The US Recovery

[astralis]

JAD,

have you been hanging up the "I'm with Her" signs yet? ;-)

but here's a good way to think about this:

http://www.vox.com/2016/9/15/1292111...y-census-obama

[GVChamp]

Everytime you link Vox, a demon gets his horns

[astralis]

GVChamp,

Everytime you link Vox, a demon gets his horns

i'm afraid what would happen if i were to link to Jacobin!

[Julie]

Secular Stagnation:

http://time.com/4269733/secular-stag...larry-summers/

[DOR]

Not true if you're on social security and pensions tied to the CPI, but overall a good sign. And if it slows Donald down, all the better.

Actually, it's 100% true . . . if you understand the meaning of "median income."

[JAD_333]

Actually, it's 100% true . . . if you understand the meaning of "median income."

I was applying it Social Security recipients as a group. The median benefit did not come close to a 5% increase in 2015.

[JAD_333]

JAD,

have you been hanging up the "I'm with Her" signs yet? ;-)

but here's a good way to think about this:

http://www.vox.com/2016/9/15/1292111...y-census-obama

Asty:

lol...nope. Not yet.

As for the article, who knows. It speculates on how something that didn't happen would have turned out if it had happened. But allow me to speculate that if Romney had been elected last time, we wouldn't be facing a choice between Trump and HRC today.

[Julie]

But allow me to speculate that if Romney had been elected last time, we wouldn't be facing a choice between Trump and HRC today.

I totally agree with you on that issue.

[GVChamp]

GVChamp,



i'm afraid what would happen if i were to link to Jacobin!

Bah, I have been avoiding that site, which is extraordinarily popular among all my leftist friends :(

[DOR]

I was applying it Social Security recipients as a group. The median benefit did not come close to a 5% increase in 2015.

I don't believe I've seen any data on the median income of Social Security recipients, so no comment.

[DOR]

Millions in U.S. Climb Out of Poverty, at Long Last

By PATRICIA COHEN SEPT. 25, 2016 The New York Times

For the first time since the recession began, the poverty rate fell substantially in 2015. The number of people living under the poverty line declined by about 3.5 million, with every major demographic group benefiting from a stronger economy and an expanding job market. For all the improvement, though, poverty remains deeply entrenched, particularly among African-Americans and Hispanics, and is more prevalent in the South and Southwest.

. . .
Poverty declined among every group. But African-Americans and Hispanics — who account for more than 45 percent of those below the poverty line of $24,300 for a family of four in most states — experienced the largest improvement.

Government programs — like Social Security, the earned-income tax credit and food stamps — have kept tens of millions from sinking into poverty year after year. But a main driver behind the impressive 1.2 percentage point decline in the poverty rate, the largest annual drop since 1999, was that the economy finally hit a tipping point after years of steady, if lukewarm, improvement.

. . .

Number of people whose income rose above the official poverty line in 2015
TOTAL 3,534,000
In families 2,831,000
Unrelated 703,000

White 1,866,000
Hispanic 971,000
Black 735,000
Asian 59,000

Female 1,863,000
Male 1,671,000

18 to 64 2,113,000
Under 18 1,031,000
65 and older 389,000

Metro area 2,698,000
Non-metro 836,000
Did not work 1,415,000
Work full time 554,000
Work part time 144,000

No diploma 927,000
High school 882,000
BA or higher 228,000
Some college, no degree 169,000

http://www.nytimes.com/2016/09/26/bu...long-last.html

[DOR]

Revised GDP growth gains 1.4 percent, stronger than expected

The U.S. economy grew at a modestly faster pace in the second quarter than previously estimated, but the latest data confirms the expansion decelerated in the first half of the year.

Gross domestic product, a broad measure of goods and services produced across the economy, expanded at an inflation-adjusted 1.4% seasonally adjusted annual rate in the second quarter, the Commerce Department said Thursday. That's up from last month's estimate of a 1.1% growth rate during the spring. Economists surveyed by The Wall Street Journal expected revised GDP growth at a 1.3% pace for the April to June period.

Second-quarter growth accelerated from the first quarter's 0.8% pace, but was slower than the roughly 2% annual rate averaged since the recession ended in mid-2009. The current expansion's pace is the weakest of any since 1949.

Thursday's report showed a measure of business investment improved rather than declined, accounting for most of the upward revision.

Economic growth has held below a 1.5% pace for three straight quarters. The marked slowdown during an already sluggish expansion raised concerns that the economy was stumbling seven years after the recession ended.

But many economists project output began to accelerate a bit this summer and should return to at least the expansion's average growth rate during the second half of the year. Similarly, payroll growth improved in recent months after a spring slump.

"Growth was weak in the first half of the year, we're seeing definite evidence that the economy is now expanding more strongly," Federal Reserve Chairwoman Janet Yellen said last week. Improved economic growth and progress in the labor market "have strengthened the case for an increase in the federal funds rate," she said. The central bank has held its benchmark interest rate steady since December.

Fed policymakers project the economy to grow at 1.8% pace for all of 2016, implying a modest second-half pick up. The Federal Reserve Bank of Atlanta, on Wednesday, forecast a 2.8% growth pace in the third quarter. The projection has been scaled back from well above 3% over the past month.
Other data due out Thursday, including an inventories report, could alter third-quarter projections.

The second-quarter GDP report showed a measure of business spending, nonresidential fixed investment, rose at a 1% rate versus the prior estimate of a 0.9% decline. The upward revision was due to a much smaller decline in structures investment than previously estimated, and an increase in intellectual-property investments.

