First the good news, US GDP was up 2.5% in the first quarter, driven largely by increased consumer spending, and by restocking done by retailers after a fourth quarter sell down of inventory. This done was in anticipation of a decline in sales after the FICA tax holiday expired and that decline never really happened.
Last week's initial unemployment claims were down substantially indicating businesses aren't cutting back. While consumer spending is up, the savings rate is down, but still at a respectable number compared to the negative savings rate during the Bush years.
The bad news is that real household income has resumed the downward slide that began with the Bush crash. Income hit a low point in mid 2011 down 10% from pre-crash numbers, and struggled back to a 7% deficit, but is now down 8.2% and likely to keep sliding.
The numbers weren't all that great before the crash, you see worker wages had risen steadily with productivity from the time Alexander Hamilton created our economic system back in 1790 until right up until 1980. Since then the money has all gone into the pockets of the extremely rich. If you adjusted income to productivity the median household income would be double what it is now, and the minimum wage would $22/hour.
The problem is getting worse mostly because first tier union workers who make decent wages are retiring and being replaced with younger worker making third of the pay. Increasingly highly profitable companies are even locking out workers, a sort of reverse strike. They are doing this in order to take away benefits from these second tier union workers. With their pay in the low to mid teens they can't withstand the bullying of their employers for very long.
The new Twinkies owner, a capital holdings company, has vowed to reopen the bakeries with only non-union workers. The corporate media continues to give the impression that it was a union strike that killed the Twinkies, but it was of course a repeating cycle of predatory capitalists that bought the company with borrowed money, looted the assets and pension funds. They would then bankrupt the company, taking still more in 're-organisation' fees and then the whole process was repeated several times until there was nothing left but the brand name. Workers had already given so many concessions that there was no point in continuing.
This is how you take the world's dominant economy and reduce it to third world status, and nothing is even slowing them down. www.prairie2.com Twitter @BruceEnberg and Prairie2 News on Facebook
A Big Box Store owned sweat shop in Bangladesh collapsed into a twisted pile yesterday, 90 known dead and hundreds still missing. When I say the Walmarts of the world own these sweat shops, I mean it in an economic sense, not in the paper fiction consisting of layers of corporate ownership that they hide behind to evade criminal responsibility. If you or I did the things the Walton family have done behind the bureaucracy of their corporate holdings we would never see the light of day again. That's not to say they are the only ones doing this, the decriminalization of mergers & acquisitions by the Reagan Adm has put most of the world's corporate holdings in the hands of sociopaths.
The fiction promoted by the corporate media is that these garment factories are locally owned, but the margin they operate on is so small that they have no choice but to do exactly what they are told by their corporate masters. It's true that they aren't explicitly told to lock the fire exits and ignore the giant cracks in the concrete, but they'll be joining the ranks of the starving poor if they don't, and they will simply be replaced by someone who will. The thing is, it really doesn't make the poorly made shirt that you buy cheaper, labor is not a big portion of the cost, it just deprives people a living wage, and that is the goal of the Neo-Cons.
Tweet Fall: on Tuesday an internet hacker inserted a message into the official twitter feed of the Associated Press saying that multiple explosions had occurred inside the White House and the POTUS had been injured. This triggered Wall Street computers monitoring the news feed to create an algorithmic response that generated millions of trades on Wall Street exchanges in a nano-second, and this dropped the value of the Dow 30 by 200 billion USD. [Be sure to download the 007 movie track 'Tweet Fall' by Adele on Fox Music].
Tweet Fall is however an insignificant blip compared to the day to day skimming operations of these computers. Their primary function is to monitor 'buy' orders for stock and if the algorithm detects a buying trend the computer will corner the market on that stock because it can act a nano-second faster than the buy orders. This forces the buyer to pay a few cents more for the shares then they would have paid a fraction of a second earlier. It doesn't sound like much but with as much as 80% of Wall Street trades done this way it captures billions for traders that hold stock for no more than two seconds. The trends that they are able to create by doing this also encourages more buying and selling by the retirement funds that hold a huge portion of the stock (and are desperate to show 'value'), this serves to create still more nano-second profit capture opportunities. And as shocking as this is, it is only one of the many scams Wall Street traders are running, more on this in future posts.
