So, the Economy

Is anyone else starting to get the unwelcome feeling we’re headed for “summer of recovery” 9?

Maybe it’s just my sample — and that would be worrisome, because my sample consists mostly of not only highly educated but highly capable people — but it seems like every other week a friend is being laid off, or friends who haven’t had a raised in 10 years, still aren’t getting a raise, or–

Yet the press, whom I thought would turn on a dime once Obama was out of office, is still saying that the economy is better than ever.

Who am I to believe?  Them? Or my lying eyes?

I grant you that it’s almost impossible for the economy to right itself while hampered by the load of cement, called Obama Care, that FINALLY managed to stop the great American engine.

We’d absorbed a lot of other Leftist hits, but a program that vacuums money from both public and private pockets at ever increasing rate is too big a hit to just shrug off.

And I grant you, given the hits we’ve absorbed, there is still an amazing amount of life and productivity in America.

And please, please, understand what I’m talking about is NOT a sudden crash.  If sudden crashes, running around the hills with an AK or eating the neighbors were the likely thing, it would already have happened, in Europe.  What I fear is more the fate of Europe, the slow descent into senescence and dependency, without ever identifying the cause of the ill.

You see, our government has become like a tick.  It puts out just enough anesthetic, that people don’t realize it’s attached and sucking the life blood out of civilization.

And yeah, I’d feel much better at the thought that once they beat us into the ground, the leeches with bureaucratic, do-nothing jobs will suffer the most.  But when you all go down together, there is no consolation.

Right now, my only hope is that we do to them what we did when they thought they’d successfully taken over journalism and we ambushed them with blogs.

I don’t know how you do that to an entire economy, except I know the capable, the smart, the flexible thinkers need to hit the ground running, and keep running.

Think of something you can start and run that they’ll never see coming; something that does whatever job it is faster and better.

Go out and create and build and work.  You’re our only hope.

 

 

152 responses to “So, the Economy

  1. I see slow stirrings. There were a lot of expansions and projects that were put on the shelf the day Obama was elected. They are not coming off as fast as Id like (or new ones being invented), but I see signs it is slowly happening. E.g. More coal exports to China means port expansion for coal loading facilities. Perhaps the delays in getting things like Ocare and tax cuts done is slowing it up. Perhaps it is just the time needed to plan and do paperwork.

    • Business cycles, unfortunately, are not like the tides – more like the winds. Yes, the adverse current has slowed, and seems to be stopping, maybe turning around. But how much? How fast? Is it really? There are powerful forces working hard to hold on to their gains in blowing us towards the rock-strewn shores of disaster.

      • BobtheRegisterredFool

        GOP is apparently showing signs of being lily livered in repealing Obamacare.

        • I am shocked, SHOCKED! to see that the GOPe is lily livered.
          Of course, the GOPe is probably one of the few demographics that actually beleive the NYT, WaPo, and CNN are the big dog movers and shakers of American opinion.

  2. I have one friend who was laid off, but he was a lobbyist, so it’s probably for the best.

  3. Government ticks. Experiencing that here in Ontario, Canada. Our version of Obamacare was the green energy act implemented quite a few years ago. All it has done was shutter power plants, expand “green” energy (i.e. windmills and solar), crank up energy costs and made things far too expensive to operate. Up shot is that businesses are closing or moving to friendlier climes (Mexico and America). The provincial government has been slapping bandaids on the problem so just normal people can keep their lights on and not have to come to the choice of food or heat. There are a lot of government programs out there that seem to exist to pour as much sand in the gears of the engines of economies that you just can’t point to one and say “This is it! This one caused all the damage.”

    Things will get better hopefully. If we are lucky the damage can be reversed.

    • My sympathies. I’ve been following Ontario’s utility mess for the past few years, in part (I admit) out of morbid curiosity to see what the next great disaster of a fix the government foists onto the province.

    • Except for the VFX and animation businesses, which will keep moving to Canada as long as Canada can afford to bribe the productions for half the salary of all Canadian residents.

    • I hadn’t been paying too much attention to anything, especially the folks next door, but my truck recently broke, and the best repair place is actually in Winnipeg. To get my “$199” (my account read a -198.40 until the exchange charge was added) they had to charge $264.39 in Canukistani Pesos!
      Egad.
      .75us to 1cd is worse than I last recall doing a cross border payment (iirc it was .86us – 1cd) and way worse than I recall some leftoids bragging about during GWB (I think it was within pennies for a short bit there, but it didn’t last long and was back to .89 or so)

  4. Well, I live in Southern California, so I’m not exactly the person to ask…

    😛

    But it’s hard to say what’s going to happen this year. I expected the stock market to drop somewhat when Trump took office because of inflation being corrected (i.e. the government would stop pretending that prices weren’t going up). And yet, the market is still going up.

    So… I dunno. We’ll see.

    Though also, unless Trump manages to get Congress to pass something *really* drastic, Obama’s still going to have a lot of effect on what happens this summer.

    On the positive side, Trump has started to make some moves at reducing the power of the Federal bureaucracy. So maybe that will help somewhat.

  5. My government funded scientist friends are marching for science today to protect their jobs.

  6. America survived the Great Depression. In spite of FDR. The chances that we’ll survive this are greater than it might look. Though it’ll take work.

  7. The economy isn’t a monolith. There are areas that are doing well and areas that aren’t. And it’s not as simple as “this industry is doing well, while that one isn’t” or “this state is going great guns, but that one is floundering”.

    Government intervention and “planning” of the economy always makes things worse, eventually. Government is the biggest problem for the US economy — It’s a parasite. It produces nothing, but costs a huge amount. Apart from the cost of paying all the bureaucrats, clerks, etc., and the cost of maintaining their workplaces, there’s the cost of complying with all the rules and regulations that they create.

  8. The data is corrupt and personal experiences of oneself and one’s friends is too limited to be an accurate metric, so it is quite hard to judge general economic temperaments. Economies like ours do not turn on a dime and shift in fits and starts, further complicating analysis by feel. Frankly, it has been so long since we had a strong economy that I forget what one feels like.

