7 63.5 63.6 63.7 63.6 63.6
2013 63.6 63.5 63.3 63.4 63.4 63.5 63.4 63.2 63.2 62.8 63.0 62.8
2014 63.0

Unemployment Level

10,236,000

Series Id:           LNS13000000
Seasonally Adjusted
Series title:        (Seas) Unemployment Level
Labor force status:  Unemployed
Type of data:        Number in thousands
Age:                 16 years and over

unemployment_level

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 5708 5858 5733 5481 5758 5651 5747 5853 5625 5534 5639 5634
2001 6023 6089 6141 6271 6226 6484 6583 7042 7142 7694 8003 8258
2002 8182 8215 8304 8599 8399 8393 8390 8304 8251 8307 8520 8640
2003 8520 8618 8588 8842 8957 9266 9011 8896 8921 8732 8576 8317
2004 8370 8167 8491 8170 8212 8286 8136 7990 7927 8061 7932 7934
2005 7784 7980 7737 7672 7651 7524 7406 7345 7553 7453 7566 7279
2006 7064 7184 7072 7120 6980 7001 7175 7091 6847 6727 6872 6762
2007 7116 6927 6731 6850 6766 6979 7149 7067 7170 7237 7240 7645
2008 7685 7497 7822 7637 8395 8575 8937 9438 9494 10074 10538 11286
2009 12058 12898 13426 13853 14499 14707 14601 14814 15009 15352 15219 15098
2010 14953 15121 15212 15333 14858 14483 14527 14660 14578 14520 15097 14373
2011 13910 13858 13748 13944 13873 13971 13785 13820 13905 13604 13326 13090
2012 12650 12883 12732 12603 12689 12702 12698 12464 12070 12138 12045 12273
2013 12315 12047 11706 11683 11690 11747 11408 11256 11203 11140 10841 10351
2014 10236

Unemployment Rate

6.6%

Series Id:           LNS14000000
Seasonally Adjusted
Series title:        (Seas) Unemployment Rate
Labor force status:  Unemployment rate
Type of data:        Percent or rate
Age:                 16 years and over

unemployment_rate_U_3
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 4.0 4.1 4.0 3.8 4.0 4.0 4.0 4.1 3.9 3.9 3.9 3.9
2001 4.2 4.2 4.3 4.4 4.3 4.5 4.6 4.9 5.0 5.3 5.5 5.7
2002 5.7 5.7 5.7 5.9 5.8 5.8 5.8 5.7 5.7 5.7 5.9 6.0
2003 5.8 5.9 5.9 6.0 6.1 6.3 6.2 6.1 6.1 6.0 5.8 5.7
2004 5.7 5.6 5.8 5.6 5.6 5.6 5.5 5.4 5.4 5.5 5.4 5.4
2005 5.3 5.4 5.2 5.2 5.1 5.0 5.0 4.9 5.0 5.0 5.0 4.9
2006 4.7 4.8 4.7 4.7 4.6 4.6 4.7 4.7 4.5 4.4 4.5 4.4
2007 4.6 4.5 4.4 4.5 4.4 4.6 4.7 4.6 4.7 4.7 4.7 5.0
2008 5.0 4.9 5.1 5.0 5.4 5.6 5.8 6.1 6.1 6.5 6.8 7.3
2009 7.8 8.3 8.7 9.0 9.4 9.5 9.5 9.6 9.8 10.0 9.9 9.9
2010 9.7 9.8 9.9 9.9 9.6 9.4 9.5 9.5 9.5 9.5 9.8 9.4
2011 9.1 9.0 9.0 9.1 9.0 9.1 9.0 9.0 9.0 8.8 8.6 8.5
2012 8.2 8.3 8.2 8.2 8.2 8.2 8.2 8.1 7.8 7.8 7.8 7.9
2013 7.9 7.7 7.5 7.5 7.5 7.5 7.3 7.2 7.2 7.2 7.0 6.7
2014 6.6

Employment-Population Ratio

58.8%

Series Id:           LNS12300000
Seasonally Adjusted
Series title:        (Seas) Employment-Population Ratio
Labor force status:  Employment-population ratio
Type of data:        Percent or rate
Age:                 16 years and over
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 64.6 64.6 64.6 64.7 64.4 64.5 64.2 64.2 64.2 64.2 64.3 64.4
2001 64.4 64.3 64.3 64.0 63.8 63.7 63.7 63.2 63.5 63.2 63.0 62.9
2002 62.7 63.0 62.8 62.7 62.9 62.7 62.7 62.7 63.0 62.7 62.5 62.4
2003 62.5 62.5 62.4 62.4 62.3 62.3 62.1 62.1 62.0 62.1 62.3 62.2
2004 62.3 62.3 62.2 62.3 62.3 62.4 62.5 62.4 62.3 62.3 62.5 62.4
2005 62.4 62.4 62.4 62.7 62.8 62.7 62.8 62.9 62.8 62.8 62.7 62.8
2006 62.9 63.0 63.1 63.0 63.1 63.1 63.0 63.1 63.1 63.3 63.3 63.4
2007 63.3 63.3 63.3 63.0 63.0 63.0 62.9 62.7 62.9 62.7 62.9 62.7
2008 62.9 62.8 62.7 62.7 62.5 62.4 62.2 62.0 61.9 61.7 61.4 61.0
2009 60.6 60.3 59.9 59.8 59.6 59.4 59.3 59.1 58.7 58.5 58.6 58.3
2010 58.5 58.5 58.5 58.7 58.6 58.5 58.5 58.6 58.5 58.3 58.2 58.3
2011 58.4 58.4 58.4 58.4 58.4 58.2 58.2 58.3 58.4 58.4 58.5 58.5
2012 58.5 58.5 58.6 58.5 58.6 58.6 58.5 58.4 58.6 58.8 58.7 58.6
2013 58.6 58.6 58.5 58.6 58.7 58.7 58.7 58.6 58.6 58.2 58.6 58.6
2014 58.8

Unemployment Rate – 16-19 Yrs

20.7%

Series Id:           LNS14000012
Seasonally Adjusted
Series title:        (Seas) Unemployment Rate - 16-19 yrs.
Labor force status:  Unemployment rate
Type of data:        Percent or rate
Age:                 16 to 19 years

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 12.7 13.8 13.3 12.6 12.8 12.3 13.4 14.0 13.0 12.8 13.0 13.2
2001 13.8 13.7 13.8 13.9 13.4 14.2 14.4 15.6 15.2 16.0 15.9 17.0
2002 16.5 16.0 16.6 16.7 16.6 16.7 16.8 17.0 16.3 15.1 17.1 16.9
2003 17.2 17.2 17.8 17.7 17.9 19.0 18.2 16.6 17.6 17.2 15.7 16.2
2004 17.0 16.5 16.8 16.6 17.1 17.0 17.8 16.7 16.6 17.4 16.4 17.6
2005 16.2 17.5 17.1 17.8 17.8 16.3 16.1 16.1 15.5 16.1 17.0 14.9
2006 15.1 15.3 16.1 14.6 14.0 15.8 15.9 16.0 16.3 15.2 14.8 14.6
2007 14.8 14.9 14.9 15.9 15.9 16.3 15.3 15.9 15.9 15.4 16.2 16.8
2008 17.8 16.6 16.1 15.9 19.0 19.2 20.7 18.6 19.1 20.0 20.3 20.5
2009 20.7 22.3 22.2 22.2 23.4 24.7 24.3 25.0 25.9 27.2 26.9 26.7
2010 26.0 25.6 26.2 25.4 26.5 26.0 25.9 25.6 25.8 27.3 24.8 25.3
2011 25.5 24.1 24.3 24.5 23.9 24.8 24.8 25.1 24.5 24.2 24.1 23.3
2012 23.5 23.8 24.8 24.6 24.2 23.7 23.7 24.4 23.8 23.8 23.9 24.0
2013 23.5 25.2 23.9 23.7 24.1 23.8 23.4 22.6 21.3 22.0 20.8 20.2
2014 20.7

Average Weeks Unemployed

35.4 Weeks

Series Id:           LNS13008275
Seasonally Adjusted
Series title:        (Seas) Average Weeks Unemployed
Labor force status:  Unemployed
Type of data:        Number of weeks
Age:                 16 years and over
average_weeks_unemployed
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 13.1 12.6 12.7 12.4 12.6 12.3 13.4 12.9 12.2 12.7 12.4 12.5
2001 12.7 12.8 12.8 12.4 12.1 12.7 12.9 13.3 13.2 13.3 14.3 14.5
2002 14.7 15.0 15.4 16.3 16.8 16.9 16.9 16.5 17.6 17.8 17.6 18.5
2003 18.5 18.5 18.1 19.4 19.0 19.9 19.7 19.2 19.5 19.3 19.9 19.8
2004 19.9 20.1 19.8 19.6 19.8 20.5 18.8 18.8 19.4 19.5 19.7 19.4
2005 19.5 19.1 19.5 19.6 18.6 17.9 17.6 18.4 17.9 17.9 17.5 17.5
2006 16.9 17.8 17.1 16.7 17.1 16.6 17.1 17.1 17.1 16.3 16.2 16.1
2007 16.3 16.7 17.8 16.9 16.6 16.5 17.2 17.0 16.3 17.0 17.3 16.6
2008 17.5 16.9 16.5 16.9 16.6 17.1 17.0 17.7 18.6 19.9 18.9 19.9
2009 19.8 20.2 20.9 21.7 22.4 23.9 25.1 25.3 26.6 27.5 28.9 29.7
2010 30.3 29.9 31.6 33.3 33.9 34.5 33.8 33.6 33.4 34.2 33.9 34.8
2011 37.2 37.5 39.2 38.7 39.5 39.7 40.4 40.2 40.2 39.1 40.3 40.7
2012 40.1 40.0 39.4 39.3 39.6 40.0 38.8 39.1 39.4 40.3 39.2 38.0
2013 35.4 36.9 37.0 36.6 36.9 35.7 36.7 37.0 36.8 36.0 37.1 37.1
2014 35.4

Median Weeks Unemployed

16.0 weeks

Series Id:           LNS13008276
Seasonally Adjusted
Series title:        (Seas) Median Weeks Unemployed
Labor force status:  Unemployed
Type of data:        Number of weeks
Age:                 16 years and over

median_weeks_unemployed

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 5.8 6.1 6.0 6.1 5.8 5.7 6.0 6.3 5.2 6.1 6.1 6.0
2001 5.8 6.1 6.6 5.9 6.3 6.0 6.8 6.9 7.2 7.3 7.7 8.2
2002 8.4 8.3 8.4 8.9 9.5 11.0 8.9 9.0 9.5 9.6 9.3 9.6
2003 9.6 9.5 9.7 10.2 9.9 11.5 10.3 10.1 10.2 10.4 10.3 10.4
2004 10.6 10.2 10.2 9.5 9.9 11.0 8.9 9.2 9.6 9.5 9.7 9.5
2005 9.4 9.2 9.3 9.0 9.1 9.0 8.8 9.2 8.4 8.6 8.5 8.7
2006 8.6 9.1 8.7 8.4 8.5 7.3 8.0 8.4 8.0 7.9 8.3 7.5
2007 8.3 8.5 9.1 8.6 8.2 7.7 8.7 8.8 8.7 8.4 8.6 8.4
2008 9.0 8.7 8.7 9.4 7.9 9.0 9.7 9.7 10.2 10.4 9.8 10.5
2009 10.7 11.7 12.3 13.1 14.2 17.2 16.0 16.3 17.8 18.9 19.8 20.1
2010 20.0 19.9 20.5 22.1 22.3 25.0 22.2 20.9 20.2 21.4 21.0 22.0
2011 21.5 21.2 21.7 20.9 21.6 22.1 21.8 22.2 21.9 20.7 20.9 20.6
2012 20.9 20.0 19.6 19.2 19.8 19.8 17.2 18.2 18.7 20.0 18.6 17.8
2013 16.0 17.7 18.1 17.3 16.9 16.2 15.8 16.5 16.4 16.5 17.0 17.1
2014 16.0

Not in Labor Force, Searched for Work and Available

2,592,000

Series Id:                       LNU05026642
Not Seasonally Adjusted
Series title:                    (Unadj) Not in Labor Force, Searched For Work and Available
Labor force status:              Not in labor force
Type of data:                    Number in thousands
Age:                             16 years and over
Job desires/not in labor force:  Want a job now
Reasons not in labor force:      Available to work now
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 1207 1281 1219 1216 1113 1142 1172 1097 1166 1044 1100 1125 1157
2001 1295 1337 1109 1131 1157 1170 1232 1364 1335 1398 1331 1330 1266
2002 1532 1423 1358 1397 1467 1380 1507 1456 1501 1416 1401 1432 1439
2003 1598 1590 1577 1399 1428 1468 1566 1665 1544 1586 1473 1483 1531
2004 1670 1691 1643 1526 1533 1492 1557 1587 1561 1647 1517 1463 1574
2005 1804 1673 1588 1511 1428 1583 1516 1583 1438 1414 1415 1589 1545
2006 1644 1471 1468 1310 1388 1584 1522 1592 1299 1478 1366 1252 1448
2007 1577 1451 1385 1391 1406 1454 1376 1365 1268 1364 1363 1344 1395
2008 1729 1585 1352 1414 1416 1558 1573 1640 1604 1637 1947 1908 1614
2009 2130 2051 2106 2089 2210 2176 2282 2270 2219 2373 2323 2486 2226
2010 2539 2527 2255 2432 2223 2591 2622 2370 2548 2602 2531 2609 2487
2011 2800 2730 2434 2466 2206 2680 2785 2575 2511 2555 2591 2540 2573
2012 2809 2608 2352 2363 2423 2483 2529 2561 2517 2433 2505 2614 2516
2013 2443 2588 2326 2347 2164 2582 2414 2342 2302 2283 2096 2427 2360
2014 2592

Total Unemployment Rate U-6

12.7%

Series Id:           LNS13327709
Seasonally Adjusted
Series title:        (seas) Total unemployed, plus all marginally attached workers plus total employed part time for economic reasons, as a percent of all civilian labor force plus all marginally attached workers
Labor force status:  Aggregated totals unemployed
Type of data:        Percent or rate
Age:                 16 years and over
Percent/rates:       Unemployed and mrg attached and pt for econ reas as percent of labor force plus marg attached

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
2000 7.1 7.2 7.1 6.9 7.1 7.0 7.0 7.1 7.0 6.8 7.1 6.9
2001 7.3 7.4 7.3 7.4 7.5 7.9 7.8 8.1 8.7 9.3 9.4 9.6
2002 9.5 9.5 9.4 9.7 9.5 9.5 9.6 9.6 9.6 9.6 9.7 9.8
2003 10.0 10.2 10.0 10.2 10.1 10.3 10.3 10.1 10.4 10.2 10.0 9.8
2004 9.9 9.7 10.0 9.6 9.6 9.5 9.5 9.4 9.4 9.7 9.4 9.2
2005 9.3 9.3 9.1 8.9 8.9 9.0 8.8 8.9 9.0 8.7 8.7 8.6
2006 8.4 8.4 8.2 8.1 8.2 8.4 8.5 8.4 8.0 8.2 8.1 7.9
2007 8.4 8.2 8.0 8.2 8.2 8.3 8.4 8.4 8.4 8.4 8.4 8.8
2008 9.2 9.0 9.1 9.2 9.7 10.1 10.5 10.8 11.0 11.8 12.6 13.6
2009 14.2 15.2 15.8 15.9 16.5 16.5 16.4 16.7 16.7 17.1 17.1 17.1
2010 16.7 17.0 17.1 17.2 16.6 16.4 16.4 16.5 16.8 16.6 16.9 16.6
2011 16.1 16.0 15.9 16.1 15.8 16.1 16.0 16.1 16.3 15.9 15.6 15.2
2012 15.1 15.0 14.5 14.6 14.8 14.8 14.9 14.7 14.7 14.4 14.4 14.4
2013 14.4 14.3 13.8 13.9 13.8 14.2 13.9 13.6 13.6 13.7 13.1 13.1
2014 12.7

Employment Situation Summary

Transmission of material in this release is embargoed until                      USDL-14-0168
8:30 a.m. (EST) Friday, February 7, 2014

Technical information:
Household data:        (202) 691-6378  •  cpsinfo@bls.gov  •  www.bls.gov/cps
Establishment data:    (202) 691-6555  •  cesinfo@bls.gov  •  www.bls.gov/ces

Media contact:         (202) 691-5902  •  PressOffice@bls.gov

                                 THE EMPLOYMENT SITUATION -- JANUARY 2014

Total nonfarm payroll employment rose by 113,000 in January, and the unemployment rate
was little changed at 6.6 percent, the U.S. Bureau of Labor Statistics reported today.
Employment grew in construction, manufacturing, wholesale trade, and mining. 

  ------------------------------------------------------------------------------------
 |                        Changes to the Employment Situation Data                    |
 |                                                                                    |
 |Establishment survey data have been revised as a result of the annual benchmarking  |
 |process and the updating of seasonal adjustment factors. Also, household survey data|
 |for January 2014 reflect updated population estimates. See the notes at the end of  |
 |this release for more information about these changes.                              |
 |                                                                                    |
  ------------------------------------------------------------------------------------

Household Survey Data

Both the number of unemployed persons, at 10.2 million, and the unemployment rate, at
6.6 percent, changed little in January. Since October, the jobless rate has decreased by
0.6 percentage point. (See table A-1.)  (See the note and tables B and C for information
about the effect of annual population adjustments to the household survey estimates.) 

Among the major worker groups, the unemployment rates for adult men (6.2 percent), adult
women (5.9 percent), teenagers (20.7 percent), whites (5.7 percent), blacks (12.1 percent),
and Hispanics (8.4 percent) showed little change in January. The jobless rate for Asians
was 4.8 percent (not seasonally adjusted), down by 1.7 percentage points over the year.
(See tables A-1, A-2, and A-3.)

The number of long-term unemployed (those jobless for 27 weeks or more), at 3.6 million,
declined by 232,000 in January. These individuals accounted for 35.8 percent of the
unemployed. The number of long-term unemployed has declined by 1.1 million over the year.
(See table A-12.)

After accounting for the annual adjustment to the population controls, the civilian labor
force rose by 499,000 in January, and the labor force participation rate edged up to 63.0
percent. Total employment, as measured by the household survey, increased by 616,000 over
the month, and the employment-population ratio increased by 0.2 percentage point to 58.8
percent. (See table A-1. For additional information about the effects of the population
adjustments, see table C.)

The number of persons employed part time for economic reasons (sometimes referred to as
involuntary part-time workers) fell by 514,000 to 7.3 million in January. These individuals
were working part time because their hours had been cut back or because they were unable to
find full-time work. (See table A-8.)

In January, 2.6 million persons were marginally attached to the labor force, little changed
from a year earlier. (The data are not seasonally adjusted.) These individuals were not in
the labor force, wanted and were available for work, and had looked for a job sometime in
the prior 12 months. They were not counted as unemployed because they had not searched for
work in the 4 weeks preceding the survey. (See table A-16.)

Among the marginally attached, there were 837,000 discouraged workers in January, about
unchanged from a year earlier. Discouraged workers are persons not currently looking for
work because they believe no jobs are available for them. The remaining 1.8 million persons
marginally attached to the labor force in January had not searched for work for reasons such
as school attendance or family responsibilities. (See table A-16.)

Establishment Survey Data

Total nonfarm payroll employment increased by 113,000 in January. In 2013, employment growth
averaged 194,000 per month. In January, job gains occurred in construction, manufacturing,
wholesale trade, and mining. (See table B-1.)

Construction added 48,000 jobs over the month, more than offsetting a decline of 22,000 in
December. In January, job gains occurred in both residential and nonresidential building
(+13,000 and +8,000, respectively) and in nonresidential specialty trade contractors
(+13,000). Heavy and civil engineering construction also added 10,000 jobs.

Employment in manufacturing increased in January (+21,000). Over the month, job gains
occurred in machinery (+7,000), wood products (+5,000), and motor vehicles and parts
(+5,000). Manufacturing added an average of 7,000 jobs per month in 2013.

In January, wholesale trade added 14,000 jobs, with most of the increase occurring in
nondurable goods (+10,000).

Mining added 7,000 jobs in January, compared with an average monthly gain of 2,000 jobs
in 2013.

Employment in professional and business services continued to trend up in January (+36,000).
The industry added an average of 55,000 jobs per month in 2013. Within the industry,
professional and technical services added 20,000 jobs in January. 

Leisure and hospitality employment continued to trend up over the month (+24,000). Job
growth in the industry averaged 38,000 per month in 2013. 

Employment in health care was essentially unchanged in January for the second consecutive
month.  Health care added an average of 17,000 jobs per month in 2013. 

Employment in retail trade changed little in January (-13,000). Within the industry, sporting
goods, hobby, book, and music stores lost 22,000 jobs, offsetting job gains in the prior 3
months. In January, motor vehicle and parts dealers added 7,000 jobs.

In January, federal government employment decreased by 12,000; the U.S. Postal Service
accounted for most of this decline (-9,000).

Employment in other major industries, including transportation and warehousing, information,
and financial activities, showed little or no change over the month.

In January, the average workweek for all employees on private nonfarm payrolls was unchanged
at 34.4 hours. The manufacturing workweek declined by 0.2 hour to 40.7 hours, and factory
overtime edged down by 0.1 hour to 3.4 hours. The average workweek for production and
nonsupervisory employees on private nonfarm payrolls was unchanged at 33.5 hours. (See
tables B-2 and B-7.)

Average hourly earnings for all employees on private nonfarm payrolls rose by 5 cents to
$24.21. Over the year, average hourly earnings have risen by 46 cents, or 1.9 percent. In
January, average hourly earnings of private-sector production and nonsupervisory employees
increased by 6 cents to $20.39. (See tables B-3 and B-8.)

The change in total nonfarm payroll employment for November was revised from +241,000 to
+274,000, and the change for December was revised from +74,000 to +75,000. With these
revisions, employment gains in November and December were 34,000 higher than previously
reported. Monthly revisions result from additional reports received from businesses since
the last published estimates and the monthly recalculation of seasonal factors. The annual
benchmark process also contributed to the revisions in this news release.

_____________
The Employment Situation for February is scheduled to be released on Friday, March 7, 2014,
at 8:30 a.m. (EST).

                                  Revisions to Establishment Survey Data

In accordance with annual practice, the establishment survey data released today have been
benchmarked to reflect comprehensive counts of payroll jobs for March 2013. These counts
are derived principally from the Quarterly Census of Employment and Wages (QCEW), which
enumerates jobs covered by the UI tax system. The benchmark process results in revisions
to not seasonally adjusted data from April 2012 forward. Seasonally adjusted data from
January 2009 forward are subject to revision. In addition, data for some series prior to
2009, both seasonally adjusted and unadjusted, incorporate revisions.

The total nonfarm employment level for March 2013 was revised upward by 369,000 (+347,000
on a not seasonally adjusted basis, or 0.3 percent). The average benchmark revision over
the past 10 years was plus or minus 0.3 percent. 

This revision incorporates the reclassification of jobs in the QCEW. Private household
employment is out of scope for the establishment survey. The QCEW reclassified some
private household employment into an industry that is in scope for the establishment
survey--services for the elderly and persons with disabilities. This reclassification
accounted for an increase of 466,000 jobs in the establishment survey. This increase of
466,000 associated with reclassification was offset by survey error of -119,000 for a
total net benchmark revision of +347,000 on a not seasonally adjusted basis. Historical
time series have been reconstructed to incorporate these revisions. 

The effect of these revisions on the underlying trend in nonfarm payroll employment was
minor. For example, the over-the-year change in total nonfarm employment for 2013 was
revised from 2,186,000 to 2,322,000 seasonally adjusted. Table A presents revised total
nonfarm employment data on a seasonally adjusted basis for January through December 2013.

All revised historical CES data, as well as an article that discusses the benchmark and
post-benchmark revisions and other technical issues can be accessed through the CES
homepage at www.bls.gov/ces/. Information on the data released today also may be obtained
by calling (202) 691-6555.

Table A. Revisions in total nonfarm employment, January-December 2013, seasonally adjusted
(Numbers in thousands)

------------------------------------------------------------------------------------------
                    |                                    |                                
                    |                Level               |      Over-the-month change     
                    |---------------------------------------------------------------------
    Year and month  |    As     |           |            |    As    |         |           
                    |previously |    As     | Difference |previously|   As    | Difference
                    |published  |  revised  |            |published | revised |           
------------------------------------------------------------------------------------------
                    |           |           |            |          |         |           
          2013      |           |           |            |          |         |           
                    |           |           |            |          |         |           
 January............|  134,839  |  135,261  |     422    |    148   |    197  |      49   
 February...........|  135,171  |  135,541  |     370    |    332   |    280  |     -52   
 March..............|  135,313  |  135,682  |     369    |    142   |    141  |      -1   
 April..............|  135,512  |  135,885  |     373    |    199   |    203  |       4   
 May................|  135,688  |  136,084  |     396    |    176   |    199  |      23   
 June...............|  135,860  |  136,285  |     425    |    172   |    201  |      29   
 July...............|  135,949  |  136,434  |     485    |     89   |    149  |      60   
 August.............|  136,187  |  136,636  |     449    |    238   |    202  |     -36   
 September..........|  136,362  |  136,800  |     438    |    175   |    164  |     -11   
 October............|  136,562  |  137,037  |     475    |    200   |    237  |      37   
 November...........|  136,803  |  137,311  |     508    |    241   |    274  |      33   
 December (p).......|  136,877  |  137,386  |     509    |     74   |     75  |       1   
------------------------------------------------------------------------------------------

   p = preliminary

                Adjustments to Population Estimates for the Household Survey

Effective with data for January 2014, updated population estimates have been used in the
household survey. Population estimates for the household survey are developed by the U.S.
Census Bureau. Each year, the Census Bureau updates the estimates to reflect new information
and assumptions about the growth of the population since the previous decennial census. The
change in population reflected in the new estimates results from adjustments for net
international migration, updated vital statistics and other information, and some
methodological changes in the estimation process. 

