Employers add no net jobs in Aug.; rate unchanged

Conservative said:

If you want to continue to look back do so in a non partisan way, WTC 1 happened under Clinton, Clinton was handed Bin Laden but didn't take him, Clinton signed the Iraq Liberation Act, Clinton had a PDB in December 1998, Clinton shot a multi million dollar missile into a $10 tent and killed a camel.

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Conservative said:

New debt is never fixed

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and refinancing old debt happens all the time. Higher interest rates equally higher growth is bs unless you have full employment and we don't.

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Higher interest rates in the 80's led to 10.8% unemployment so your argument is bogus.

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Right now there are over 25 million unemployed and under employed Americans, rising interest rates and taxes does nothing to put those people back to work

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Conservative said:

Terrible because the Fed keeps pouring money into the economy. They can do that because of 25 million unemployed and under employed Americans and stagnant economic growth. Adding more debt right now is suicidal.

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pbrauer said:

The Iraq Liberation Act was nothing more than to support rebels if they decided to take down Saddam, nothingmore, no military. Operation Desert Fox was a 4-day campaign in December of 1998 did plenty of damage to the Saddam regime.

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Goldenboy219 said:

Incorrect. The Fed ended their QEII program in June. Why have interest rates fallen lower than when the Fed was in full purchasing mode?

If we do not add anymore debt, we will surely go back into recession. This much is clear.

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Boo Radley said:

I don't know how that can haunt us, but we can clearly say we would have lost those jobs then. The people who stayed employed were able to pay bills and buy things and were not on unemployment.

But that is what I mean by limits. The stimulus at best was a short term answer. Long term efforts have to come largely from the private sector when it comes to jobs. All the governemnt can do without hiring people is give stimulus dollars for the short erm.

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Conservative said:

Interest rates are inching towards record lows again because of terrible economic growth and high unemployment.

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Adding more debt at 14.6 trillion levels is a disaster, time for the market to correct itself and for Congress to go on a diet. Hardly going to happen with this Administration who seems to believe they are responsible for personal responsibility issues.

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Andrew Mellon said:

liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate… it will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up from less competent people.[

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Goldenboy219 said:

No. The issue in Europe, the Swiss:Euro peg, and the sheer liquidity of our treasury market has pushed rates lower than they were when the Fed conducting QEI and QEII. At this point, the Fed is likely to begin a program deemed "Operation Twist".



Andrew Mellon said the same thing.



In 1929. Which is why your "solution" is definitely not an option. How did that work out for Mellon? Was he correct?

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American said:

/partisanship off
Now you're talking about Bush obviously (i.e., low unemloyment and deficits). But guess what (and not to beat up on Clinton specifically), Clinton should have continued a sound investment in military research during his peacetime presidency. But he didn't, and then when the war came.....Bush had to do both (invest in research and fight a war). Now I'm not trying to start a debate about the merits of the war, but merely to show that Clinton could have bought the research at a cheaper price than Bush, not to mention it costs a lot more when you need it NOW. So these spending deficits get so huge when you don't maintain some consistency all the time. The same happened with Carter, he let the military rot and Reagan spent more to bring it back. So just remove the presidents' names, and look at the spending line being consistent. It's easier to prepare for war during peace time, when defense contractors have nothing else to do. Once war starts, everything goes fast track. Well the problem is that during peace time defense contractors are laying off people cause they have no work, and when the war comes they have to rebuild their workforce like RIGHT NOW. You can apply this to most things I believe. Clinton did it because the Cold War was "over", but it wasn't that over. They over-reduced like a pendulum, and then Bush had to swing it the other way. So bottomline, maintain your army and transform it gradually. If we did this I think we could eliminate most deficits.