    People cite the great sucking maw of government boondoggles but my sense is that the real problem lies in the millions of regulatory strings binding us [insert reference to Gulliver’s welcome in Lilliput]. Slackening those bonds can be a tedious process and the wait for full circulation to return painful. It may be a while before we regain our strength.

    • There is actually quite good data out there if you know where/how to look for it.

      For example, any list of interest rates contains within it that source’s estimates of interest rates in the future.

      For example, Friday’s close on the 1 year Treasury note was 0.99% and the 2 year was 1.2%. This tells me the US Treasure thinks one year money at the nearly risk free rate a year from now will cost 3%.

      Why? Because two years of 2% money yields for $104 two years out for $100 invested. The one year money yields $100.99 one year out and the one year rate it reinvests in needs to yield the same $104 or I’m better (or worse, depending on the direction of the difference) taking the two year money.

      Thus, people buying Treasuries on the whole are predicting the near risk free cost of money to jump about 200 basis points in a year which is an indicator they expect a decent increase in demand for short term capitol.

      That said you are better off using some more complicated implied rates such as between 5 year and 10 year as the easily calculated short rates are much more sensitive to day to day news than the longer ones.

      You can use all the rates to build a forward rate curve which you can then use to read arbitrary rates at arbitrary times in the future (in fact, we build several at 3 pm every business day and then do various shocks to best fit the market moves of that day).

      While these are perfect economic indicators nor are they 100% manipulation impossible (see the recent LIBOR scandal) they are built, most of the time, from the actual choices of people in most free markets unlike compiled and massaged “official” data.

      I’ll point out they are huge inputs to our models compared to lost of “official” data. We use it to make choices about hedging and the future of several billion dollars of assets which is why I trust my mathematical models more than climate ones and similar why I trust these inputs. I have a daily PnL where 1 million is a rounding error that we’re judged by. I don’t get to explain away consecutive days of misses much less a decade.

      So there is good data out there; you just need to know where to look.

  9. Yet the press, whom I thought would turn on a dime once Obama was out of office, is still saying that the economy is better than ever.

    To say otherwise at this point in time might force the press to recognize the causes lying in the prior administration. They have already proven distant and hard hearted towards the working man and woman, particularly those bitter Bible and gun clingers.

    Just give them time. Right now they are hopeful that they take down Trump on the Russian connection and his taxes. If the Trump administration manages to get us out of Obama care then those dogs will howl.

    • There’s also the problem that admitting that there is inflation would trigger cost of living adjustments in a whole boatload of government payments. Technically, we’re already past the debt ceiling but accounting tricks have kept the government spending. The accounting tricks run out in a few days. If anyone had admitted to inflation before this the accounting tricks would have gone up in smoke on April first. Whether or not the government will admit to inflation after a new debt ceiling gives more breathing room I have no idea.

  10. I can’t speak to other areas or other fields, but in Kansas City I’ve been struck by the number of retail places with very prominent “help wanted” signs. The retail places aren’t just the big boxes that have constant turnover, but farm supply places and hobby stores, so I’m cautiously optimistic about the economy. Assuming this is sign of real economic growth, it may take some time to work its way through other sectors and locations.

    • Professor Badness

      Assuming it’s not a case of “We laid off our full-timer and need to hire two part-timers.” Or the more popular, “Our 12 year employee cost too much to continue paying. We new new blood too pay at half the cost.”

    • Some of that is demographic shift. A couple of employers I deal with have a *very* hard time filling even low-level positions.

      A sizeable percentage of the people they hire won’t ever show up for work. Of the ones that do, showing up on time seems to be outside their capbility. And once they find out “work” doesn’t mean “occasional breaks from Facebook or Jezebel” they ragequit. Then you have to deal with the ones who have been through umpteen “diversity” and “sexual harassment” courses, and walk around looking for something they can turn into a lawsuit and settlement.

      There are some good people out there, but you have to sort through a lot of dross to find them.

      Then there’s the flip side – companies that dump employees instead of giving them promotions or benefits. Back when we had factories in my town, you could always tell when they were having layoffs; that’s when the huge HELP WANTED ads appeared in the papers.

      • My husband’s been offered one position. With a fifty mile commute-he didn’t apply for it, they grabbed his resume off one of the websites. At under $30k a year. To take it, he’d first have to buy a newer car, as the 21 year old car is not freeway safe, or put over $3000 into the old car. (The kid-hauler could do it, but gas would be much worse and then I would be unable to haul kids around.) Figured that a) we couldn’t live on it, not with the added commute expenses, b) would reset his “previous salary” significantly lower, and c) unemployment pays more. Over a decade SysAdmin experience. If they won’t pay enough people won’t work. If paying enough to get workers costs too much, then the economy’s not going to recover.
        Stocking shelves locally would make more sense if we get to that point-which, actually, at least two stores locally pay their entry level workers as much as that out of town offer. He’s hearing nothing from most applications, and the state university jobs he applied to back in December have been “reviewing applications” for three months.

        • sounds like the HB1 scam going great guns . . . offer those qualified far less than the person should get, claim no qualified candidates are available, and then bring in two “slave labor” HB1 workers. Though, Trump said he wants the system looked into, but I doubt much change will happen.

          • This is something that I don’t think requires any looking into. We just need to say that any H1B worker can move to any job once they are here, and if an H1B worker quits, he has three months to find a new employer before being sent home.

            This will give H1B workers the freedom to leave their first employer if they are treated awfully, or if a competing employer is willing to offer them more pay.

            Surely, if H1B employees are filling needs that no one else can fill, companies shouldn’t fear poaching new hires, because they would already be paying their H1B employees top dollar, right?

            • It also addresses the real reason companies love H1B. It is isn’t cost sayings per se (although that is a big knock on effect) but the conversion from free workers to indentured servants. You can do a lot of things, not just cut wages, to indentured servants you can’t to free workers.