In accordance with usual practice, BLS will not revise the official household survey estimates
for December 2013 and earlier months. To show the impact of the population adjustments, however,
differences in selected December 2013 labor force series based on the old and new population
estimates are shown in table B. 

The adjustments increased the estimated size of the civilian noninstitutional population in
December by 2,000, the civilian labor force by 24,000, employment by 22,000, and unemployment
by 2,000. The number of persons not in the labor force was reduced by 22,000. The total
unemployment rate, employment-population ratio, and labor force participation rate were
unaffected. 

Data users are cautioned that these annual population adjustments can affect the comparability
of household data series over time. Table C shows the effect of the introduction of new
population estimates on the comparison of selected labor force measures between December 2013
and January 2014. Additional information on the population adjustments and their effect on
national labor force estimates is available at www.bls.gov/cps/cps14adj.pdf.

Table B. Effect of the updated population controls on December 2013 estimates by sex, race, and
Hispanic or Latino ethnicity, not seasonally adjusted
(Numbers in thousands)

__________________________________________________________________________________________________
                                        |      |     |      |       |        |       |            
                                        |      |     |      |       |  Black |       |            
                                        |      |     |      |       |    or  |       |  Hispanic  
                  Category              | Total| Men | Women| White | African| Asian | or Latino  
                                        |      |     |      |       |American|       | ethnicity  
                                        |      |     |      |       |        |       |            
________________________________________|______|_____|______|_______|________|_______|____________
                                        |      |     |      |       |        |       |            
  Civilian noninstitutional population..|    2 |  29 |  -27 |   -65 |     48 |    33 |     -57    
    Civilian labor force................|   24 |  24 |    0 |   -17 |     34 |    15 |     -38    
      Participation rate................|   .0 |  .0 |   .0 |    .0 |     .0 |    .0 |      .0    
     Employed...........................|   22 |  22 |    0 |   -16 |     31 |    14 |     -34    
      Employment-population ratio.......|   .0 |  .0 |   .0 |    .0 |     .0 |    .0 |      .0    
     Unemployed.........................|    2 |   3 |   -1 |    -1 |      4 |     1 |      -4    
      Unemployment rate.................|   .0 |  .0 |   .0 |    .0 |     .0 |    .0 |      .0    
    Not in labor force..................|  -22 |   4 |  -27 |   -48 |     14 |    18 |     -18    
________________________________________|______|_____|______|_______|________|_______|____________

   NOTE: Detail may not sum to totals because of rounding. Estimates for the above race groups
(white, black or African American, and Asian) do not sum to totals because data are not presented
for all races. Persons whose ethnicity is identified as Hispanic or Latino may be of any race.

Table C. December 2013-January 2014 changes in selected labor force measures,
with adjustments for population control effects
(Numbers in thousands)

______________________________________________________________________________
                                       |           |            |             
                                       |           |            |  Dec.-Jan.  
                                       | Dec.-Jan. |    2014    |   change,   
                                       |  change,  | population |  after re-  
                Category               |    as     |   control  |  moving the 
                                       | published |   effect   |  population 
                                       |           |            |   control   
                                       |           |            |  effect (1) 
_______________________________________|___________|____________|_____________
                                       |           |            |             
  Civilian noninstitutional population.|    170    |       2    |     168     
    Civilian labor force...............|    523    |      24    |     499     
      Participation rate...............|     .2    |      .0    |      .2     
     Employed..........................|    638    |      22    |     616     
      Employment-population ratio......|     .2    |      .0    |      .2     
     Unemployed........................|   -115    |       2    |    -117     
      Unemployment rate................|    -.1    |      .0    |     -.1     
    Not in labor force.................|   -353    |     -22    |    -331     
_______________________________________|___________|____________|_____________

   (1) This Dec.-Jan. change is calculated by subtracting the population 
control effect from the over-the-month change in the published seasonally
adjusted estimates.
   NOTE: Detail may not sum to totals because of rounding.

  ------------------------------------------------------------------------------------
 |                                                                                    |
 |                            Change to the Household Survey Tables                   |
 |                                                                                    |
 |Effective with this release, household survey table A-10 includes two new seasonally|
 |adjusted series for women age 55 and over--the number of unemployed persons and the |
 |unemployment rate. These replace the series that were previously displayed for this |
 |group, which were not seasonally adjusted.                                          |
 |                                                                                    |
  ------------------------------------------------------------------------------------

  ------------------------------------------------------------------------------------
 |                                                                                    |
 |               Updated Veteran Weighting Methodology for Household Survey           |
 |                                                                                    |
 |Beginning with data for January 2014, estimates for veterans in table A-5 of this   |
 |release incorporate updated weighting procedures. The new weighting methodology more|
 |accurately reflects the current demographic composition of the veteran population.  |
 |The primary impact of the change was an increase in the "Gulf War-era I" veteran    |
 |population and a decrease in the number of veterans in the "Other service periods"  |
 |category. The updated methodology had little effect on unemployment rates for       |
 |veterans, regardless of gender or period of service. Additional information on the  |
 |effect of the change on labor force estimates for veterans is available at          |
 |www.bls.gov/cps/vetsweights2014.pdf.                                                |
 |                                                                                    |
  ------------------------------------------------------------------------------------

Employment Situation Summary Table A. Household data, seasonally adjusted

HOUSEHOLD DATA
Summary table A. Household data, seasonally adjusted
[Numbers in thousands]

CategoryJan.
2013Nov.
2013Dec.
2013Jan.
2014Change from:
Dec.
2013-
Jan.
2014Employment status Civilian noninstitutional population244,663246,567246,745246,915-Civilian labor force155,699155,284154,937155,460-Participation rate63.663.062.863.0-Employed143,384144,443144,586145,224-Employment-population ratio58.658.658.658.8-Unemployed12,31510,84110,35110,236-Unemployment rate7.97.06.76.6-Not in labor force88,96391,28391,80891,455- Unemployment rates Total, 16 years and over7.97.06.76.6-Adult men (20 years and over)7.46.76.36.2-Adult women (20 years and over)7.26.26.05.9-Teenagers (16 to 19 years)23.520.820.220.7-White7.16.15.95.7-Black or African American13.812.411.912.1-Asian (not seasonally adjusted)6.55.34.14.8-Hispanic or Latino ethnicity9.78.78.38.4- Total, 25 years and over6.55.85.65.4-Less than a high school diploma12.010.69.89.6-High school graduates, no college8.17.37.16.5-Some college or associate degree7.06.46.16.0-Bachelor’s degree and higher3.83.43.33.2- Reason for unemployment Job losers and persons who completed temporary jobs6,6755,7315,3665,407-Job leavers984890862818-Reentrants3,5203,0653,0362,937-New entrants1,2741,1691,2011,184- Duration of unemployment Less than 5 weeks2,7532,4392,2552,434-5 to 14 weeks3,0772,5852,5062,429-15 to 26 weeks1,8671,7421,6511,689-27 weeks and over4,7074,0443,8783,646- Employed persons at work part time Part time for economic reasons7,9837,7237,7717,257-Slack work or business conditions5,1174,8694,8844,405-Could only find part-time work2,6132,4992,5922,571-Part time for noneconomic reasons18,55618,85818,73119,165- Persons not in the labor force (not seasonally adjusted) Marginally attached to the labor force2,4432,0962,4272,592-Discouraged workers804762917837– December – January changes in household data are not shown due to the introduction of updated population controls.
NOTE: Persons whose ethnicity is identified as Hispanic or Latino may be of any race. Detail for the seasonally adjusted data shown in this table will not necessarily add to totals because of the independent seasonal adjustment of the various series. Updated population controls are introduced annually with the release of January data.

Employment Situation Summary Table B. Establishment data, seasonally adjusted

ESTABLISHMENT DATA
Summary table B. Establishment data, seasonally adjusted
Category Jan.
2013
Nov.
2013
Dec.
2013(p)
Jan.
2014(p)
EMPLOYMENT BY SELECTED INDUSTRY
(Over-the-month change, in thousands)
Total nonfarm 197 274 75 113
Total private 219 272 89 142
Goods-producing 43 68 -13 76
Mining and logging 3 1 1 7
Construction 23 32 -22 48
Manufacturing 17 35 8 21
Durable goods(1) 9 19 2 15
Motor vehicles and parts 3.5 4.7 3.3 4.7
Nondurable goods 8 16 6 6
Private service-providing(1) 176 204 102 66
Wholesale trade 16.9 16.8 10.2 13.9
Retail trade 26.9 22.3 62.7 -12.9
Transportation and warehousing 9.8 32.4 10.6 9.9
Information -1 1 -10 0
Financial activities 8 -4 3 -2
Professional and business services(1) 45 73 4 36
Temporary help services 4.9 36.6 30.1 8.1
Education and health services(1) 17 25 -4 -6
Health care and social assistance 23.5 24.4 1.1 1.5
Leisure and hospitality 47 37 20 24
Other services 7 -1 7 4
Government -22 2 -14 -29
WOMEN AND PRODUCTION AND NONSUPERVISORY EMPLOYEES(2)
AS A PERCENT OF ALL EMPLOYEES
Total nonfarm women employees 49.4 49.5 49.5 49.4
Total private women employees 48.0 48.0 48.0 47.9
Total private production and nonsupervisory employees 82.6 82.6 82.6 82.6
HOURS AND EARNINGS
ALL EMPLOYEES
Total private
Average weekly hours 34.4 34.5 34.4 34.4
Average hourly earnings $23.75 $24.15 $24.16 $24.21
Average weekly earnings $817.00 $833.18 $831.10 $832.82
Index of aggregate weekly hours (2007=100)(3) 97.5 99.6 99.4 99.5
Over-the-month percent change 0.2 0.5 -0.2 0.1
Index of aggregate weekly payrolls (2007=100)(4) 110.5 114.8 114.6 114.9
Over-the-month percent change 0.4 0.8 -0.2 0.3
HOURS AND EARNINGS
PRODUCTION AND NONSUPERVISORY EMPLOYEES
Total private
Average weekly hours 33.6 33.7 33.5 33.5
Average hourly earnings $19.95 $20.30 $20.33 $20.39
Average weekly earnings $670.32 $684.11 $681.06 $683.07
Index of aggregate weekly hours (2002=100)(3) 104.9 107.1 106.6 106.7
Over-the-month percent change -0.2 0.5 -0.5 0.1
Index of aggregate weekly payrolls (2002=100)(4) 139.8 145.3 144.8 145.3
Over-the-month percent change 0.1 0.8 -0.3 0.3
DIFFUSION INDEX(5)
(Over 1-month span)
Total private (264 industries) 64.0 66.9 56.4 61.2
Manufacturing (81 industries) 56.8 65.4 59.9 54.3
Footnotes
(1) Includes other industries, not shown separately.
(2) Data relate to production employees in mining and logging and manufacturing, construction employees in construction, and nonsupervisory employees in the service-providing industries.
(3) The indexes of aggregate weekly hours are calculated by dividing the current month’s estimates of aggregate hours by the corresponding annual average aggregate hours.
(4) The indexes of aggregate weekly payrolls are calculated by dividing the current month’s estimates of aggregate weekly payrolls by the corresponding annual average aggregate weekly payrolls.
(5) Figures are the percent of industries with employment increasing plus one-half of the industries with unchanged employment, where 50 percent indicates an equal balance between industries with increasing and decreasing employment.
(p) Preliminary
NOTE: Data have been revised to reflect March 2013 benchmark levels and updated seasonal adjustment factors.

Weakness Continues as 113,000 Jobs Are Added in January

Employers added jobs at a slower-than-expected pace in January, the second month in a row that hiring has been disappointing and a sign that the labor market remains anemic despite indications of growth elsewhere in the economy.

Payrolls increased by 113,000, the Labor Department reported Friday morning, well below the gain of 180,000 that economists expected. The unemployment rate, based on a separate survey of households that was more encouraging, actually fell by a tenth of a percentage point, to 6.6 percent.

The data for January come after an even more disappointing report on the labor market for December, which was revised upward only slightly Friday, to show a gain of just 75,000 jobs, from 74,000. The level of hiring in January was also substantially below the average monthly gain of 178,000 positions over the last six months, as well as the monthly addition of 187,000 over the last year.

The two weak months in a row will prompt questions about whether the Federal Reserve acted prematurely when policy makers in December voted to begin scaling back the central bank’s expansive stimulus efforts.

The new data is not expected to alter the Fed’s course, economists said, but another poor report on hiring next month might force policy makers to rethink their plan when they next meet in late March.

“In one line: grim,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics, in a note to clients Friday morning.

While seasonal adjustments may have played a role and upward revisions for hiring in October and November were more encouraging, he said, “The payroll rebound clearly is disappointing; none of the ground lost in December was recovered.”

Other economists conceded the picture for January was hardly bright, but cautioned it was too soon to conclude there had been a fundamental loss of momentum in the economy, especially given seasonal fluctuations in the data and the possibility that weather inhibited some hiring.

“We’re not seeing the takeoff that people wanted to see, but it’s not a disaster,” said Julia Coronado, chief economist for North America at BNP Paribas. “The 113,000 figure is definitely way below trend, but we want another month or two of data before we can draw conclusions.”

One mystery economists will be focusing on is why employment gains have not kept up with economic growth as measured by gross domestic product, which picked up substantially in the second half of 2013. The annualized pace of expansion was 3.2 percent in the fourth quarter, and 4.1 percent in the third quarter.

One reason may be that new technologies are allowing employers to make do with fewer workers, for instance the use of automated customer service systems instead of call centers, or Internet retailers’ taking over from brick-and-mortar stores where sales associates prowl the floors.

Another shift is evident from the yawning gap in employment for college graduates versus workers who lack a high school diploma. For people with a college degree or higher, the jobless rate was 3.1 percent, compared with 9.6 percent for Americans who did not finish high school.

Wintry conditions that held back hiring were blamed for the weakness in December, a theory popular among more optimistic economists after those numbers came out in early January.

But despite what seems like an endless series of snowstorms on the East Coast and arctic conditions in the Midwest recently, the reference week for the latest survey was Jan. 12-18, when conditions were fairly normal as Januaries go, limiting some of the impact of the weather in this report.

In the report on January, one sector holding back payrolls was the government, which shrank by 29,000 jobs in January. Excluding that loss, private employers added 142,000 positions, a slightly better showing.

Several other sectors which had been strong in recent months – education and health care as well as retailing – also lost positions, contributing to the overall weakness.

The falloff in hiring in the health care sector was especially notable. In December and January together, just 2,600 health care positions were filled. By contrast, as recently as November, nearly 25,000 health care workers were added to payrolls.

Although this area of the economy is going through a transformation as President Obama’s new health care plan is slowly introduced, that is unlikely to have caused the abrupt slowdown in hiring, said Ethan Harris, a head of global economics at Bank of America Merrill Lynch. If anything, he said, the law should create new jobs in the sector as health care coverage is expanded, even if higher costs for some employers result in job cuts elsewhere in the economy.

As for retail, which lost nearly 13,000 jobs in January, some of that reduction could have essentially been because of excessive hiring in December, Mr. Harris said, when stores added nearly 63,000 positions as the holiday shopping season peaked. The cuts may also have been spurred by weak results at some retailers, with chains like J. C. Penney announcing major job cuts last month, and Loehmann’s, the venerable discounter, now in liquidation.

The employment-population ratio, which has been falling as more workers drop out of the job market, edged up 0.2 percentage points to 58.8 percent. In recent years, the exit of people from the work force has reduced the unemployment rate, but it is a sign that people are giving up hope of finding a job in the face of slack conditions, hardly the way policy makers would like to see joblessness come down.

http://www.nytimes.com/2014/02/08/business/us-economy-adds-113000-jobs-unemployment-rate-at-6-6.html?_r=0

EMBARGOED UNTIL RELEASE AT 8:30 A.M. EST, THURSDAY, JANUARY 30, 2014
BEA 14-03

* See the navigation bar at the right side of the news release text for links to data tables,
contact personnel and their telephone numbers, and supplementary materials.

Lisa S. Mataloni: (202) 606-5304 (GDP) gdpniwd@bea.gov
Recorded message: (202) 606-5306
Jeannine Aversa: (202) 606-2649 (News Media)
National Income and Product Accounts
Gross Domestic Product, 4th quarter and annual 2013 (advance estimate)
      Real gross domestic product -- the output of goods and services produced by labor and property
located in the United States -- increased at an annual rate of 3.2 percent in the fourth quarter of 2013
(that is, from the third quarter to the fourth quarter), according to the "advance" estimate released by the
Bureau of Economic Analysis.  In the third quarter, real GDP increased 4.1 percent.

The Bureau emphasized that the fourth-quarter advance estimate released today is based on
source data that are incomplete or subject to further revision by the source agency (see the box on page 4
and “Comparisons of Revisions to GDP” on page 5). The “second” estimate for the fourth quarter, based
on more complete data, will be released on February 28, 2014.

The increase in real GDP in the fourth quarter primarily reflected positive contributions from
personal consumption expenditures (PCE), exports, nonresidential fixed investment, private inventory
investment, and state and local government spending that were partly offset by negative contributions
from federal government spending and residential fixed investment. Imports, which are a subtraction in
the calculation of GDP, increased.

The deceleration in real GDP in the fourth quarter reflected a deceleration in private inventory
investment, a larger decrease in federal government spending, a downturn in residential fixed
investment, and decelerations in state and local government spending and in nonresidential fixed
investment that were partly offset by accelerations in exports and in PCE and a deceleration in imports.

The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 1.2 percent in the fourth quarter, compared with an increase of 1.8 percent in the third.
Excluding food and energy prices, the price index for gross domestic purchases increased 1.7 percent in
the fourth quarter, compared with an increase of 1.5 percent in the third.

_______
FOOTNOTE. Quarterly estimates are expressed at seasonally adjusted annual rates, unless otherwise
specified. Quarter-to-quarter dollar changes are differences between these published estimates. Percent
changes are calculated from unrounded data and are annualized. “Real” estimates are in chained (2009)
dollars. Price indexes are chain-type measures.

This news release is available on www.bea.gov along with the Technical Note and Highlights
related to this release.
_______

Real personal consumption expenditures increased 3.3 percent in the fourth quarter, compared
with an increase of 2.0 percent in the third. Durable goods increased 5.9 percent, compared with an
increase of 7.9 percent. Nondurable goods increased 4.4 percent, compared with an increase of 2.9
percent. Services increased 2.5 percent, compared with an increase of 0.7 percent.

Real nonresidential fixed investment increased 3.8 percent in the fourth quarter, compared with
an increase of 4.8 percent in the third. Nonresidential structures decreased 1.2 percent, in contrast to an
increase of 13.4 percent. Equipment increased 6.9 percent, compared with an increase of 0.2 percent.
Intellectual property products increased 3.2 percent, compared with an increase of 5.8 percent. Real
residential fixed investment decreased 9.8 percent, in contrast to an increase of 10.3 percent.

Real exports of goods and services increased 11.4 percent in the fourth quarter, compared with
an increase of 3.9 percent in the third. Real imports of goods and services increased 0.9 percent,
compared with an increase of 2.4 percent.

Real federal government consumption expenditures and gross investment decreased 12.6 percent
in the fourth quarter, compared with a decrease of 1.5 percent in the third. National defense decreased
14.0 percent, compared with a decrease of 0.5 percent. Nondefense decreased 10.3 percent, compared
with a decrease of 3.1 percent. Real state and local government consumption expenditures and gross
investment increased 0.5 percent, compared with an increase of 1.7 percent.

The change in real private inventories added 0.42 percentage point to the fourth-quarter change
in real GDP after adding 1.67 percentage points to the third-quarter change. Private businesses
increased inventories $127.2 billion in the fourth quarter, following increases of $115.7 billion in the
third quarter and $56.6 billion in the second.

Real final sales of domestic product — GDP less change in private inventories — increased 2.8
percent in the fourth quarter, compared with an increase of 2.5 percent in the third.

Gross domestic purchases

Real gross domestic purchases — purchases by U.S. residents of goods and services wherever
produced — increased 1.8 percent in the fourth quarter, compared with an increase of 3.9 percent in the
third.

Disposition of personal income

Current-dollar personal income increased $69.4 billion (2.0 percent) in the fourth quarter,
compared with an increase of $140.0 billion (4.0 percent) in the third. The deceleration in personal
income primarily reflected downturns in personal dividend income and in farm proprietors’ income and
a deceleration in personal current transfer receipts that were partly offset by an acceleration in wages
and salaries.

Personal current taxes increased $23.7 billion in the fourth quarter, in contrast to a decrease of
$11.0 billion in the third.

Disposable personal income increased $45.7 billion (1.5 percent) in the fourth quarter, compared
with an increase of $151.0 billion (5.0 percent) in the third. Real disposable personal income increased
0.8 percent in the fourth quarter, compared with an increase of 3.0 percent in the third.

Personal outlays increased $118.6 billion (4.0 percent) in the fourth quarter, compared with an
increase of $113.4 billion (3.9 percent) in the third. Personal saving — disposable personal income less
personal outlays — was $545.1 billion in the fourth quarter, compared with $618.0 billion in the third.

The personal saving rate — personal saving as a percentage of disposable personal income — was
4.3 percent in the fourth quarter, compared with 4.9 percent in the third. For a comparison of personal
saving in BEA’s national income and product accounts with personal saving in the Federal Reserve
Board’s financial accounts of the United States and data on changes in net worth, go to
www.bea.gov/national/nipaweb/Nipa-Frb.asp.

Current-dollar GDP

Current-dollar GDP — the market value of the nation’s output of goods and services — increased
4.6 percent, or $189.6 billion, in the fourth quarter to a level of $17,102.5 billion. In the third quarter,
current-dollar GDP increased 6.2 percent, or $251.9 billion.

2013 GDP

Real GDP increased 1.9 percent in 2013 (that is, from the 2012 annual level to the 2013 annual
level), compared with an increase of 2.8 percent in 2012.

The increase in real GDP in 2013 primarily reflected positive contributions from personal
consumption expenditures (PCE), exports, residential fixed investment, nonresidential fixed investment,
and private inventory investment that were partly offset by a negative contribution from federal
government spending. Imports, which are a subtraction in the calculation of GDP, increased.

The deceleration in real GDP in 2013 primarily reflected a deceleration in nonresidential fixed
investment, a larger decrease in federal government spending, and decelerations in PCE and in exports
that were partly offset by a deceleration in imports and a smaller decrease in state and local government
spending.

The price index for gross domestic purchases increased 1.2 percent in 2013, compared with an
increase of 1.7 percent in 2012.

Current-dollar GDP increased 3.4 percent, or $558.4 billion, in 2013, compared with an increase
of 4.6 percent, or $710.8 billion, in 2012.

During 2013 (that is, measured from the fourth quarter of 2012 to the fourth quarter of 2013) real
GDP increased 2.7 percent. Real GDP increased 2.0 percent during 2012. The price index for gross
domestic purchases increased 1.1 percent during 2013, compared with an increase of 1.5 percent in
2012.

________
BOX. Information on the assumptions used for unavailable source data is provided in a technical note
that is posted with the news release on BEA’s Web site. Within a few days after the release, a detailed
“Key Source Data and Assumptions” file is posted on the Web site. In the middle of each month, an analysis
of the current quarterly estimate of GDP and related series is made available on the Web site; click on
Survey of Current Business, “GDP and the Economy.” For information on revisions, see “Revisions to GDP, GDI,
and Their Major Components.

________

BEA’s national, international, regional, and industry estimates; the Survey of Current Business;
and BEA news releases are available without charge on BEA’s Web site at www.bea.gov. By visiting
the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.

* * *

Next release — February 28, 2014 at 8:30 A.M. EST for:
Gross Domestic Product: Fourth Quarter and Annual 2013 (Second Estimate)

* * *

Release dates in 2014

Gross Domestic Product

2013: IV and 2013 annual 2014: I 2014: II 2014: III

Advance… January 30 April 30 July 30 October 30
Second…. February 28 May 29 August 28 November 25
Third….. March 27 June 25 September 26 December 23

Corporate Profits

Preliminary… …… May 29 August 28 November 25
Revised……. March 27 June 25 September 26 December 23

Comparisons of Revisions to GDP

Quarterly estimates of GDP are released on the following schedule: the “advance” estimate, based on
source data that are incomplete or subject to further revision by the source agency, is released near the end of the
first month after the end of the quarter; as more detailed and more comprehensive data become available,
the “second” and “third” estimates are released near the end of the second and third months, respectively.
The “latest”” estimate reflects the results of both annual and comprehensive revisions.

