Jeremy Grantham calls housing a “Classic Echo Bubble”

[The-Shoveler]

IMO it all comes down to lack on wage inflation (in the middle class),

That’s what it’s all about, they are desperate to create it any way possible.

$15.00 minimum wage, new overtime set to 47K etc…

It’s not really about minimum but it’s a way to get more into the middle.

Anyway IMO..

[The-Shoveler]

Wage inflation stagnates the whole economy stagnates.

[njtosd]

[quote=FlyerInHi]

Now is the 50th anniversary of China’s cultural revolution. I was reading that, at the time, people were starving and had nothing. The period since then has been the greatest creation of wealth in the history of capitalism.[/quote]

Maybe because the assets of 60-80 million people (wealthy in particular) thought to have died as a result of the revolution were redistributed to the remaining population.

[Rich Toscano]

[quote=The-Shoveler]Wage inflation stagnates the whole economy stagnates.[/quote]

Fortunately wage growth is improving, after having been stagnant for several years:

https://www.frbatlanta.org/chcs/wage-growth-tracker?panel=1

[FlyerInHi]

[quote=njtosd][quote=FlyerInHi]

Now is the 50th anniversary of China’s cultural revolution. I was reading that, at the time, people were starving and had nothing. The period since then has been the greatest creation of wealth in the history of capitalism.[/quote]

Maybe because the assets of 60-80 million people (wealthy in particular) thought to have died as a result of the revolution were redistributed to the remaining population.[/quote]

I streamed the program on my drive to Vegas. 60 to 80 million deaths is rather higher even is you include the Revoltion of 1949, and the following famines.

There was wealth destruction followed by amazing wealth creation in a few short decades.

http://www.npr.org/2016/05/05/476873854/newly-released-documents-detail-traumas-of-chinas-cultural-revolution
DAVIES: Do we know how many people died?

DIKOTTER: Overall? The entire cultural revolution? Probably if you take 1966 to 1976 – in other words a good decade – until the very moment that Chairman Mao dies, you can probably count about 1.5 to 2 million people who were hounded to their deaths.

But the point must be that in comparison to “Mao’s Great Famine” which took place earlier from ’58 to ’62, that appears to be a rather low figure. But the point is that it is not so much death which characterized the Cultural Revolution, it was trauma.

It was the way in which people were pitted against each other, were obliged to denounce family members, colleagues, friends. It was about loss, loss of trust, loss of friendship, loss of faith in other human beings, loss of predictability in social relationships. And that really is the mark that the Cultural Revolution left behind.

[FlyerInHi]

[quote=The-Shoveler]IMO it all comes down to lack on wage inflation (in the middle class),

That’s what it’s all about, they are desperate to create it any way possible.

$15.00 minimum wage, new overtime set to 47K etc…

It’s not really about minimum but it’s a way to get more into the middle.

Anyway IMO..[/quote]

They are desperate to create wage inflation. Who is they? The people who understand economics.

Yes. Getting money to the masses so they can spend and absorb excess capacity.

Higher rents and house prices can also force employees to successful demand higher wages.

[The-Shoveler]

MIB

Hahah

No really it is TPTB, yep “they” really exist.

[spdrun]

Stagnation is good. Growth is another word for cancer. CO2 output increases during economic growth and shrinks during recessions.

Best hope for Planet Earth would be a long-term recession plus something that massively affects population growth. Maybe Zika was engineered to do that.

I’d say the overtime limit isn’t about wage growth. It’s about reduction of hours to reasonable levels, which is also a good thing.

[njtosd]

[quote=FlyerInHi][quote=njtosd][quote=FlyerInHi]

Now is the 50th anniversary of China’s cultural revolution. I was reading that, at the time, people were starving and had nothing. The period since then has been the greatest creation of wealth in the history of capitalism.[/quote]

Maybe because the assets of 60-80 million people (wealthy in particular) thought to have died as a result of the revolution were redistributed to the remaining population.[/quote]

I streamed the program on my drive to Vegas. 60 to 80 million deaths is rather higher even is you include the Revoltion of 1949, and the following famines.

