Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Tag Archives: wage

Conference Board Predicts Robust Economy for Rest of Year

This article appeared online at TheNewAmerican.com on Friday, April 20, 2018:

The report from the independent Conference Board released on Thursday confirmed what most already know: The U.S. economy is on a tear, and there appears to be nothing on the horizon to slow it down, at least for the next six to nine months. Said its Director Ataman Ozyildirim:

The U.S. LEI [Leading Economic Index] increased in March, and while the monthly gain [was] slower than in previous months, its six-month growth rate increased further and points to solid growth in the U.S. economy for the rest of the year.

 

The strengths among the components of the leading index have been very [robust] over the last six months.

The LEI, which bottomed out during the Great Recession in the middle of 2009, has rocketed from 73 to

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The Economy is Booming. Why Should Anyone be Surprised?

This article was published by The McAlvany Intelligence Advisor on Friday, April 13, 2018:

For a small fee, anyone can download the Harvard Business School’s case study on Apple, Inc. In a nutshell, Apple began in April, 1976 with three employees, no customers, and no revenues. Today it has 123,000 employees, millions of customers, and revenues approaching a quarter of a trillion dollars.

This confounds Keynesians who believe, steadfastly and in the face of overwhelming evidence to the contrary, that it is consumers who drive the economy. On just about every business news show on evening television, one can hear something like “consumers, which are responsible for 70 percent of the economy,…” etc., etc. How do they explain the growth of Apple?

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New Weekly Unemployment Claims Remain Below 300,000, Longest Streak Since 1967

This article appeared online at TheNewAmerican.com on Thursday, April 12, 2018:

Unemployment claims fell last week to just 233,000, far below the historical average, cementing into place the longest streak below 300,000 jobless claims since 1967. A proxy for layoffs, those claims reflect not only an increasing reluctance on the part of employers to let their workers go, but an increasing need for them to bring more workers on in the face of an economic tsunami that’s just now starting to roll into the American economy.

This is just one of many indicators reflecting a growing economy, including an unemployment rate at 4.1 percent, the lowest level since 2000 (and expected to move much lower in the coming months) and employers adding to their payrolls for 90 straight months — the longest economic expansion in history.

Keynesian economists consider that consumers drive the economy, using their pay raises to drive spending on consumer goods and services. Common sense economics — aka Austrian School economics — claims that is putting the cart before the horse: It is capital investment that drives the economy, providing goods and services that consumers discover that they need and want and are willing to pay for.

The classic example is Apple’s iPhone, which

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Is America’s Welfare State Stifling the Economy?

This article was published by the McAlvany Intelligence Advisor on Monday, February 5, 2018:

There were two numbers buried in Friday’s jobs report from the BLS that portend difficulty for the economy: The number unemployed remains at 6.7 million, and the labor participation rate remains stuck at 62.7 percent. In September 2015 that latter number was 62.4. In 2000 it was 67.3 percent.

How is that possible? With the unfettering of the economy through deregulation and now the recapture and reinvestment of tax dollars that were previously being directed to Washington, just about every economic indicator is green. Why aren’t these millions reentering the workforce?

There’s good news and bad news. Some of those people are leaving the workforce and retiring. Their savings, pension, profit-sharing and 401(k) plans are reflecting the performance of the stock market and consequently are allowing them to recalibrate their retirement plans: they’re retiring sooner than later.

Some of the younger cohort – age 25-54 – are going back to school to learn the skills they need for the new economy.

But others are content just to stay right where they are:

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The Coming Avalanche of Repatriated Dollars

This article appeared online at TheNewAmerican.com on Friday, January 19, 2018: 

English: Historical GDP per capita for the Uni...

This is an old chart of US GDP. Get ready for the next leg up

On Thursday The New American speculated about the impact of Apple’s repatriation of its overseas profit hoard of some $250 billion and where Apple intends to invest some of it. It raised questions about the $2.5 trillion in profits that is still held overseas by American companies unwilling to subject those profits to the United States’ outrageously high income tax rates.

With Apple’s decision, and the repatriation tax rate of just 15.5 percent in the new tax law, some of those questions can be addressed.

First,

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Apple’s Repatriation of Its Profits: Talk About Stimulating the Economy!

This article was published by The McAlvany Intelligence Advisor on Friday, January 19, 2018: 

After paying the world’s largest tax bill – $38 billion – Apple, Inc., the world’s largest company by market capitalization and now the government’s largest taxpayer, will have $214 billion left over.