Annual revisions, which generally cover the quarters of the 3 most recent calendar years, are usually carried
out each summer and incorporate newly available major annual source data. Comprehensive (or benchmark)
revisions are carried out at about 5-year intervals and incorporate major periodic source data, as well as
improvements in concepts and methods that update the accounts to portray more accurately the evolving U.S.
economy.

The table below shows comparisons of the revisions between quarterly percent changes of current-dollar
and of real GDP for the different vintages of the estimates. From the advance estimate to the second estimate (one
month later), the average revision to real GDP without regard to sign is 0.5 percentage point, while from the
advance estimate to the third estimate (two months later), it is 0.6 percentage point. From the advance estimate to
the latest estimate, the average revision without regard to sign is 1.3 percentage points. The average revision
(with regard to sign) from the advance estimate to the latest estimate is 0.3 percentage point, which is larger
than the average revisions from the advance estimate to the second or to the third estimates. The larger average
revisions to the latest estimate reflect the fact that comprehensive revisions include major improvements, such as
the incorporation of BEA’s latest benchmark input-output accounts. The quarterly estimates correctly indicate the
direction of change of real GDP 97 percent of the time, correctly indicate whether GDP is accelerating or
decelerating 72 percent of the time, and correctly indicate whether real GDP growth is above, near, or below trend
growth more than four-fifths of the time.

Revisions Between Quarterly Percent Changes of GDP: Vintage Comparisons
[Annual rates]

Vintages Average Average without Standard deviation of
compared regard to sign revisions without
regard to sign

____________________________________________________Current-dollar GDP_______________________________________________

Advance to second……………….. 0.2 0.5 0.4
Advance to third………………… .2 .7 .4
Second to third…………………. .0 .3 .2

Advance to latest……………….. .3 1.3 1.0

________________________________________________________Real GDP_____________________________________________________

Advance to second……………….. 0.1 0.5 0.4
Advance to third………………… .1 .6 .4
Second to third…………………. .0 .2 .2

Advance to latest……………….. .3 1.3 1.0

NOTE. These comparisons are based on the period from 1983 through 2010.http://bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

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Posted on December 5, 2013. Filed under: American History, Blogroll, Communications, Economics, Employment, Federal Government, Federal Government Budget, Fiscal Policy, Foreign Policy, government, government spending, Health Care, history, Investments, Language, Law, liberty, Life, Links, Macroeconomics, media, Microeconomics, Obamacare, People, Philosophy, Politics, Raves, Talk Radio, Tax Policy, Unemployment, Video, Wealth, Wisdom, Writing | Tags: , , , , , , , , , , |

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EMBARGOED UNTIL RELEASE AT 8:30 A.M. EST, THURSDAY, DECEMBER 5, 2013
BEA 13-57

* See the navigation bar at the right side of the news release text for links to data tables,
contact personnel and their telephone numbers, and supplementary materials.

Lisa S. Mataloni: (202) 606-5304 (GDP) gdpniwd@bea.gov
Howard Krakower: (202) 606-5564 (Profits) cpniwd@bea.gov
Recorded message: (202) 606-5306
Jeannine Aversa: (202) 606-2649 (News Media)
National Income and Product Accounts
Gross Domestic Product, 3rd quarter 2013 (second estimate);
Corporate Profits, 3rd quarter 2013 (preliminary estimate)
      Real gross domestic product -- the output of goods and services produced by labor and property
located in the United States -- increased at an annual rate of 3.6 percent in the third quarter of 2013 (that
is, from the second quarter to the third quarter), according to the "second" estimate released by the
Bureau of Economic Analysis.  In the second quarter, real GDP increased 2.5 percent.

      The GDP estimate released today is based on more complete source data than were available for
the "advance" estimate issued last month.  In the advance estimate, the increase in real GDP was 2.8
percent (see "Revisions" on page 3). With this second estimate for the third quarter, the increase in
private inventory investment was larger than previously estimated.

      The increase in real GDP in the third quarter primarily reflected positive contributions from
private inventory investment, personal consumption expenditures (PCE), exports, nonresidential fixed
investment, residential fixed investment, and state and local government spending that were partly offset
by a negative contribution from federal government spending. Imports, which are a subtraction in the
calculation of GDP, increased.

      The acceleration in real GDP growth in the third quarter primarily reflected an acceleration in
private inventory investment, a deceleration in imports, and an acceleration in state and local
government spending that were partly offset by decelerations in exports, in PCE, and in nonresidential
fixed investment.

_________
FOOTNOTE.  Quarterly estimates are expressed at seasonally adjusted annual rates, unless otherwise
specified.  Quarter-to-quarter dollar changes are differences between these published estimates.  Percent
changes are calculated from unrounded data and are annualized.  "Real" estimates are in chained (2009)
dollars.  Price indexes are chain-type measures.

      This news release is available on BEA’s Web site along with the Technical Note and Highlights related
to this release.  For information on revisions, see "Revisions to GDP, GDI, and Their Major Components".
_________

     The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 1.8 percent in the third quarter, the same increase as in the advance estimate; this index
increased 0.2 percent in the second quarter.  Excluding food and energy prices, the price index for gross
domestic purchases increased 1.5 percent in the third quarter, compared with an increase of 0.8 percent
in the second.

      Real personal consumption expenditures increased 1.4 percent in the third quarter, compared
with an increase of 1.8 percent in the second.  Durable goods increased 7.7 percent, compared with an
increase of 6.2 percent.  Nondurable goods increased 2.4 percent, compared with an increase of 1.6
percent.  Services was unchanged in the third quarter; in the second quarter, services increased 1.2
percent.

      Real nonresidential fixed investment increased 3.5 percent in the third quarter, compared with an
increase of 4.7 percent in the second.  Nonresidential structures increased 13.8 percent, compared with
an increase of 17.6 percent.  Equipment was unchanged in the third quarter; in the second quarter,
equipment increased 3.3 percent.  Intellectual property products increased 1.7 percent, in contrast to a
decrease of 1.5 percent.  Real residential fixed investment increased 13.0 percent, compared with an
increase of 14.2 percent.

      Real exports of goods and services increased 3.7 percent in the third quarter, compared with an
increase of 8.0 percent in the second.  Real imports of goods and services increased 2.7 percent,
compared with an increase of 6.9 percent.

      Real federal government consumption expenditures and gross investment decreased 1.4 percent
in the third quarter, compared with a decrease of 1.6 percent in the second.  National defense decreased
0.3 percent, compared with a decrease of 0.6 percent.  Nondefense decreased 3.1 percent, the same
decrease as in the second quarter.  Real state and local government consumption expenditures and gross
investment increased 1.7 percent, compared with an increase of 0.4 percent.

      The change in real private inventories added 1.68 percentage points to the third-quarter change in
real GDP, after adding 0.41 percentage point to the second-quarter change.  Private businesses increased
inventories $116.5 billion in the third quarter, following increases of $56.6 billion in the second quarter
and $42.2 billion in the first.

      Real final sales of domestic product -- GDP less change in private inventories -- increased 1.9
percent in the third quarter, compared with an increase of 2.1 percent in the second.

Gross domestic purchases

      Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever
produced -- increased 3.4 percent in the third quarter, compared with an increase of 2.5 percent in the
second.

Gross national product

      Real gross national product -- the goods and services produced by the labor and property
supplied by U.S. residents -- increased 3.9 percent in the third quarter, compared with an increase of 2.7
percent in the second.  GNP includes, and GDP excludes, net receipts of income from the rest of the
world, which increased $13.7 billion in the third quarter after increasing $7.7 billion in the second; in the
third quarter, receipts increased $1.7 billion, and payments decreased $12.1billion.

Current-dollar GDP

      Current-dollar GDP -- the market value of the nation's output of goods and services -- increased
5.6 percent, or $229.8 billion, in the third quarter to a level of $16,890.8 billion.  In the second quarter,
current-dollar GDP increased 3.1 percent, or $125.7 billion.

Gross domestic income

      Real gross domestic income (GDI), which measures the output of the economy as the costs
incurred and the incomes earned in the production of GDP, increased 1.4 percent in the third quarter,
compared with an increase of 3.2 percent (revised) in the second.  For a given quarter, the estimates of
GDP and GDI may differ for a variety of reasons, including the incorporation of largely independent
source data.  However, over longer time spans, the estimates of GDP and GDI tend to follow similar
patterns of change.

Revisions

      The upward revision to the percent change in real GDP primarily reflected upward revisions to
private inventory investment and to nonresidential fixed investment that were partly offset by an upward
revision to imports and a downward revision to exports.

                                                                     Advance Estimate             Second Estimate
                                                                       (Percent change from preceding quarter)

Real GDP................................................                    2.8                        3.6
Current-dollar GDP......................................                    4.8                        5.6
Gross domestic purchases price index....................                    1.8                        1.8

                                            Corporate Profits

      Profits from current production (corporate profits with inventory valuation adjustment (IVA) and
capital consumption adjustment (CCAdj)) increased $38.3 billion in the third quarter, compared with an
increase of $66.8 billion in the second.  Taxes on corporate income decreased $4.8 billion, in contrast to
an increase of $10.0 billion.  Profits after tax with IVA and CCAdj increased $43.0 billion, compared
with an increase of $56.9 billion.

      Dividends decreased $179.7 billion in the third quarter, in contrast to an increase of $273.5
billion in the second.  The large third-quarter decrease primarily reflected dividends paid by Fannie Mae
to the federal government in the second quarter.  Undistributed profits increased $222.8 billion, in
contrast to a decrease of $216.6 billion.  Net cash flow with IVA -- the internal funds available to
corporations for investment -- increased $234.5 billion, in contrast to a decrease of $205.3 billion.

_________
BOX.  Profits from current production reflect the depreciation of
fixed assets valued at current cost using consistent depreciation profiles.
These profiles are based on used-asset prices and do not depend on the
depreciation-accounting practices used for federal income tax returns.  The IVA and CCAdj are
adjustments that convert inventory withdrawals and depreciation of fixed assets reported on a tax-return,
historical-cost basis to the current-cost economic measures used in the national income and product
accounts.
_________

Corporate profits by industry

      Domestic profits of financial corporations increased $8.6 billion in the third quarter, compared to
an increase of $24.5 billion in the second.  Domestic profits of nonfinancial corporations increased $13.0
billion, compared to an increase of $37.8 billion.

      The rest-of-the-world component of profits increased $16.7 billion in the third quarter, compared
with an increase of $4.6 billion in the second.  This measure is calculated as the difference between
receipts from rest of the world and payments to rest of the world.

Gross value added of nonfinancial domestic corporate business

      In the third quarter, real gross value added of nonfinancial corporations increased, and profits per
unit of real value added increased.  The increase in unit profits reflected an increase in unit prices that
was partly offset by increases in both unit labor costs and nonlabor costs incurred by corporations.

                                     *          *          *

BEA's national, international, regional, and industry estimates; the Survey of Current Business;
and BEA news releases are available without charge on BEA's Web site at www.bea.gov.  By visiting
the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.

                                     *          *          *

                         Next release -- December 20, 2013, at 8:30 A.M. EST for:
                       Gross Domestic Product:  Third Quarter 2013 (Third Estimate)
                          Corporate Profits:  Third Quarter (Revised Estimate)

                                     *          *          *
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Posted on October 20, 2013. Filed under: American History, Blogroll, College, Communications, Computers, Constitution, Economics, Education, Employment, Federal Government, Federal Government Budget, Fiscal Policy, Foreign Policy, government, government spending, Health Care, history, Macroeconomics, Tax Policy | Tags: , , , , , , , |

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Posted on October 20, 2013. Filed under: American History, Blogroll, College, Communications, Constitution, Economics, Education, Employment, European History, Federal Government, Federal Government Budget, Fiscal Policy, Food, Foreign Policy, government spending, history, Illegal, Immigration, Inflation, Investments, IRS, Law, liberty, Life, Links, Macroeconomics, media, Microeconomics, People, Philosophy, Photos, Politics, Psychology, Public Sector, Rants, Raves, Tax Policy, Taxes, Terrorism, Unemployment, Unions, Video, War, Wealth, Wisdom | Tags: , , , , , , , , , , , , , , |

niall-ferguson

“For the fiscal position of the federal government is in fact much worse today than is commonly realized. As anyone can see who reads the most recent long-term budget outlook—published last month by the Congressional Budget Office, and almost entirely ignored by the media—the question is not if the United States will default but when and on which of its rapidly spiraling liabilities.”

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An entitlement-driven disaster looms for America, yet Washington persists with its game of Russian roulette.

 

In the words of a veteran investor, watching the U.S. bond market today is like sitting in a packed theater and smelling smoke. You look around for signs of other nervous sniffers. But everyone else seems oblivious.

Yes, the federal government shut down this week. Yes, we are just two weeks away from the point when the Treasury secretary says he will run out of cash if the debt ceiling isn’t raised. Yes, bond king Bill Gross has been on TV warning that a default by the government would be “catastrophic.” Yet the yield on a 10-year Treasury note has fallen slightly over the past month (though short-term T-bill rates ticked up this week).

Part of the reason people aren’t rushing for the exits is that the comedy they are watching is so horribly fascinating. In his vain attempt to stop the Senate striking out the defunding of ObamaCare from the last version of the continuing resolution, freshman Sen. Ted Cruz managed to quote Doctor Seuss while re-enacting a scene from the classic movie “Mr. Smith Goes to Washington.”

Meanwhile, President Obama has become the Hamlet of the West Wing: One minute he’s for bombing Syria, the next he’s not; one minute Larry Summers will succeed Ben Bernanke as chairman of the Federal Reserve, the next he won’t; one minute the president is jetting off to Asia, the next he’s not. To be in charge, or not to be in charge: that is indeed the question.

According to conventional wisdom, the key to what is going on is a Republican Party increasingly at the mercy of the tea party. I agree that it was politically inept to seek to block ObamaCare by these means. This is not the way to win back the White House and Senate. But responsibility also lies with the president, who has consistently failed to understand that a key function of the head of the executive branch is to twist the arms of legislators on both sides. It was not the tea party that shot down Mr. Summers’s nomination as Fed chairman; it was Democrats like Sen. Elizabeth Warren, the new face of the American left.

Yet, entertaining as all this political drama may seem, the theater itself is indeed burning. For the fiscal position of the federal government is in fact much worse today than is commonly realized. As anyone can see who reads the most recent long-term budget outlook—published last month by the Congressional Budget Office, and almost entirely ignored by the media—the question is not if the United States will default but when and on which of its rapidly spiraling liabilities.

True, the federal deficit has fallen to about 4% of GDP this year from its 10% peak in 2009. The bad news is that, even as discretionary expenditure has been slashed, spending on entitlements has continued to rise—and will rise inexorably in the coming years, driving the deficit back up above 6% by 2038.

A very striking feature of the latest CBO report is how much worse it is than last year’s. A year ago, the CBO’s extended baseline series for the federal debt in public hands projected a figure of 52% of GDP by 2038. That figure has very nearly doubled to 100%. A year ago the debt was supposed to glide down to zero by the 2070s. This year’s long-run projection for 2076 is above 200%. In this devastating reassessment, a crucial role is played here by the more realistic growth assumptions used this year.

As the CBO noted last month in its 2013 “Long-Term Budget Outlook,” echoing the work of Harvard economists Carmen Reinhart and Ken Rogoff : “The increase in debt relative to the size of the economy, combined with an increase in marginal tax rates (the rates that would apply to an additional dollar of income), would reduce output and raise interest rates relative to the benchmark economic projections that CBO used in producing the extended baseline. Those economic differences would lead to lower federal revenues and higher interest payments. . . .

“At some point, investors would begin to doubt the government’s willingness or ability to pay U.S. debt obligations, making it more difficult or more expensive for the government to borrow money. Moreover, even before that point was reached, the high and rising amount of debt that CBO projects under the extended baseline would have significant negative consequences for both the economy and the federal budget.”

Just how negative becomes clear when one considers the full range of scenarios offered by CBO for the period from now until 2038. Only in three of 13 scenarios—two of which imagine politically highly unlikely spending cuts or tax hikes—does the debt shrink from its current level of 73% of GDP. In all the others it increases to between 77% and 190% of GDP. It should be noted that this last figure can reasonably be considered among the more likely of the scenarios, since it combines the alternative fiscal scenario, in which politicians in Washington behave as they have done in the past, raising spending more than taxation.

Only a fantasist can seriously believe “this is not a crisis.” The fiscal arithmetic of excessive federal borrowing is nasty even when relatively optimistic assumptions are made about growth and interest rates. Currently, net interest payments on the federal debt are around 8% of revenues. But under the CBO’s extended baseline scenario, that share could rise to 20% by 2026, 30% by 2049, and 40% by 2072. By 2088, the last date for which the CBO now offers projections, interest payments would—absent any changes in current policy—absorb just under half of all tax revenues. That is another way of saying that policy is unsustainable.

The question is what on earth can be done to prevent the debt explosion. The CBO has a clear answer: “[B]ringing debt back down to 39 percent of GDP in 2038—as it was at the end of 2008—would require a combination of increases in revenues and cuts in noninterest spending (relative to current law) totaling 2 percent of GDP for the next 25 years. . . .

“If those changes came entirely from revenues, they would represent an increase of 11 percent relative to the amount of revenues projected for the 2014-2038 period; if the changes came entirely from spending, they would represent a cut of 10½ percent in noninterest spending from the amount projected for that period.”

Anyone watching this week’s political shenanigans in Washington will grasp at once the tiny probability of tax hikes or spending cuts on this scale.

It should now be clear that what we are watching in Washington is not a comedy but a game of Russian roulette with the federal government’s creditworthiness. So long as the Federal Reserve continues with the policies of near-zero interest rates and quantitative easing, the gun will likely continue to fire blanks. After all, Fed purchases of Treasurys, if continued at their current level until the end of the year, will account for three quarters of new government borrowing.

But the mere prospect of a taper, beginning in late May, was already enough to raise long-term interest rates by more than 100 basis points. Fact (according to data in the latest “Economic Report of the President”): More than half the federal debt in public hands is held by foreigners. Fact: Just under a third of the debt has a maturity of less than a year.

Hey, does anyone else smell something burning?

Correction: Net interest payments on the federal debt are about 8% of revenues. The Oct. 5 op-ed “The Shutdown Is a Sideshow. Debt Is the Threat” misstated the payments as a percentage of GDP.

Mr. Ferguson’s latest book is “The Great Degeneration: How Institutions Decay and Economies Die” (Penguin Press, 2013).

http://online.wsj.com/news/articles/SB10001424052702304906704579113661593684356

 

Niall Ferguson Gets It Backwards, The Budget Deficit ‘Threat’ Is An Opportunity

John Tamny,

 

Back in 2008 in the lead-up to the 2008 presidential elections, John Stewart’s Comedy Channel show did a feature on John McCain going back to 1980. Each year offered a video clip of the Arizona Senator warning of a looming fiscal crisis related to the nation’s budget deficit.

Though one would be foolish to use The Daily Show as an economics lesson, the underlying point of the McCain segment was valid. Politicians, economists and mere members of the U.S. citizenry have been predicting deficit doom for as long as this writer’s been sentient, and probably even as long McCain’s been kicking.

All of which brings us to a recent Wall Street Journal Op-ed by British historian extraordinaire, Niall Ferguson. Though he seems to admit to joining an echo chamber that’s rather long in the tooth, Ferguson is the latest, and surely not the last to, in his own words, yell that the fiscal “theater is indeed burning.”  At this point we could fill several Rose Bowls with prominent individuals who’ve made the same argument. As he wrote last Saturday:

“For the fiscal position of the federal government is in fact much worse today than is commonly realized. As anyone can see who reads the most recent long-term budget outlook—published last month by the Congressional Budget Office, and almost entirely ignored by the media—the question is not if the United States will default but when and on which of its rapidly spiraling liabilities.”

This is in no way meant to dismiss Ferguson’s basic point. Maybe the horrid deficit tomorrow that never seems to come is on our doorstep, but at least for now it should be said that the television version of The Boy Who Cried Wolf made for modern consumption would star an angry adult male predicting deficit doom. Or maybe this is much ado about nothing. Better yet, maybe the proper way to look at the deficit question is to cease all the doom and gloom, and view the deficit as an opportunity.

For one, assuming we reach the point that all the deficit worriers talk about whereby the U.S. budget is consumed by interest payments, let’s look at the positives. Figure if Congressional appropriations are reduced to interest payments, it will be much more difficult for the fiscally incontinent members of both political parties to dream up new ways to waste our money.

Taking the debt discussion local for a moment, California has long been fingered by the same deficit-fearing crowd as a likely default prospect, but if so, does anyone think Apple AAPL +0.87%, Google GOOG +13.8%, and Intel INTC -0.19% will suffer higher rates for debt finance alongside the profligate State of California if the latter defaults?

Applied nationally, assuming Treasury goes explicit in its default in the way it’s long been implicit (the dollar that Treasuries pay out bought 1/35th of an ounce of gold in 1971, yet today it buys roughly 1/1300th) in its stiffing of creditors, is it really a certainty that Armageddon awaits as Ferguson presumes? Or is it more likely that investors, burned by Treasury, will migrate away from U.S. debt, along with government debt more broadly?

If so, never explained by the doomsayers is why this would be so bad. Creditors and investors won’t just sit on their money, rather they’ll find better, more hospitable places to put their capital to work. Assuming they charge Treasury 10% for 30-year debt, does anyone think Coca-Cola KO +0.6% will see its debt finance costs rise to a similar level?

If readers assume yes, that market panic would drive rates well beyond the aforementioned number, that too wouldn’t be a forever concept. High prices by virtue of being high naturally beget lower prices down the line as the high rates of interest lure profit-focused investors into the arena. Needless to say, whether investors simply tire of lending to Treasury such that they jack up rates, or if they raise rates in response to an actual default, financial capital won’t sit idle forever. Eventually investors will find new, and infinitely more productive places to deploy their funds. At risk of sounding too ‘tea party-ish’ given Ferguson’s not-so-veiled contempt for the movement, it’s not a reach to suggest that Amazon.com’s Jeff Bezos, FedEx’s Fred Smith, and Berkshire Hathaway’s Warren Buffett are much better allocators of capital than are John Boehner, Nancy Pelosi, and Harry Reid.

Of course to highly influential people like Ferguson, Treasury Secretary Jack Lew, and Fed Chairman Bernanke, default is the unthinkable, and would surely lead to the ‘Mother of All Great Depressions’ as interest rates skyrocket amid panic in the markets, and also in the street. Fair enough, but also wholly unproven. Lest we forget, it was the same crowd, or a reasonable facsimile (Bernanke at least), who told us that a failure to save Citigroup (bailed out five times in 22 years by the Fed) would lead to a decades-long recession.  Yes, in Bernanke’s world the capitalist system can only sustain itself if we run away from capitalism with lightning speed in order to prop up that which the markets don’t want.  Oh well, at the very least consider where all of this default/crisis talk is coming from.

Importantly, there’s another option that’s not talked of enough as a path out of a deficit ‘crisis’ that they regularly warn us about. How about economic growth? It’s really that simple, and if the political class had a clue about how economies grow (they don’t, but too many of us blindly accept their warnings about bank failures, default, global contraction as though they do), they might turn all the deficit worrying to their advantage.

Simply put, economic growth is easy. Taxes are a penalty placed on work and investment, so reduce the penalty on both to get more of both. Regulations don’t work (see the banks overseen by the Fed, SEC and the rest), but they do inhibit the profit motive for distracting executives who should be focused on the shareholder, and by extension, the customer. Trade is why we get up for work each day so that we can exchange our surplus for that of others, so when barriers to trade are put up, we foster inefficiency all the while taxing the purpose of work. Money is how we measure the value of the goods we exchange, and the investments we enter into, so stabilize its value. Notable with money is that in his masterful book, The Cash Nexus, Ferguson wrote of ‘forever’ British debt instruments that forever paid out low rates of interest precisely because the Pound had a stable definition in terms of gold.

To make basic what already is, growing countries never have to worry about deficits simply because their debt is so attractive. Greece isn’t suffering a debt crisis because it owes too much money, rather it’s in trouble because its even more hapless political class doesn’t understand that its debt problems would disappear if it adopted growth policies like the ones listed above. As Forbes contributor Louis Woodhill has pointed out regularly, interest rates on Greek debt became even more onerous once its politicians raised taxes to ‘fix’ the problem. What they missed is that the deficit problem was one of too little growth. It’s much the same here.

In short, rather than worry about a debt ‘threat’ that never seems to materialize, we should view the deficit as an opportunity to implement policies that always work, and that may even turn people like John McCain into optimists. If so, we can then get serious about the real economic problem which is the size of government itself. The raging fire in the theater of the latter is largely smoke free, but it represents all the future Microsofts and Intels, cancer and heart disease cures, and transportation innovations that have never revealed themselves thanks to our wasteful political class consuming so much of our capital. Government spending is what Ferguson et al might focus on if they weren’t so blinded by the ‘horrific’ deficit problems of tomorrow that never seem to come, and that wouldn’t matter much even if they did.

http://www.forbes.com/sites/johntamny/2013/10/10/niall-ferguson-gets-it-backwards-the-budget-deficit-threat-is-an-opportunity/

 

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Dr. Lacy Hunt–Roadblocks To Recovery — The Economic Consequences of Debt — Heading Towards The Bang Point — “This is how the world ends not with a bang but a whimper.” — Videos

Posted on March 5, 2013. Filed under: American History, Banking, Blogroll, Business, College, Communications, Economics, Education, Federal Government, Federal Government Budget, Fiscal Policy, government, history, Inflation, Investments, Law, liberty, Links, Macroeconomics, media, Microeconomics, Monetary Policy, Money, People, Philosophy, Politics, Raves, Taxes, Video, Wealth, Wisdom | Tags: , , , , , , , , |

“Only those who will risk going too far can possibly find out how far one can go.”