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Conservative said:

This isn't 1929 and we didn't have a 14.6 trillion dollar debt then. Is there even enough debt for you to finally say enough is enough? who is calling for liquidation of stocks, real estate, etc. I am for rewarding the taxpayers not the politicians. I seem to understand what you have a problem understanding is that inflation is on the horizon and inflation will lead to higher interest rates. Imagine financing debt at Volcker's interest rates today. What was the debt in 1980-83? My solution is the only option, reward taxpayers and put the govt. on a diet. Here are the expenses of the govt. today vs. what they should be IMO

Defense 696.1
International Affairs 45.2
Gen. Science, Space 30.9
Energy 11.5
Natural resources/env 41,6
Agriculture 23.2
Commerce 25.0
Transportation 92.5
Community Dev 24.9
Education/Train/Social 125.1
Health 369.0
Medicare 451.6
Income Security 624.0
Social Security 706.7
Veterans Benefits 108.4
Justice 55.2
General Govt. 18.1
Net Interest 196.9


Total 3604.3

Defense 600.1
International Affairs 30.1
Gen. Science, Space 10.9
Energy
Natural resources/env
Agriculture
Commerce
Transportation
Community Dev
Education/Train/Social
Health 369.0
Medicare
Income Security 300.5
Social Security
Veterans Benefits 108.4
Justice 55.2
General Govt. 18.1
Net Interest 196.9


Total 1689.2

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Goldenboy219 said:

I have asked you a plethora of questions today, and you have yet to respond to one of them. It is not a conversation if you fail to address my questions; instead it is a rant.

We really cannot cut government spending without invoking a massive recession worse than that of 2009.

Remember, Y=C+I+G+NX If net exports is negative, any cuts in government spending greater than the absolute value of NX will INSTANTANEOUSLY result in a dollar for dollar loss in Y (or GDP). If you have the ability to negate this comment, then by all means go for it.

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Conservative said:

That is your opinion, and sorry but believe I have answered your questions probably to the same level you answered mine. We have a 14.6 trillion dollar debt in a country with a yearly GDP of about 15 trillion. Budget deficits the past two years have exceeded 3 trillion dollars and that doesn't seem to be enough for you. When is enough enough in your world? Why would you reward politicians instead of taxpayers by raising taxes or more govt. spending that does nothing but fuel ineffeciencies. You seem to promote the "too big to fail" argument and in this case big is the Federal govt. tell me how cutting govt. spending is going to create a massive recession? Import exports are a very small percentage of GDP thus cuts in govt. spending will mean lower deficits thus fewer dollars going to debt service and more revenue on the part of the consumers.

Your policies would be better suited for the socialist countries of Europe and the old Soviet Union. I understand the consumer economy today which you seem to ignore. Consumers keeping more of their money drive private business and creates jobs. We did quite well prior to having a 3.7 trillion dollar govt so what has changed? Govt. control has changed, increased dependence has changed,. That has to be reversed.

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AdamT said:

The problem is that, paradoxically, we cannot cut spending in any significant way without making the deficit worse.

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Conservative said:

That is your opinion, and sorry but believe I have answered your questions probably to the same level you answered mine.We have a 14.6 trillion dollar debt in a country with a yearly GDP of about 15 trillion. Budget deficits the past two years have exceeded 3 trillion dollars and that doesn't seem to be enough for you. When is enough enough in your world? Why would you reward politicians instead of taxpayers by raising taxes or more govt. spending that does nothing but fuel ineffeciencies. You seem to promote the "too big to fail" argument and in this case big is the Federal govt. tell me how cutting govt. spending is going to create a massive recession? Import exports are a very small percentage of GDP thus cuts in govt. spending will mean lower deficits thus fewer dollars going to debt service and more revenue on the part of the consumers.

Your policies would be better suited for the socialist countries of Europe and the old Soviet Union. I understand the consumer economy today which you seem to ignore. Consumers keeping more of their money drive private business and creates jobs. We did quite well prior to having a 3.7 trillion dollar govt so what has changed? Govt. control has changed, increased dependence has changed,. That has to be reversed.

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Goldenboy219 said:

If the government does not borrow that money and spend it, it would not have been spent! Remember... A: {C+I+G+NX=Y} B: {C+I+G(1-stimulus)+NX=Y-stimulus.} With these identities in mind, which is higher; A or B?

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Goldenboy219 said:

How long would this take? When asset deflation begins to take foot, it can create enormous inertia that wipes out a great deal of wealth for a generation. For example. Lets say the U.S. economy was to contract by 20% in one year. How many years would it take for the U.S. to reach its previous output number at an average growth rate of 5% per year (which is more than generous)? Better yet, how much would the US economy have to grow to reach its previous level of output?

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Conservative said:

How does cutting spending make the deficit worse? this ought to be good

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Goldenboy219 said:

Conservative said:

That is your opinion, and sorry but believe I have answered your questions probably to the same level you answered mine.