It is making plans for that $214 billion. In its announcement on Wednesday, the company said it would be making “a new set of investments to build on its commitment to support the American economy and its workforce, concentrated in three areas where Apple has had the greatest impact on job creation: direct employment by Apple, spending and investment with Apple’s domestic suppliers and manufacturers, and fueling the fast-growing app economy that Apple created with iPhone® and the App Store®.”

It added:

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Walmart Voluntarily Raises Its Minimum Wage

This article appeared online at TheNewAmerican.com on Friday, January 12, 2018: 

The world’s largest retailer, Walmart, announced on Thursday that it was voluntarily raising its minimum wage for new workers to $11 an hour starting next month. Included in the announcement were staged bonuses that will be paid to present workers based on their time with the company. Also included was a vast improvement in maternity benefits, with full-time hourly workers receiving 10 weeks of paid maternity leave and six weeks of paternal leave. Parents who adopt will get the same benefits plus a check from Walmart for $5,000 to help cover their adoption costs.

This is on top of the wage increases announced by the retailer in 2015 to be staged in over the next three years.

What’s notable is that this is taking place ahead of

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Credit Card Debt Hits $1 Trillion; Wall Street and Michael Snyder Yawn

This article was published by The McAlvany Intelligence Advisor on Wednesday, January 10, 2018: 

Michael Snyder rivals only David Stockman in his pessimistic economic outlook, reflecting that outlook by naming his blog “The Economic Collapse.” On the first day of the New Year, Michael dug into his files for the most “crazy” numbers from 2017. He found 44, including these:

One out of every ten young adults in the United States has been homeless at some point over the past year;

 

The United States has lost more than 70,000 manufacturing facilities since China joined the WTO in 2001;

 

A total of 6,985 store locations were shut down last year, and we are expected to break the record again in 2018:

 

Only 25 percent of all Americans have more than $10,000 in savings right now; and

 

44 percent of all U.S. adults do not even have enough money “to cover an unexpected $400 expense,” according to the Federal Reserve.

What’s missing from Michael’s list? Credit card debt, student loan debt, and vehicle financing debt. Surely he was aware of these numbers, but for some reason didn’t include them in his list. For the first time in history, credit card debt last year hit $1 trillion, eclipsing the record set back in 2008 following the real estate collapse and the beginning of the Great Recession. Snyder didn’t mention the nearly $3 trillion in “non-revolving” debt (i.e., auto and student loans) either. Seeking Alpha called these numbers “scary” but Snyder ignored them.

A closer look behind the numbers reveals that these may not be such “scary” numbers after all. Perhaps that’s why Snyder ignored them, simply because, by his definition, they didn’t qualify as “crazy.” For one thing, fewer than 40 percent of all households carry any sort of credit card debt. Among millennials ages 18 to 29 only a third even have a credit card.

Next, the ratio of income to credit card debt at the end of 2017 (before the new tax cuts) was already declining with the ratio of credit card debt compared to the nation’s gross domestic economic output at about 5 percent, compared with 6.5 percent in 2008.

Also, credit card delinquencies remain way below the 9 percent historical average, at just 7.5 percent, and far below the rate of 15 percent touched following the 2008 financial crisis.

There’s another way to look at credit card debt: compare outstanding balances to incomes.ValuePenguin performed such a service, showing that households with annual incomes of between $25,000 and $100,000 have less than $7,000 in outstanding balances on their credit cards. Further, that analysis showed that the average has increased only slightly since 2013.

With almost two million more people working today than held jobs a year ago, and others enjoying wage and salary increases, that $1 trillion in credit card debt becomes far less “scary.” In a $20 trillion economy that is growing at three percent a year, $1 trillion in credit card debt may reflect that growth as banks are willing to issue more cards to more credit-worthy individuals and those individuals, having perhaps learned lessons from the Great Recession, are using them more prudently. That “trillion” dollar number may instead reflect a growing and increasingly healthy economy employing more people making more money who are using credit opportunities more wisely.

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Sources:

USATodayCredit card debt hits new record, raising warning sign

SeekingAlpha.comCredit card debt on watch

Michael Snyder: 44 Numbers From 2017 That Are Almost Too Crazy To Believe

ValuePenguin.com:  Average Credit Card Debt in America: 2017 Facts & Figures

Economist Mark Zandi Exposes His Statist Worldview

This article was published by The McAlvany Intelligence Advisor on Monday, January 8, 2018:

Mark Zandi should be embarrassed. Not because he is an establishment economist. Not because he is a Keynesian. And not because he’s not a smart guy. He should be embarrassed that someone allowed him to publish nonsense about the state of the economy in order to promote his worldview.