“This is the way the world ends

Not with a bang but a whimper.”

“Most of the evil in this world is done by people with good intentions.”

T.S. Eliot

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“There Was No Increase In The Standard of Living Since 1997″ – Lacy Hunt

Kung Fu Girl interviews Lacy Hunt

Roadblocks to Recovery an Interview with Dr. Lacy Hunt

We Move Along Toward the Bang Point – Lacy Hunt

An Early Warning Sign is the Currency Depreciates – Lacy Hunt; Part II

Former Fed Official warns of multi-decade downturn PART 1 – Lacy Hunt

Former Fed Official warns of multi-decade downturn PART 2 – Lacy Hunt

T. S. Eliot – The Hollow Men

The Hollow Men T.S. Eliot How Cultures Die

Background Articles and Videos

Velocity of Money (Circulation) Part 1

Velocity of Money (Circulation) Part 2

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Lewis J. Spellman Interviews Dr. Lacy Hunt–The Morass of Debt–Videos

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R. Christopher Whalen: Inflated: How Money and Debt Built the American Dream–Videos

Posted on December 10, 2012. Filed under: Banking, Blogroll, Business, Communications, Demographics, Economics, Employment, Federal Government, Fiscal Policy, government, government spending, history, History of Economic Thought, Homes, Immigration, Inflation, Investments, Law, liberty, Life, Links, Macroeconomics, media, Microeconomics, Monetary Policy, Money, Philosophy, Politics, Public Sector, Rants, Raves, Regulations, Resources, Tax Policy, Technology, Unions, Weather, Wisdom | Tags: , , , , , , , |

Inflated_How_Money_and_Debt_Built_The American_Dream

r_Christopher_Whalen

“Whalen is smart. He’s one of the few worthy of your time. Others: Marc Faber, Hugh Hendry, Doug Dachille, David Rosenberg, Howard Davidowitz, James Grant, Peter Schiff, Niall Ferguson, Doug Casey, Jim Rogers.”

Chris Whalen Drops the F-Bomb on Wall Street while sounding the Bankruptcy Alarm

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Inflated: How Money and Debt Built the American Dream | Christopher Whalen

‘Inflated: How Money and Debt Built the American Dream’

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Richard Duncan–The New Depression–Videos

Posted on December 9, 2012. Filed under: American History, Banking, Blogroll, College, Communications, Economics, Education, Employment, Federal Government, Federal Government Budget, Fiscal Policy, government, government spending, history, History of Economic Thought, Inflation, Investments, Language, Law, liberty, Life, Links, Macroeconomics, media, Microeconomics, Monetary Policy, Money, People, Philosophy, Politics, Public Sector, Rants, Raves, Security, Strategy, Tax Policy, Taxes, Unemployment, Unions, Video, War, Wealth, Wisdom | Tags: , , , , , , , , , , , , , , , , , , , |

9781118157794.pdf

richard_ducan

The U.S. does not have a capitalist economy 

A new depression: Out of credit

Interview With Richard Duncan, Author of The New Depression 

Richard Duncan on Riding out this Depression on a Deflationary Debt Raft! 

    “The New Depression” Book w/ Glenn Beck & Richard Duncan

The New Depression: Richard Duncan | McAlvany Commentary 

Pt 1/5: Can governments end the crisis cycle? 

Pt 2/5: Can governments end the crisis cycle? 

Pt 3/5: Can governments end the crisis cycle?

Pt 4/5: Can governments end the crisis cycle?

Pt 5/5: Can governments end the crisis cycle?

Jim Rogers  New Recession/Depression Coming

Peter Schiff interviews Marc Faber on Schiffradio Oct 2012 

Why the global recession is in danger of becoming another Great Depression, and how we can stop it

When the United States stopped backing dollars with gold in 1968, the nature of money changed. All previous constraints on money and credit creation were removed and a new economic paradigm took shape. Economic growth ceased to be driven by capital accumulation and investment as it had been since before the Industrial Revolution. Instead, credit creation and consumption began to drive the economic dynamic. In The New Depression: The Breakdown of the Paper Money Economy, Richard Duncan introduces an analytical framework, The Quantity Theory of Credit, that explains all aspects of the calamity now unfolding: its causes, the rationale for the government’s policy response to the crisis, what is likely to happen next, and how those developments will affect asset prices and investment portfolios.

In his previous book, The Dollar Crisis (2003), Duncan explained why a severe global economic crisis was inevitable given the flaws in the post-Bretton Woods international monetary system, and now he’s back to explain what’s next. The economic system that emerged following the abandonment of sound money requires credit growth to survive. Yet the private sector can bear no additional debt and the government’s creditworthiness is deteriorating rapidly. Should total credit begin to contract significantly, this New Depression will become a New Great Depression, with disastrous economic and geopolitical consequences. That outcome is not inevitable, and this book describes what must be done to prevent it.

  • Presents a fascinating look inside the financial crisis and how the New Depression is poised to become a New Great Depression
  • Introduces a new theoretical construct, The Quantity Theory of Credit, that is the key to understanding not only the developments that led to the crisis, but also to understanding how events will play out in the years ahead
  • Offers unique insights from the man who predicted the global economic breakdown

Alarming but essential reading, The New Depression explains why the global economy is teetering on the brink of falling into a deep and protracted depression, and how we can restore stability.

http://www.wiley.com/WileyCDA/WileyTitle/productCd-1118157796.html

The New Depression: Richard Duncan’s prognosis of our economic ills and the answer to them

“… In a nutshell, his case is half-Austrian. Or indeed half-Keynesian. That is because whilst Duncan’s diagnosis of the current economic ills is very much in the Austrian school of economics, with its emphasis on the role of credit, his prescription for fixing the economy is large-scale borrowing to fund infrastructure work, all of which sounds rather Keynesian.

It is a more fiscally responsible version of Keynesianism than some, for Duncan argues that, “The U.S. government can now borrow money for ten years at a cost of 2 percent interest a year. If it borrows at that rate and invests in projects that yield even 3 percent … on a grand scale in grand projects … [our economy] could be transformed”. In other words, borrow massively to boost economic growth, but spend those funds on projects that will generate future returns which make the borrowing affordable.

Duncan has a particular set of target for his investment plans for the American economy – developing new industries to reduce the trade deficit and generate new tax revenues. In particular, he talks about renewable energy, arguing that massive investment will cut energy bills whilst also providing the sort of financial return that makes the massive spending of money on it a prudent rather than profligate move.

All that means there are three main bones of contention in the book: is Richard Duncan right in blaming the crash on credit conditions; is he right that massive infrastructure investment on projects which pay returns the answer; and if money is to be invested in infrastructure that pays returns, does renewable energy fit the bill? Although a book principally about the US economy and the policy choices faced by Americans, those three questions are very applicable to other countries too, even if his evidence tends to be centred on the USA.

As he mulls over these three questions, most readers will find at least one eye-catching piece of evidence to savour, such as when he describes how heavily the financial system became dependent on credit not going sour:

In 1945 [American] commercial banks held reserves and vault cash of … the equivalent of 12 percent of their total assets … By 2007, the banks’ reserves and vault cash [was] 0.6 percent.

He goes on to argue that

Economic progress was no longer achieved the old-fashioned way through savings and investments, but, rather, by borrowing and consumption … The new reality is that credit has displaced money as the key economic variable.

Hence the book’s subtitle, “The Breakdown of the Paper Money Economy”.

Each of the three main questions in themselves could sustain not merely one whole book but a mini-book publishing flurry of titles. To condense credible arguments over all three into one relatively slim and easy to follow volume is tribute to the Duncan, even if some readers may choose to agree with less than all three of the main points of his case. …”

http://www.libdemvoice.org/the-new-depression-richard-duncans-prognosis-of-our-economic-ills-and-the-answer-to-them-28981.html

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James Grant–Videos

Posted on August 3, 2012. Filed under: American History, Banking, Blogroll, Books, Climate, College, Communications, Economics, Education, Employment, Energy, Federal Government, Fiscal Policy, government, government spending, history, History of Economic Thought, Inflation, Investments, Language, Law, liberty, Life, Links, Macroeconomics, media, Microeconomics, Monetary Policy, Money, People, Philosophy, Politics, Raves, Resources, Unemployment, War, Wealth, Wisdom | Tags: , , , , , , , , , , , , , , |

Jim Grant explains how Central Banks are Waging War on Supply and Demand

James Grant Explains a World without the Federal Reserve – Capital

James Grant: Gold, the Refuge of the Idiots 

“What Does the Fed Do?” with James Grant — Ron Paul Fed Lecture Series, Pt 2/3

Q&A: Author James Grant

Value Investing Conference 2010 – Part 2

James Grant – on Bernanke, bank capital & lack of capitalism 

Jim Grant 

Never before has the Fed done what it’s doing now” 

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Rising Gasoline Prices Due To Excessive Speculation In Oil Futures Contracts–Political Issue in 2012 Elections–American People Are Being Screwed At The Gas Pump & Grocery Store–Videos

Posted on May 2, 2012. Filed under: Agriculture, American History, Blogroll, Business, College, Communications, Economics, Education, Employment, Farming, Federal Government, Fiscal Policy, Food, government, government spending, Investments, Language, Law, liberty, Life, Links, Macroeconomics, media, Microeconomics, Monetary Policy, People, Philosophy, Politics, Raves, Resources, Taxes, Unemployment, Video, War, Weather, Wisdom | Tags: , , , , , , , , , , , , , , , , , , |

http://www.gasbuddy.com/gb_retail_price_chart.aspx?time=24

Gas Prices Explained 

Quantitative Easing Explained

Senator Blumenthal on Curbing Excessive Oil Speculation

Senator Blumenthal calls for action against excessive oil speculation that inflates gas prices

Cantwell: ‘Shenanigans’ in Oil Market Reminiscent of Enron ‘Nightmare’ in Pacific NW

How Uncertainty, Speculation Factor Into Gas Prices 

Banksters & Speculation Behind High Food-Oil Prices

Under Questioning by Cantwell, Exxon CEO Estimates Oil Should Cost $60-70 Per Barrel

On May 12, 2011, when questioned by U.S. Senator Maria Cantwell (D-WA) at a Senate Finance Committee hearing, Exxon Mobil Chairman and Chief Executive Officer Rex Tillerson said that oil should cost between $60 and $70 per barrel, if the price of oil were based on supply and demand fundamentals. Oil was trading at $98 per barrel on Thursday morning, after inexplicitly plunging 5.5 percent yesterday.

Michael Greenberger on “commodity prices and volatility”

Regulations on Speculation Weak, But Better Than Nothing

Speculation and Watered Down Regulation

Secret Exemptions Allowed Speculators to Distort Futures Markets

CFTC Commissioner: “A Hair Trigger Away from Economic Calamity” 

Will CFTC Limit Excessive Speculation?

Stossel: Oil Speculation

The Price Of Oil

CHHS Director explains derivatives regulation on C-SPAN – 5/15/09

Michael Greenberger Talks Speculation In Commodity Markets

Oil speculation and oil prices 

Myth: The World is Running Out of Oil (Peak Oil) 

Hearing on Energy Price Manipulation – Greenberger Testimony 

Background Articles and Videos

Lecture 2: Course outline, futures markets history and market mechanics

Lecture 3: Futures contracts

Lecture 4: Options contracts and market history 

Lecture 5: Reading futures contract price quote tables

Lecture 15: A further review of technical analysis

Lecture 16: Introduction to hedging with futures 

Lecture 17: Hedging continued

Lecture 18: Hedging risk vs. return, diversification and options on futures

Lecture 19: Options on futures continued, with examples 

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Carmen M. Reinhart and Kenneth S. Rogoff–This Time Is Different: Eight Centuries of Financial Folly–A Decade of Debt–Videos

Posted on February 12, 2012. Filed under: American History, Banking, Blogroll, Business, College, Communications, Demographics, Diasters, Economics, Education, Employment, Federal Government, Federal Government Budget, Fiscal Policy, Foreign Policy, government, government spending, history, History of Economic Thought, Language, Law, liberty, Life, Links, Macroeconomics, media, Microeconomics, Monetary Policy, Money, People, Philosophy, Politics, Public Sector, Raves, Resources, Talk Radio, Tax Policy, Technology, Unemployment, Unions, Video, War, Wealth, Wisdom | Tags: , , , , , , , |

“…Synopsis

Throughout history, rich and poor countries alike have been lending, borrowing, crashing–and recovering–their way through an extraordinary range of financial crises. Each time, the experts have chimed, “this time is different”–claiming that the old rules of valuation no longer apply and that the new situation bears little similarity to past disasters. With this breakthrough study, leading economists Carmen Reinhart and Kenneth Rogoff definitively prove them wrong. Covering sixty-six countries across five continents, This Time Is Differentpresents a comprehensive look at the varieties of financial crises, and guides us through eight astonishing centuries of government defaults, banking panics, and inflationary spikes–from medieval currency debasements to today’s subprime catastrophe. Carmen Reinhart and Kenneth Rogoff, leading economists whose work has been influential in the policy debate concerning the current financial crisis, provocatively argue that financial combustions are universal rites of passage for emerging and established market nations. The authors draw important lessons from history to show us how much–or how little–we have learned.

Using clear, sharp analysis and comprehensive data, Reinhart and Rogoff document that financial fallouts occur in clusters and strike with surprisingly consistent frequency, duration, and ferocity. They examine the patterns of currency crashes, high and hyperinflation, and government defaults on international and domestic debts–as well as the cycles in housing and equity prices, capital flows, unemployment, and government revenues around these crises. While countries do weather their financial storms, Reinhart and Rogoff prove that short memories make it all too easy for crises to recur.

An important book that will affect policy discussions for a long time to come, This Time Is Different exposes centuries of financial missteps. …”

http://search.barnesandnoble.com/This-Time-Is-Different/Carmen-M-Reinhart/e/9780691142166

What’s Wrong With the Recovery?

Interview with Kenneth Rogoff on “This time is different”

Carmen Reinhart & Kenneth Rogoff: Coming Out of the Crisis

Carmen Reinhart on A Decade of Debt

Q & A: Carmen M. Reinhart on A Decade of Debt

Fall 2010 Marc Sumerlin Lecture Series Featuring Prof. Carmen Reinhart

Why the Financial Crisis & What is the Way Out

Ken Rogoff – Debts, Deficits and Global Financial Stability

Carmen Reinhart: Serial Default Syndrome

Kenneth Rogoff: Economic Reappraisal

Background Articles and Videos

John Kay: A Call for Eclecticism (3/5) 

Keynesian Kenneth Rogoff about “benefits of inflation” 2008.12.15 

Currency Wars (Video) 

Kenneth Rogoff At Bretton Woods, United States Speaks to Shaili Chopra

The Future of the Global Economy and Financial System Plenary Session Recording, Part 9 

Agenda Summer 2010: The Limits of Economics

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Nassim Nicholas Taleb–The Black Swan–Videos

Posted on February 4, 2012. Filed under: American History, Banking, Blogroll, Business, College, Communications, Culture, Demographics, Diasters, Economics, Education, Employment, Energy, Federal Government, Federal Government Budget, Fiscal Policy, Foreign Policy, government, government spending, Health Care, history, Homes, Immigration, Inflation, Investments, Language, Law, liberty, Life, Links, Macroeconomics, media, Medicine, Microeconomics, Monetary Policy, Money, People, Philosophy, Politics, Psychology, Radio, Raves, Resources, Science, Tax Policy, Video, War, Wealth, Wisdom | Tags: , , , , , , , , , , , , , , , |

 When asked about his opinion on the Republican primaries of the 2012 presidential elections on his official Facebook page, Taleb said “[t]he only person I trust is Ron Paul.”

Nassim Taleb educates a quant

Nassim Nicholas Taleb – What is a “Black Swan?” 

Nassim Nicholas Taleb Angry 

Atheists and the Stock Market – Nassim Nicholas Taleb 

TIME 10 Questions:      10 Questions for Nassim Taleb

The Predictability of Unpredictability

Nassim Taleb – ‘The Banks Have Hijacked the Government’

Nassim Taleb: Risk & Regulation – NewWaveSlave.com

Benoit Mandelbrot and Nassim Taleb on the financial crisis

Nassim Taleb 23/11/2010 – his beef with Bernanke

Nassim Taleb: “OWS Second Generation Marxist Class Struggle”

Nassim Nicholas Taleb,  PART 1. THE BLACK SWAN,….. The “Fragility” Crisis has Just Begun, PART 1. 

Nassim Nicholas Taleb,   PART 2, THE BLACK SWAN, ….The “Fragility” Crisis has Just Begun PART 2. 

Nassim Nicholas Taleb, PART 3, THE BLACK SWAN….The “Fragility” Crisis has Just Begun PART 3. 

Nassim Nicholas Taleb,  PART 4. THE BLACK SWAN….The “Fragility” Crisis has Just Begun PART 4.

Nassim Nicholas Taleb,  PART 5. THE BLACK SWAN….The “Fragility” Crisis has Just Begun PART 5. 

Nassim Nicholas Taleb at Harvard University, part 1

Nassim Nicholas Taleb at Harvard University, part 2 

Nassim Taleb – Fooled by Randomness and Black Swans 

Nassim Taleb Speaks to a Clueless Congress (Part 1 of 2)

Nassim Taleb Speaks to a Clueless Congress (Part 2 of 2)

Staying the Course: Part II – Zeitgeist Europe ’09

Nassim Taleb Criticizes Tim Geithner’s Plan

Nassim Nicholas Taleb – ‘Things are getting worst’

Taleb Says Focus on Specific Trades in Selloff Misguided 

Investing in Uncertainty Wall Street  Pseudo Economics (Nassim Taleb author: The Black Swan)

The Black Swan by Nassim Nicholas Taleb @ WIBC 2009 

The Russia Forum 2010-02-04 Currencies: Finding New Balance part 5/6

Taleb Up 50% This Year

Taleb’s idea on ending the crisis 

Video: Nassim Taleb – Issues for CIOs Now 

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Video: Nassim Taleb – Getting Personal

Word of the Day: Turkey! 

Nassim Nicholas Taleb

“…Nassim Nicholas Taleb (Arabic: نسيم نيقولا نجيب طالب‎, alternatively Nessim or Nissim, born 1960) is a Lebanese American essayist whose work focuses on problems of randomness and probability.[3] His 2007 book The Black Swan was described in a review by Sunday Times as one of the twelve most influential books since World War II.[4]

He is a bestselling author,[5][6][7] and has been a professor at several universities, currently at Polytechnic Institute of New York University and Oxford University.[8][9] He has also been a practitioner of mathematical finance,[10]a hedge fund manager,[11][12][13] a Wall Street trader,[14][15][16] and is currently a scientific adviser at Universa Investments and the International Monetary Fund.[17][18]

He criticized the risk management methods used by the finance industry and warned about financial crises, subsequently making a fortune out of the late-2000s financial crisis.[19][20] He advocates what he calls a “black swan robust” society, meaning a society that can withstand difficult-to-predict events.[11] He favors “stochastic tinkering” as a method of scientific discovery, by which he means experimentation and fact-collecting instead of top-down directed research.[21]

Family background and education

Taleb was born in Amioun, Lebanon, a son of Dr. Najib Taleb, an oncologist and researcher in anthropology, and his wife Minerva Ghosn. His parents were Greek Orthodox Lebanese with French citizenship, and he attended a French school there, the Grand Lycée Franco-Libanais.[2][22] His family saw its political prominence and wealth reduced by the Lebanese Civil War, which began in 1975. During the war, Taleb studied for several years in the basement of his family’s home.[23]

Both sides of his family were politically prominent in the Lebanese Greek Orthodox community. On his mother’s side, his grandfather, Fouad Nicolas Ghosn, and his great-grandfather, Nicolas Ghosn, were both deputy prime ministers. His paternal grandfather was a supreme court judge; his great-great-great-great grandfather, Ibrahim Taleb, was a governor of the Ottoman semi-autonomous Mount Lebanon Governorate in 1861. The Taleb family Palazo, built in 1860 by Florentine architects for his great-great-great-great grandfather, still stands in Amioun.[24]

Taleb received his bachelor and master in science degrees from the University of Paris.[25] He holds an MBA from the Wharton School at the University of Pennsylvania and a PhD in Management Science (his thesis was on the mathematics of derivatives pricing) from the University of Paris (Dauphine)[26] under the direction of Hélyette Geman.[27]

A polyglot, Taleb has a literary fluency in English, French, and classical Arabic; a conversational fluency in Italian and Spanish; and can read classical texts in Greek, Latin, Aramaic, and ancient Hebrew, as well as the Canaanite script.[28][29]

Finance career

Taleb considers himself less a businessman than an epistemologist of randomness, and says that he used trading to attain independence and freedom from authority.[30] As a trader, his strategy has been to safeguard investors against crises while reaping rewards from rare events, and thus his trading career has included several jackpots followed by lengthy dry spells.[2] Taleb was a pioneer of tail risk hedging (now sometimes called “black swan protection”),[31] whereby investors are insured against extreme market moves. He says that reaping dividends the way he has means dwelling in the land of “Mediocristan” instead of “Extremistan”, the latter being an environment where huge things (black swans) can happen to you, whereas Mediocristan is the land of dentists who earn an above average income but with less extreme variations.[32]

He has held the following positions: managing director and proprietary trader at UBS; worldwide chief proprietary arbitrage derivatives trader for currencies, commodities and non-dollar fixed income at CS First Boston; chief currency derivatives trader for Banque Indosuez; managing director and worldwide head of financial option arbitrage at CIBC Wood Gundy; derivatives arbitrage trader at Bankers Trust, proprietary trader at BNP Paribas, as well as independent option market maker on the Chicago Mercantile Exchange; and founder of Empirica Capital, after which Taleb retired from trading and became a full-time author and scholar in 2004.[33] Taleb is currently Principal/Senior Scientific Adviser at Universa Investments in Santa Monica, California, a tail protection firm owned and managed by former Empirica partner Mark Spitznagel.

Taleb reportedly became financially independent after the crash of 1987[15] and made a multi-million dollar fortune during the financial crisis that began in 2007, a development which he attributed to the mismatch between statistical distributions used in finance and reality.[34] Universa is a fund which is based on the “black swan” idea and to which Taleb is a principal adviser. Separate funds belonging to Universa made returns of 65% to 115% in October 2008.[20][35] In the wake of the economic crisis that started in 2008, Taleb has become an activist for a “black swan robust society” [36][37] and as of July 2011, Taleb is working with the International Monetary Fund on identifying and mitigating tail risks in financial markets.[17]

Academic career

Taleb became a full time researcher in 2004, as a university professor. He is currently Distinguished Professor of Risk Engineering at Polytechnic Institute of New York University,[38] Associate Member at the Institut Jean Nicod of the École Normale Supérieure in Paris[39] and Distinguished Research Scholar, Said Business School, Oxford University.[9] He was Visiting Professor at London Business School and the Dean’s Professor in the Sciences of Uncertainty at the Isenberg School of Management at the University of Massachusetts Amherst, Adjunct Professor of Mathematics at the Courant Institute of New York University, and affiliated faculty member at the Wharton Business School Financial Institutions Center. He jointly teaches regular courses with Paul Wilmott and occasionally on the Certificate in Quantitative Finance. In 2008–2009, he ranked fifth in terms of the number of downloaded papers on the Social Science Research Network (SSRN).[40]

Writing career

Taleb’s first non-technical book, Fooled by Randomness, about the underestimation of the role of randomness in life, was published in 2001.

His second non-technical book, The Black Swan, about unpredictable events, was published in 2007, selling as of February 2011, close to 3 million copies. It spent 36 weeks in hardcover on the [41] New York Times Bestseller list list; 17 as hardcover and 19 weeks[42] as paperback. [2] and was translated into 31 languages.[2] The Black Swan has been credited with predicting the banking and economic crisis of 2008.[4]

Taleb’s non-technical writing style mixes a narrative style (often semi-autobiographical) and short philosophical tales together with historical and scientific commentary. The sales of Taleb’s first two books garnered an advance of $4 million for a follow-up book[2] on anti-fragility.

A book of aphorisms, The Bed of Procrustes: Philosophical and Practical Aphorisms, was released in December 2010.

In 2007, in The Black Swan, Taleb warned about the coming crisis:[43]

Globalization creates interlocking fragility, while reducing volatility and giving the appearance of stability. In other words it creates devastating Black Swans. We have never lived before under the threat of a global collapse. Financial Institutions have been merging into a smaller number of very large banks. Almost all banks are interrelated. So the financial ecology is swelling into gigantic, incestuous, bureaucratic banks – when one fails, they all fall. The increased concentration among banks seems to have the effect of making financial crisis less likely, but when they happen they are more global in scale and hit us very hard. We have moved from a diversified ecology of small banks, with varied lending policies, to a more homogeneous framework of firms that all resemble one another. True, we now have fewer failures, but when they occur …. I shiver at the thought. The government-sponsored institution Fannie Mae, when I look at its risks, seems to be sitting on a barrel of dynamite, vulnerable to the slightest hiccup. But not to worry: their large staff of scientists deem these events “unlikely”.