The change in private inventories was a smaller drag on growth than previously estimated, due to a larger contribution from farm inventories last quarter. Overall, the inventory change subtracted 1.16 percentage points from the GDP advance last quarter, smaller than the previously estimated drag of 1.26 points. Inventory building has weighed on growth for five straight quarters. An expected turn in that cycle is one reason economists project better second-half gains.

A measure of economic growth that excludes inventory effects, real final sales of domestic product, rose at a 2.6% pace in the second quarter.

Consumer spending, which accounts for about two-thirds of total output, rose at a 4.3% pace in the spring, compared with an earlier estimate of growth at a 4.4% annual rate. Last quarter's gain was still the largest increase in household outlays since late 2014.

Residential fixed investment, including home building and improvements, fell at an unrevised 7.7% pace in the second quarter. Before last quarter, residential investment had been a driver of economic growth since 2014.

Growth in exports, which add to GDP, outpaced gains for imports, which subtract from domestic output, during the last quarter. As a result, trade contributed a slightly better 0.18 percentage point to overall growth in the second quarter. Trade was a significant drag on growth during 2015, a year in which the dollar strengthened against many foreign currencies.

Government spending declined at a 1.7% rate in the second quarter, compared to a prior estimate of down 1.5%.

Corporate profits after tax, without inventory valuation and capital consumption adjustments, rose 5.6% from the prior quarter, up from a previous estimate of a 4.9% increase in the second quarter. That measure most closely matches profits as reported on company balance sheets. The profit measure was down 1.7% from the second quarter of 2015.

A before-tax measure of profits, which includes inventory and capital adjustments, fell 0.6% in the second quarter, versus the earlier-estimated decline of 1.2%. The measure, intended to be more inline with output gauges, was down 4.3% from a year earlier.

Profits at U.S. corporations have been stressed in recent years by the strong dollar, which makes U.S.-made products more expensive for foreign customers, and low oil prices that have hammered the domestic energy industry.

The dollar and oil prices have stabilized in recent months but margins could be squeezed going forward by weak global growth, rising labor costs and other forces.

http://www.cnbc.com/2016/09/29/gdp-2...-estimate.html

[DOR]

Where Have All the Workers Gone?


by Professor Alan B. Krueger, Princeton, Oct 4, 2016

The main finding of this analysis is that the labor force participation rate has historically only displayed, at most, a moderate procyclical pattern. Shifting demographic shares, mainly an increase in older workers, can account for 80% of the decline in the participation rate since the last business cycle peak under a simple decomposition , although secular trends for some groups are also important.

Survey evidence indicates that almost half of prime age NLF men [men not in the laborforce] take pain medication on a daily basis. 40% of NLF prime age men report that pain prevents them from working on a full-time job for which they are qualified.



Note: those who are surprised by the low level of labor force participation should look at Figure 3 on p. 48. According to the demographics, the sharp decline in participation since 1998 is exactly in line with predictions.

https://drive.google.com/file/d/0B7m...3h4X0E/preview

[DOR]

Gross Domestic Product: Third Quarter 2016 (Advance Estimate)

Real gross domestic product increased at an annual rate of 2.9 percent in the third quarter of 2016, according to the "advance" estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 1.4 percent.

http://www.bea.gov/newsreleases/nati...ewsrelease.htm

DOR Comment: The longer term perspective.

Real GDP growth in the 2010s is running 20% faster than in the 2000s, an average of 2.1% vs. 1.7%. That’s mainly due to capital investment (6.4% vs. -1.2% in the previous decade), and despite contracting government spending (-0.9% vs. +2.4%). Domestic demand is rising more than 50% faster, 2.5% vs. 1.6%.

Labor figures are even more diverse. While the labor force is rising by only 0.5% since the first quarter of 2010, compared to 1.2% in the 2000s, employment is up 1.4%, vs. 0.2% in the 2000s. Average weekly unemployment claims are down from an average of 380,000 (on a smaller labor force and population base) to 349,000. Employment among all age groups and genders is up, with the exception of women 16-19 years of age.

_ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ 2000s _ _ _ 2010s
Real GDP Avg qtr-to-qtr _ _ _ _ _ _+1.82% _ _ _ +2.09%
Private Consumption_ _ _ _ _ _ _ _+2.41% _ _ _ +2.23%
Government Consumption_ __ _ __+2.35% _ _ _ -0.89%
Capital Investment_ _ _ _ _ _ _ _ _ _-1.23% _ _ _ +6.38%
Exports_ _ _ _ _ _ _ _ __ _ _ _ _ _ _ +3.47% _ _ _ +4.47%
Imports_ _ _ _ _ _ _ _ __ _ _ _ _ _ _+2.91% _ _ _ +4.62%
Domestic Demand_ _ _ _ _ _ _ _ _ _+1.61% _ _ _ +2.46%
Current Account (% of GDP) _ _ _ _-4.54% _ _ _ -2.63%

Population _ _ _ _ _ _ _ _ _ _ _ _ _ _+0.97% _ _ _ +0.76%
Non-institutionalized Pop. _ _ _ _ _ _+1.33% _ _ _ +1.14%
Labor Force _ _ _ _ _ _ _ _ _ _ _ _ _ _+1.21% _ _ _ +0.50%
Employment _ _ _ _ _ _ _ _ _ _ _ _ _ _+0.18% _ _ _ +1.36%
Unemployment Rate _ _ _ _ _ _ _ _ _ +5.54% _ _ _ +7.29%
Weekly Claims (‘000s) _ _ _ _ _ _ _ _ _379.68 _ _ _ _ 348.76

[DOR]

The latest revision to Q-3 2016 real GDP growth pushes the QQ figure up to 3.2%, from the previously estimated 2.9%. Private consumption grew faster but capital investment slower.