The Right Wing is outraged over airport delays because of the Sequester cut driven furloughs of air traffic controllers, but the FAA cuts were specifically mandated by the Republicans in amendments to the Sequester law. These cuts were designed to embarrass Obama, period. The rightwing talking point it is that dictator Obama could simply stop paying for Food Stamps and keep the planes flying on time. After all we know that welfare, the nanny state bureaucrats and foreign aid account for 99% of the Federal budget.
With every embarrassment of rigged research, rigged trading, rigged voting, rigged no-bid contracts, rigged legislation, and on and on and on, the right sinks closer to irrelevance. The problem is that this evil was so powerful to begin with that no matter how many time Buffy kicks them in the face they just keep getting up. It will take the realization by a far bigger portion of the population that there is evil among us to make it stop. It starts with you, sharpen your wooden stake. www.prairie2.com twitter @BruceEnberg and on Facebook
The Revolution won't be televised, but you can follow 'the collapse of civilization' on social media in real time. See you on the other side, we will share a can of beans, P2
The blast in West, Texas produced a yield equivalent to about a kiloton of TNT. They know this by measuring the size of the mushroom cloud. You see they did so many open air nuke tests in the 40s and 50s that there is actually a formula for this. The amount of anhydrous (dry) ammonia gas in the tanks was enough to yield 1.2 kilotons if it was all consumed in the blast. This was 1350 times what was allowed by Federal regulations, but since the Reagan Administration it's been up to the states to enforce these sort of work place rules. We don't know yet if the massive amount of ammonia nitrate also stored on the sight played any roll in the blast, it's an oxidizer and won't explode unless mixed with fuel oil.
Texas doesn't like to interfere in the rights of business. In fact there was nothing keeping the plant or something even worse from being right in the middle of town. The only zoning restriction in Texas is how close a strip club can be to a residence, church or school. Nuclear scale explosives? No problem, there's a vacant lot between the school and the nursing home, move right in, as long as your female workers keep their tops on. The thing about anhydrous ammonia is it's not particularly flammable, it burns at a lower temperature than its ignition point. The big concern for public safety is that you can use it to cook meth. That is it's safe as long as you follow the applicable regulations, funny how ignoring what the nanny state tells you tends to work out badly.
It turns out that scholarly research paper by economists Reinhart & Rogoff that the right has been using to justify austerity instead of spending money to stimulate the economy was so much BS. An econ grad student was studying the work and found a spread sheet coding error that produced completely erroneous data. When Paul Ryan stands up and says we must have austerity, go ahead and snicker or better yet, laugh out loud.
The Gold Bugs aren't giving up of course, they claim the gold market collapse was due to 'market manipulation' by the central banks who are buying all the gold, or Wall Street in cahoots with Obama (like they get along), or some unknown force (bare boobs maybe?). Now they claim that there is in fact a shortage of physical gold and dealers can't get any to sell. Seriously? Maybe the dealers just don't want to sell gold for less than they paid for it on the hopes the price will come back, and in fact the price is slowly climbing. Glenn Beck started using Boston within hours to start ginning up panic among his listeners that they needed to buy gold to protect themselves.
Tell the suckers they can't get any and they'll pay way above market. Speaking of that, bullets are the new 'gold'. People are paying four times retail for some calibers that are supposedly in short supply. This is even stupider than the gold nonsense, there has supposedly been a shortage of ammunition for five years and you don't need to mine bullets. They aren't hard to make and I'll bet you that a Congressional inquiry would discover they're not making them at anywhere near capacity, but the NRA will never allow one of those, it's not in the Second Amendment. It is in Article One, but that part of Constitution doesn't count. www.prairie2.com and Twitter @BruceEnberg
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