Among the people Taleb’s writing has influenced is writer Malcolm Gladwell of The New Yorker. Gladwell wrote, “We associate the willingness to risk great failure – and the ability to climb back from catastrophe – with courage. But in this we are wrong. That is the lesson of Nassim Taleb.”[44][45]

Philosophical theories

His book The Bed of Procrustes summarizes the central problem: “we humans, facing limits of knowledge, and things we do not observe, the unseen and the unknown, resolve the tension by squeezing life and the world into crisp commoditized ideas”. Taleb disagrees with Platonic (i.e., theoretical) approaches to reality to the extent that they lead people to have the wrong map of reality rather than no map at all.[16] He opposes most economic and grand social science theorizing, which in his view suffer acutely from the problem of overuse of Plato’s Theory of Forms.

Relatedly, he also believes that universities are better at public relations and claiming credit than generating knowledge. He argues that knowledge and technology are usually generated by what he calls “stochastic tinkering” rather than by top-down directed research.[21][46][47][48]

He calls for cancellation of the Nobel Memorial Prize in Economics, saying that the damage from economic theories can be devastating.[49][50] He opposes top-down knowledge as an academic illusion and believes that price formation obeys an organic process.[51] Together with Espen Gaarder Haug, Taleb asserts that option pricing is determined in a “heuristic way” by operators, not by a model, and that models are “lecturing birds on how to fly”.[51] Pablo Triana has explored this topic with reference to Haug and Taleb,[52][53] and says that perhaps Taleb is correct to urge that banks be treated as utilities forbidden to take potentially lethal risks, while hedge funds and other unregulated entities should be able to do what they want.[54]

Taleb’s writings discuss the error of comparing real-world randomness with the “structured randomness” in quantum physics where probabilities are remarkably computable and games of chance like casinos where probabilities are artificially built.[32] Taleb calls this the “Ludic fallacy“. His argument centers on the idea that predictive models are based on Plato’s Theory of Forms, gravitating towards mathematical purity and failing to take some key ideas into account, such as: the impossibility of possessing all relevant information, that small unknown variations in the data can have a huge impact, and flawed theories/models that are based on empirical data and that fail to consider events that have not taken place but could have taken place. Discussing the Ludic fallacy in The Black Swan, he writes, “The dark side of the moon is harder to see; beaming light on it costs energy. In the same way, beaming light on the unseen is costly in both computational and mental effort.”

In the second edition of The Black Swan, he posited that the foundations of quantitative economics are faulty and highly self-referential. He states that statistics is fundamentally incomplete as a field as it cannot predict the risk of rare events, a problem that is acute in proportion to the rarity of these events. With the mathematician Raphael Douady, he called the problem statistical undecidability (Douady and Taleb, 2010).

Taleb sees his main challenge as mapping his ideas of “robustification” and “anti-fragility“, that is, how to live and act in a world we do not understand and build robustness to black swan events. Taleb introduced the idea of the “fourth quadrant”. One of its applications is in his definition of the most effective (that is, least fragile) risk management approach: what he calls the ‘barbell’ strategy which is based on avoiding the middle in favor of linear combination of extremes, across all domains from politics to economics to one’s personal life. These are deemed more robust to estimation errors. For instance, he suggests that investing money in ‘medium risk’ investments is pointless because risk is difficult if not impossible to compute. His preferred strategy is to be both hyper-conservative and hyper-aggressive at the same time. For example, an investor might put 80 to 90% of their money in extremely safe instruments, such as treasury bills, with the remainder going into highly risky and diversified speculative bets. An alternative suggestion is to engage in highly speculative bets that are insured against losses of more than a specified amount. He asserts that by adopting these strategies a portfolio can be “robust”, that is, gain a positive exposure to black swan events while limiting losses suffered by such random events.[55] Taleb also applies a similar barbell-style approach to health and exercise. Instead of doing steady and moderate exercise daily, he suggests that it is better to do a low-effort exercise such as walking slowly most of the time, while occasionally expending extreme effort. He avers that the human body evolved to live in a random environment, with various unexpected but intense efforts and much rest.[56]

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In a 2008 article in The Times, the journalist Bryan Appleyard described Taleb as “now the hottest thinker in the world”.[14] The Nobel Laureate Daniel Kahneman proposed the inclusion of Taleb’s name among the world’s top intellectuals, saying “Taleb has changed the way many people think about uncertainty, particularly in the financial markets. His book, The Black Swan, is an original and audacious analysis of the ways in which humans try to make sense of unexpected events.”[57] Taleb was treated as a “rock star” at the World Economic Forum annual meeting in Davos in 2009; at that event he had harsh words for bankers.[clarification needed][58][59]

Taleb contends that statisticians can be pseudoscientists when it comes to risks of rare events and risks of blowups, and mask their incompetence with complicated equations. This stance has attracted criticism: the American Statistical Association devoted the August 2007 issue of The American Statistician to The Black Swan. The magazine offered a mixture of praise and criticism for Taleb’s main points, with a focus on Taleb’s writing style and his representation of the statistical literature. Robert Lund, a mathematics professor at Clemson University, writes that in Black Swan, Taleb is “reckless at times and subject to grandiose overstatements; the professional statistician will find the book ubiquitously naive.”[60]

Aaron Brown, a finance professor at Yeshiva University, said that “the book reads as if Taleb has never heard of nonparametric methods, data analysis, visualization tools or robust estimation.”[61] Nonetheless, he calls the book “essential reading” and urges statisticians to overlook the insults to get the “important philosophic and mathematical truths.” Taleb replied in the second edition of The Black Swan that “One of the most common (but useless) comments I hear is that some solutions can come from ‘robust statistics.’ I wonder how using these techniques can create information where there is none”.[62] While praising the book, Westfall and Hilbe in 2007 complained that Taleb’s criticism is “often unfounded and sometimes outrageous.”[63] Taleb’s contentious style, they say, “describes writers and professionals as knaves or fools, mostly fools. His writing is full of irrelevances, asides and colloquialisms, reading like the conversation of a raconteur rather than a tightly argued thesis.”[63] Taleb felt that academics showed “bad faith” by criticizing a literary book that claimed to be a literary book and by ignoring the empirical evidence provided in his appendix and more technical works.[64]

The late Berkeley statistician David Freedman said that efforts by statisticians to refute Taleb’s stance have been unconvincing.[65] Taleb wrote in the second edition of The Black Swan that he had a session in 2008 with statisticians in which the hostility changed:

I found out that telling researchers “This is where your methods work very well” is vastly better than telling them “This is what you guys don’t know.” So when I presented to what was until then the most hostile crowd in the world, members of the American Statistical Association, a map of the four quadrants, and told them: your knowledge works beautifully in these three quadrants, but beware of the fourth one, as this is where the Black Swans breed, I received instant approval, support, offers of permanent friendship, refreshments (Diet Coke), invitations to come present at their sessions, even hugs(…) They tried to convince me that statisticians were not responsible for these aberrations, which come from people in the social sciences who apply statistical methods without understanding them.

Taleb and Nobel laureate Myron Scholes have traded personal attacks, particularly after Taleb’s paper with Espen Haug on why nobody used the Black-Scholes-Merton formula. Taleb said that Scholes was responsible for the financial crises of 2008, and suggested that “this guy should be in a retirement home doing Sudoku. His funds have blown up twice. He shouldn’t be allowed in Washington to lecture anyone on risk.”[37] Scholes retorted that Taleb simply “popularises ideas and is making money selling books”. Scholes claimed that Taleb does not cite previous literature, and for this reason Taleb is not taken seriously in academia.[66] Taleb and Haug (2010) listed hundreds of research documents showing the Black-Scholes formula was not Scholes’ at all and argued that the economics establishment ignored the literature by practitioners and mathematicians (such as Ed Thorp), who had developed a more sophisticated version of the formula.

Citing his academic works on the same topics covered in The Black Swan, Taleb said that “Academics should comment on data there, not make technical comments on a literary book”.[64] He has said that no direct published criticism has been directed at his ideas, but rather at his person and style. He wrote, “you never win an argument until they attack your person.”[64] In an interview on Charlie Rose, Taleb said that he was pleased that none of the criticism he received for The Black Swan had any substance, as it was either unintelligent, ad hominem, or style over substance, which convinced him to “go for the jugular” with a huge financial bet on the breakdown of statistical methods in finance.[67]

Taleb’s aggressive attitude against the finance industry has led to personal attacks, including a smear campaign and death threats from former employees of Lehman Brothers.[68]

Personal life

Though a non-smoker, Taleb suffered from throat cancer in the mid-1990s, which he overcame.[69] According to his official bio, he has dual residence in New York and Amioun, Lebanon.[70] He has stated that his major hobby is “teasing people who take themselves and the quality of their knowledge too seriously and those who don’t have the guts to sometimes say: ‘I don’t know …'”[71] Some reporters have commented that information about his personal life is difficult to extract, though Taleb appears to enjoy being in the limelight.[72] Others find him more talkative: Malcolm Gladwell, in What the Dog Saw, wrote: “We would have lunches that would last for hours. The delight I took in his company was offset only by the dread I felt at the prospect of transcribing all those hours of tapes.”[73] When asked about his opinion on the Republican primaries of the 2012 presidential elections on his official Facebook page, Taleb said “[t]he only person I trust is Ron Paul.” [74]  …”

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

 

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Eat The Rich!–Vote Obama In 2012 For More Spending, More Taxes, More Deficits, More Debt, More Unemployment, More Recession–No Hope–No Change–No Deal!–Videos

Posted on September 20, 2011. Filed under: Banking, Blogroll, Books, Business, Communications, Economics, Employment, Fiscal Policy, Macroeconomics, Microeconomics, Monetary Policy, Money, Video, War, Wealth, Weapons, Wisdom | Tags: , , , , , , , , , , , , , , , , , , |

EAT THE RICH!

 

Obama sets the record straight: It’s not class warfare …It’s MATH

 

President Obama – It’s Not Class Warfare to Ask Millionaire to Pay Same Tax Rate as Secretary

 

Obama the Socialist wants to spread YOUR money around

Obama – Taxes, Capital Gains

 

President Barack Obama, September 19, 2011

“…So I am ready, I am eager, to work with Democrats and Republicans to reform the tax code to make it simpler, make it fairer, and make America more competitive.  But any reform plan will have to raise revenue to help close our deficit.  That has to be part of the formula.  And any reform should follow another simple principle:  Middle-class families shouldn’t pay higher taxes than millionaires and billionaires.  That’s pretty straightforward.  It’s hard to argue against that.  Warren Buffett’s secretary shouldn’t pay a higher tax rate than Warren Buffett.  There is no justification for it.

It is wrong that in the United States of America, a teacher or a nurse or a construction worker who earns $50,000 should pay higher tax rates than somebody pulling in $50 million. Anybody who says we can’t change the tax code to correct that, anyone who has signed some pledge to protect every single tax loophole so long as they live, they should be called out.  They should have to defend that unfairness — explain why somebody who’s making $50 million a year in the financial markets should be paying 15 percent on their taxes, when a teacher making $50,000 a year is paying more than that — paying a higher rate.  They ought to have to answer for it.  And if they’re pledged to keep that kind of unfairness in place, they should remember, the last time I checked the only pledge that really matters is the pledge we take to uphold the Constitution. …”

2011 Tax Rates & 2011 Tax Brackets

Here are the federal income tax rates for 2011 from the IRS:

2011 Tax Rates & 2011 Tax Brackets

Here are the federal income tax rates for 2011 from the IRS:

Tax Rate Single Married Filing Joint Married Filing Separate Head of Household
10% Up to $8,500 Up to $17,000 Up to $8,500 Up to $12,150
15% $8,501 – $34,500 $17,001 – $69,000 $8,501 – $34,500 $12,151 – $46,250
25% $34,501 – $83,600 $69,001 – $139,350 $34,501 – $69,675 $46,251 – $119,400
28% $83,601 – $174,400 $139,351 – $212,300 $69,676 – $106,150 $119,401 – $193,350
33% $174,401 – $379,150 $212,301 – $379,150 $106,151 – $189,575 $193,351 – $379,150
35% Over $379,150 Over $379,150 Over $189,575 Over $379,150

In addition to the tax brackets above, you may owe tax under the alternative minimum tax. You can review the 2011 AMT exemption to see if it will apply to you.

Proposed 2012 Tax Rates & Tax Brackets

Tax Rate Single Married Filing Joint Head of Household
10% Up to $8,600 Up to $17,200 Up to $12,250
15% $8,601 – $34,900 $17,201 – $69,800 $12,251 – $46,750
25% $34,901 – $84,500 $69,801 – $140,850 $46,751 – $120,700
28% $84,501 – $195,950 $140,851 – $237,700 $120,701 – $216,800
36% $195,951 – $383,350 $237,701 – $383,350 $216,801 – $383,350
39.6% Over $383,350 Over $383,350 Over $383,350

Married Filing Separate was not included in the release. I’ll update the 2012 federal tax tables for all filing statuses as soon as the information is available.

2012 Tax Rates vs 2011 Tax Rates

Want to compare the proposed 2012 tax brackets to the current year to see the changes?

The biggest changes in the proposal are expanding the 28% bracket and replacing the 33% and 35% brackets with 36% and 39.6% brackets.

http://www.mydollarplan.com/tax-brackets/

FACT CHECK: Are rich taxed less than secretaries?

“…This year, households making more than $1 million will pay an average of 29.1
percent of their income in federal taxes, including income taxes, payroll taxes
and other taxes, according to the Tax Policy Center, a Washington think
tank.

Households making between $50,000 and $75,000 will pay an average of 15
percent of their income in federal taxes.

Lower-income households will pay less. For example, households making between
$40,000 and $50,000 will pay an average of 12.5 percent of their income in
federal taxes. Households making between $20,000 and $30,000 will pay 5.7
percent.

The latest IRS figures are a few years older — and limited to federal income
taxes — but show much the same thing. In 2009, taxpayers who made $1 million or
more paid on average 24.4 percent of their income in federal income taxes,
according to the IRS.

Those making $100,000 to $125,000 paid on average 9.9 percent in federal
income taxes. Those making $50,000 to $60,000 paid an average of 6.3
percent.

Obama’s claim hinges on the fact that, for high-income families and
individuals, investment income is often taxed at a lower rate than wages. The
top tax rate for dividends and capital gains is 15 percent. The top marginal tax
rate for wages is 35 percent, though that is reserved for taxable income above
$379,150.

With tax rates that high, why do so many people pay at lower rates? Because
the tax code is riddled with more than $1 trillion in deductions, exemptions and
credits, and they benefit people at every income level, according to data from
the nonpartisan Joint Committee on Taxation, Congress’ official scorekeeper on
revenue issues.

The Tax Policy Center estimates that 46 percent of households, mostly low-
and medium-income households, will pay no federal income taxes this year. Most,
however, will pay other taxes, including Social Security payroll taxes. …”

http://www.google.com/hostednews/ap/article/ALeqM5iP3lhS4ZQ-UhyUvFfUgdPCiu-jJA?docId=47a565563a294b2bad96544a7f0ddc1b

Table 1. Summary of Federal Individual Income Tax Data, 2008(Updated October 2010)

Number of Returns with Positive AGI AGI ($ millions) Income Taxes Paid ($ millions) Group’s Share of Total AGI Group’s Share of Income Taxes Income Split Point Average Tax Rate
All Taxpayers 139,960,580 8,426,625 1,031,512 100% 100% - 12.24%
Top 1% 1,399,606 1,685,472 392,149 20.00% 38.02% $380,354 23.27%
1-5% 5,598,423 1,241,229 213,569 14.73% 20.70% 17.21%
Top 5% 6,998,029 2,926,701 605,718 34.73% 58.72% $159,619 20.70%
5-10% 6,998,029 929,761 115,703 11.03% 11.22% 12.44%
Top 10% 13,996,058 3,856,462 721,421 45.77% 69.94% $113,799 18.71%
10-25% 20,994,087 1,821,717 169,193 21.62% 16.40% 9.29%
Top 25% 34,990,145 5,678,179 890,614 67.38% 86.34% $67,280 15.68%
25-50% 34,990,145 1,673,932 113,025 19.86% 10.96% 6.75%
Top 50% 69,980,290 7,352,111 1,003,639 87.25% 97.30% >$33,048 13.65%
Bottom 50% 69,980,290 1,074,514 27,873 12.75% 2.70% <$33,048 2.59%
Source: Internal Revenue Service
Table 6
Total Income Tax Shares, 1980-2008 (Percent of federal income tax paid by each group)
Year Total Top 0.1% Top 1% Top 5% Between 5% & 10% Top 10% Between 10% & 25% Top 25% Between 25% & 50% Top 50% Bottom 50%
1980 100% 19.05% 36.84% 12.44% 49.28% 23.74% 73.02% 19.93% 92.95% 7.05%
1981 100% 17.58% 35.06% 12.90% 47.96% 24.33% 72.29% 20.26% 92.55% 7.45%
1982 100% 19.03% 36.13% 12.45% 48.59% 23.91% 72.50% 20.15% 92.65% 7.35%
1983 100% 20.32% 37.26% 12.44% 49.71% 23.39% 73.10% 19.73% 92.83% 7.17%
1984 100% 21.12% 37.98% 12.58% 50.56% 22.92% 73.49% 19.16% 92.65% 7.35%
1985 100% 21.81% 38.78% 12.67% 51.46% 22.60% 74.06% 18.77% 92.83% 7.17%
1986 100% 25.75% 42.57% 12.12% 54.69% 21.33% 76.02% 17.52% 93.54% 6.46%
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987 100% 24.81% 43.26% 12.35% 55.61% 21.31% 76.92% 17.02% 93.93% 6.07%
1988 100% 27.58% 45.62% 11.66% 57.28% 20.57% 77.84% 16.44% 94.28% 5.72%
1989 100% 25.24% 43.94% 11.85% 55.78% 21.44% 77.22% 16.94% 94.17% 5.83%
1990 100% 25.13% 43.64% 11.73% 55.36% 21.66% 77.02% 17.16% 94.19% 5.81%
1991 100% 24.82% 43.38% 12.45% 55.82% 21.46% 77.29% 17.23% 94.52% 5.48%
1992 100% 27.54% 45.88% 12.12% 58.01% 20.47% 78.48% 16.46% 94.94% 5.06%
1993 100% 29.01% 47.36% 11.88% 59.24% 20.03% 79.27% 15.92% 95.19% 4.81%
1994 100% 28.86% 47.52% 11.93% 59.45% 20.10% 79.55% 15.68% 95.23% 4.77%
1995 100% 30.26% 48.91% 11.84% 60.75% 19.62% 80.36% 15.03% 95.39% 4.61%
1996 100% 32.31% 50.97% 11.54% 62.51% 18.80% 81.32% 14.36% 95.68% 4.32%
1997 100% 33.17% 51.87% 11.33% 63.20% 18.47% 81.67% 14.05% 95.72% 4.28%
1998 100% 34.75% 53.84% 11.20% 65.04% 17.65% 82.69% 13.10% 95.79% 4.21%
1999 100% 36.18% 55.45% 11.00% 66.45% 17.09% 83.54% 12.46% 96.00% 4.00%
2000 100% 37.42% 56.47% 10.86% 67.33% 16.68% 84.01% 12.08% 96.09% 3.91%
2001 100% 16.06% 33.89% 53.25% 11.64% 64.89% 18.01% 82.90% 13.13% 96.03% 3.97%
2002 100% 15.43% 33.71% 53.80% 11.94% 65.73% 18.16% 83.90% 12.60% 96.50% 3.50%
2003 100% 15.68% 34.27% 54.36% 11.48% 65.84% 18.04% 83.88% 12.65% 96.54% 3.46%
2004 100% 17.44% 36.89% 57.13% 11.07% 68.19% 16.67% 84.86% 11.85% 96.70% 3.30%
2005 100% 19.26% 39.38% 59.67% 10.63% 70.30% 15.69% 85.99% 10.94% 96.93% 3.07%
2006 100% 19.56% 39.89% 60.14% 10.65% 70.79% 15.47% 86.27% 10.75% 97.01% 2.99%
2007 100% 20.19% 40.41% 60.61% 10.59% 71.20% 15.37% 86.57% 10.54% 97.11% 2.89%
2008 100% 18.47% 38.02% 58.72% 11.22% 69.94% 16.40% 86.34% 10.96% 97.30% 2.70%
Source: IRS
Table 8
Average Tax Rate, 1980-2008 (Percent of AGI paid in income taxes)
Year Total Top 0.1% Top 1% Top 5% Between 5% & 10% Top 10% Between 10% & 25% Top 25% Between 25% & 50% Top 50% Bottom 50%
1980 15.31% 34.47% 26.85% 17.13% 23.49% 14.80% 19.72% 11.91% 17.29% 6.10%
1981 15.76% 33.37% 26.59% 18.16% 23.64% 15.53% 20.11% 12.48% 17.73% 6.62%
1982 14.72% 31.43% 25.05% 16.61% 22.17% 14.35% 18.79% 11.63% 16.57% 6.10%
1983 13.79% 30.18% 23.64% 15.54% 20.91% 13.20% 17.62% 10.76% 15.52% 5.66%
1984 13.68% 29.92% 23.42% 15.57% 20.81% 12.90% 17.47% 10.48% 15.35% 5.77%
1985 13.73% 29.86% 23.50% 15.69% 20.93% 12.83% 17.55% 10.41% 15.41% 5.70%
1986 14.54% 33.13% 25.68% 15.99% 22.64% 12.97% 18.72% 10.48% 16.32% 5.63%
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987 13.12% 26.41% 22.10% 14.43% 19.77% 11.71% 16.61% 9.45% 14.60% 5.09%
1988 13.21% 24.04% 21.14% 14.07% 19.18% 11.82% 16.47% 9.60% 14.64% 5.06%
1989 13.12% 23.34% 20.71% 13.93% 18.77% 12.08% 16.27% 9.77% 14.53% 5.11%
1990 12.95% 23.25% 20.46% 13.63% 18.50% 12.01% 16.06% 9.73% 14.36% 5.01%
1991 12.75% 24.37% 20.62% 13.96% 18.63% 11.57% 15.93% 9.55% 14.20% 4.62%
1992 12.94% 25.05% 21.19% 13.99% 19.13% 11.39% 16.25% 9.42% 14.44% 4.39%
1993 13.32% 28.01% 22.71% 14.01% 20.20% 11.40% 16.90% 9.37% 14.90% 4.29%
1994 13.50% 28.23% 23.04% 14.20% 20.48% 11.57% 17.15% 9.42% 15.11% 4.32%
1995 13.86% 28.73% 23.53% 14.46% 20.97% 11.71% 17.58% 9.43% 15.47% 4.39%
1996 14.34% 28.87% 24.07% 14.74% 21.55% 11.86% 18.12% 9.53% 15.96% 4.40%
1997 14.48% 27.64% 23.62% 14.87% 21.36% 12.04% 18.18% 9.63% 16.09% 4.48%
1998 14.42% 27.12% 23.63% 14.79% 21.42% 11.63% 18.16% 9.12% 16.00% 4.44%
1999 14.85% 27.53% 24.18% 15.06% 21.98% 11.76% 18.66% 9.12% 16.43% 4.48%
2000 15.26% 27.45% 24.42% 15.48% 22.34% 12.04% 19.09% 9.28% 16.86% 4.60%
2001 14.23% 28.20% 27.50% 23.68% 14.89% 21.41% 11.58% 18.08% 8.91% 15.85% 4.09%
2002 13.03% 28.49% 27.25% 22.95% 13.87% 20.51% 10.47% 16.99% 7.67% 14.66% 3.21%
2003 11.90% 24.64% 24.31% 20.74% 12.22% 18.49% 9.54% 15.38% 7.12% 13.35% 2.95%
2004 12.10% 23.09% 23.49% 20.67% 12.28% 18.60% 9.26% 15.53% 7.01% 13.51% 2.97%
2005 12.45% 22.52% 23.13% 20.78% 12.37% 18.84% 9.27% 15.86% 6.93% 13.84% 2.98%
2006 12.60% 21.98% 22.79% 20.68% 12.60% 18.86% 9.36% 15.95% 7.01% 13.98% 3.01%
2007 12.68% 21.46% 22.45% 20.53% 12.66% 18.79% 9.43% 15.98% 7.01% 14.03% 2.99%
2008 12.24% 22.70% 23.27% 20.70% 12.44% 18.71% 9.29% 15.68% 6.75% 13.65% 2.59%
Source: IRS

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

Summary of Outlays, Revenues (Receipts), Deficits, Surpluses Fiscal Years 1980-2010(Nominal Dollars in Millions)
Fiscal Year Outlays Revenues (Receipts) Deficits (-), Surpluses
1980 590,941 517,112 -73,830
1981 678,241 599,272 -78,968
1982 745,743 617,766 -127,977
1983 808,364 600,562 -207,802
1984 851,805 666,488 -185,367
1985 946,344 734,037 -212,308
1986 990,382 769,155 -221,277
1987 1,004,017 854,288 -149,730
1988 1,064,417 854,288 -155,178
1989 1,143,744 991,105 -152,639
1990 1,252,994 1,031,958 -221,036
1991 1,324,226 1,054,988 -269,238
1992 1,381,529 1,091,208 -290,321
1993 1,409,386 1,154,335 -255,051
1994 1,461,753 1,258,566 -203,186
1995 1,515,742 1,351,790 -163,392
1996 1,560,484 1,453,053 -107,431
1997 1,601,116 1,579,232 -21,884
1998 1,652,458 1,721,728 69,270
1999 1,701,842 1,827,452 125,610
2000 1,788,950 2,025,191 236,241
2001 1,862,846 1,991,082 128,236
2002 2,010,894 1,853,136 -157,758
2003 2,159,899 1,782,314 -377,585
2004 2,292,841 1,880,114 -412,727
2005 2,471,957 2,153,611 -318,346
2006 2,655,050 2,406,869 -248,181
2007 2,728,686 2,567,985 -160,701
2008 2,982,544 2,523,991 -458,553
2009 3,517,677 2,104,989 -1,412,688
2010 3,456,213 2,162,724 -1,293,489
2011 Est. 3,818,819 2,173,700 -1,645,119
2012 Est. 3,728,686 2,627,449 -1,101,237
2013 Est. 3,770,876 3,003,345 -767,531

http://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/hist01z1.xls

http://www.taxfoundation.org/news/show/250.html#Data

Obama lied, it is Marxist class warfare as the above charts clearly show! Marxist Math!

