Unemployment falls below 9%

Muldur said:
The LPR is VITAL to properly understanding the UE rate, and how it portrays the economy.
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Again, the Labor Force Participation rate is calculated by first adding the employed and unemployed together. It's a different measure than unemployment. It does not help us understand the unemployment rate, but it can be used to provide additional information.

And, no matter what other information you wish to add in order to make it seem insignificant, the fact is the unemployment rate is slowly edging downward, and the economy has been adding net jobs in recent months.
 
Muldur said:
I'm re-replying to this because I left out a more important aspect of the disconnect between stocks and the status of the real economy. One that has nothing to do with the other issues of fraud and manipulation.

Stocks prices, even when honestly determined, are based on stockholder valuations of the company's immediate status, not the real state of the economy.

Example: XYZ Corp lays off 100,000 people, even though they are profitable. As a result their profit/loss statements look better and they are rewarded with a higher share price by "investors".

But what has XYZ Corp actually done? They've destroyed the ability to consume for 100,000 individuals and/or families. Those lost jobs result in lost business for every business that serviced those 100,000 individuals/families, forcing them in turn to lay people off. Rinse, repeat over and over.

That's NOT good for the real economy, the economy that distributes needed resources to allow people to live. Laying off workers, even if needed (and many layoffs are NOT needed, but rather designed to "increase profits"), is always a bad economic indicator.

Before the Marketeers start harping about the inevitability of layoffs and "creative destructions" and all that theoretical stuff, I know that a certain amount of "churn" is expected and unavoidable. That doesn't make it good, nor does it mean we need more of it.

Producers need people with incomes to consume their produce. That's one of the reasons why the US is so frakked right now. We've eliminated the ability of too many consumers to consume and we wonder why producers have no business coming in.
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While you might have a case that a specific change in the price of certain stocks is not necessarily good news for the economy, you cannot possibly argue with the fact that the general trend of the stock market parallels the health of the economy. It is one of the main indicators of the health of the economy. Trying to paint it as "not important" is a desperate and stupid ploy by Obama-haters who are frantic about him actually succeeding in turning the economy around.
 
Also, core retail sales in January were up 0.7 percent. Pretty tough to argue that stock prices probably rose only due to layoffs or downsizing.
 
Tricky said:
While you might have a case that a specific change in the price of certain stocks is not necessarily good news for the economy, you cannot possibly argue with the fact that the general trend of the stock market parallels the health of the economy. It is one of the main indicators of the health of the economy. Trying to paint it as "not important" is a desperate and stupid ploy by Obama-haters who are frantic about him actually succeeding in turning the economy around.
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Just so.

Investors are not stupid people.

The value of a company, it's "market cap" is most usually more strongly influenced by whether it is selling product than anything else, because that is how revenue us usually generated.

And as markets rise, so too do portfolios rise.

As portfolios rise, wealth rises.

When wealth rises, economic activity increases.

Do Republicans suddenly not comprehend that a rising tide raises all boats?

They love that phrase when they want to make life easier for the wealthy...
 
BenBurch said:
Do Republicans suddenly not comprehend that a rising tide raises all boats?
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Francesca R said:
Is that a statement of your belief?
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Though this wasn't addresed to me, I'd like to weigh in on it.

Like all analogies, "A rising tide lifts all boats" is imperfect. It is not technically correct, as tides are local and "all boats" is a universal term. Obviously the meaning is that a general improvement benefits everyone, but as we all know, this is not completely true either. As a rule of thumb, though, it is accurate enough.

The problem is in determining if the trend is "general". Rising success in one segment may adversely affect success in other segments, the oil industry being a prime example of this. So how do you tell if a trend is "general" or not? There's no perfect way, but one way to make the analysis better is to lump together many and diverse elements of the economy into broad indices that balance out the negative effects with the positive effects.

Well guess what, Muldur. That's exactly what the Dow Jones Industrial Average does. It does not perfectly reflect each individual componant of the average, but overall, if companies are making money, the economy is improving. You don't need an MBA to figure this out.

So if a "rising tide" means conditions across the board, then it does indeed lift most boats." A rising water level in someone's private swimming pool doesn't do much, by which I mean that adding to the fortunes of the 1% doesn't lift all boats.
 
WildCat said:
I think that's when job openings for office clerks require a 4 year college degree.
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If there were a lot of jobs out there, employers wouldn't make a 4-year degree a requirement for office clerk. If 100 applications are coming in for one position, it's a way to narrow the field. Such a requirement doesn't arise in a vacuum - it's a function of available positions vs. applicants.
 
Tricky said:
Though this wasn't addresed to me, I'd like to weigh in on it.
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It's just that gatekeepers of the left are apt to regard higher stock-market wealth as something that inordinately benefits the rich. So it was a bit surprising.

By the way the DJIA is the geometric (not market cap weighted) average of 30 share prices so not terribly general.
 
Francesca R said:
It's just that gatekeepers of the left are apt to regard higher stock-market wealth as something that inordinately benefits the rich. So it was a bit surprising.
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I'm not sure who these gatekeepers of the left are or what they are apt to make of positive stock market measures, but I will point out that in this thread, several of us have pointed to several different economic indicators that all point to a modest but real recovery.

This has been met largely with a rejection of these well-established and long-accepted measures as economic indicators.

My point in starting the thread was that if the trend of modest good news continues, the GOP will have a steeply uphill battle in keeping Obama from a second term.
 
BenBurch said:
In a very general sense, yes. Prosperity rewards everybody, even those who are without means or jobs. There are exceptions, there always are, but its a general rule that can be useful.
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OK. Would you say that "trickle down" is a useful general rule too (essentially the same thing in other words)? If not what's different about it?
 
Francesca R said:
OK. Would you say that "trickle down" is a useful general rule too (essentially the same thing in other words)? If not what's different about it?
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No. That is quite a different case. When ONLY the rich get richer, the amount of spending in the country does not rise that much, and the result is not prosperity, it is a class divide.

Trickle-down is the asinine theory that if you give Mitt Romney even LESS tax to pay that Mitt Romney is going to make jobs and buy things in sufficient proportion to raise the estate of those without his sinecures. It just does not work that way.
 
I also heard a plea about a shortage of welders in one of the southeastern states on the radio two days ago. (Sorry, don't remember the particulars.)
 
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