There was wealth destruction followed by amazing wealth creation in a few short decades.

http://www.npr.org/2016/05/05/476873854/newly-released-documents-detail-traumas-of-chinas-cultural-revolution
DAVIES: Do we know how many people died?

DIKOTTER: Overall? The entire cultural revolution? Probably if you take 1966 to 1976 – in other words a good decade – until the very moment that Chairman Mao dies, you can probably count about 1.5 to 2 million people who were hounded to their deaths.

But the point must be that in comparison to “Mao’s Great Famine” which took place earlier from ’58 to ’62, that appears to be a rather low figure. But the point is that it is not so much death which characterized the Cultural Revolution, it was trauma.

It was the way in which people were pitted against each other, were obliged to denounce family members, colleagues, friends. It was about loss, loss of trust, loss of friendship, loss of faith in other human beings, loss of predictability in social relationships. And that really is the mark that the Cultural Revolution left behind.[/quote]

Ok – tomato tomahto. According to Dikotter it was 45 million between 58 and 62.
I realize that was before – maybe I should just say Chairman Mao. After the black plague in Europe the remaining people did very well temporarily. I saw statistics saying that 82% of the land that was “vacated” was claimed by others (usually younger people who survived the plague better) within a year. Fewer people, more land and more resources per person. Not a great way to achieve that result.

[FlyerInHi]

[quote=njtosd] Fewer people, more land and more resources per person. Not a great way to achieve that result.[/quote]

Actually the wealth creation in China was after Mao’s death. They put educated, competent people in charge. Although a communist country in name, they created the greatest amount of wealth in the history of capitalism. Quite a feat given all the challenges.

I believe we are successful in America because our politicians generally listen to academics and educated experts.

Mao was an uneducated pitchfork peasant. And we don’t want people like that running things. Venezuela is a good example.

About the growth conundrum, after the 2008 crisis, our politicians and politicians around the world ignored the advice of economists and failed to enact growth indulding policies. The central banks, as independent institutions, were left to act on their own.

[XBoxBoy]

[quote=FlyerInHi]Mao was an uneducated pitchfork peasant.[/quote]

Sorry, but that’s just not true. Mao was the son of a wealthy farmer (read land owner) and much better educated than the vast majority of Chinese of his age.

[FlyerInHi]

Ok. Leaving aside Mao’s education and knowledge of economics, China’s intelligentsia was undoubtedly decimated under Mao. In the 80s, educated were allowed to serve again.

There are very good reasons central banks, as independent instructions, acted to prop up economies. Leave aside the period before, the Fed acted beautifully after 2008. The ECB, more beholden to politics, didn’t do such a good job.

I believe the problem of low rates, low growth, stagnant wages and high asset prices is because fiscal policy didn’t keep up with monetary policy.

[Rich Toscano]

[quote=FlyerInHi]Leave aside the period before, the Fed acted beautifully after 2008.[/quote]

You could have said the same thing in 2005 — and many did. Until the Fed has successfully normalized policy*, it’s too early to declare victory.

* – BTW – That’s the hard part.

[FlyerInHi]

[quote=spdrun]Stagnation is good. Growth is another word for cancer. CO2 output increases during economic growth and shrinks during recessions.

Best hope for Planet Earth would be a long-term recession plus something that massively affects population growth. Maybe Zika was engineered to do that.

I’d say the overtime limit isn’t about wage growth. It’s about reduction of hours to reasonable levels, which is also a good thing.[/quote]

Be careful what you wish for. We have a preview in Japan and Europe
Population decrease is bad for small towns and villages. You can live cheap in a small town but nobody wants that.
I guess you may argue that reverting to nature is a good thing.

http://www.slate.com/blogs/the_slatest/2016/02/26/japan_s_population_decreased_by_nearly_one_million_people_yikes.html

[spdrun]

What’s wrong with Europe? Being on the bleeding edge of tech isn’t everything.

Who gives a crap about small villages? Towns and villages have become ghost towns since before Pompeii. If a few villages dry up and blow away, so what? Nothing is immortal.

[Author]

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