You failed to answer:





Lets start with these two question.

As to your post: I have already proven it mathematically

Holding I, C, and NX constant. GDP= C+I+G+NX, when you cut spending with NX being negative, GDP is redefined as GDP-spending cut = C+I+G(1-spending cut)+NX. If you were to actually answer the questions i ask, i would not have repeat basic concepts to which you continue to question.

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If the govt. doesn't borrow that money and spend it we wouldn't have as much debt and debt service. You seem to believe the govt. is the answer, I disagree as govt. has taken on roles it has no business in doing.

Sorry, but I don't really care about your formulas but I do care about reality. Consumption is 2/3rds of GDP, Net Exports has been negative as we have continued to run a trade deficit and that reduces GDP now. Govt spending is about 20% of GDP and we can do with less of that which will be offset by consumer spending and more attractive job markets.

We don't live in a socialist economy that you are trying to create here. Business can do quite well especially the private sector small businesses without massive govt. spending and that is where the jobs are created. The only viable alternative now is to cut spending and increase economic activity through incentives to the private sector. Cutting corporate tax rates will do that and make us more competitive with foreign countries and would also stablize the value of the dollar making our products more attractive overseas

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pbrauer said:

How do you "create" jobs when people don't have money in their pockets and their jobs have been sent overseas?

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Goldenboy219 said:

Because cutting spending leads to cutting jobs. There is a negative multiplier effect associated with such cuts when there is a large output gap.

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Goldenboy219 said:

You failed to answer:





Lets start with these two questions.

As to your post: I have already proven it mathematically

Holding I, C, and NX constant. GDP= C+I+G+NX, when you cut spending with NX being negative, GDP is redefined as GDP-spending cut = C+I+G(1-spending cut)+NX. If you were to actually answer the questions i ask, i would not have repeat basic concepts to which you continue to question.

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jambalaya said:

A big Amen Barbarian. The Republicans usually get drunk on tax cuts and the Democrats get drunk on spending. We had a situation where both got drunk on spending and tax cuts while only giving token resistance to each other to put on a show for their constituents. That equals disaster. And people don't talk about NAFTA and other free trade agreements enough. We need to admit those agreements have been nothing but poison for us.

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Conservative said:

If the govt. doesn't borrow that money and spend it we wouldn't have as much debt and debt service. You seem to believe the govt. is the answer, I disagree as govt. has taken on roles it has no business in doing.

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In its original conception, a liquidity trap refers to the phenomenon when further injections of money into the economy will not serve to further lower interest rates. This can be visualized through a demand curve. Demand for money becomes perfectly elastic (i.e. where the demand curve for money is horizontal). Under the narrow version of Keynesian theory in which this arises, it is specified that monetary policy affects the economy only through its effect on interest rates. Thus, if an economy enters a liquidity trap, further increases in the money stock will fail to further lower interest rates and, therefore, fail to stimulate.

In the wake of the Keynesian revolution in the 1930s and 1940s, various neoclassical economists sought to minimize the concept of a liquidity trap by specifying conditions in which expansive monetary policy would affect the economy even if interest rates failed to decline. Don Patinkin and Lloyd Metzler specified the existence of a "Pigou effect," named after English economist Arthur Cecil Pigou, in which the stock of real money balances is an element of the aggregate demand function for goods, so that the money stock would directly affect the "Investment Saving" curve in an IS/LM analysis, and monetary policy would thus be able to stimulate the economy even during the existence of a liquidity trap. While many economists had serious doubts about the existence or significance of this Pigou Effect, by the 1960s academic economists gave little credence to the concept of a liquidity trap.

The neoclassical economists asserted that, even in a liquidity trap, expansive monetary policy could still stimulate the economy via the direct effects of increased money stocks on aggregate demand. This was essentially the hope of the Bank of Japan in the 1990s, when it embarked upon quantitative easing. Similarly it was the hope of the central banks of the United States and Europe in 2008–2009, with their foray into quantitative easing. These policy initiatives tried to stimulate the economy through methods other than the reduction of short-term interest rates.

