I will never put my name on a product that does not have the best that is in me.
John Deere
Labor Fact of the Day
According to data released by the Bureau of Labor Statistics today, the union membership rate [in 2014] fell to 11.1 percent, with just 14.6 million wage and salaried workers maintaining membership; the rate of union membership for public-sector workers last year was 35.7 percent, compared to just 6.6 percent for the private sector.Image of the Day
The Right To Travel Unfettered?
The Bush/Obama Legacy of Slow Economic Growth
This week's announcement of fourth-quarter growth slowing down from an annualized rate of 5% in the third quarter to 2.6% and a 2.4% rate in 2014 as a whole extended a 9-year streak of sub-3% growth, the longest stretch at least since BEA maintains GDP data online (since 1930). [3% is the long-term growth rate and a typical threshold where we start seeing positive outcomes in the labor market--more robust hiring, income, etc.] I recently pointed out Bush's streak of 2%-plus quarterly growth from 2003-2006; in fact, Bush achieved 3%-plus in 2004-2005; I'm not trying to make this a partisan issue, except Obama explicitly took claim for the economy's strongest performance since 1999, i.e., the Clinton era, which I debunked in the post. In fact, 2014 is the fourth straight year that Obama has failed to top 2010's GDP increase of 2.5%. This week's sluggish stock market in part reflects disappointment over Q4 data; I was not surprised, nor should my faithful readers, because I've been pointing out the effects of the sharp oil market correction on investment and jobs in the shale oil industry. (It is true that there is an upside to the oil market story, i.e., more discretionary income for consumers, but we are likely just beginning to see the economic impact in terms of well-paid job losses and recently announced cutbacks in capital expenditures; production cutbacks will be phased in because of ongoing contractual commitments. Note that many of these contracts have downsize oil price hedges, and I expect sometime over the year we'll find out more about the parties on the losing side of these transactions.) I suspect the energy industry will continue to drag on the US economy over 2015, and I also think the currency wars will be a drag as US exporters find them increasingly priced out of sluggish world economy.
The Fed seems to be determined to raise interest rates over the coming year, which disappointed Wall Street, although they are in no hurry to raise them soon. It seems, though, as though we are in the early stages of a global currency war. It goes beyond the yen and the euro; for example, Denmark just cut its CD rate for the third time in 2 weeks to remain competitive with the euro--and reportedly one local bank is actually paying some customers to take out a mortage! It has caused a Y2K-like challenge for IT applications, which were not designed to accommodate negative interest rates. We are already seeing surging imports and declining exports; I still have problems seeing the Fed doing something to strengthen the dollar once they start smelling deflation in the air. Treasury notes are already picking up strength, not only because they are effectively the "gold standard" in safety but paying higher interest than many OECD competitors. (If anything, they could use the occasion to start unwinding their balance sheet...) There are rumors of American Blue Chippers like IBM and Microsoft about to layoff workers. I think we'll see the stock market and job markets struggle just to tread water, never mind advance. I think we'll see GDP figures continue to struggle moving forward. If and when GDP heads to 0% growth--we know what's coming. Been there, done that: another round of QE.
Crimes of Teacher Crony Unionism: The Zero-Sum Game of Teacher Tenure and Your Child's Future
[Gov. Andrew Cuomo (D-NY)] said he openly disagreed with a teacher union member who said he represents the students.
“No, you don’t,” Cuomo said he told the person. “You represent the teachers. Teacher salaries, teacher pensions, teacher tenure, teacher vacation rights. I respect that. But don’t say you represent the students.”
Political Cartoon
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| Courtesy of the original artist via Heritage Foundation |
Joe Cocker, "Cry Me a River"
