I need help on the economy...

[Frustratedlady]

I have a couple Repugs who are touting the great economy we have going, complete with information on how the corporations are doing so well in regards to employment, inventory and new orders.

Sure, the corporations may be doing well, but are they allowing their profits to trickle down? What happens when the credit card overload is finally revealed. What happens when the war debt hits us in the face...our national debt? What about the value of the dollar? What about the mortgage foreclosures? What about the vehicle industry? What happens when China and others call in their chits?

Can anyone give me more arguments? I've been so busy these past two weeks, I've lost track of what is happening in the economy. Can I get some info/ammo I can use from you intelligent folks on DU?

[DemocratSinceBirth]

1. Start

Start by telling them inflation, unemployment, and the deficit were lower under Clinton and the GNP was higher... Those are facts...

Also, the number of Americans living below the poverty line was lower...

[Warpy]

2. There are two things you need to talk about

First, disposable income. That's the amount of money left over after the essentials of food, shelter, clothing, transportation and medical care have been taken care of. Most people are finding they have very little disposable income after 7 years of falling wages and skyrocketing prices. Ask them how well they're doing every week since gas prices have doubled.

The second thing to talk about is net worth. That covers what you actually own with what you owe subtracted from it. Since most folks have their net worth in their houses and those houses are beginning to deflate in value, how many people are still in positive numbers? Remember, those toys you don't own in that house you don't own with that SUV you don't own in the driveway don't represent your net worth. Anything left over after you subtract all your debts is your net worth. In this economy, a lot of people who think they're middle class because they can still leverage debt are actually destitute.

As for those corporate profits, much of that is being skimmed off at the top and not being passed on to stockholders. None is being shared with employees. Minor increase in stock price is supposed to satisfy stockholders that their wealth is growing, but the market has actually declined in value since Stupid took office when you index it to even the laughable inflation numbers the government puts out. Factor in the 40+% drop in the dollar and you have a crash in the market and the net worth of everyone invested in it.

We are about to see the end game of an economy that concentrates wealth at the top and substitutes debt for wages at the bottom. I hope your GOP friends are prepared for it because it will not be pretty.

[Froward69]

3. of the jobs lost (4mill?)

only half of them have been replaced. of those two thirds are minimum wage. not a living wage. the only halfway decent jobs around here are drilling in national forrests. (Colo)

[Fredda Weinberg]

4. I'm afraid the world is their oyster

What happens to the domestic population doesn't matter when you can relocate painlessly. Just remind them that it doesn't matter whether Marie Antoinette really said, "Let them eat cake." The consequences were the same.

[DemocratSinceBirth]

5. They Can Be Defeated On The Record

Bill Clinton presided over the best economy in a generation by any metric-

-the stock market

-the deficit

-inflation

-unemployment

-% below the poverty line

[Maribelle]

6. Under Bush incomes are stagnant while health-care and education costs skyrocket out of control.

Under Bush, we sadly watch an ugly shift in the economy as a whole - - money is being drained from the poor and middle class into the deep pockets of the very rich. For instance:

during the Clinton Administration roughly 23 million jobs were created, averaging about 240,000 jobs per month

during the Bush years roughly 5.6 million jobs have been created averaging about 71,000 per month
- - and far too many of the jobs Bush created are low wage and dead end jobs

Back in March The Left Coaster had a small article regarding how Bush's economy is built on unstable ground. And things are going downhill now.

Bush's Economy Built On Unstable Ground

http://www.theleftcoaster.com/archives/001269.php


And today we watch the deepest housing slump in 16 years and higher credit costs play out against a backdrop of a steep rise in oil prices, economists including former Federal Reserve Chairman Alan Greenspan and ex-Treasury Secretary Lawrence Summers are raising recession warnings.

Republicans Shudder as Economic Slowdown Adds to 2008 Concerns

http://www.bloomberg.com/apps/news?pid=20601103&sid=alwfSb5sF5t4&refer=us

[fasttense]

7. Here is some more current information:

Unemployment numbers:

Delving further into the employment data shows that the birth-death model adjustment was responsible for the turnaround in August employment. The birth-death model (BDM) added 120,000 fictitious jobs in August, and backing out the BDM adjustment would have led to a decline of 31,000 jobs for the month. The BDM adjustment for September payrolls was much smaller, coming in at 17,000 jobs.

-chart-

The large gyrations seen in the government’s employment data are due to the relative roll of the BDM. Over the last twelve months, the BDM has accounted for 69% of the job creation in this country. It is a scary thought when 69% of the jobs created in the most widely-used employment data set are statistically made and suspect to large revisions.

-cut-

At either rate, instead of looking at the day-to-day or month-to-month data, those in the financial markets should be looking at the trend to tell them where things are going. The smoothing out of the data by looking at the YOY rate tells you where things are trending and helps remove the day-to-day noise. Virtually every employment indicator is pointing in the same direction, down. Not only are employment trends decelerating but they are also showing no signs of turning around either.

http://www.financialsense.com/Market/wrapup.htm

>>>

On financial funds:

Largest Mortgage Fund Freezes all redemptions

http://www.nypost.com/seven/10062007/business/freeze_is...

>>>

NEW YORK (Reuters) - JPMorgan Chase (JPM.N) and Bank of America (BAC.N) are expected to disclose losses of about $3 billion in mortgage securities and leveraged loans when they report earnings this month, the Financial Times reported, citing an analyst.