The Story of Spending

Is Washington Bankrupting America?

Obama sets the record straight: It’s not class warfare …It’s MATH

President Obama – It’s Not Class Warfare to Ask Millionaire to Pay Same Tax Rate as Secretary

President Obama on Economic Growth and Deficit Reduction

Six Reasons Why the Capital Gains Tax Should Be Abolished

Saving Social Security with Personal Retirement Accounts

Keynesian Economics Is Wrong: Bigger Gov’t Is Not Stimulus

Eight Reasons Why Big Government Hurts Economic Growth

The Empirical Evidence Against Big Government

Background Articles and Videos

What We Believe, Part 1: Small Government and Free Enterprise

What We Believe, Part 2: The Problem with Elitism

What We Believe, Part 3: Wealth Creation

What We Believe, Part 4: Natural Law

What We Believe, Part 5: Gun Rights

What We Believe, Part 6: Immigration

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The History of Money–Videos

Posted on December 18, 2010. Filed under: Banking, Blogroll, Communications, Demographics, Economics, government, history, Investments, Language, Law, liberty, Links, Monetary Policy, Money, People, Philosophy, Politics, Raves, Religion, Resources, Taxes, Video | Tags: , , , , , , , , |

The History of Money – Part 1

 

The History of Money – Part 2

The History of Money – Part 3

 

The History of Money – Part 4

 

The History of Money – Part 5

 

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Bankrupting America–Look Before Your Leap–Stop Spending–Balanced Budgets–Videos

Posted on November 23, 2010. Filed under: Blogroll, Language, Law, liberty, Life, Links, media, People, Philosophy, Politics, Quotations, Rants, Raves, Regulations, Resources, Strategy, Talk Radio, Taxes, Transportation, Video | Tags: , , , , |

Is Washington Bankrupting America?

 

Instead of budgeting, Congress is….

 

Public Pulse: how the American public views its government

 

 

Beyond the Headlines: the truth about our jobs crisis

 

How to create one million jobs

 

The Greecing of America, Simplified

 

Wait and See

 

Truth about government bailouts

 

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The Day The Dollar Crashes–What’s Next? What’s Next? What’s Next?–Videos

Posted on November 5, 2010. Filed under: Blogroll, Business, Communications, Computers, Demographics, Economics, Education, Employment, Fiscal Policy, government, government spending, Health Care, Investments, Law, liberty, Life, Links, Monetary Policy, People, Philosophy, Politics, Psychology, Quotations, Rants, Raves, Regulations, Security, Taxes, Technology, Video, Wisdom | Tags: , , , , , , , , , , , , , , , , , , , , , |

Year Gross Debt in Billions undeflated[10] as % of GDP Debt Held By Public ($Billions) as % of GDP
1910 2.6 unk. 2.6 unk.
1920 25.9 unk. 25.9 unk.
1928 18.5[11] unk. 18.5 unk.
1930 16.2 unk. 16.2 unk.
1940 50.6 52.4 42.8 44.2
1950 256.8 94.0 219.0 80.2
1960 290.5 56.0 236.8 45.6
1970 380.9 37.6 283.2 28.0
1980 909.0 33.4 711.9 26.1
1990 3,206.3 55.9 2,411.6 42.0
2000 5,628.7 58.0 3,409.8 35.1
2001 5,769.9 57.4 3,319.6 33.0
2002 6,198.4 59.7 3,540.4 34.1
2003 6,760.0 62.6 3,913.4 35.1
2004 7,354.7 63.9 4,295.5 37.3
2005 7,905.3 64.6 4,592.2 37.5
2006 8,451.4 65.0 4,829.0 37.1
2007 8,950.7 65.6 5,035.1 36.9
2008 9,985.8 70.2 5,802.7 40.8
2009 12,311.4 86.1 7,811.1 54.6
2010 (2 Nov) 13,724.0 93.2 (3rd Q) 9,133.6 62.0 (3rd Q)
2010 (est.) 14,456.3 98.1 9,881.9 67.1
2011 (est.) 15,673.9 101.0 10,873.1 70.1
2012 (est.) 16,565.7 100.6 11,468.4 69.6
2013 (est.) 17,440.2 99.7 12,027.1 68.7
2014 (est.) 18,350.0 99.8 12,594.8 68.5

Note: 2010-2014 are projections

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

Debt Clock

http://www.usdebtclock.org/

Peter Schiff – It’s Scary How Clueless Bernanke Is

Glenn Beck Talks NWO With Damon Vickers (Part 1)

Glenn Beck Talks NWO With Damon Vickers (Part 2)

 

Glenn Beck David Buckner The MONEY BUBBLE/ASSET BUBBLE Fox News 11-17-09

Glenn Beck More About The MONEY BUBBLE/ASSET BUBBLE Fox News 11-17-09

 

The inevitable day the Dollar crashes

 

Glenn Beck Part 1 – What Happens Next? 11/5/2010

 

Glenn Beck Part 2 – What Happens Next? 11/5/2010

 

Glenn Beck Part 3 – What Happens Next? 11/5/2010

 

The Truth About The Economy Total Collapse – Facing the RECESSION of 2010

When will America Collapse? …..answers from Jim Rogers, Marc Faber, Gerald Celente and others

 

Tuesday is Just the Beginning…

 

Republicans Win BIG…

Background Articles and Videos

GLENN BECK WARNS OF CATASTROPHIC EVENT & NEEDING TO STOCKPILE FOOD

 

Peter Schiff Was Right 2006 – 2007 (2nd Edition)

Peter Schiff – Fed panel

Vickers Was Right

 

Damon Vickers on Alex Jones Tv 1/6:A New Financial Order!!

 

Damon Vickers on Alex Jones Tv 2/6:A New Financial Order!!

 

Damon Vickers on Alex Jones Tv 3/6:A New Financial Order!!

 

Damon Vickers on Alex Jones Tv 4/6:A New Financial Order!!

 

Damon Vickers on Alex Jones Tv 5/6:A New Financial Order!!

 

Damon Vickers on Alex Jones Tv 6/6:A New Financial Order!!

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Why We Are In So Much Debt–Videos

Posted on November 4, 2010. Filed under: College, Communications, Economics, Education, Investments, Language, Law, liberty, Life, Links, media, Monetary Policy, People, Philosophy, Politics, Raves, Video, Wisdom | Tags: , , |

Why We Are In So Much Debt [1/8]

Why We Are In So Much Debt [2/8]

Why We Are In So Much Debt [3/8]

Why We Are In So Much Debt [4/8]

Why We Are In So Much Debt [5/8]

Why We Are In So Much Debt [6/8]

Why We Are In So Much Debt [7/8]

Why We Are In So Much Debt [8/8]

 

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The Obama Depression Deepens–Federal Reserve Executes–QE II Plan–”Operation Pawnshop”–$2,500 Billion In Quantitative Easing–Money Printing–Will It Be Enough?

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Hijacking Catastrophe–Videos

Posted on October 22, 2010. Filed under: Blogroll, Books, College, Communications, Culture, Demographics, Economics, Education, Federal Government, Fiscal Policy, Foreign Policy, government, government spending, history, Homes, Immigration, Investments, Language, Law, liberty, Life, Links, media, Monetary Policy, People, Philosophy, Politics, Quotations, Rants, Raves, Regulations, Religion, Resources, Science, Security, Strategy, Talk Radio, Taxes, Technology, Transportation, Video, War, Wisdom | Tags: , , , , , , , , , , , , , , |

Hijacking Catastrophe 1 / 7

 

Hijacking Catastrophe 2 / 7

 

Hijacking Catastrophe 3 / 7

 

Hijacking Catastrophe 4 / 7

 

Hijacking Catastrophe 5 / 7

 

Hijacking Catastrophe 6 / 7

 

Hijacking Catastrophe 7 / 7

 

Background Articles and Videos

Hijacking Catastrophe: 9/11, Fear & the Selling of American Empire

“…Hijacking Catastrophe: 9/11, Fear & the Selling of American Empire is a 2004 documentary narrated by Julian Bond and directed by Jeremy Earp and Sut Jhally. It examines the possibility that neoconservatives used the September 11, 2001 attacks to usher in a new doctrine of expanding American power through military force under the guise of a “war on terror” and that the doctrine, known as the Project for the New American Century (PNAC), had been laid out prior to 9/11 by its authors, which include Dick Cheney, Paul Wolfowitz, Donald Rumsfeld, Jeb Bush and Dan Quayle. …”

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

Summary

The film maintains that fear of terrorism was manipulated to support goals which are in step with the PNAC; namely the overthrow of Saddam Hussein. Not just for control of regional strategic resources (natural gas and oil), but to reassert American dominance on the world stage as a warning to potential adversaries. Interviews were conducted with critics such as Noam Chomsky and Nobel Peace Prize laureate Jody Williams. It also interviews policy analysts, military brass, journalists, insider observations from Chief UN Weapons Inspector Scott Ritter and Pentagon whistleblower Lt. Colonel Karen Kwiatkowski.

The historical context of the “Bush Doctrine” is examined and compared to Wolfowitz’s PNAC philosophy. The film goes on to look at the “selling of American empire” and the possible economical, social, cultural and political implications it will have in America, and on the world if implemented further during Bush’s second term. …”

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

Sut Jhally

“…Satvinder “Sut” Jhally(Hindi: सुत्त झल्ली),(Punjabi: ਸੁੱਤ ਝੱਲੀ) (born 29 May 1955) is a professor of Communication at the University of Massachusetts Amherst and is a cultural studies scholar in the area of advertising, media, and consumption.[1] He is the producer of several documentaries on media literacy topics[2] and the founder and executive director of the Media Education Foundation, a non-profit established in 1992 which “produces and distributes video documentaries to encourage critical thinking and debate about the relationship between media ownership, commercial media content, and the democratic demand for free flows of information, diverse representations of ideas and people, and informed citizen participation.”[3]

Sut Jhally was born in Kenya, and raised in England. He moved to Canada in 1978 after accepting a scholarship to the University of Victoria. He continued his studies at Simon Fraser University, where he received his Ph.D.[4]

Jhally is often highly critical of popular culture, advertising, as well as various aspects of US foreign policy.

In his 1991 video “Dreamworlds” he describes the image of women in music videos as male adolescent fantasies: young and pretty, willing and eager to please men, saying no when meaning yes, often reduced to outward appearances and body parts. He concludes that an unhealthy attitude towards sexual violence can be fostered by these videos, and calls for balancing them with other cultural representations of sexuality. When MTV complained about his use of parts of copyrighted music videos, he claimed fair use and contacted the media about the story.[5]

He has been quoted as saying, “Advertising tells us that the way to happiness is through the consumption of objects. The immense accumulation of commodities has to be sold, and it is sold through the story of goods bringing happiness.” In his essay “Advertising at the Edge of the Apocalypse” and his video “Advertising and the End of the World” he argues that the major cultural force today, pervasive advertising, by constantly reinforcing a bogus association between consumerism and happiness and by focusing on individual immediate needs, stands in the way of a discussion of societal and long-term needs and leads to a squandering of resources. The video “Killing Us Softly III”, created with Jean Kilbourne, is a critique of the image of women in advertising.

Among other quotes students of his communication classes will hear from him, two of the most unforgettable are “knowing where something comes from, changes how you feel about it” and the phrase “the discourse through and about objects.”

In the 2004 video “Peace, Propaganda & the Promised Land” he shows the influence of Israeli propaganda and PR on the United States public opinion regarding the Israeli-Palestinian conflict.

In the 2004 video “Hijacking Catastrophe” he argues that the “war on terror” has been used by U.S. officials as a pretext to project military power across the world.[6]

In his 2006 video “Reel Bad Arabs” he explores the vilification of Arabs in American cinema, following Jack Shaheen’s 2001 book Reel Bad Arabs.

Video documentaries

  • Dreamworlds 3: Desire, Sex & Power in Music Video (2007) (trailer)
  • Reel Bad Arabs: How Hollywood Vilifies a People (2006), based on Jack Shaheen’s 2001 book Reel Bad Arabs (trailer)
  • Peace, Propaganda & the Promised Land (with Bathsheba Ratzkoff), (2004) (full video)
  • Hijacking Catastrophe: 9/11, Fear & the Selling of American Empire (with Jeremy Earp), (2004) (full video)
  • Wrestling with Manhood: Boys, Bullying & Battering (with Jackson Katz) (2002) (trailer)
  • No Logo (2003), based on Naomi Klein’s book No Logo (full video)
  • Killing Us Softly 3 (with Jean Kilbourne) (1999) (full video)
  • Tough Guise: Men, Violence and the Crisis in Masculinity (with Jackson Katz) (1999) (trailer)
  • Off the Straight and Narrow (with Katherine Sender) (1998) (trailer)
  • Advertising and the End of the World (1998) (trailer)
  • Dreamworlds II: Desire, Sex, Power in Music Video (1997) (full video)
  • Slim Hopes (with Jean Kilbourne) (1995) (trailer)
  • The Date Rape Backlash (1994) (trailer)
  • The Killing Screens (with George Gerbner) (1994) (trailer)
  • Pack of Lies – the Advertising of Tobacco (with Jean Kilbourne) (1992) (trailer) …”

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

 

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Heritage Foundation 2010 Budget Charts–Federal Entitlements

Posted on April 17, 2010. Filed under: Blogroll, Communications, Culture, Demographics, Economics, Education, Employment, Energy, Farming, Federal Government, Fiscal Policy, government, government spending, Health Care, history, Homes, Immigration, Investments, Law, liberty, Life, Links, media, Monetary Policy, People, Philosophy, Politics, Quotations, Rants, Raves, Regulations, Resources, Reviews, Science, Strategy, Taxes, Video, Wisdom | Tags: , , , , , , , |

The Heritage Foundation
2010 Budget Charts
Federal Government Entitlements

http://www.heritage.org/budgetchartbook/entitlements

http://www.heritage.org/budgetchartbook/entitlements

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Do You Feel Lucky Progressives–Pass Your Health Care, Energy, Amnesty, Tax, Spend, Jobs/Stimulus Spending II Bills–The American Voters Will Throw The Thieves Out Of Office–Go Ahead Make My Day!

Posted on January 28, 2010. Filed under: Blogroll, Climate, Communications, Demographics, Economics, Education, Employment, Federal Government, Fiscal Policy, government spending, Investments, Law, liberty, Life, Links, Monetary Policy, People, Philosophy, Politics, Rants, Raves, Taxes, Video, Wisdom | Tags: , , , , , , , , |

 
“You may fool all the people some of the time, you can even fool some of the people all of the time, but you cannot fool all of the people all the time.”

~Abraham Lincoln

 

Dirty Harry – Do you feel lucky?

We The People Stimulus Package

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“Experience hath shewn, that even under the best forms of government those entrusted with power have, in time, and by slow operations, perverted it into tyranny.”

~Thomas Jefferson 

 

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Obama Follows Lenin’s Advice Uses Taxation, Inflation and Corruption To Crush Capitalism

Posted on October 6, 2009. Filed under: Blogroll, Communications, Economics, Employment, Fiscal Policy, Foreign Policy, government spending, Health Care, Immigration, Investments, Law, liberty, Life, Links, media, Monetary Policy, People, Philosophy, Politics, Psychology, Rants, Raves, Regulations, Resources, Security, Video, Wisdom | Tags: , , , , , , , , , , , , , |

“The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation.”

“The best way to destroy the capitalist system is to debauch the currency.”

~Valdimir Lenin

USD_purchasing_power

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pt 1/3 Jim Sinclair on King World News

 

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Glenn Beck -10-06-09-A

 

Glenn Beck -10-06-09-B

 

Glenn Beck -10-06-09-C

Glenn Beck -10-06-09-D

 

Glenn Beck -10-06-09-E

 

 

Background Articles and Videos

bush_obama_defitics

http://src.senate.gov/public/index.cfm?FuseAction=Graphics.ViewLarge&File_id=19780049-f853-4ad4-9e23-cb9cb3e8fc17

 

NationalGDP

United States of America National Debt Clock–Must See It To Believe It!

http://www.usdebtclock.org/charts/national-debt-as-a-percent-of-gross-domestic-product.html

 

US-Debt

 

 

 

Daniel J. Mitchell – USA: Drowning In Debt?

pt 2/3 Jim Sinclair on King World News

pt 3/3 Jim Sinclair on King World News

Outstanding Debt, GDP and Income Who Are They Fooling (NWO SERIES/ ECONOMIC COLLAPSE)

 

Related Posts On Pronk Palisades

Richard Fisher–Inflation and Debt: The Interaction of Fiscal and Monetary Policy –Videos

Glenn Beck Gets Warmer–The Crisis Is Intentional and Will Get Worse!

Cloward Piven Strategy–The Crisis Strategy Of Barack Obama

Yuri Bezmenov On KGB Soviet Propaganda and Subversion–Videos

George Soros: Government Interventionist and Global Socialist–Obama’s Puppeter Master–Videos

George Soros: Barack Obama’s Money Man and Agenda Puppeter

Obama–Ayers–Chicago Annenberg Challenge–ACORN–Radical Socialists–Terrorist Bombers–Videos

 

Federal Reserve System

Banking Cartel’s Public Relations Campaign Continues:Federal Reserve Chairman Ben Bernanke On The Record

The Obama Depression Has Arrived: 15,000,000 to 25,000,000 Unemployed Americans–Stimulus Package and Bailouts A Failure–400,000 Leave Labor Force In July!

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United States Economic Depressions–The Good, The Bad, and The Ugly–Obama’s Depression–Over 15,000,000 Americans Seek Full Time Job!

Posted on June 11, 2009. Filed under: Blogroll, Economics, Employment, Homes, Investments, liberty, Life, Links, People, Philosophy, Politics, Quotations, Rants, Raves, Regulations, Taxes, Technology, Video, Wisdom | Tags: , , , , , , , , , , , , , , , , , , , , , , |

u6

“It is estimated that in 1933, at the depth of the Great Depression, about 13 million
persons in the U.S. were unemployed, which translates into an unemployment rate of
about 25 percent.1 However, those estimates were not available at the time. Throughout
the Great Depression, there was little information on the extent of unemployment in the
country. More important, there was no good way to assess whether the situation was
getting better or worse. The wealth of timely statistical information on the labor market
that we now take for granted simply didn’t exist.”

~Measures of labor underutilization from the Current Population Survey

Working Paper 424,  March 2009

Steven E. Haugen, U.S. Bureau of Labor Statistics

http://www.bls.gov/osmr/pdf/ec090020.pdf

“It is obviously futile to attempt to eliminate unemployment by embarking upon a program of public works that would otherwise not have been undertaken. The necessary resources for such projects must be withdrawn by taxes or loans from the application they would otherwise have found. Unemployment in one industry can, in this way, be mitigated only to the extent that it is increased in another.”

~Ludwig von Mises, Liberalism, page 85

 

Unemployment Rate Surges

 

Today in the United States there are over 14,500,000 individuals unemployed and seeking a full time job.

Labor Force Statistics from the Current Population Survey

Series Id:           LNS13000000
Seasonal Adjusted
Series title:        (Seas) Unemployment Level
Labor force status:  Unemployed
Type of data:        Number in thousands
Age:                 16 years and over
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
1999 5976 6111 5783 6004 5796 5951 6025 5838 5915 5778 5716 5653  
2000 5708 5858 5733 5481 5758 5651 5747 5853 5625 5534 5639 5634  
2001 6023 6089 6141 6271 6226 6484 6583 7042 7142 7694 8003 8258  
2002 8182 8215 8304 8599 8399 8393 8390 8304 8251 8307 8520 8640  
2003 8520 8618 8588 8842 8957 9266 9011 8896 8921 8732 8576 8317  
2004 8370 8167 8491 8170 8212 8286 8136 7990 7927 8061 7932 7934  
2005 7759 7972 7740 7683 7672 7551 7415 7360 7570 7457 7541 7219  
2006 7020 7176 7080 7142 7028 7039 7167 7118 6874 6738 6837 6688  
2007 7029 6887 6737 6874 6844 7028 7128 7123 7221 7295 7212 7541  
2008 7555 7423 7820 7675 8536 8662 8910 9550 9592 10221 10476 11108  
2009 11616 12467 13161 13724 14511                

The official U.S. Bureau of Labor Statistics unemployment rate  (U-3)   for May 2009 was 9.4%.

Labor Force Statistics from the Current Population Survey

Series Id:           LNS14000000
Seasonal Adjusted
Series title:        (Seas) Unemployment Rate
Labor force status:  Unemployment rate
Type of data:        Percent
Age:                 16 years and over
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
1999 4.3 4.4 4.2 4.3 4.2 4.3 4.3 4.2 4.2 4.1 4.1 4.0  
2000 4.0 4.1 4.0 3.8 4.0 4.0 4.0 4.1 3.9 3.9 3.9 3.9  
2001 4.2 4.2 4.3 4.4 4.3 4.5 4.6 4.9 5.0 5.3 5.5 5.7  
2002 5.7 5.7 5.7 5.9 5.8 5.8 5.8 5.7 5.7 5.7 5.9 6.0  
2003 5.8 5.9 5.9 6.0 6.1 6.3 6.2 6.1 6.1 6.0 5.8 5.7  
2004 5.7 5.6 5.8 5.6 5.6 5.6 5.5 5.4 5.4 5.5 5.4 5.4  
2005 5.2 5.4 5.2 5.2 5.1 5.1 5.0 4.9 5.0 5.0 5.0 4.8  
2006 4.7 4.8 4.7 4.7 4.7 4.6 4.7 4.7 4.5 4.4 4.5 4.4  
2007 4.6 4.5 4.4 4.5 4.5 4.6 4.7 4.7 4.7 4.8 4.7 4.9  
2008 4.9 4.8 5.1 5.0 5.5 5.6 5.8 6.2 6.2 6.6 6.8 7.2  
2009 7.6 8.1 8.5 8.9 9.4                

http://stats.bls.gov/news.release/empsit.nr0.htm

By July 4, 2009 the number of unemployed Americans is expected to exceed 15 million!

During the worse year of the Great Depression, 1933, the unemployment rate rose to 24.9%

While this unemployment rate was much higher than today’s official unemployment rate, the number of individuals unemployed was significantly less.

In 1933 there were over 12,800,000 individuals unemployed and seeking a full time job.

The United States in 2009 has with the economic policies and massive government spending of President Barack  Obama  has resulted in more than 2,000,000 Americans unemployed than at the bottom of the Great Depression in 1933.

The U.S. Bureau of Labor Statistics  total unemployment rate (U-6) for May 2009 was 16.4% which includes marginally attached, discouraged and part-time workers seeking full time job.

Table A-12. Alternative measures of labor underutilization (Percent)

http://www.bls.gov/news.release/empsit.t12.htm

Labor Force Statistics from the Current Population Survey

Series Id:           LNS13327709
Seasonal Adjusted
Series title:        (seas) Total unemployed, plus all marginally attached workers plus total
                     employed part time for economic reasons, as a percent of all civilian labor
                     force plus all marginally attached workers
Labor force status:  Aggregated totals unemployed
Type of data:        Percent
Age:                 16 years and over
Percent/rates:       Unemployed and mrg attached and pt for econ reas as percent of labor force plus
                     marg attached
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
1999 7.7 7.7 7.6 7.6 7.4 7.5 7.5 7.3 7.4 7.2 7.1 7.1  
2000 7.1 7.2 7.1 6.9 7.1 7.0 7.0 7.1 7.0 6.8 7.1 6.9  
2001 7.3 7.4 7.3 7.4 7.5 7.9 7.8 8.1 8.7 9.3 9.4 9.6  
2002 9.5 9.5 9.4 9.7 9.5 9.5 9.6 9.6 9.6 9.6 9.7 9.8  
2003 10.0 10.2 10.0 10.2 10.1 10.3 10.3 10.1 10.4 10.2 10.0 9.8  
2004 9.9 9.7 10.0 9.6 9.6 9.5 9.5 9.4 9.4 9.7 9.4 9.2  
2005 9.3 9.3 9.2 9.0 8.9 9.0 8.8 8.9 9.0 8.7 8.7 8.5  
2006 8.4 8.5 8.2 8.1 8.2 8.4 8.5 8.4 8.0 8.2 8.0 7.9  
2007 8.3 8.1 8.0 8.2 8.3 8.3 8.3 8.5 8.4 8.5 8.4 8.7  
2008 9.0 9.0 9.1 9.2 9.8 10.1 10.4 10.9 11.2 12.0 12.6 13.5  
2009 13.9 14.8 15.6 15.8 16.4                

There were more than 25,000,000 Americans unemployed  seeking a full time job in May 2009.

http://stats.bls.gov/news.release/empsit.t12.htm

The Obama Depression has the distinction of being the worse depression in U.S. history in terms of the number of unemployed Americans!