He lives in a world that is behaving much differently than he expected or than he apparently wants. He wants the Trump tax reform law to fail. He must admit that the economy is working much better than he ever expected it to. But, in the end, he says that it’s all a mirage, temporary, that the resurgence measured by nearly every metric isn’t going to last.

He is establishment to the core, and perhaps that’s why he’s willing to go to the mat for a worldview that is being overturned and increasingly discredited: that statists can control things much better than an uncontrolled “free” economy can.

He admitted in an article for CNBC that things are going just swimmingly:

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Trump Economy Making Democrats Look Increasingly Foolish

This article was published by The McAlvany Intelligence Advisor on Friday, January 5, 2018:

The kept media dutifully reported California Democrat Nancy Pelosi’s disgust over President Trump’s tax reform program, even though it made her look foolish. Said Pelosi, “If this goes through, kiss life on earth goodbye. The debate on health care is life/death. This is Armageddon.” This was followed by the media quoting Democrat Chuck Schumer: “Tax breaks don’t lead to job creation … [this bill is a] punch in the gut for the middle class.”

It may be a little early to tell, but at the moment the middle class is doing just fine. Life goes on; if Armageddon occurred, the media missed it. That “punch in the gut for the middle class” is about to be caused by heavier wallets, thanks to tax cuts showing up in their February paychecks.

For hundreds of thousands, that punch in the gut was immediate:

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Minimum Wage Increases in 2018 Putting People Out of Work

This article was published by The McAlvany Intelligence Advisor on Wednesday, January 3, 2018: 

According to Mic, the left-wing internet and media company that caters to millennials, Seattle “is quickly becoming one of the most interesting cities in the country for political observers.” The city boasts having an avowed socialist on its city council and proved his influence through its $4.8 billion budget in 2014 that is “loaded with a number of initiatives that illustrate how Seattle is making strides toward becoming a testing ground for boldly progressive policies.”

That salute to Seattle’s progressivism was published in 2014, and little has changed in the city council’s ideology. It now boasts a minimum wage of $15.45 an hour, with predictable effects: total wages paid to lower-income people has gone down, not up. A study just released by the National Bureau of Economic Research (NBER) explained:

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August Jobs Report Shows Economy Humming Along Nicely

This article appeared online at TheNewAmerican.com on Saturday, September 2, 2017:

English: Bureau of Labor Statistics logo RGB c...

Bureau of Labor Statistics

Laura Rosner, senior economist at Macro Policy Perspectives (known for its ability to “understand how to read the tea leaves of economic and financial developments”), summed up August’s jobs report from the Bureau of Labor Statistics (BLS) on Friday: “The economy is doing well, but it’s not necessarily taking off. We’re on an even keel. The labor market continues to hum along.”

The growth in jobs was in all the right places, too,

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Trump Doesn’t Rule Out Use of Military Force in Venezuela

This article appeared online at TheNewAmerican.com on Monday, August 14, 2017:

Following the issuance of the “Lima Declaration” on Friday stating that “Venezuela is no longer a democracy,” signed by nearly a dozen South American countries as well as Canada, President Trump had the opportunity to back off on previous threats of possibly using military force to oust its Marxist dictator Nicolás Maduro. Instead he ramped them up, declaring: “We have many options.… This is our neighbor. We are all over the world and we have troops all over the world in places that are very, very far away. Venezuela is not very far away and the people … are suffering. They’re dying. We have many options for Venezuela including a possible military option, if necessary…. I’m not going to rule out a military option. Venezuela is a mess.”

But as Henri Falcon, the opposition governor of the Venezuelan state of Lara, responded, “This mess is ours! Sort out your own, of which you have plenty.”

Mish Shedlock, a Trump supporter, asked the president a number of questions about why he is threatening Venezuela:

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Democrats’ New Slogan Channels Papa John’s Pizza

This article appeared online at TheNewAmerican.com on Tuesday, July 24, 2017:

English: Charles Schumer, United States Senato...

Charles Schumer

The Democrat Party’s new slogan, rolled out on Monday by Senate Minority Leader Chuck Schumer (shown, D-N.Y.) in the New York Times, sounds an awful lot like the slogan of Papa John’s Pizza (“Better Ingredients, Better Pizza, Papa John’s.”) The new official slogan of the party, according to Schumer, is “A Better Deal: Better Jobs, Better Wages, Better Future.”