JPMorgan is likely to report mark-to-market losses on leveraged loans of about $1.4 billion and an additional $700 million in write-downs of mortgages and mortgage-backed securities, according to Howard Mason, analyst with Sanford Bernstein, the paper reported.

Mason estimated Bank of America will take write-downs of $700 million for leveraged loans and mortgage write-downs of $300 million, the paper said.

Other banks have already taken losses on the value of their holdings in mortgage-backed securities and leveraged loans.

Citigroup (C.N), the biggest U.S. bank, took a pretax write-down of $1.4 billion as of the end of the third quarter.

Bear Stearns (BSC.N) said last month it was writing down its $7.6 billion portfolio by about $250 million, or 3.2 percent. Morgan Stanley (MS.N) wrote down its $31 billion portfolio by $726 million, or 2.3 percent.

The losses by the banks were the result of credit turmoil in recent months that drove down the values of mortgage and loan-related securities.

http://news.yahoo.com/s/nm/20071008/bs_nm/banks_writedowns_dc

>>>

The cost of the subprime crisis continues to mount on Wall Street.

To date, the total stands at nearly $20 billion.

On Friday, Merrill Lynch (Charts, Fortune 500) said it would take a write-down totaling $5.5 billion in large part because of its exposure to subprime mortgages.

Merrill was only the latest bank in recent weeks to reveal how badly its bottom line has suffered from the mortgage meltdown that began over the summer.

http://money.cnn.com/2007/10/05/news/companies/wall_str...

>>>

On affects of the housing bubble bursting:

But U.S. consumer spending on furniture and bedding, the broadest measure of industry activity, is expected to grow by just 1.5 percent this year and 2.2 percent in 2008, according to a consensus industry forecast complied by trade journal Furniture Today. That would make 2007 the industry's worst since 2001, when sales declined by 0.6 percent.

http://news.yahoo.com/s/ap/20071007/ap_on_bi_ge/mortgag...

>>>

U.S. Foreclosure Rate Surges 47 Percent

• Home Prices Plunge In First Seven Months Of 2007
• Economists Warn Debt Crisis Could Hammer Consumers
• Congress May Help Homeowners In Trouble
• Fed Cuts Interest Rate, Oil Prices Soar
• August Foreclosures Up 115% Over Last Year
• FTC Warns Many Mortgage Ads Are Deceptive
• Pending Home Sales Index Tumbles
• Foreclosures Continue at Record Levels
• Dodd Offers Legislation To Stop Predatory Lending
• Connecticut Sues Brokers, Realtors in Alleged Subprime Scam
• Feds Urge Lenders To Help Stave Off Foreclosures
• Bush, Bernanke Pledge To Stabilize Mortgage Meltdown
• Home Prices Drop Sharply; Unsold Homes Increase
• Credit Card Defaults On The Rise
• Credit Crunch 'Bigger Threat Than Terrorism'
---
• More ...

What a difference a year makes. Foreclosure notices rose 47 percent from March 2006 to last month, according to RealtyTrac, a real estate research firm. The company said banks initiated 149,000 foreclosure actions in March 2007, the most since the company began collecting data.

http://www.consumeraffairs.com/news04/2007/04/foreclosures_us.html

And I wont even mention the huge rise in recall of contaminated food, toxic chemical covered kids' toys, and pet food due to the notion of deregulation.

Then of course there is the US personal negative saving rates which haven't been seen since the Great Depression.

I could go on and on but I'm tired.

[pnutbutr]

8. be kind to me on this one

The trickle down theory can actually help stimulate the economy in the short term. It doesn't actually trickle down unless the businesses allow it to. Unfortunately, they have not allowed it to. It still can help the economy during a short term crisis. The main problem is that it is not sustainable. It relies on people, mainly the middle class spending money which is why taxes are cut and credits are given. People cannot keep spending forever especially today with the ever rising costs of necessities like fuel, food, healthcare, etc... This goes hand in hand with the fed increasing the money supply in an effort to get more money out there for people to spend. Problem again is that the money doesn't seem to be making it's way into the hands of the people who need to be spending it.

[PatSeg]

9. A while back I heard Bush boast about how many new jobs

his administration had created and I yelled back at the TV, "Yeah, and my daughter is working THREE of them!"

I look around me and see people working more hours for less money and fewer or no benefits. Productivity and profits are up for many companies, but it is not reflected in employees wages or benefits. I see young people entering the work force with huge student loan debt and few prospects, They often take jobs they could have gotten without a college degree. Jobs that are usually hourly and don't include benefits.

It doesn't matter whether you are republican or democrat, decreased wages, increased costs, loss of health care, and job loss affects all the same. The main difference is the republicans will say "What the hell happened?" and the democrats will say "I tried to warn you."

[Frustratedlady]

10. Wow! You folks are incredible! Thank you for all this information.

I had a lot of it in the back of my head, but no figures to back it up. I had reached the "banging my head against the wall" point and walked away from watching the economy for a while. Clean the cobwebs out, so to speak. You all have reminded me of some points I had forgotten.

I did have problems with three links, but I have printed out most of the information and will try to compile my rebuttal. :think:

You are the greatest! Thank you, thank you!!