Unfortunately, the economy as measured by unemployment has a least six months before it hits bottom towards the end of 2009.

The Good Depression was the 1920-1921 depression–The Harding Depression– that was the shortest in US history and was followed by a booming economy.

The Bad Depression was the 1929-1939 depression–The Great Depreassion– that really ended only after World War II.

The Ugly Depression is the 2009-2010  depression–The Obama Depression– of the radical socialist Democratic Party.

Year Rate Videos

Why You’ve Never Heard of the Great Depression of 1920

Uncommon Knowledge: The Great Depression with Amity Shlaes

Milton Friedman Debunking Myth Of The Great Depression part 1

Milton Friedman Debunking Myth Of The Great Depression part 2

Milton Friedman Debunking Myth Of The Great Depression part 3

80 Years Later: Parallels Between 1929 and 2009

A Recipe for the Next Great Depression

A Recipe for the Next Great Depression

In-Depth Look – US Unemployment Rate – Bloomberg

In-Depth Look – Europe’s Troubles Could Spill To US – Bloomberg

In-Depth Look – Employment Picture – Bloomberg

1920 5.2 %
1928 4.2
1930 8.7
1932 23.6
1934 21.7
1936 16.9
1938 19.0
1940 14.6
1942 4.7%
1944 1.2
1946 3.9
1948 3.8
1950 5.3
1952 3.0
1954 5.5
1956 4.1
1958 6.8%
1960 5.5
1962 5.5
1964 5.2
1966 3.8
1968 3.6
1970 4.9
1972 5.6
1974 5.6%
1976 7.7
19781 6.1
1980 7.1
1982 9.7
1984 7.5
19861 7.0
1987 6.2
1988 5.5
1989 5.3
19901 5.6%
1991 6.8
1992 7.5
1993 6.9
19941 6.1
1995 5.6
1996 5.4
19971 4.9
19981 4.5
19991 4.2
20001 4.0
2001 4.7
2002 5.8
20031 6.0%
20041 5.5
20051 5.1
2006 4.6
2007 4.6

NOTES: Estimates prior to 1940 are based on sources other than direct enumeration.
Data prior to 1948 are for persons age 14 and over. Data beginning in 1948 are for persons age 16 and over.
1. Not strictly comparable with prior years.
2. Beginning in Jan. 2006, data are not strictly comparable with data for 2005 and earlier years because of the revisions in the population controls used in the household survey.
Source: U.S. Department of Labor, Bureau of Labor Statistics. Web: stats.bls.gov .

The time is long past due to stop the reckless government spending for bailouts, payoffs, and handouts.

The time is long past due to stop unbalanced budgets with massive deficits resulting in a huge national debt.

The time is long past due to stop more new taxes to pay for governement  spending and deficits.

The time is long past due to stop the fiscally irresponsible professional politicians of both political parties by voting them out of office.

Stop The Spending and Deficits

US Federal Government Deficits

federal_spending

Stop Spending Our Future – The Crisis

Daniel J. Mitchell – USA: Drowning In Debt?

Stop The Cap and Trade Carbon Dioxide Energy Tax

MAJOR REDUCTIONS IN CARBON EMISSIONS ARE NOT WORTH THE MONEY DEBATE: PETER HUBER

You are invited to attend a Tea Party on July 4, 2009, Independence Day!

Happy_July_4

Join the Second American Revolution

we_the_people

The Meaning of Independence Day

Ayn Rand Center for Individual Rights

Second American Revolution–Tea Party Celebrations–Washington Fair–July 4, 2009–An Open Invitation To The American People

American People’s Plan = 6 Month Tax Holiday + FairTax = Real Hope + Real Change!–Millions To March On Washington D.C. Saturday, July 4, 2009!

Independents Lead The The Second American Revolution Surge–Independence Day–Saturday July 4, 2009 In Washington D.C.–Tea Party Time–On To Washington–Dare You To Move!

Please Spread The Message of Liberty

liberty_bell1

Proclaim liberty throughout the land to all its inhabitants.”

Let Freedom Ring

Thomas Paine on to Washington

switchfoot-dare you to move(live)

God Bless the USA – Lee Greenwood

“Permanent mass unemployment destroys the moral foundations of the social order. The young people, who, having finished their training for work, are forced to remain idle, are the ferment out of which the most radical political movements are formed. In their ranks the soldiers of the coming revolutions are recruited.”

~Ludwig von Mises, Socialism, page 440

Background Articles and Videos

How The Government Measures Unemployment

“…People with jobs are employed.
People who are jobless, looking for jobs, and available for work are unemployed.
People who are neither employed nor unemployed are not in the labor force.

“…To summarize, employed persons are:
− All persons who did any work for pay or profit during the survey reference
week.
− All persons who did at least 15 hours of unpaid work in a family-owned
enterprise operated by someone in their household.
− All persons who were temporarily absent from their regular jobs because
of illness, vacation, bad weather, industrial dispute, or various personal
reasons, whether or not they were paid for the time off.
Unemployed persons are:
− All persons who did not have a job at all during the survey reference
week, made at least one specific active effort to find a job during the prior
4 weeks, and were available for work (unless temporarily ill).
− All persons who were not working and were waiting to be called back to a
job from which they had been laid off (they need not be looking for work
to be classified as unemployed). …”

“…Yes, there is only one official definition of unemployment, and that was discussed above.
However, some have argued that this measure is too restricted, and that it does not
adequately capture the breadth of labor market problems. For this reason, economists at
BLS developed a set of alternative measures of labor underutilization. These measures
are published every month in the Employment Situation news release. They range from a
very limited measure that includes only those who have been unemployed (as officially
defined) for 15 weeks or more to a very broad one that includes total unemployed (as
officially defined), all persons marginally attached to the labor force, and all individuals
employed part time for economic reasons.

Because of the complexities of the American economic system and the wide variety of
job arrangements and jobseeking efforts, the definitions of employment and
unemployment must be specific to ensure uniformity of reporting at any given time and
over any period of time. When all of the details are considered, definitions may seem
rather complicated. The basic concepts, however, remain little changed: People with
jobs are employed, people who do not have jobs and are looking for jobs are
unemployed, and people who meet neither labor market test are not in the labor force.

The qualifying conditions are necessary to cover the wide range of labor force patterns
and to provide an objective set of standards for consistent treatment of cases.
Where can people find the data?
Each month, summary statistics on unemployment and employment are published in a
news release titled The Employment Situation.
Detailed information also is published in tables online and in a periodical called
Employment and Earnings.
On an irregular basis, special labor force topics are addressed in articles published in the
Monthly Labor Review, in a series of briefs called Issues in Labor Statistics, in a variety
of special reports, and in other BLS publications. …”

http://stats.bls.gov/cps/cps_htgm.pdf

Table A-12. Alternative measures of labor underutilization (Percent)

 Not seasonally adjusted                   Seasonally adjusted                 

                          Measure                                                                                                         

                                                            May      Apr.     May      May      Jan.     Feb.     Mar.     Apr.     May
                                                            2008     2009     2009     2008     2009     2009     2009     2009     2009  

  U-1 Persons unemployed 15 weeks or longer, as a percent
       of the civilian labor force.......................    1.8      4.5      4.6      1.8      3.0      3.4      3.7      4.0      4.5  

  U-2 Job losers and persons who completed temporary
       jobs, as a percent of the civilian labor force....    2.6      5.6      5.8      2.8      4.5      5.0      5.4      5.7      6.2  

  U-3 Total unemployed, as a percent of the civilian
       labor force (official unemployment rate)..........    5.2      8.6      9.1      5.5      7.6      8.1      8.5      8.9      9.4  

  U-4 Total unemployed plus discouraged workers, as a
       percent of the civilian labor force plus
       discouraged workers...............................    5.5      9.0      9.5      5.8      8.0      8.5      8.9      9.3      9.8  

  U-5 Total unemployed, plus discouraged workers, plus
       all other marginally attached workers, as a
       percent of the civilian labor force plus all
       marginally attached workers.......................    6.1      9.8     10.3      6.4      8.8      9.3      9.8     10.1     10.6  

  U-6 Total unemployed, plus all marginally attached
       workers, plus total employed part time for
       economic reasons, as a percent of the civilian
       labor force plus all marginally attached workers..    9.4     15.4     15.9      9.8     13.9     14.8     15.6     15.8     16.4  

   NOTE:  Marginally attached workers are persons who currently are neither working nor looking for work but indicate that they want and
 are available for a job and have looked for work sometime in the recent past.  Discouraged workers, a subset of the marginally attached,
 have given a job-market related reason for not looking currently for a job.  Persons employed part time for economic reasons are those
 who want and are available for full-time work but have had to settle for a part-time schedule.  For more information, see "BLS
 introduces new range of alternative unemployment measures," in the October 1995 issue of the Monthly Labor Review.  Updated population
 controls are introduced annually with the release of January data.

http://www.bls.gov/news.release/empsit.t12.htm

Employment Situation


Table of Contents

http://stats.bls.gov/news.release/empsit.toc.htm

Labor Force Statistics from the Current Population Survey
Series Id:           LNS13000000
Seasonal Adjusted
Series title:        (Seas) Unemployment Level
Labor force status:  Unemployed
Type of data:        Number in thousands
Age:                 16 years and over
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
1948 2034 2328 2399 2386 2118 2214 2213 2350 2302 2259 2285 2429  
1949 2596 2849 3030 3260 3707 3776 4111 4193 4049 4916 3996 4063  
1950 4026 3936 3876 3575 3434 3367 3120 2799 2774 2625 2589 2639  
1951 2305 2117 2125 1919 1856 1995 1950 1933 2067 2194 2178 1960  
1952 1972 1957 1813 1811 1863 1884 1991 2087 1936 1839 1743 1667  
1953 1839 1636 1647 1723 1596 1607 1660 1665 1821 1974 2211 2818  
1954 3077 3331 3607 3749 3767 3551 3659 3854 3927 3666 3402 3196  
1955 3157 2969 2918 3049 2747 2701 2632 2784 2678 2830 2780 2761  
1956 2666 2606 2764 2650 2861 2882 2952 2701 2635 2571 2861 2790  
1957 2796 2622 2509 2600 2710 2856 2796 2747 2943 3020 3454 3476  
1958 3875 4303 4492 5016 5021 4944 5079 5025 4821 4570 4188 4191  
1959 4068 3965 3801 3571 3479 3429 3528 3588 3775 3910 4003 3653  
1960 3615 3329 3726 3620 3569 3766 3836 3946 3884 4252 4330 4617  
1961 4671 4832 4853 4893 5003 4885 4928 4682 4676 4573 4295 4177  
1962 4081 3871 3921 3906 3863 3844 3819 4013 3961 3803 4024 3907  
1963 4074 4238 4072 4055 4217 3977 4051 3878 3957 3987 4151 3975  
1964 4029 3932 3950 3918 3764 3814 3608 3655 3712 3726 3551 3651  
1965 3572 3730 3510 3595 3432 3387 3301 3254 3216 3143 3073 3031  
1966 2988 2820 2887 2828 2950 2872 2876 2900 2798 2798 2770 2912  
1967 2968 2915 2889 2895 2929 2992 2944 2945 2958 3143 3066 3018  
1968 2878 3001 2877 2709 2740 2938 2883 2768 2686 2689 2715 2685  
1969 2718 2692 2712 2758 2713 2816 2868 2856 3040 3049 2856 2884  
1970 3201 3453 3635 3797 3919 4071 4175 4256 4456 4591 4898 5076  
1971 4986 4903 4987 4959 4996 4949 5035 5134 5042 4954 5161 5154  
1972 5019 4928 5038 4959 4922 4923 4913 4939 4849 4875 4602 4543  
1973 4326 4452 4394 4459 4329 4363 4305 4305 4350 4144 4396 4489  
1974 4644 4731 4634 4618 4705 4927 5063 5022 5437 5523 6140 6636  
1975 7501 7520 7978 8210 8433 8220 8127 7928 7923 7897 7794 7744  
1976 7534 7326 7230 7330 7053 7322 7490 7518 7380 7430 7620 7545  
1977 7280 7443 7307 7059 6911 7134 6829 6925 6751 6763 6815 6386  
1978 6489 6318 6337 6180 6127 6028 6309 6080 6125 5947 6077 6228  
1979 6109 6173 6109 6069 5840 5959 5996 6320 6190 6296 6238 6325  
1980 6683 6702 6729 7358 7984 8098 8363 8281 8021 8088 8023 7718  
1981 8071 8051 7982 7869 8174 8098 7863 8036 8230 8646 9029 9267  
1982 9397 9705 9895 10244 10335 10538 10849 10881 11217 11529 11938 12051  
1983 11534 11545 11408 11268 11154 11246 10548 10623 10282 9887 9499 9331  
1984 9008 8791 8746 8762 8456 8226 8537 8519 8367 8381 8198 8358  
1985 8423 8321 8339 8395 8302 8460 8513 8196 8248 8298 8128 8138  
1986 7795 8402 8383 8364 8439 8508 8319 8135 8310 8243 8159 7883  
1987 7892 7865 7862 7542 7574 7398 7268 7261 7102 7227 7035 6936  
1988 6953 6929 6876 6601 6779 6546 6605 6843 6604 6568 6537 6518  
1989 6682 6359 6205 6468 6375 6577 6495 6511 6590 6630 6725 6667  
1990 6752 6651 6598 6797 6742 6590 6922 7188 7368 7459 7764 7901  
1991 8015 8265 8586 8439 8736 8692 8586 8666 8722 8842 8931 9198  
1992 9283 9454 9460 9415 9744 10040 9850 9787 9781 9398 9565 9557  
1993 9325 9183 9056 9110 9149 9121 8930 8763 8714 8750 8542 8477  
1994 8630 8583 8470 8331 7915 7927 7946 7933 7734 7632 7375 7230  
1995 7375 7187 7153 7645 7430 7427 7527 7484 7478 7328 7426 7423  
1996 7491 7313 7318 7415 7423 7095 7337 6882 6979 7031 7236 7253  
1997 7158 7102 7000 6873 6655 6799 6655 6608 6656 6454 6308 6476  
1998 6368 6306 6422 5941 6047 6212 6259 6179 6300 6280 6100 6032  
1999 5976 6111 5783 6004 5796 5951 6025 5838 5915 5778 5716 5653  
2000 5708 5858 5733 5481 5758 5651 5747 5853 5625 5534 5639 5634  
2001 6023 6089 6141 6271 6226 6484 6583 7042 7142 7694 8003 8258  
2002 8182 8215 8304 8599 8399 8393 8390 8304 8251 8307 8520 8640  
2003 8520 8618 8588 8842 8957 9266 9011 8896 8921 8732 8576 8317  
2004 8370 8167 8491 8170 8212 8286 8136 7990 7927 8061 7932 7934  
2005 7759 7972 7740 7683 7672 7551 7415 7360 7570 7457 7541 7219  
2006 7020 7176 7080 7142 7028 7039 7167 7118 6874 6738 6837 6688  
2007 7029 6887 6737 6874 6844 7028 7128 7123 7221 7295 7212 7541  
2008 7555 7423 7820 7675 8536 8662 8910 9550 9592 10221 10476 11108  
2009 11616 12467 13161 13724 14511                

America’s Greatest Depression Fighter

(No, it wasn’t Franklin Delano Roosevelt)

 

by Jim Powell

“…A depression not only harms millions of people. It leads to intense political pressure for more government spending, higher taxes and other assaults on economic liberty. So it’s important to get through a depression as quickly as possible. Which U.S. president ranks as the best depression fighter?

Not the fabled Franklin Delano Roosevelt, who came to power in 1933, since the Great Depression persisted until the federal government conscripted some 12 million men into the armed forces. Biographers and political historians hail FDR’s charismatic personality, his “Fireside Chats” and his political genius, but his tripling of taxes, his laws making it more expensive for employers to hire people, his anti-discounting laws, his large-scale destruction of food, the 700 industrial cartels he enforced, the monopolies he established, the frivolous antitrust lawsuits he authorized against big employers – these and other measures throttled recovery and prolonged unemployment averaging 17%.

America’s greatest depression fighter was Warren Gamaliel Harding. An Ohio senator when he was elected president in 1920, he followed Woodrow Wilson who got America into World War I, contributed to the deaths of 116,708 Americans, built up huge federal bureaucracies, imprisoned dissenters and incurred $25 billion of debt, for which he has been much praised by historians.

Harding inherited the mess, in particular the post-World War I depression – almost as severe, from peak to trough, as the Great Contraction from 1929 to 1933, that FDR inherited and prolonged. Richard K. Vedder and Lowell E. Gallaway, in their book Out of Work (1993), noted that the magnitude of the 1920 depression “exceeded that for the Great Depression of the following decade for several quarters.” The estimated gross national product plunged 24% from $91.5 billion in 1920 to $69.6 billion in 1921. The number of unemployed people jumped from 2.1 million in 1920 to 4.9 million in 1921. …”

“…Federal spending was cut from $6.3 billion in 1920 to $5 billion in 1921 and $3.2 billion in 1922. Federal taxes were cut from $6.6 billion in 1920 to $5.5 billion in 1921 and $4 billion in 1922. Harding’s policies started a trend. The low point for federal taxes was reached in 1924. For federal spending, in 1925. The federal government paid off debt, which had been $24.2 billion in 1920, and it continued to decline until 1930.

Conspicuously absent was business-bashing that became a hallmark of FDR’s speeches. Absent, too, were New Deal–type big government programs to make it more expensive for employers to hire people, to force prices above market levels, to promote cartels and monopolies. Frederick Lewis Allen wrote, “Business itself was regarded with a new veneration. Once it had been considered less dignified and distinguished than the learned professions, but now people thought they praised a clergyman highly when they called him a good business man.”

With Harding’s tax cuts, spending cuts and relatively non-interventionist economic policy, the gross national product rebounded to $74.1 billion in 1922. The number of unemployed fell to 2.8 million – a reported 6.7% of the labor force – in 1922. So, just a year and a half after Harding became president, the Roaring 20s were underway! The unemployment rate continued to decline, reaching a low of 1.8% in 1926 – an extraordinary feat. Since then, the unemployment rate has been lower only once in wartime (1944), and never in peacetime.

“The seven years from the autumn of 1922 to the autumn of 1929,” wrote Vedder and Gallaway, “were arguably the brightest period in the economic history of the United States. Virtually all the measures of economic well-being suggested that the economy had reached new heights in terms of prosperity and the achievement of improvements in human welfare. Real gross national product increased every year, consumer prices were stable (as measured by the consumer price index), real wages rose as a consequence of productivity advance, stock prices tripled. Automobile production in 1929 was almost precisely double the level of 1922. It was in the twenties that Americans bought their first car, their first radio, made their first long-distance telephone call, took their first out-of-state vacation. This was the decade when America entered ‘the age of mass consumption.’”

Warren Harding made additional contributions to liberty. In 1922, he nominated George Sutherland to the Supreme Court – and Sutherland went on to become one of the greatest champions of liberty who ever served there. The next year, Harding nominated Pierce Butler. These were to be two of the “Four Horsemen of Reaction” who, during the 1930s, courageously struck down FDR’s early New Deal legislation that had been suppressing recovery….”

“…Harding suffered a stroke and died in San Francisco on August 2, 1923. “At the time of his death, no president was more popular and admired,” John W. Dean wrote in his biography of Harding. Harding’s body was returned to Washington on a funeral train. According to Dean, “This trip, reported in every newspaper in the land, resulted in a public outpouring of sentiment the likes of which had not been experienced by the nation since the death of Abraham Lincoln, and would not occur again until the death of Franklin Roosevelt. An estimated 9 million people from factories and farms, schools and shops, in the cities and in the fields, spontaneously appeared along the railroad tracks to silently – and often in tears – pay last respects to a president they admired, a friend they’d lost.”

Unfortunately, Harding’s stunning success as a depression fighter was overshadowed by the Teapot Dome scandal that engulfed his administration after he died. This resulted from “progressive” era conservation policies in which the government owned land known to have petroleum reserves, at Teapot Dome, Wyoming and Elk Hills, California. Since the beginnings of recorded history, government involvement in the economy has always led to corruption, and Secretary of the Interior Albert Fall accepted bribes for leases enabling private companies to extract the oil. If the reserves had been privately owned, there wouldn’t have been a scandal….”

http://www.lewrockwell.com/orig4/powell-jim4.html

What was the unemployment rate during the Great Depression?

“…The unemployment rate for the years 1923-29 was 3.3 percent. In 1931 it jumped to 15.9, in 1933 it was 24.9 percent. It then steadily decreased until 1941 when it stood at 9.9%. In 1942, after U.S. entry into World War II, the rate dropped to 4.7%.

(Source: http://www.bls.gov/opub/cwc/cm20030124ar03p1.htm)

“…When trying to compare historical and contemporary employment and unemployment rates, it is important to note that US employment and unemployment figures (and there are multiple official employment and unemployment figures for the same time period, just as there are multiple official rates of inflation, depending on exactly what is being looked at) are now calculated differently than they were during the 1930s and 1940s. In general, current unemployment numbers would be between 5% and 10% higher if calculated in the same way as in the past; conversely, the numbers from the 1930s and 1940s would be 5% – 10% lower if calculated using our contemporary methods. One, but not the only, major change is that workers are no longer considered “unemployed” if they become discouraged after being unable to find a job and stop searching. These workers disappear from the numbers.