              Notice how much companies love indentured servants even if they are not called that and you see why I’m not convinced abolition has proved it is on the right side of history yet even if it is on the right side or morality.

              • Couple years back Disney World abolished 150 of their 300 IT positions. Those laid off were offered a very nice severance package on the condition that they remained long enough to train the 150 Indian H1B computer folks brought in to staff the new positions just created.
                They may make fantastic movies and run a very entertaining theme park, but Disney corporate are a pack of scum sucking filth.

                • The Animation union exists because of how badly Disney himself treated animators in his original shop. They are just continuing the traditions of their founder.

            • Oooh, I like it….

      • The other problem is that it is impossible for teenagers to get proper work experience for even basic, necessary skills like “showing up on time” or “showing up at all” or “don’t ask if you’re done yet”, or “you’re here to work, not play on your phone”, ect.
        Public schooling tends to graduate kids with a rectal-cranial inversion, and it takes a couple of years of real job type work to lose it. The old part time jobs used to go a long way in reversing the effect.

        • Yeah, my fourteen year old has been looking for a job for six months. No one wants to hire him: the reason given is insurance. Now he’s doing yard and garden work, freelance.

  11. One of my clients is a steelyard. In 2009 they went from a growing company to just barely making it within a few months. They saw several of their larger, national-chain competitors shut down, but they kept their noses to the grindstone.

    After the election, they expected an economic upturn. Bridges, office buildings, and machinery all need steel. But sales have remained flat.
    Their outside salesmen keep their ears to the grapevine; none of their customers have moved to other suppliers; there’s just no new business out there.

    Here in my town, I can drive through what was once a modest industrial park, and it’s now rows of empty buildings, factories converted to mini-storage or warehouse space, and just a handful of actual functioning manufacturing businesses. Then there are the empty buildings about town, that used to be a MacDonalds, used to be a 7-11, used to be a Piggly Wiggly, used to be a Shell station… when groceries, gas, convenience stores, and fast food start taking down their signs and skulking away, it underscores how grim the situation has become.

    • After the election, they expected an economic upturn.

      Well yeah — you can’t do shovel ready jobs without shovels, right?

      Except somebody noticed that a large majority of jobs calling for shovels paid men — big, brawny men, with upper body strength privilege. So an deliberate effort was made to channel those funds to jobs held by women. Jobs in HR, regulatory compliance, fairness evaluation, tolerance instruction and the like. Not jobs that create wealth but jobs which assure wealth is distributed correctly.

    • Our town got a multiple-whammy. BSO (Before Spotted Owls), it was lumber, plywood, doors and windows. ASO, it got harder to log, and the mills went away. (There’s still some logging going on, but the mills are about 100 miles away.) When the housing bubble burst, the rest of the building products stuff went sour, so there have been a bunch of folks trying *anything* to earn an honest dollar. (Won’t mention the other kind; that’s been going on, too.

      The saving grace, is that despite the best efforts of our betters in Oregon, local agriculture is still solid. Not quite as much cattle locally. Water rights for the tribes were determined as “senior to everybody”, and these rights have been weaponized. There was one attempt to cut off the town well for a small town in the eastern portion of the county, but the courts put a stop to that. (Black letter law said Nope). Still, grazing on one of the rivers has been quashed due to water calls. The good news is that hay, barley and oddities like strawberry plants grow and can be shipped out.

      The other bit is that we’re part of the escape route for Ex-Californians, particularly those not that well off. Lots of retirees (like us) have come in, and the businesses have figured it out. There used to be two medium sized farm and ranch stores in town; still two, but one’s a lot bigger. Both are different companies from what they were, and the focus is a bit more general than strictly farm and ranch. FWIW, the bigger store is now in a closed K-mart; it opened over Christmas, and it’s doing well. You can still get a 6′ rototiller for your Deere, but the clothing selection is a lot better…

      Still some problems. Locally, Albertson’s had to divest the two Safeway stores as part of its acquisition regulation. Haggen, the buyer had 18 stores, bought 146 Safeway/Pavillion/Von’s and promptly did a face plant. Per Dave Packard: “More companies died from indigestion than starvation”. Yep. So, now downtown has no grocery, and the vacant grocery store slot at the busiest intersection in town is likely to stay vacant. (Two thriving groceries within a half mile, and that Safeway was hurting to begin with…) Not sure what the town gummint will do about the vacant downtown store; they need something, but it could end up as better bus service and a batch of small shops.

      Interesting times; I’m glad we can live on our retirement income/savings.

      • There was one attempt to cut off the town well for a small town in the eastern portion of the county, but the courts put a stop to that. (Black letter law said Nope).

        They tried something similar in Twisp, Washington, and succeeded in removing the majority of the towns water rights– even though, as you say, black letter law says that their justification (one failed year in the 20s which may be a paperwork loss) is invalid. (Same rules say that after X amount of time, accepting the continued filings means it’s not a lapse.)

        • I have a sweater from Twisp’s all-night laundromat and showers. I believe my husband (who was the original owner of that hoodie) was impressed by the existence of such a place.

          • With wifi!

            I believe the guy who owns that place is Hank, of Hank’s Harvest Foods.

            Which you really should look up, visit that grocery once and it’s going to stick in your memory. Hank believes in preserving animals by making it more valuable for the locals to guide hunts for them, rather than the animals being horrible pests that might wipe out your crop and do nothing for you. (Lots of safaris, and the store is decorated with the stuffed animals!)

            • It wouldn’t have had wi-fi in 1997 or thereabouts, when that epic weekend trip to Canada actually happened. (I was sorry to have missed out when I heard about it later. Ah, for the days when college students could do things like that without a passport…)

  12. Not sure.

    It is likely to be difficult, because nobody is sure what the snap-back is going to be…oh, and then there’s the “little” issue of violent riots and all.

  13. Maybe I’m misremembering, but during the Reagan era, I think things finally turned around about the summer of 1982, so it may take awhile.

    • Yeah, newscritters were talking of a “Reagan Recession” or such and saying how terrible Reaganomics was. By 1984 “Reagonomics” was a word only used by Republicans.