When the Japanese economy fell into a period of prolonged stagnation despite near-zero interest rates, the concept of a liquidity trap returned to prominence.[1] However, while Keynes's formulation of a liquidity trap refers to the existence of a horizontal demand curve for money at some positive level of interest rates, the liquidity trap invoked in the 1990s referred merely to the presence of zero interest rates (ZIRP), the assertion being that since interest rates could not fall below zero, monetary policy would prove impotent in those conditions, just as it was asserted to be in a proper exposition of a liquidity trap.

While this later conception differed from that asserted by Keynes, both views have in common first the assertion that monetary policy affects the economy only via interest rates, and second the conclusion that monetary policy cannot stimulate an economy in a liquidity trap. Declines in monetary velocity offset injections of short term liquidity.

Much the same furor has emerged in the United States and Europe in 2008–2010, as short-term policy rates for the various central banks have moved close to zero.[2]

In October 2010, Nobel laureate Joseph Stiglitz explained how the U.S. Federal Reserve was implementing another monetary policy—creating currency—to combat the liquidity trap.[3] Stiglitz noted that the Federal Reserve intended, by creating $600 billion and inserting this directly into banks, to spur banks to finance more domestic loans and refinance mortgages. However, Stiglitz pointed out that banks were instead spending the money in more profitable areas by investing internationally in commodities and the emerging markets. Banks were also investing in foreign currencies which, Stiglitz and others point out, may lead to currency wars while China redirects its currency holdings away from the United States.[4]

Economist Scott Sumner has criticized the idea that Japan unsuccessfully attempted expansionary monetary policy during the Lost Decade. Indeed, he claims Japan's monetary policy was far too tight.

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Sorry, but I don't really care about your formulas but I do care about reality.

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Consumption is 2/3rds of GDP

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Net Exports has been negative as we have continued to run a trade deficit and that reduces GDP now.

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Govt spending is about 20% of GDP and we can do with less of that which will be offset by consumer spending and more attractive job markets.

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We don't live in a socialist economy that you are trying to create here.

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Business can do quite well especially the private sector small businesses without massive govt. spending and that is where the jobs are created.

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The only viable alternative now is to cut spending

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and increase economic activity through incentives to the private sector.

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Cutting corporate tax rates will do that and make us more competitive with foreign countries and would also stablize the value of the dollar making our products more attractive overseas

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The Barbarian said:

I've tried to figure out a way to answer your mathematical formula, but I can't. I also am not sure it really has much relevance here. First how can you or anyone just nominally hold “I” (investment)
“C” (consumption) and “NX” constant ? What happens if like recently our exports rise ?

How could investments be held constant ? Or for that matter consumption?

I'm sorry maybe I'm just not understanding... because it just seems that altho what you are saying maybe true today, 30 days, 6months, or a year from now that could change.

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Goldenboy219 said:

Fiscal stimulus is the only answer when the economy is in a liquidity trap. What is a liquidity trap? I'll save you the time:

From wiki





The formula is based on reality: For example, see the NIPA tables from BEA.gov, which give a thorough breakdown of the C+I+G+NX = GDP



And the sky is blue on a bright summer day. What is your point?



More of your ignorance is displayed. A negative import/export ratio symbolizes we purchase more from abroad than we sell to them, which is a good thing if your trading partner has a low-skill labor comparative advantage. However, a current account must be balanced, and therefore the absolute value of NX is then injected from abroad in the form of foreign direct investment. For more information, research the current account.



What makes you believe that cutting spending will lead to more consumption? If you cut spending, you will cut jobs which will surely decrease consumption, and put more fear in the consumer.



Nonsense. You simply lack the experience and education in regards to the political economy that would allow you to even identify my position.



Massive government spending began in the 80's and continues to this day. It is simply irresponsible to believe gutting government at a time where unemployment is @ 9.1% will lead to growth. I might lead to growth 10 years from now, but an entire generation will likely suffer from such a policy.



Which would kill jobs instantly, and cause a negative blow to consumer confidence.



WTF? Interest rates are at or near all time lows, taxes are at their lowest levels since the 20's.



Wow.... I mean, this is cute. A stronger dollar makes are products more attractive overseas?

:lamo

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j-mac said:

Let's hear it libs, how the economy is getting better.....Ha! what a joke....:roll:

Then there is this little ditty.....



That 16% must largely be in these forums from what I see of the posting from liberals, and liberals that are ashamed to admit they are liberals in here...:lol:

j-mac

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