Category Archives: Economy

Can an economic stat help narrow our grand economic divide?

Egalitarian-minded economists are pushing for a ‘GDP 2.0’—and getting some lawmaker help.

Why do so many Americans deeply distrust government? One part of the reason, two top economists suggested to a key congressional committee this week, just might be the most basic—and familiar—of the economic statistics the federal government produces. Continue reading

Workers stuck ‘paying the ultimate price’ as GE freezes pensions for 20,000 employees

‘GE hired a new CEO last year with a pay package worth up to $300 million.’

Workers are stuck “paying the ultimate price for executives’ poorly-timed deals,” said Our Revolution on Monday after General Electric announced it was freezing the pensions of roughly 20,000 employees with salaried benefits. Continue reading

‘Stunning rebuke to predatory Wall Street megabanks’ as California Gov. signs law allowing creation of public banks

‘The people of California just went up against the most powerful corporate lobby in the country—and won.’

California Gov. Gavin Newsom on Wednesday signed into law historic legislation that would allow the state’s cities and counties to establish public banks as an alternative to private financial institutions, a move advocates hailed as a “stunning rebuke to the predatory Wall Street megabanks that crashed the global economy in 2007-08.” Continue reading

The disaster of negative interest rates

President Trump wants negative interest rates, but they would be disastrous for the U.S. economy, and his objectives can be better achieved by other means. Continue reading

Trump’s economy revealed

Donald Trump and his enablers are hoping that a strong economy will help the American people look past the damage they are doing to the country. That’s why Trump is constantly crowing about job numbers and the stock market in order to paint a rosy picture of the economy. Continue reading

Big business won’t save us from itself

Nearly 200 CEOs have signed a pledge to ‘do better’ than serving their own greed. How? They won’t say.

Ralph Waldo Emerson once wrote of being leery of a fast-talking huckster who visited his home: “The louder he talked of his honor, the faster we counted our spoons,” Emerson exclaimed. Continue reading

Desperate central bankers grab for more power

Conceding that their grip on the economy is slipping, central bankers are proposing a radical economic reset that would shift yet more power from government to themselves. Continue reading

‘Hell no,’ say progressives, after GOP Sen. Joni Ernst suggests cutting Social Security ‘behind closed doors’

‘No matter how hard you try to hide, the American people will be watching—and we won't let you cut our earned Social Security benefits.'

Republican Sen. Joni Ernst of Iowa is under fire after telling a recent town hall audience that members of Congress should negotiate changes to Social Security “behind closed doors” in order to dodge scrutiny from the media and advocacy groups. Continue reading

The key to a sustainable economy is 5,000 years old

We are again reaching the point in the business cycle known as “peak debt,” when debts have compounded to the point that their cumulative total cannot be paid. Student debt, credit card debt, auto loans, business debt and sovereign debt are all higher than they have ever been. As economist Michael Hudson writes in his provocative 2018 book, “…and forgive them their debts,” debts that can’t be paid won’t be paid. The question, he says, is how they won’t be paid. Continue reading

Red states cut worker pay by $1.5 billion

If you’re a minimum wage worker in a conservative state, your state lawmakers may have cut your paycheck by over $4,000.

Last month, the House voted to incrementally raise the minimum wage to $15 an hour. Continue reading

What globalism did was to transfer the US economy to China

The main problem with the US economy is that globalism has been deconstructing it. The offshoring of US jobs has reduced US manufacturing and industrial capability and associated innovation, research, development, supply chains, consumer purchasing power, and tax base of state and local governments. Corporations have increased short-term profits at the expense of these long-term costs. In effect, the US economy is being moved out of the First World into the Third World. Continue reading

A tire that should inspire fear in the heart of workers

This sad story is as old as NAFTA.

Mickey Ray Williams keeps a Goodyear tire in his Gadsden, Alabama, conference room. Made in Mexico and imported to Gadsden, that tire induces fear. Continue reading

Neoliberalism has met its match in China

When the Federal Reserve cut interest rates on July 31 for the first time in more than a decade, commentators were asking why. According to official data, the economy was rebounding, unemployment was below 4%, and GDP growth was above 3%. If anything, by the Fed’s own reasoning, it should have been raising rates. Continue reading

Is the Federal Reserve losing control of the gold price?

After years of being kept in the doldrums by orchestrated short selling described by Roberts and Kranzler, gold has lately moved up sharply reaching $1,510 last Wednesday morning. The gold price has continued to rise despite the continuing practice of dumping large volumes of naked contracts in the futures market. The gold price is driven down but quickly recovers and moves on up. I haven’t an explanation at this time for the new force that is more powerful than the short-selling that has been used to control the price of gold. Continue reading

More fake happy news about jobs

The Bureau of Labor Statistics reports that the US economy created 148,000 new private sector jobs during July. The jobs number does not translate into employed people as increasingly Americans hold two or more jobs. For example, the BLS reports that from June to July the number of multiple job holders rose by 233,000 which is 85,000 more than the 148,000 new private sector jobs. What we are seeing is not more people employed, but more multiple job holders. Since May the number of multiple job holders has increased by 534,000. Continue reading

Financial capitalism gone amok: Ultra-low interest rates and price bubbles

Don’t look now, but there is a new monetary craze going on in some parts of the world, and it is the new so-called ‘unconventional’ monetary policy adopted by some central banks to push interest rates to ultra-low levels, and even into negative territory. For some time now, some central banks and some governments have been pushing nominal interest rates down, so much so that a few countries have negative short-term interest rates and, when inflation is factored in, even more deeply negative real interest rates. Why suddenly such an unconventional monetary policy? Their rationale is a fear that the economy could otherwise be saddled with an overvalued currency and be faced with a too heavy debt burden, and this would hurt their economic growth. Continue reading