    • Swamps can take a while to drain

    • I would also add that Carter was not like Obama. The first inklings of de-regulartion started under Carter in 79/80. For example, The Staggers Rail Act which de-regulated the railroads was passed and signed in 1980. By contrast, Obama was issuing new red tape as late as January 19 of this year.

  14. I have two informal economic indicators. One is the numbers on Call Before You Dig tickets. Each agent seems to have a specific three digit number, followed by three more to identify the ticket. These go up sequentially beginning with 1 through 999. You can enter your own locate tickets, and for these they assign to groups that are treated like the agent number. When the number of tickets reaches 999, the next causes the group number to increment by 1 with the next ticket identifier resetting to 1.

    After the housing bubble went pop, the group number seldom incremented by 1. This means there were rarely 999 tickets issued to that group statewide. During the bubble we’d sometimes see the group number increment in the late afternoon. Since our state requires you call the Utility Protection Center so many days before you dig, the number of tickets issued daily in the group is a good measurement of construction activity.

    Before the November election, we started seeing the group number increment every now and then. Following the election, the group number has incremented more frequently. Now it’s almost a daily occurrence even though they assigned some members of the group their own agent numbers.

    My other indicator is the mount of hoops state agencies make you jump through to get work done. My theory is their work is slack, they look for work to do, and increase requirements. But when they’re swamped, the last thing they want is more work. One agency that is affected by construction has been very laid back lately. I think it’s due to their workload.

    All this means that our state may finally be seeing recovery. Some of this is optimism simply from the Democrats losing the White House (haven’t been the only one to notice this in the state). I’m cautiously optimistic that maybe things are picking up.

    Our state isn’t your state, and some parts of a state can prosper while another suffers, so this only is applicable to our state.

    I’m not surprised that the media hasn’t downplayed all this, because they were trumpeting a recovery years prior to the election. If they suddenly say it’s not a recovery, it’s an admission that it didn’t start during the Obama Administration. They aren’t about to do that. It’s hard to claim an economic decline right now. But with the next economic downturn, look for them to pile on Trump just as they would with any Republican president.

  15. YES. It’s time to get your tickets to the NINTH (and FINAL) Annual Tour of The Summer Of Recovery, (sponsored by the Obama Administration)! Call 1-800-IMAFOOL or go online at SummerOfRecovery9.com.

  16. Rents and real estate are up here in Reno. That’s probably because the past master at sucking up government subsidies, Elon Musk, is building the Tesla battery giga-factory just across the county line in the desert. I have also been seeing help wanted signs in front of businesses. Got my finger’s crossed that the bubble doesn’t burst.

  17. I’ve seen cautious optimism out there – the feel that it’s not likely to get much worse much faster, like they were expecting under Madame Dictator. But it hasn’t gotten better yet – we’re still under the same regulatory, tax-heavy, fee-heavy, paperwork-smothered environment. Govt. can make things worse overnight, but can’t make them better overnight. Even the regs that got stuck down were mostly the last-minute changes by Obama to burn the place down on his way out, not the things that have been crushing the economy for years.

    Granted, we’re only a few months in. There’s a lot of groundwork to be laid before any big changes can happen, and a lot of congresscritters who’d rather lose nobly than actually, y’know, win. Or do what their constituents want. At least we got a decent Supreme Court judge, but even that, by definition, is a holding action against violations that make it all the way to the supreme court. We’ve got a few years yet to get the some real change (though life will get harder if certain congresscritters don’t stop being idiots and lose us the house & senate in the next election).

    I, too, expected the fed gov to start revealing the true numbers so it could look like the economy “crashed” under Trump – but now I start to wonder just how many of them depend how heavily on keeping the same scheme going, and on how many don’t actually have any access to reality anymore… or are more terrified of what Wall Street et al. might do if they saw the true state of the country?

    • Cautious optimism up here as well, with hopes for spill-over (metaphorical) from the big shale oil discovery down state. Mother Nature is still a major concern, given what hail did to crops last week, plus the fires. There are more “Help wanted” signs and job postings, though. O’care is still a PITA, a number of federal regulations are still slowing things, but optimism is in the air for the first time in a while.

    • Sometimes numbers aren’t fixed because it would make too many people look bad. In the early 90s, I worked with a guy who had been a programmer back when the Tymnet network was a sideline to the computing timeshare service of TymShare. He told me of a project he had worked on in the 70s. The government wanted TymShare to do all of the computing involved in calculating the unemployment numbers, which would save the government the cost of upgrading their systems.

      So the analysts and some of the programmers studied the inputs and the formulas that were used to derive the unemployment numbers, then went back to Pennsylvania (the closest data center to DC) to write and debug their software.

      When things reached the point where TymShare was to run in parallel with the government for a few months to ensure that all was well, all was not well. The TymShare number was always higher than the government number. Much burning of the Midnight Oil ensued, but no bug could be found. A team went to DC to confer with the people who were producing the number now. They found no flaw with TymShare’s program. So the TymShare and government geeks started going over both sets of code to see where the problem might be.

      The problem was with the government code. They had been turning out artificially low unemployment numbers for years. So how do we explain this to the people? Short version: They didn’t. They paid TymShare for all of the development work, plus the full value of the three-year operating contract on the condition that they forget all about it. Too many people would look bad if they revised years of unemployment data. So they just went on doing things the old way.(TymShare was privately held at the time so there were no regulatory filings to give the game away.)

      • The way that unemplyment rate is calculated has changed at least a couple of times since then, the last time was in 2010.

      • Related: Correcting numbers is part of how Evil Rob got his current job. He took over a warehouse that had been badly manipulated as to inventory (false returns by the previous manager, and other tricks to hide larceny.) He started off by contacting the central logistics group and telling them that his numbers were going to be horrible until he got it straightened out, and kept them in the loop until the inventory was accurately represented in the computer. It rather impressed them when he applied for a job in the logistics group…

    • You mean “how many are lying outright, vs. how many are in their own private little fuhrerbunkers manipulating imaginary statistics?”