Employment and unemployment figures are also difficult to compare, since they are typically calculated differently. For example, official employment and unemployment numbers may go up at the same time, which is illogical if we think that these numbers are based on the same formula. …”

http://wiki.answers.com/Q/What_was_the_unemployment_rate_during_the_Great_Depression

Great Depression

by Gene Smiley

“…A worldwide depression struck countries with market economies at the end of the 1920s. Although the Great Depression was relatively mild in some countries, it was severe in others, particularly in the United States, where, at its nadir in 1933, 25 percent of all workers and 37 percent of all nonfarm workers were completely out of work. Some people starved; many others lost their farms and homes. Homeless vagabonds sneaked aboard the freight trains that crossed the nation. Dispossessed cotton farmers, the “Okies,” stuffed their possessions into dilapidated Model Ts and migrated to California in the false hope that the posters about plentiful jobs were true. Although the U.S. economy began to recover in the second quarter of 1933, the recovery largely stalled for most of 1934 and 1935. A more vigorous recovery commenced in late 1935 and continued into 1937, when a new depression occurred. The American economy had yet to fully recover from the Great Depression when the United States was drawn into World War II in December 1941. Because of this agonizingly slow recovery, the entire decade of the 1930s in the United States is often referred to as the Great Depression. …”

“…It is commonly argued that World War II provided the stimulus that brought the American economy out of the Great Depression. The number of unemployed workers declined by 7,050,000 between 1940 and 1943, but the number in military service rose by 8,590,000. The reduction in unemployment can be explained by the draft, not by the economic recovery. The rise in real GNP presents similar problems. Most estimates show declines in real consumption spending, which means that consumers were worse off during the war. Business investment fell during the war. Government spending on the war effort exceeded the expansion in real GNP. These figures are suspect, however, because we know that government estimates of the value of munitions spending, to name one major area, were increasingly exaggerated as the war progressed. In fact, the extensive price controls, rationing, and government control of production render data on GNP, consumption, investment, and the price level less meaningful. How can we establish a consistent price index when government mandates eliminated the production of most consumer durable goods? What does the price of, say, gasoline mean when it is arbitrarily held at a low level and gasoline purchases are rationed to address the shortage created by the price controls? What does the price of new tires mean when no new tires are produced for consumers? For consumers, the recovery came with the war’s end, when they could again buy products that were unavailable during the war and unaffordable during the 1930s. …”

http://www.econlib.org/library/Enc/GreatDepression.html

U.S. Labor Force Trends

“…

http://findarticles.com/p/articles/mi_qa3761/is_200806/ai_n28083118/

List of recessions in the United States

Recessions and other Economic Crises

Name  ↓ Dates  ↓ Duration  ↓ Time since start of previous entry  ↓ Causes References
Panic of 1797 1797–1800 &0000000000000003.0000003 years The effects of the deflation of the Bank of England crossed the Atlantic Ocean to North America and disrupted commercial and real estate markets in the United States and the Caribbean. Britain‘s economy was greatly affected by developing disflationary repercussions because it was fighting France in the French Revolutionary Wars at the time. [9] [5]
Depression of 1807 1807–1814 &0000000000000007.0000007 years &0000000000000010.00000010 years The Embargo Act of 1807 was passed by the United States Congress under President Thomas Jefferson. It devastated shipping-related industries. The Federalists fought the embargo and allowed smuggling to take place in New England. [10][11][5]
Panic of 1819 1819–1824 &0000000000000005.0000005 years &0000000000000012.00000012 years The first major financial crisis in the United States featured widespread foreclosures, bank failures, unemployment, and a slump in agriculture and manufacturing. It also marked the end of the economic expansion that followed the War of 1812. [12][13][5]
Panic of 1837 1837–1843 &0000000000000006.0000006 years &0000000000000018.00000018 years A sharp downturn in the American economy was caused by bank failures and lack of confidence in the paper currency. Speculation markets were greatly affected when American banks stopped payment in specie (gold and silver coinage). [14][5]
Panic of 1857 1857–1860 &0000000000000003.0000003 years &0000000000000020.00000020 years Failure of the Ohio Life Insurance and Trust Company burst a European speculative bubble in United States railroads and caused a loss of confidence in American banks. Over 5,000 businesses failed within the first year of the Panic, and unemployment was accompanied by protest meetings in urban areas. [15][5]
Panic of 1873 1873–1879 &0000000000000006.0000006 years &0000000000000016.00000016 years Economic problems in Europe prompted the failure of the Jay Cooke & Company, the largest bank in the United States, which burst the post-Civil War speculative bubble. The Coinage Act of 1873 also contributed by immediately depressing the price of silver, which hurt North American mining interests. [16][5]
Long Depression 1873–1896 &0000000000000023.00000023 years The collapse of the Vienna Stock Exchange caused a depression that spread throughout the world. It is important to note that during this period, the global industrial production greatly increased. In the United States, for example, industrial output increased fourfold. [17][5]
Panic of 1893 1893–1896 &0000000000000003.0000003 years &0000000000000020.00000020 years Failure of the United States Reading Railroad and withdrawal of European investment led to a stock market and banking collapse. This Panic was also precipitated in part by a run on the gold supply. [18][5]
Panic of 1907 1907–1908 &0000000000000001.0000001 year &0000000000000014.00000014 years A run on Knickerbocker Trust Company deposits on October 22, 1907, set events in motion that would lead to a severe monetary contraction. [19][5]
Post-World War I recession 1918–1921 &0000000000000003.0000003 years &0000000000000011.00000011 years Severe hyperinflation in Europe took place over production in North America. It was a brief but very sharp recession and was caused by the end of wartime production, along with an influx of labor from returning troops. This in turn caused high unemployment. [20][5]
Great Depression 1929–1933 &0000000000000043.00000043 months &0000000000000021.00000021 months Stock markets crashed worldwide, and a banking collapse took place in the United States. Although sometimes dated as lasting until the Second World War, the US economy was growing again by 1933, and technically the U.S. was not in recession from 1933 to 1937 [21][5]
Recession of 1937 1937–1938 &0000000000000013.00000013 months &0000000000000050.00000050 months The Recession of 1937 is only considered minor when compared to the Great Depression, but is otherwise among the worst recessions of the 20th century. [22]
Recession of 1945 Feb-Oct 1945 &0000000000000008.0000008 months &0000000000000080.00000080 months The decline in government spending at the end of World War II led to an enormous drop in Gross Domestic Product making this technically a recession. The Post War years were unusual in a number of ways and this era has little in common with other recessions. [23]
Recession of 1948 Nov 1948–Oct 1949 &0000000000000011.00000011 months &0000000000000037.00000037 months The 1948 recession was a relatively brief cyclical economic downturn, the mildness of which led to confidence in the notion that the Post War-era would be a period of stronger growth. [24]
Recession of 1953 July 1953–May 1954 &0000000000000010.00000010 months &0000000000000045.00000045 months After a post-Korean War inflationary period, more funds were transferred into national security. The Federal Reserve changed monetary policy to be more restrictive in 1952 due to fears of further inflation. [25][26][5]
Recession of 1958 Aug 1957–April 1958 &0000000000000008.0000008 months &0000000000000039.00000039 months Monetary policy was tightened during the two years preceding 1957, followed by an easing of policy at the end of 1957. The budget balance resulted in a change in budget surplus of 0.8% of GDP in 1957 to a budget deficit of 0.6% of GDP in 1958, and then to 2.6% of GDP in 1959. [27][5]
Recession of 1960-1 April 1960–Feb 1961 &0000000000000010.00000010 months &0000000000000024.00000024 months After President Kennedy’s 30 January 1961 call for increased government spending to improve the Gross National Product and to reduce unemployment, the 1960-61 recession ended in February.[28]
Recession of 1969-70 Dec 1969–Nov 1970 &0000000000000011.00000011 months &0000000000000106.000000106 months The relatively mild 1969 recession is thought to have been mostly caused by the Federal Reserve raising interest rates to hold down inflation. [5]
1973 oil crisis1973–1974 stock market crash Nov. 1973– March 1975 &0000000000000016.00000016 months &0000000000000036.00000036 months A quadrupling of oil prices by OPEC coupled with high government spending due to the Vietnam War led to stagflation in the United States. [29][5]
1980 recession Jan-July 1980 &0000000000000006.0000006 months &0000000000000058.00000058 months The NBER considers a short recession to have occurred in 1980, followed by a short period of growth and then a deep recession. Unemployment remained relatively elevated inbetween recessions. The early ’80s are sometimes referred to as a “double dip” or “w-shaped” recession. [5]
Early 1980s recession July 1981–Nov 1982 &0000000000000016.00000016 months &0000000000000012.00000012 months The Iranian Revolution sharply increased the price of oil around the world in 1979, causing the 1979 energy crisis. This was caused by the new regime in power in Iran, which exported oil at inconsistent intervals and at a lower volume, forcing prices to go up. Tight monetary policy in the United States to control inflation led to another recession. The changes were made largely because of inflation that was carried over from the previous decade due to the 1973 oil crisis and the 1979 energy crisis. [30][31][5]
Early 1990s recession July 1990–March 1991 &0000000000000008.0000008 months &0000000000000092.00000092 months Industrial production and manufacturing-trade sales increased in early 1991. [32][5]
Early 2000s recession Mar-Nov 2001 &0000000000000008.0000008 months &0000000000000120.000000120 months The collapse of the dot-com bubble, the September 11th attacks, and accounting scandals contributed to a relatively mild contraction in the North American economy. [33][5]
Late 2000s recession Dec 2007-current ongoing &0000000000000073.00000073 months The collapse of the housing market led to bank collapses in the US and Europe, causing the amount of available credit to be sharply curtailed, resulting in huge liquidity and solvency crises. In addition, record oil prices and food prices, stock markets crashed globally, and several high profile banking, automotive, and manufacturing giants collapsed in the United States [34][35]

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

Economic Depressions: Their Cause and Cure

by Murray N. Rothbard

“…Thus, the Misesian theory of the business cycle accounts for all of our puzzles: The repeated and recurrent nature of the cycle, the massive cluster of entrepreneurial error, the far greater intensity of the boom and bust in the producers’ goods industries.

Mises, then, pinpoints the blame for the cycle on inflationary bank credit expansion propelled by the intervention of government and its central bank. What does Mises say should be done, say by government, once the depression arrives? What is the governmental role in the cure of depression? In the first place, government must cease inflating as soon as possible. It is true that this will, inevitably, bring the inflationary boom abruptly to an end, and commence the inevitable recession or depression. But the longer the government waits for this, the worse the necessary readjustments will have to be. The sooner the depression-readjustment is gotten over with, the better. This means, also, that the government must never try to prop up unsound business situations; it must never bail out or lend money to business firms in trouble. Doing this will simply prolong the agony and convert a sharp and quick depression phase into a lingering and chronic disease. The government must never try to prop up wage rates or prices of producers’ goods; doing so will prolong and delay indefinitely the completion of the depression-adjustment process; it will cause indefinite and prolonged depression and mass unemployment in the vital capital goods industries. The government must not try to inflate again, in order to get out of the depression. For even if this reinflation succeeds, it will only sow greater trouble later on. The government must do nothing to encourage consumption, and it must not increase its own expenditures, for this will further increase the social consumption/investment ratio. In fact, cutting the government budget will improve the ratio. What the economy needs is not more consumption spending but more saving, in order to validate some of the excessive investments of the boom.

Thus, what the government should do, according to the Misesian analysis of the depression, is absolutely nothing. It should, from the point of view of economic health and ending the depression as quickly as possible, maintain a strict hands off, “laissez-faire” policy. Anything it does will delay and obstruct the adjustment process of the market; the less it does, the more rapidly will the market adjustment process do its work, and sound economic recovery ensue.

The Misesian prescription is thus the exact opposite of the Keynesian: It is for the government to keep absolute hands off the economy and to confine itself to stopping its own inflation and to cutting its own budget.

If Coolidge made 1929 inevitable, it was President Hoover who prolonged and deepened the depression, transforming it from a typically sharp but swiftly-disappearing depression into a lingering and near-fatal malady, a malady “cured” only by the holocaust of World War II. Hoover, not Franklin Roosevelt, was the founder of the policy of the “New Deal”: essentially the massive use of the State to do exactly what Misesian theory would most warn against – to prop up wage rates above their free-market levels, prop up prices, inflate credit, and lend money to shaky business positions. Roosevelt only advanced, to a greater degree, what Hoover had pioneered. The result for the first time in American history, was a nearly perpetual depression and nearly permanent mass unemployment. The Coolidge crisis had become the unprecedentedly prolonged Hoover-Roosevelt depression.

Ludwig von Mises had predicted the depression during the heyday of the great boom of the 1920s – a time, just like today, when economists and politicians, armed with a “new economics” of perpetual inflation, and with new “tools” provided by the Federal Reserve System, proclaimed a perpetual “New Era” of permanent prosperity guaranteed by our wise economic doctors in Washington. Ludwig von Mises, alone armed with a correct theory of the business cycle, was one of the very few economists to predict the Great Depression, and hence the economic world was forced to listen to him with respect. F. A. Hayek spread the word in England, and the younger English economists were all, in the early 1930s, beginning to adopt the Misesian cycle theory for their analysis of the depression – and also to adopt, of course, the strictly free-market policy prescription that flowed with this theory. Unfortunately, economists have now adopted the historical notion of Lord Keynes: That no “classical economists” had a theory of the business cycle until Keynes came along in 1936. There was a theory of the depression; it was the classical economic tradition; its prescription was strict hard money and laissez-faire; and it was rapidly being adopted, in England and even in the United States, as the accepted theory of the business cycle. (A particular irony is that the major “Austrian” proponent in the United States in the early and mid-1930s was none other than Professor Alvin Hansen, very soon to make his mark as the outstanding Keynesian disciple in this country.)

What swamped the growing acceptance of Misesian cycle theory was simply the “Keynesian Revolution” – the amazing sweep that Keynesian theory made of the economic world shortly after the publication of the General Theory in 1936. It is not that Misesian theory was refuted successfully; it was just forgotten in the rush to climb on the suddenly fashionable Keynesian bandwagon. Some of the leading adherents of the Mises theory – who clearly knew better – succumbed to the newly established winds of doctrine, and won leading American university posts as a consequence.

But now the once arch-Keynesian London Economist has recently proclaimed that “Keynes is Dead.” After over a decade of facing trenchant theoretical critiques and refutation by stubborn economic facts, the Keynesians are now in general and massive retreat. Once again, the money supply and bank credit are being grudgingly acknowledged to play a leading role in the cycle. The time is ripe – for a rediscovery, a renaissance, of the Mises theory of the business cycle. It can come none too soon; if it ever does, the whole concept of a Council of Economic Advisors would be swept away, and we would see a massive retreat of government from the economic sphere. But for all this to happen, the world of economics, and the public at large, must be made aware of the existence of an explanation of the business cycle that has lain neglected on the shelf for all too many tragic years. …”

http://www.lewrockwell.com/rothbard/rothbard183.html


1929 – The Great Wall Street Crash & Depression: Part 1 of 6

1929 – The Great Wall Street Crash & Depression: Part 2 of 6

1929 – The Great Wall Street Crash & Depression: Part 3 of 6

1929 – The Great Wall Street Crash & Depression: Part 4 of 6

1929 – The Great Wall Street Crash & Depression: Part 5 of 6

1929 – The Great Wall Street Crash & Depression: Part 6 of 6

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Irresponsible Government Intervention Results In Huge and Continuing Government Failures–Shut Down Government Interventions–No More Bailouts!

Posted on February 19, 2009. Filed under: Blogroll, Economics, Employment, Homes, Investments, Links, Politics, Quotations, Rants, Raves, Regulations, Taxes, Technology, Video | Tags: , , , , , , , , , , |

 The essence of the interventionist policy is to take from one group to give to another. It is confiscation and distribution.

Interventionism cannot be considered as an economic system destined to stay. It is a method of transformation of capitalism into socialism by a series of successive steps.

~Ludwig von Mises

government_intervention

  red_socialism

The above cartoon combined with an excellent article by economist Thomas Sowell provides a casebook example of government intervention in the economy leading to more and more government intervention with the result being  a US and world wide recession and financial crisis.

The Radical Socialists led by Renegade President Obama are wrecking the economy and destroying jobs by their continuing plans to bailout the imprudent and irresponsible.

The market would let them fail, because that is how resources are reallocated to those who produce the wealth, income and jobs.

The Federal government wants to continue the bailouts to those who should not be bailed out.

The Fascist Democratic Radicals (FDRs), socialist all, are destroying the United States economy.

The Trouble Asset Recovery Plan (TARP) money was designed to provide sound and quality banks with capital to buy the assets of banks that were failing.

My advice is do not to do business with any bank, business, and organization that accepts government bailout money.

Why?

 The Federal Government gradually controls more and more of that bank, business, and organization once they accept their money.

 

Obama’s Focus On Foreclosures

 

Who caused the problem?

Jim Rogers : Must Let Banks Fail Feb 11 2009

 

2009 will be the year of Total decline for US Jim Rogers

 

Rogers on the Global Market Meltdown

 

Just say no to bailouts and no to businesses, banks, and organizations that accept bailouts.

 

What should you do?

Here is one interesting suggestion:

Jim Rogers Obama does not Understand Economics !!!!!!

 

Tom Woods on Glenn Beck “Meltdown” 02/09/2009

 

Upside Down Economics

by Thomas Sowell

“…It was precisely government intervention which turned a thriving industry into a basket case.

An economist specializing in financial markets gave a glimpse of the history of housing markets when he said: “Lending money to American homebuyers had been one of the least risky and most profitable businesses a bank could engage in for nearly a century.” That was what the market was like before the government intervened. Like many government interventions, it began small and later grew. …” “…Under growing pressures from both the Clinton administration and later the George W. Bush administration, banks began to lower their lending standards. Mortgage loans with no down payment, no income verification and other “creative” financial arrangements abounded. Although this was done under pressures begun in the name of the poor and minorities, people who were neither could also get these mortgage loans. With mortgage loans widely available to people with questionable prospects of being able to keep up the payments, it was an open invitation to financial disaster. Those who warned of the dangers had their warnings dismissed. Now, apparently, we need more politicians intervening in more industries, if you believe the politicians and the media. …” http://townhall.com/columnists/ThomasSowell/2009/02/18/upside_down_economics?page=2   

 

 Socialism and interventionism. Both have in common the goal of subordinating the individual unconditionally to the state.

 Every step which leads from capitalism toward planning is necessarily a step near to absolutism and dictatorship.

~Ludwig von Mises, Omnipotent Government, page 44 and 53. 

 

Background Articles and Videos

 

Glenn Beck Socialism to Fascism 

 

The Economic “Stimulus”

by Thomas Sowell

“…In short, it can be years before the money that is supposed to stimulate the economy actually gets into the economy. And nobody knows what the economy will be like when that money finally gets into circulation.

A common problem with government economic policies in general is that it is very hard to predict how long it will be before the policy actually affects the economy. An economic stimulus policy created during a contraction in demand can take effect during an inflationary expansion of demand– and fuel still more inflation.

A trillion dollars or so, created out of thin air by a government that already has a huge deficit, can set off another round of inflation that can take some very painful new policies to bring under control– or can have even more painful effects, if it is not brought under control. The new administration may need that get-out-of-jail-free card.”

http://townhall.com/columnists/ThomasSowell/2009/01/06/the_economic_stimulus?page=2

 

 

Regional Banks Reject TARP Funding

“…When Congress approved $700 billion for TARP, it was supposed to buy troubled mortgage securities from banks. The bill’s language was broad, and former Treasury Secretary Henry Paulson decided in October he would use $250 billion to buy preferred stock in banks to bolster their capital. In late October, Paulson forced the nation’s nine largest banks to accept a total of $125 billion, regardless of their health.[17] This was former Treasury Secretary Henry Paulson’s original vision for the TARP fund, but he switched course and decided to devote $250 billion to direct equity stake investments in banks before waffling again and heading back in the direction of asset purchases.[22] The Treasury has repeatedly said that TARP is not a bailout, and that it expects to eventually make money on the program. A study this month by the Congressional Budget Office found that, of the $247 billion the government had spent through Dec. 31, taxpayers were on the hook for about a quarter, or $64 billion. That amount represents the difference between what the Treasury paid for assets versus their market values. The Office of Management and Budget must submit semiannual reports on the costs of TARP, and the CBO must assess those reports.[1] Buying toxic assets was the original plan for government money until the Treasury shifted gears toward investments. “The first step has to be removing these toxic assets,” Kaufman said. He sees the government buying up bad loans similar to the way the Resolution Trust Corp. bought distressed homes from savings and loans nearly two decades ago. Just as the RTC wound up costing taxpayers less than one-half the original estimates, the public could be on the hook for less than the full $700 billion this time, Kaufman said. Toxic-asset purchases can be tricky when it’s hard to figure out a reasonable, fair price.[11] Parts of the discussion taking place within the government revolve around ways to leverage the remaining money in the TARP. The Fed already plans to use $20 billion from the TARP to set up a $200 billion program to support consumer and small business loans.[18]

…”

“…Until we start recognizing the losses, we’re just engaging in crony capitalism,” said Mason, who is also a banking industry consultant. Executives of banks that get federal support without being force to take adequate writedowns, he adds, are “using Congress as a piggybank.” Treasury Secretary Henry Paulson used much of the first half of TARP to buy preferred shares in banks, using the rationale that banks’ capital shortfalls needed to be filled before they could be depended on to extend loans to expand the economy. Under the plan, big banks such as Citi, JPMorgan Chase ( JPM, Fortune 500 ) and Goldman Sachs ( GS, Fortune 500 ) got billions of dollars in federal funds with few strings attached. Paulson said the plan — which he adopted after regulators in the U.K. launched their own plan to buy banks’ preferred shares — resulted in a more stable financial system.[4] The program, which is similar to the ones that U.S. regulators have extended to Citigroup ( C, Fortune 500 ) and Bank of America ( BAC, Fortune 500 ), aims to “reinforce the stability of the financial system, to increase confidence and capacity to lend, and in turn to support the recovery of the economy,” the U.K. Treasury said in a statement. Offering loan guarantees to a broad array of banks is reportedly among the options being considered by incoming President Barack Obama as he seeks to restore economic growth.[4] …”

“…Instead of using the first payment of $350 billion to purchase troubled assets, as the name Troubled Asset Relief Program suggests, the money has been erratically and arbitrarily distributed in a monstrous act of government intervention and ownership over our financial markets.[25] More than 200 banks have gotten $191 billion in relief from the $700 billion Troubled Asset Relief Program, according to Keefe Bruyette.[22] Two local banks have garnered millions from the controversial $700 billion Trouble Asset Relief Program, often called the banking bailout bill.[19]

Citigroup tops the list with $25 billion in TARP funding, while some smaller community banks have taken around $1 million. J.W. Davis, Carolina First chairman, said his company discussed the TARP program extensively before exchanging equity for money with the federal government. He said a tight credit market makes it difficult to raise capital, and the TARP program was an efficient and low-cost solution.[19] “I am convinced that our bank and many, many others are lending more than we would have if we hadn’t taken the TARP money, says Ken Wilcox, chief executive of SVB Financial, which operates Silicon Valley Bank in Palo Alto. Wilcox says his bank, which caters to startup and publicly held technology companies, was able to raise several billion in new deposits since it took $235 million in TARP funds in early December.[17] We’ve also in the interbank market we have had on average $40 billion or $50 billion out and into bank market, that is also a form of lending. All of this is helped by the TARP so we think it’s a valid question people to ask what are doing with the TARP money and we do say its hard to separate exactly what is TARP money because remember we’re making loans all the time but we are trying to follow the intent and spirit of TARP which is to help the economy of the United States recover and make sure we’re financing people.[27]

…”

 

http://newsfeedresearcher.com/data/articles_b5/banks-buyouts-tarp.html

 

Two local banks get a piece of bailout

“…Critics, however, point to a lack of oversight surrounding the federal program and a shift in direction from the bill’s original intent.

Under the terms of the agreement with the Treasury, South Financial and Mountain First must pay the money back with interest. The banks are charged 5 percent annually for the first five years. After five years, the rate goes up to 9 percent.

“The reason we participated in that was we wanted to provide more services to Western North Carolina,” said Greg Gibson, Mountain First Bank and Trust CEO. “This TARP program offered the best alternative to offer credit to our customers.”

When Congress originally approved the TARP program, Treasurer Secretary Henry Paulson planned to purchase troubled loans from shaky financial institutions. Paulson quickly changed course, and the Treasury has used the money to purchase stock in nearly 300 banks, thrifts and finance companies. Citigroup tops the list with $25 billion in TARP funding, while some smaller community banks have taken around $1 million.

J.W. Davis, Carolina First chairman, said his company discussed the TARP program extensively before exchanging equity for money with the federal government. He said a tight credit market makes it difficult to raise capital, and the TARP program was an efficient and low-cost solution.

“We saw it as an opportunity to pad our capital,” Davis said. “Given the slowdown, we thought padding those ratios was good. We also want to take advantage of things in the marketplace.”

http://www.blueridgenow.com/article/20090119/TOPSTORIES/901180996/1042/NEWS?Title=Two_local_banks_get_a_piece_of_bailout 

 

What Just Happened?

“…And where did the ultimately successful plan come from, anyway?  Ten days ago it appeared that it was UK Prime Minister Gordon Brown’s idea (doubtless crafted for him by Bank of England Governor Mervyn King). True enough, Brown boldly and confidently tackled his banking crisis at its root. A cartoon in the Financial Times depicted leaders of other industrial nations following him along in a cheerful dance. There followed the standard paeans to John Maynard Keyes.

 

But the basic blueprints Brown adopted had been drawn up in Stockholm in late 1992, when central bankers in Sweden, Norway and Finland moved swiftly to rescue their big banks after the collapse of a property bubble. The rescue succeeded, though its aftermath lingered on for four years.

 

What were the channels through which Swedish influence flowed to London and Washington? This is an especially interesting question because of the experience of the early 1930s, when Gustav Cassel argued without success that overly restrictive American monetary policy was making matters worse, and Gunnar Myrdal devised budgetary policies implemented by the new Social Democratic government in 1933 that spared Sweden the worst of the Great Depression.

 

In other words, economists of the Stockholm School implemented successful macroeconomic policies several years before John Maynard Keynes published his General Theory of Employment, Interest and Money, even if they were unable to make the case for what they were doing to the wider world. The Swedes have taken economics very seriously ever since. Would they sit on their hands at a time when the world was threatened with another serious depression? What overtures would they make instead? …” 

http://www.economicprincipals.com/issues/2008.10.26/341.html

 

1/3) Tom Woods: Meltdown (Lew Rockwell Show 2/11/09)

 

2/3) Tom Woods: Meltdown (Lew Rockwell Show 2/11/09)

 

3/3) Tom Woods: Meltdown (Lew Rockwell Show 2/11/09)

 

 

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Fred Thompson On Borrowing and Spending–Yes We Can!

Posted on January 3, 2009. Filed under: Blogroll, Economics, Employment, Investments, Law, Links, Politics, Quotations, Raves, Regulations, Taxes, Video | Tags: , , , , , , , , , , , , , , , |

Trying to fix problems caused by excess consumption with more spending is like telling a fat guy that the way to lose weight is to eat more donuts.

~Fred Thompson

 

Fred Thompson on the Economy

 

Great video!

Ask not what your country can spend on you, ask what you can spend for your country. Is that what made American a great country?

~Fred Thompson

 

Background Articles and Videos

 

Postponing Reality

By Thomas Sowell

 

“…While Detroit’s Big Three are laying off thousands of workers, Toyota is hiring thousands of workers right here in America, where a substantial share of all our Toyotas are manufactured.

Will this save Detroit or Michigan? No.

Detroit and Michigan have followed classic liberal policies of treating businesses as prey, rather than as assets. They have helped kill the goose that lays the golden eggs. So have the unions. So have managements that have gone along to get along.

Toyota, Honda and other foreign automakers are not heading for Detroit, even though there are lots of experienced automobile workers there. They are avoiding the rust belts and the policies that have made those places rust belts.

A bailout of Detroit’s Big Three would be only the latest in the postponements of reality. As for automobile dealers, they can probably sell Toyotas just as easily as they sold Chevvies. And Toyotas will require just as many tires per car, as well as other parts from automobile parts suppliers.”

http://www.realclearpolitics.com/articles/2008/12/postponing_reality.html

 

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