How to pay for it all: An option the candidates missed

The Democratic Party has clearly swung to the progressive left, with candidates in the first round of presidential debates coming up with one program after another to help the poor, the disadvantaged and the struggling middle class. Proposals ranged from a Universal Basic Income to Medicare for All to a Green New Deal to student debt forgiveness and free college tuition. The problem, as Stuart Varney observed on FOX Business, was that no one had a viable way to pay for it all without raising taxes or taking from other programs, a hard sell to voters. If robbing Peter to pay Paul is the only alternative, the proposals will go the way of Trump’s trillion dollar infrastructure bill for lack of funding. Continue reading

Libra: Facebook’s audacious bid for global monetary control

Payments can happen cheaply and easily without banks or credit card companies. This has now been demonstrated—not in the United States but in China. Unlike in the US, where numerous firms feast on fees from handling and processing payments, in China most money flows through mobile phones nearly for free. In 2018, these cashless payments totaled a whopping $41.5 trillion; and 90% were through Alipay and WeChat Pay, a pair of digital ecosystems that blend social media, commerce and banking. Continue reading

The diminishing American economy

Since June 2009 Americans have lived in the false reality of a recovered economy. Various fake news and manipulated statistics have been used to create this false impression. However, indicators that really count have not supported the false picture and were ignored. Continue reading

The 7 biggest failures of Trumponomics

Donald Trump and Republicans in Congress keep crowing about the economy, when in reality Trumponomics has been a disaster. Continue reading

The gig is up

Uber just filed its first quarterly report as a publicly traded company. Although it lost $1bn, investors may still do well because the losses appear to be declining. Continue reading

The bankers’ ‘power revolution’: How the government got shackled by debt

The U.S. federal debt has more than doubled since the 2008 financial crisis, shooting up from $9.4 trillion in mid-2008 to over $22 trillion in April 2019. The debt is never paid off. The government just keeps paying the interest on it, and interest rates are rising. Continue reading

Trump’s trade war has probably permanently damaged America’s tech leadership position

On May 15, US president Donald Trump issued an “Executive Order on Securing the Information and Communications Technology and Services Supply Chain.” Continue reading

Trump’s ‘trade war’ is a war on you

“It’s not China that pays tariffs,” Fox News Sunday host Chris Wallace pointed out on May 12. “It’s the American importers, the American companies that pay what, in effect, is a tax increase and oftentimes passes it on to U.S. consumers.” Continue reading

The next state-owned bank—California or Washington?

As public banking gains momentum across the country, policymakers in California and Washington state are vying to form the nation’s second state-owned bank, following in the footsteps of the highly successful Bank of North Dakota, founded in 1919. The race is close, with state bank bills now passing their first round of hearings in both states’ senates. Continue reading

Why is the Fed paying so much interest to banks?

When Mary Poppins was made into a movie in 1964, Mr. Banks’ advice to his son was sound. Banks were then paying more than 5% interest on deposits, enough to double young Michael’s investment every 14 years. Continue reading

Media blackout as Israel’s largest banks pay over $1 billion in fines for US tax evasion schemes

Similar revelations about other banks and offshore tax-evasion schemes—such as those contained in the Panama Papers—led to global protests and even the resignations of some world leaders.

WASHINGTON—Israel’s three largest banks—Hapoalim Bank, Leumi Bank and Mizrahi Tefahot Bank—have all been ordered to pay record fines, which collectively are set to total over $1 billion, to the U.S. government after the banks were found to have actively colluded with thousands of wealthy Americans in massive tax-evasion schemes. Continue reading

Monetary policy takes center stage: MMT, QE or public banks?

As alarm bells sound over the advancing destruction of the environment, a variety of Green New Deal proposals have appeared in the US and Europe, along with some interesting academic debates about how to fund them. Monetary policy, normally relegated to obscure academic tomes and bureaucratic meetings behind closed doors, has suddenly taken center stage. Continue reading

Why unions matter to you

As I travel around the country, I tell people: if you have a job, join a union. And if you don’t have a union, start one. Continue reading

Is neoliberalism killing Russia?

Putin’s approval rating is high, but it has declined over the past year. The decline is mainly related to domestic policy. Apparently, the public perceives recent Kremlin economic policy as a continuation of the disastrous policies that Washington imposed on Russia in the 1990s when Russia was loaded up with foreign debt while state assets were privatized and plundered by oligarchs sponsored by the West who “cashed out” by selling the assets to foreigners. Continue reading

QE forever: The Fed’s dramatic about-face

“Quantitative easing” was supposed to be an emergency measure. The Federal Reserve “eased” shrinkage in the money supply due to the 2008-09 credit crisis by pumping out trillions of dollars in new bank reserves. After the crisis, the presumption was that the Fed would “normalize” conditions by sopping up the excess reserves through “quantitative tightening” (QT)—raising interest rates and selling the securities it had bought with new reserves back into the market. Continue reading

High healthcare expenses: The leading cause of US consumer bankruptcies

The US is the only developed nation without some form of universal coverage. The world’s richest nation doesn’t give a hoot about its ordinary people, serving its privileged class exclusively. Continue reading