  18. Here in Indianapolis, Marsh (local grocery chain) has just announced they’re closing three more stores. One of them is the one just down the road from us. This is after they closed the one by WalMart last year. So we’ve got one Marsh left in reasonable driving distance.

    So far we still have two Krogers reasonably close, and both seem to be busy enough. So we’ll see how long they last.

    I know that our retail business (Starship Cat) is struggling. We closed down the online side of operations after we had three scammy returns in three months, which means we don’t have sales income when we don’t have a show. And a lot of shows have been disappointing of late. We have to be *very* careful about the big comic cons because their booths are expensive (a lot of eggs in one basket) and way too many of them are becoming autograph mills. Once people buy all their super-expensive autographs and photo ops from the big-name stars, they’re out of money and just come around to admire the merchandise, but don’t buy. So we’re retrenching to smaller shows with lower expenses, but it means we don’t do as well. So we’re fighting a Catch-22.

    Gotta write more. And gotta market more on what I have up.

    • We’re in Indy also – NorthEast side. Play SCA sometimes, local + Pennsic. Not much con activity. Coffee?
      JPDevereaux

  19. A couple of months ago over on MGC, there was a post about how someone who is self-employed needs to set aside 50% of their earnings for taxes.
    A 50% tax rate on startups and innovators is oppressive. We can’t even blame the King..we’ve done it to ourselves over a couple of generations with our own elected representatives.
    In spite of Trump, Obamacare is still on the books, because a majority of Congress, including the entire Democratic Party and enough Republicans to back them up still wants the government to take care of of the poor (civil servants and people who hire lobbyists) and run health care (into the ground).

    • The immediate feeling was perhaps not so much optimism as relief. The flight isn’t smooth and the aircraft isn’t climbing, and the flight might not even be level… but at least the flight path isn’t aimed straight at the mountainside.

      (It was so hard NOT typing “…but they dang sure ain’t gonna spot us on no radar screen!”)

    • [T]he entire Democratic Party and enough Republicans to back them up still wants the government to take care of of the poor …

      Not exactly right. First, nobody really cares about taking care of the poor. Democrats expect to buy their votes by playing on their resentment and feelings of victimization while Republicans are scared out of their minds of ads and newspaper editorials attacking them for being unfeeling.

      Second, the Dems are so bat-feces crazy over Trump defeating their Hillary that there is nothing, nothing he could do which they would support. He could promise to forgive all Federally held college student loans and the Dems would demand more. Even his willingness to pump billions into infrastructure in Red states has been rebuffed.

      • That second point bears emphasizing. A good-sized chunk of the Democratic base would rather burn the country down than allow their congresscritters to do anything that doesn’t violently oppose Trump. It’s a huge mistake on their part, of course, because there are quite a few areas where Trump could probably be persuaded to side with the Dems, assuming that the Dems weren’t so enraged by him.

      • Oh, yes, the “push Grandma’s wheelchair off a cliff”. ads. The threat is just as effective, or even more so, at keeping Democrats in line.

      • Well, there are the politicians and then there are the useful… I can’t even say idiots. I know very intelligent, very sincere people who are sure that government funding of the sciences is too useful to cut AND that requiring the EPA to show their data or abortion providers to meet safety standards is merely a cover to shut them down by interpreting the standards unreasonably, or that cutting benefits to anybody is equivalent to wanting everybody who gets them to die. A kind woman who makes posts on Facebook asking how pro-life people feel having blood on their hands.

        I am tired, and busy, and we’re all emotionally involved, and I don’t want to hold my tongue and keep thinking guiltily of all the encouragement I got as a teenager to stand up for the Truth and not just go along with the crowd… but I don’t want to lose them either. And there are people I want to catch up with and maybe could this coming week but I’m afraid they’ll want to talk politics so I’m kind of dreading it.

        • ” is merely a cover to shut them down by interpreting the standards unreasonably,”

          Because that is exactly what they’d do and they can’t imagine other people are more honest or honorable than themselves (the self-annointed pinaccle of all human achievement).

          • It is one of the saddest aspects of the human condition that the worse people are, the more they are eager to believe the worst of all others.

        • Many of my music friends are scared of loosing federal funding. I expect it’s the uncertainty. If we didn’t have federal grants for the symphony, would our donors step up? If we didn’t have federal funding in the schools, would the district get taxpayers to pay more? Most musicians are used to the a little of this and a little of that method of earning a living, and most of the thises and thats are going to keep on. Weddings and funerals and private students and gigs and busking are all staying right where they are, with a likely improvement if the economy picks up. And the musicians are still scared. Maybe 10% of my income is Symphony related, and my music income is really low, like don’t pay quarterlies low (you know you aren’t making jack if the IRS waits for their cut).
          Probably the science march folks are just as scared. They will have to come up with a new way to get paid. I can’t think of much that is productive a lot of them can do right now to secure their food and shelter, except, y’know, it’s garden planting time in most the USA. They should engage in some hands on botany.

          • This illustrates one of the selling points of Socialism. The benefits are very visible (we get money) while the costs are well hidden (I trust I don’t need to expand.)

            The opposite tends to be true of free market capitalism. People tend to take the benefits for granted and focus on the costs (actual and imagined.)

    • You left out the ones who threw a fit that setting a broken leg can’t be done as quickly as breaking it in the first place, especially after a very long time untreated and with an unknown number of those working to set it actually wanting the leg to stay broken.

    • To be fair, I don’t think that the preservation of Obamacare is due to people who necessarily want the government to run health care (although that is the effect).

      I think that the Democrats these days represent the “professional class” — the people who all have college degrees from respected universities and work nice cushy jobs where they don’t have to get their hands dirty.

      What does Obamacare look like to someone like that? Well, they see that insurance companies can’t punish them for “pre-existing conditions”. (Which, to be sure, is a really good thing!) And, since they all have nice insurance through their employers, that’s all they see. Why shouldn’t they like Obamacare?