A closer look reveals old, tired, stale, and tasteless ideas of a party that not only has lost its way, but has lost a majority of Americans along the way. A recent Washington Post/ABC News poll revealed that

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Robots and Kiosks (and Amazon) are Making Jobs Reports Irrelevant

This article was published by The McAlvany Intelligence Advisor on Friday, July 7, 2017:

MarketWatch

MarketWatch

Malcolm Frank is one of those rarest of futurists: He sees what’s coming and writes clearly about what to do about it. In his What to do When Machines do Everything: How to get Ahead in a World of AI, Algorithms, Bots and Big Data, Frank discusses the massive upheavals businesses are going through as they try to keep up and stay profitable.

One issue he doesn’t discuss is how to measure the new economy’s output.

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Blockbuster Study: Seattle’s Minimum-wage Increases Cost Low-wage Workers $125 a Month

This article appeared online at TheNewAmerican.com on Monday, June 26, 2017:  

A study commissioned by Seattle’s city council just came back with results they didn’t want to hear: Their efforts to raise wages of the city’s lowest-paid workers are instead costing them about $125 a month. This is thanks to their employers cutting their hours in response to the law raising the minimum wage from $10.50 an hour to $13 an hour in 2016.

Mark Long, one of the authors of the University of Washington (UW) study, said:

If you’re a low-skilled worker with one of these jobs, $125 a month is a sizeable amount of money. It can be the difference between being able to pay your rent and not being able to pay your rent.

In addition, the UW study concluded that, thanks to the minimum-wage increase, some 5,000 low wage jobs in Seattle were never created.

All of which makes perfect economic sense:

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Labor Department’s April Jobs Report Strong and Getting Stronger

This article appeared online at TheNewAmerican.com on Friday, May 5, 2017:  

The headline numbers from the Labor Department’s latest employment report for April were encouraging: 211,000 jobs were added last month (compared to economists’ expectations of less than 190,000), pushing the unemployment rate to 4.4 percent, the lowest seen in 10 years, while average wages grew, year-over-year, by 2.5 percent.

That’s exactly what one would expect from a healthy economy.

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Jobs Numbers Come in Higher Once Again, Supporting Trump’s Policies

This article appeared online at TheNewAmerican.com on Thursday, April 6, 2017:

Reporters used adjectives such as “torrid,” “solid,” “unexpected,” and “strong” to characterize March jobs growth of 263,000, as reported by ADP/Moody’s on Wednesday, which far exceeded professional economists’ estimates of 170,000 new jobs for the month.

Last month Mark Zandi was uncharacteristically buoyant when commenting on February’s jobs numbers: “February was a very good month for workers. Powering job growth were the construction, mining and manufacturing industries.… Near record high job openings and record low layoffs underpin the entire market.”

Today Zandi extended his comments as the jobs market continues its recovery: “Job growth is off to a strong start in 2017. The gains are broad-based but most notable in the goods-producing side of the economy, including construction, manufacturing and mining.”

During the past eight years economists such as Zandi had much less to be excited about as jobs growth under the previous administration was

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Baltimore Mayor Vetoes Minimum-wage Bill After Doing “Research”

This article appeared online at TheNewAmerican.com on Monday, April 3, 2017:

During her election campaign for mayor of Baltimore last fall, Democrat Catherine Pugh (shown below), along with dozens of other Democratic politicians, supported the “Fight for 15” to raise the minimum wage to $15 an hour. Last week, she had the opportunity to fulfill that promise when the Baltimore city council passed a bill doing just that. But, after doing “some research,” Pugh changed her mind and her position, saying instead that “I am vetoing this bill.”

One wonders just what her “research” uncovered that was persuasive enough to cause her to change her mind, go against the grain, veto the bill, and incur the wrath of the progressives on the city council. Perhaps she had a conversation with

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Restaurants Add “Labor Surcharge” to Tabs to Cover Minimum-wage Increases

This article appeared online at TheNewAmerican.com on Monday, March 13, 2017:

English: This is actually Tom's Restaurant, NY...

Instead of increasing their menu prices in response to increased minimum-wage levels, restaurant owners are burying their increased labor costs at the bottom of each tab. The increase, between three and four percent, only comes after the customer has completed his meal. The increase also increases the tip customers leave behind as most customers leave a gratuity based on the check’s total. This is going to raise the average customer’s check, which has already increased by nearly 11 percent since 2012, close to five or six percent.

Some restaurant and fast-food owners aren’t burying the increase but are instead calling attention to it so that customers know that they’re the ones actually bearing the brunt of the forced increase in the minimum wage. Sami Ladeki, the owner of six Sammy’s Woodfired Pizza & Grill restaurants in San Diego and eight others across California, used to call it a “California mandate” but removed it after getting a call from the city attorney. Ladeki, who says he makes a profit of around one percent charging $12 to $14 a pizza, told the Wall Street Journal:

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Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.
Copyright © 2018 Bob Adelmann