Posted on 01/05/2006 7:17:03 AM PST by Willie Green
For education and discussion only. Not for commercial use.
When The Wall Street Journal hires its editorial writers, is selective economic aphasia listed as a job qualification? We at GLOBALIZATION FOLLIES aren't trying to be flip here. But it's the only possible explanation other than flagrant intellectual dishonesty for editorials like the one published just before New Years on Americans' holiday spending.
Determined to show that the free trade policies it has pushed so zealously have produced only benefits for the U.S. economy, and not sagging living standards (among other costs), The Journal made clear its ability to tune out economic reality in a brief titled "Cheers." According to Journal editorialists, rising holiday sales figures belie the Democrats' efforts "to throw soot on the growth story by constantly saying that median incomes are falling." As the editorial condescendingly explained, "Judging by these holiday sales, somebody must have money."
Of course, it's possible to make this argument with a straight face only by forgetting a little economic and financial concept called debt. Especially relevant for any discussions of holiday shopping, the latest government statistics show that the second and third quarters of 2005 represented the first two consecutive quarters of negative personal savings since quarterly data started being released in 1947. The third quarter of 2005 was also the first since 1947 when net national savings as a whole went negative. Yes, somebody has to have the money to finance the nation's ongoing shopping spree. Increasingly, however, it's not Americans, but their foreign creditors.
Actually, this information was staring Journal editorialists in the face even as they were writing their copy. For what was the source of the data that inspired this paean to cure-all powers of free trade? A credit card company.
(Sources: "Cheers," The Wall Street Journal, December 28, 2005;
"Table 5.1. Saving and Investment [Billions of dollars] Seasonally adjusted at annual rates," National Economic Accounts, Bureau of Economic Analysis, Department of Commerce)
Owners equity in household real estate is $10.9 trillion. American households own $19.111 trillion in real estate (at market value) and have $8.196 in mortgages.
Federal Reserve: Flow of Funds (page 110)
The dollar is not what it used to be considering easy money.
What did the dollar used to be?
Are you saying that if my house sells today for $500,000, it's really not worth $500,000?
Foreigners are subsidizing negative real interest rates
Huh?
so we are borrowing and consuming like drunken sailors.
If we are borrowing like drunken sailors, how is it our household net worth is now $51 trillion, which is double what it was just a decade ago?
??? How is freely trading with someone who lives in another country not free trade.
It's not free trade because we're not "freely trading with someone who lives in another country", that's how.
Transnational corporations are not a "someone".
Another example of "Willie logic".
True. There are a lot of people with money to spend. It's the same as there have always been. One rich guy spends thousands of dollars and "consumer confidence" is up and the recession is over.
Is that you, Rush.... Sean...?
Shhhhhh!
so China is going to pay my Visa bill?
Right. I was concerned about the allegedly negative savings rate until I looked at what counts as "savings". By that standard I save 0% of my income, when in reality it's at least 30%.
Record levels? Explain? Is it a record in strictly numerical terms or is it a record as seen in the % of homes in foreclosure. It makes a difference you know.
- and the percentage of home ownership (i.e., how much of the house you actually own) at record low levels"
Like to see some links to your sources, if you have any.
Really? Then who (or what) are they, if not a someone or a collection of someones?
They're organizations that utilize their economic resources to corrupt legitimate governments, replacing them with their own puppets.
"Merchants have no country. The mere spot they stand on does not constitute so strong an attachment as that from which they draw their gains."
--Thomas Jefferson to Horatio G. Spafford, 1814. ME 14:119
"I hope we shall... crush in its birth the aristocracy of our moneyed corporations, which dare already to challenge our government to a trial of strength and bid defiance to the laws of our country."
--Thomas Jefferson to George Logan, 1816. FE 10:69
All of them? In any case, I didn't ask what they did with their resources. I asked why I can't freely trade with them.
You've got that right.
Not even that. We are merely stewards for the State. We pay the insurance, the upkeep and pay to improve the property under the eagle eye of the REAL owner. If we fail to pay our yearly rent, even after we've finished paying the bank, the REAL owner takes back HIS property.
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