      The problem is, they have very little experience with the working class, the poor, or those whose jobs don’t come with nice healthcare packages. So they tend to imagine that everyone else is like them, and that the only reason to not like Obamacare must be because one is evil.

      • Forcing an insurance company to cover preexisting conditions at no additional charge is precisely the same as requiring them to issue car insurance at the same cost to little old ladies and the guy with five wrecks and three DUIs.
        When they accept known preexisting conditions that will ultimately require treatment far in excess of the premiums paid in they must then spread the cost of those payments across the premiums of everyone else. ie government mandated transfer of wealth from those who have it to those who need it.
        Fair? Of course not, but life often isn’t. A solution could be found, but won’t as long as government mandated theft is easier.

        • False. It’s requiring them to issue car insurance to the guy who just wrecked his car — and to cover the wreck.

          Even the five wrecks and three DUI is possible. It’s the “already wrecked” that makes it impossible.

          • Not necessarily. “Pre-existing conditions” includes things like diabetes and asthma—and I know that from folk who were uninsurable from birth. “Pre-existing conditions” has been interpreted very, very broadly by insurance companies.

            Personally, I wonder what a USAA-style medical insurance would be like. In USAA (military and their families, for this who don’t know), the clients are the shareholders. There is no group of people who are not in the program to get money out of the program, and USAA is generally considered one of the best insurance groups in the nation. If you had a medical insurance group like that, would that tilt the balance of monetary requirements better?

            • And why would things like asthma and diabetes NOT be like the guy who already wrecked his car?

              Besides, of course, that you can total the car.

              • It’s the (obvious) inability to total that makes health insurance inherently screwy, unlike the other issues with health insurance today.

              • If you are born with a condition that is a maintenance issue, but that makes you uninsurable for EVERYTHING, that’s more like “you were assigned a car that has a slow oil leak, so we won’t cover you for any accidents.”

                That’s… obnoxious. And life-threatening to some folk when it doesn’t need to be. My husband’s niece couldn’t get insured as a medical provider herself because of chronic childhood asthma. (She owes her life to St. Jude’s and Shriners hospitals, BTW.)

                And like I said, insurance has made “pre-existing conditions” a very broad category, and I’ve heard of autism being defined as a pre-existing condition in order to deny insurance. I can understand wanting people to not jump in the insurance pool after a major medical issue, but some people are being turned away who want to do the right thing.

                • Except that the issue is they want it to cover the small oil leak.

                  And yes, these people are charity cases. They can not be otherwise. You can’t insure against a 100% chance. This is why pre-Obamacare it was handled through “high-risk pools” that were subsidized by the state. Because mixing it up with insurance only breaks insurance.

      • My husband has one of those “cushy” jobs and we have company insurance. But the costs and affects from the ACA are spilling over into the cost of that insurance. We’re paying almost double now and have a huge deductible which we didn’t have for years. I am chronically ill so I go to the doctor a LOT and the medical bills are really making our life rough right now. The sooner the ACA goes, the better. We tried to help the 20% by sacrificing the 80% and that was just monumental stupidity at its finest.

        • like, for instance, every one in this family is covered for delivery, gender reassignment and abortion. NONE OF US CAN GET PREGNANT. As for gender reassignment, Dan and I are too comfortable with who we are at our ages, and the kids would have to be crazy. World’s UGLIEST women.

          • Portagee, have you seen some of the supposedly female SJWs?
            Careful when making such claims.

  20. It’s amazing how I read that we’ll run out of oil. We’ll run out of water, we’ll run out of arable ground, but nobody ever worries that we’ll run out of children, run out of taxpayer money or run out of people’s patience.

    • Peak Patience seems a title needing a story.

    • Peak Oil gives them more power

    • The 1941 edition of Ricardo’s “The High Speed Internal Combustion Engine” predicted we’d run out of oil within 20 years.

      Oil reserve information has been subject to corporate and national propaganda spin since the 1800s. Their official predictions have fallen on their face since before the advent of the internal combustion engine; nobody pays much attention any more.

      • I pay attention to the oil company numbers – because I use the correct definition of them.

        Oil companies measure their reserves as the minimum amount of oil that they are very sure they can get out of their leases. “Proven” reserves in other words – if they say a particular field has 20 million barrels of oil in it, they mean that everything they know about that field tells them they are at least 95% likely to be able to pump 20 million barrels out of it. (The remaining uncertainty is that petrogeologists know their models are not perfect. Unlike some who call themselves “scientists.”)

        Their numbers, though, are quite frequently low – because they hardly make any estimation based on future technology (one or two years out at most), and only minimal estimate adjustments based on projected prices (higher price, the more oil you can get out of most fields; conversely, of course, for lower price).

        And their numbers are quite frequently high, too. There is no way to predict if, or when, you are going to get an Obama administration. Or a Carter administration. Or just a “go along to get along” Bush administration. There is a very wide gulf between “can pump” and “may pump.”

  21. Venture capital is starting to look at the oil patch again. Small investors inside the industry are starting to put their own money into a few projects. I don’t know if it’s the economy, anticipation that the price of oil has hit bottom and isn’t doing a dead cat bounce, or if it’s “oh crap! It’s better than anything else!”

  22. Cautious optimism here. I have a small amount of money socked away in a fund. Throughout much of the Obama administration, the value of the fund grew only by the amount of money we added. Did get a bit of growth in 2016, but much less than the amount of money we added. In the first quarter of 2017, we’ve seen more growth in the fund than we saw in all of 2016.

    Still never going to be able to afford to retire, though. The plan is to die at my desk and have them wheel me away.

  23. Michael Houst

    Economically, the ordinary U.S. citizen seems to be heading into a level on par with legal and illegal residents where everyone “enjoys” the same standard of living as Winston Smith in 1984. Only the elites really enjoy a level of prosperity that the masses have no concept of anymore.

  24. You can’t expect an economic upturn like a poke vault after just one election.

    Many of the disastrous policies of the past eight years are still in place.

    Many of the disastrous PEOPLE of the pasceight years are still in place. You cannot expect an economic upswing under Paul Ryan and Mitch McConnell anymore than you could under Pelosi and Reid.

    Notice that most of the problems that are being addressed are being addressed through the White House, not Congress. But it’s harder to clean out Congress when your reps are bringing that sweet sweet pork back to your district while condemning it in everyone else’s.

  25. I think what you’re seeing is a continuation of a long-term phenomenon that precedes the Obama Administration and really goes back to the W Administration–not that it’s his to blame for, just that it became much clearer on his watch.

    We now have two economies that live in parallel, sometimes cheek-by-jowl…jut as we seem to have two cultures, two political environments and the rest.

    Economy #1 is what we might call the classical economy: the economy of production. This is the economy where we seem to be able to produce more and more with less and less, for both better and worse. It’s the economy of emptied factories that have relocated to Mexico, or Malaysia, or some other place where the cost of shipping to the US is outweighed by the savings of cheaper labor. Note that it has to be not only cheaper in the naive meaning of fewer dollars per hour, but in the more nuanced sense of fewer dollars per unit of output.

    It’s also the economy of layoffs because the unions, or the bureaucracy, or some technological breakthrough, or some misguided floor on hourly compensation (*ahem* $15/hr perhaps…) makes it too costly to continue to do business the old-fashioned way. So you get layoffs as the factories retool for a more automated process, or relocate to South Carolina, or plain old shut down. Note that this doesn’t necessarily “destroy US jobs”: but it typically reduces the necessary number of them, and relocates those that are left to lower-cost areas.

    The flip side of the classical economy, or if you like the economy of production, is economy #2, which I’ll call the economy of consumption and profitability. This is the economy that benefits from the cost savings that are the result of the layoffs and plant closings: the economy where you can buy a cellphone today that is twice as powerful as the best phone from two years ago, at half the price. Because of these phenomena, all the companies that live in this space are going gangbusters in the markets–as are some others who simply happen to be in the right place at the right time, e.g. the energy sector that is involved with extracting, refining, and delivering fossil-fuel products.

    So the media, who as usual can’t see beyond the end of their tiny upturned noses, look around them, notice that all their banker and broker pals are doing great, and so they dutifully report on that. Naturally they have nothing to say about the bitter clingers sunk in the slough of despond out in Michigan or West Virginia or wherever.

    But this has been going on for a decade and a half, anyhow.

    • I really think it goes back to the 90s and that the dotcom boom covered up the bad parts

    • [T]his doesn’t necessarily ‘destroy US jobs’ …

      Having done accounting stints in a number of US factories over the last few years I have noticed that almost all the “shop labor” are not company employees, they are hired through temp agencies (sorta like I was.) This means the company can adjust labor use — putting on or laying off a shift — much more freely. There are other benefits to the company as well, but I doubt there’s any interest in that discussion.

      • our place does the “Contingent” employee thing to make wages lower. Because of Gov’t contracts, our mandated minimum is $10/hr, and even though they pay the temp company more per employee, it is still less over all, (no post training period raises, no insurance costs, not administrating 401k etc) and they don’t ever get a raise (though most are started slightly above minimum) but it is a poor method. These folks really almost never stay long enough to actually learn the job, and one lost part of a finger a few months back due to poor training.
        The recent buyout … oops, my bad “merger” … may change some of this, but a lot is local culture.
        My boss, justifying trying to get me to work a saturday (after I already worked 50+ hours) basically said that if I’d just work 60 hours a week, they might not need to hire a second person. This went over really well, and apparently he either realized it himself, or someone reported back I ranted that I’d just work at the speed of everyone else (they have a set target of work, and most can F@%# off almost all day and still meet it) because working hard just means you get less help and more work.
        Then he realized that if I quit (even going bankrupt will not stop me from walking away if they got too stupid. someone finally convinced him of that too) they can expect even more $66,000+ mistakes when they have someone try to make one of my blends ( it was a small batch made while I was on vacation. luckily the customer didn’t use any before it got recalled), and I certainly can’t train my possible replacement if I’m gone, so I got a raise.
        Still took another worker 48 hours of helping me while I did about 2 months of 50 hour weeks to get almost caught up (good thing, I got a kidney stone then, so I missed some work days, only worked 34 hrs). A last 50 hour week and I finally got technically caught up, but not what I prefer, one more to keep the schedule (scheduler is a knot head) then two weeks of a regular shift, and starting monday, back to the 50 hour again. Oh, btw he scheduled about 30 hours of work for this coming week . . .then this past thursday, added 30-40 or more, and then the foam guys need a batch by friday that is yet another 20 hours of work.
        So, until I printed a schedule friday morning, I was technically caught up, and monday, when I go in, I’ll be a week plus behind before I start. even spending thursday and friday last week doing some of the coming week’s work.

        Sorry, got caught up in a bit of a rant there.

  26. Even if the tax cuts and infrastructure spending were approved on Monday, repatriation of overseas funds at a 15% tax rate was approved Wednesday, and the regulatory burden cut in half by Friday it would still take until at least their next fiscal year for large corporations to change directions. Firms with fewer than 50 employees would kick up sooner, but they would still be hampered by ObamaCare, and unlikely to make the jump to 51 or more employees.

    • Maybe not even then… bureaucratic inertia seems to be stronger than the will for survival. Executives with “golden parachute” contracts don’t get hurt when it all comes toppling down.

  27. And where to start… damn, Now I’m not going to get anything billable done this afternoon. You’ve started the wheels turning with your danged truth in words, and positive insight. but thank you for that regardless, now I’ve got some notes to make. Cheers.

  28. Trump is president now. That means the media are going to be putting the worst spin on economic news until he leaves office. If they’re grudgingly admitting that things are improving, I’m inclined to believe it.

    • Christopher M. Chupik

      And if there is good economic news, they’ll spin it as being the result of evil ruthless capitalistic imperialism.

  29. How long did Reagan take to undo the missteps of Nixon/NixonFord/Carter? And Trump needs to undo Bush/Bush/Clinton/Clinton/Bush/Bush/Obama/Obama (while fighting a GOP that seemingly opposes American prosperity).

    It should never have needed to happen; but I think we just need to be wiser in who we elect at every level and fight for smaller government.

    As far as producing, well, as much as I like wrongthink fiction, I’m no John Galt.

    • Who’s John Galt? He doesn’t exist, he was only an allegory. We all have to be John Galt these days.

  30. julieapascal

    Well, petroleum is better. It’s not $100 a barrel but it’s better. At least a little bit of the regulatory stuff has been put on hold. Not duplicating regulations with multiple agencies is far from a small thing. Granted, I’m still probably the lowest paid petroleum geologist in the country. Which is not a complaint! I’m half time with “operations” and am completely thankful I have the opportunity to do some science the other half of the time. And I think I need to do some field work so I’m hoping my boss will go for that and won’t worry I’ll get eaten by a bear if I hike in alone to put my nose on some rocks.

    And on the bottom end, my kids are all making money for once. #2 and spouse are employed and can pay bills. #3 has an honest to gawd entry level job. And #1 and #4 are somehow getting other people to pay for custom art and sketches. Which says to me that *other people* have money enough to pay for custom art and sketches.

  31. *WP insists I posted this already, though I do not see it. If it double posts, ignore/delete it.

    Anecdatum from Speck, Appalachia:

    Coal runs are steady. They faltered and were close to dead two years agone. Way I see it, that means the coal companies are watching things awful sharp. Doesn’t pay to jump too soon, and the lead times are long. They have to be.

    Manufacturing is down, still. From seven big factories to three, since 2007. The three survivors are hiring-temps, that is. They weren’t even doing that before. Wages continue to be flat. Skilled labor positions command top dollar around here- lots of folks retiring that hung on longer than they wanted to, through the last eight years. Not enough trained folks, though. Cost of living is still low, and that means lower wages compared to elsewhere. Makes it hard to attract qualified candidates from outside the area.

    Gov’t contracts are tapering off. I think NASA canceled on us this year, no real surprise. Overseas sales are fluctuating- Asia is up, Europe is down (save Italy, for some reason). That’s just for the one division of the company I know about, though. Corporate ordering is up again- sports contracts down, but hotels more than made up for it.

    Pipeline jobs are still hiring. Lots of retail, too. Tourism this year (so far) has been better than expected, so there’s that. No new businesses as yet, and several of the last surviving small businesses shut their doors this past year. No idea if they’ll try again soon.

    My take is the bigger locals aren’t willing to take any risks, yet. That may change is regulations get eased and/or the Obamacare anvil quits dragging everyone down. The smaller ones have adapted to the new normal, much as one can. We’ll see if they can handle the competition, if and when entrepreneurship kicks back over.

    Not enough there to call it cautious optimism, as yet. More like watchful patience.

    • The local shipyard is going, but nervous. There has been talk of cutting their contract, but the boats keep breaking, sometimes, the hulls are what breaks! My place is busy, shutting down my old place upped the workload a bit (some of the old place’s customers went elsewhere, so not quite a doubling), and the other divisions are always in demand. The other places around here seem about as busy, except the paper mills, but those have been on a down slope since I was a kid. The one automotive related place is hiring, and the other deals in big truck parts mostly and is steady. Home construction is down, but they are pricing themselves out ($170/sq ft, … wait, you want a foundation too? Basement?)

  32. This analysis of economics, demographics, society, and real estate was done in France, but has some applicability to the US:

    https://www.city-journal.org/html/french-coming-apart-15125.html

  33. I sincerely think that if Trump can survive and ignore all the attempts at reasons for impeachment, we will see a big difference come this time next year. At least, that’s what helps me somewhat sleep at night. Father-in-law is being forced into retirement in late summer which means the hubs (who hasn’t had anything other than a cost of living raise in almost two years because of a wrong headed merger) has to pick up the slack on the mortgage, utilities, etc. Even if things just remain status quo with a repeal of Ocare, then life will be okay.

  34. I think we have both large and systemic issues in the economy. The large ones are getting a bit better, so we are seeing some growth in fits and starts, but people are too spooked to really believe it yet.

    But the systemic problems have not been handled – and they will cause the system to crash hard when they hit (I am not a run-in-the-woods survivor type, but I don’t see how they can be handled).

    1) Public Pensions :: most (if not all) of them are insolvent and the retirees will not get what they are promised. Union Pensions for regular workers are also vulnerable to this as well – the first Teamster Union filed a week or two ago – and the PBGC (or whatever the acronym is) does not have the finances to bail out more than a small amount of them – and those at 10 cents on the dollar.

    2) Social Security – without a high interest rate, this can’t be funded much longer, and if they inflate our currency, then it could be paid “face value” but will buy much less. So anyone planning on this will take a huge hit.

    3) CDOs and other financial derivatives. Nobody has faced the music on the large banks shenanigans, and they are still there, although now they are in the trillions. I think Deutsche Bank alone has more derivatives then the entire economy of Germany. The bad loans are still on their books (Greece, et al) and at SOME point these come home to roost. Note that even China is affected, the growth in their credit is humongous.

    These are my “big 3” – and the underlying is international – although in some countries 1 and 2 would be merged together to the same scandal. But how do you deal with them? You need a time when things are allowed to fail – and you will see fail across everything as the financial chickens come back to roost. But until that is done, I don’t see any strong growth in anything – everyone knows (or at least anyone financially savvy enough to understand) this sword of Damocles is hanging over the world’s neck. When it falls? Who knows. Brexit? Madam President Le Pen? At some point Europe will faceplant, and the dominoes will fall…

    Of course, we survive that – maybe the elite don’t, but it will clear the deck, and if there are outsiders ready to step forward to run for office – maybe we clearcut more of the swamp (Trump can’t do more then prune it back – the elite are too entrencthed and people are too soft to do what needs to be done).

    Sorry for the long post. Have a Nice Day!

    -John