COVID Economy

[pacearrow02]

I do enjoy trying to serve as a counterbalance to a very one sided message board though.  Nothing wrong with challenging people's belief's a little bit. 

Not always successful at keeping it good, cordial discussion but when a lot of the responses come with a slew of name calling and weird accusations I lose my cool a bit. 

And if I'm posting anytime after 9pm that usually means their is a decent amount of bourbon fueling the fire.

[pacearrow02]

Your math is off.
If the economy slumps 10 percent one quarter, rebounds 6 percent the next and 3 percent the one after that, we're not almost even. Because the 10 percent drop is being calculated against a higher figure than the 6 percent and 3 percent increases.

I'll never call myself a mathematician but so if we're 3.5% below where we started the year at and GDP grows 4% in 4th quarter let's assume, that wouldn't put us back to end of 2019 GDP?  If you say no I wouldn't question that at all, it'd have to get us pretty damn close at least id imagine.

[forgetful]

I'll never call myself a mathematician but so if we're 3.5% below where we started the year at and GDP grows 4% in 4th quarter let's assume, that wouldn't put us back to end of 2019 GDP?  If you say no I wouldn't question that at all, it'd have to get us pretty damn close at least id imagine.

Some are projecting a flat 4th quarter or even a decline. The growth has flattened considerably, and without another stimulus, consumer spending is also flattening or declining.

Any additional stresses because of COVID increases and potential shutdowns will drag on the economy further.

Not to mention European shutdowns having a ripple effect. I'd fell much more comfortable with a 4th quarter projection right now of between -1% - +1%. With more downside risk than possible upside gain.

[MU82]

From today's column by lifelong conservative Republican George Will:

His replacement for Obamacare remains as nonexistent as his $1 trillion infrastructure program. ...

In defeat, Trump probably will resemble another figure from American fiction — Ring Lardner's "Alibi Ike," the baseball player whose talent was for making excuses. Trump will probably say that if not for the pandemic, Americans would have voted their pocketbooks, which would have been bulging because of economic growth, and reelected him. Americans, however, are more complicated and civic-minded than one-dimensional economy voters. But about those pocketbooks:

The 4 percent growth Trump promised as a candidate and the 3 percent he promised as president became, pre-pandemic, 2.5 percent during his first three years, a negligible improvement over the 2.4 percent of the last three Barack Obama years. This growth was partly fueled by increased deficit spending (from 4.4 percent of gross domestic product to 6.3 percent, by the International Monetary Fund's calculation).

Bloomberg Businessweek reports, "In the first three and a half years of Trump's presidency the U.S. Department of Labor approved 1,996 petitions [for Trade Adjustment Assistance] covering 184,888 jobs shifted overseas. During the equivalent period of President Barack Obama's second term, 1,811 petitions were approved covering 172,336 workers."

And the Economist says: "Recent research suggests that Mr. Trump's tariffs destroyed more American manufacturing jobs than they created, by making imported parts more expensive and prompting other countries to retaliate by targeting American goods. Manufacturing employment barely grew in 2019. At the same time, tariffs are pushing up consumer prices by perhaps 0.5 percent, enough to reduce average real household income by nearly $1,300."

As I said, the economy is a dumpster fire.

It was only decent (not "the greatest in American history") before the pandemic, and it's a disaster now after months and months and months of denying, lying, downplaying, mocking and, most despicably, actively fueling it by repeatedly holding mask-less, social-distance-less, super-spreader events for his own aggrandizement.

[pacearrow02]

Some are projecting a flat 4th quarter or even a decline. The growth has flattened considerably, and without another stimulus, consumer spending is also flattening or declining.

Any additional stresses because of COVID increases and potential shutdowns will drag on the economy further.

Not to mention European shutdowns having a ripple effect. I'd fell much more comfortable with a 4th quarter projection right now of between -1% - +1%. With more downside risk than possible upside gain.

Ya almost impossible to try and predict.  Couple articles I read today the "expert" was asked given the upward trend in positive cases if they would adjust 4th quarter prediction and none of them said they would shift expectations much.  Unless of course Biden wins then they would adjust expectations down huge!!!

Joking of course.

[jesmu84]

I think avg Americans are surviving economically as evidence of the strong housing market and historically high balances in their savings account albeit that has dipped a bit recently because stimulus program running out but generally speaking I think we're all doing ok.  Unemployment rate way to high but to be expected when large swaths of the country and still shut down, i imagine once things open back up fully that will drop to record lows again, question is can congress get it together to pass a last round of stimulus to keep these folks afloat until they have the opportunity to get back to work.

Seriously?

That housing market was incredibly strong in 06 and 07 too.

Savings? Do you do any investigating before you say things?

https://www.marketwatch.com/story/nearly-25-of-americans-have-no-emergency-savings-and-lost-income-due-to-coronavirus-is-piling-on-even-more-debt-2020-06-03

https://www.cnbc.com/2020/08/19/nearly-40percent-of-cash-strapped-americans-cant-last-a-month-on-savings.html

A large chuck of the country has no savings at all.

[pacearrow02]

Seriously?

That housing market was incredibly strong in 06 and 07 too.

Savings? Do you do any investigating before you say things?

https://www.marketwatch.com/story/nearly-25-of-americans-have-no-emergency-savings-and-lost-income-due-to-coronavirus-is-piling-on-even-more-debt-2020-06-03

https://www.cnbc.com/2020/08/19/nearly-40percent-of-cash-strapped-americans-cant-last-a-month-on-savings.html

A large chuck of the country has no savings at all.

I do read in fact.

https://www.statista.com/statistics/246268/personal-savings-rate-in-the-united-states-by-month/

[pacearrow02]

Seriously?

That housing market was incredibly strong in 06 and 07 too.

Savings? Do you do any investigating before you say things?

https://www.marketwatch.com/story/nearly-25-of-americans-have-no-emergency-savings-and-lost-income-due-to-coronavirus-is-piling-on-even-more-debt-2020-06-03

https://www.cnbc.com/2020/08/19/nearly-40percent-of-cash-strapped-americans-cant-last-a-month-on-savings.html

A large chuck of the country has no savings at all.

I can send you a bunch of links if you'd like.

https://www.google.com/amp/s/amp.usatoday.com/amp/3319970001

[jesmu84]

I can send you a bunch of links if you'd like.

https://www.google.com/amp/s/amp.usatoday.com/amp/3319970001

Lol.

"High income earners" are definitely not average americans.

Your interpretation of the economy at this point in time is laughable.

[Hards Alumni]

I can send you a bunch of links if you'd like.

https://www.google.com/amp/s/amp.usatoday.com/amp/3319970001

This is offtopic, but don't use amp links.  They're bad for a fair internet.   

[rocky_warrior]

The reliable thing about a Jamie, is that they can't stop being a Jamie.

[pacearrow02]

Lol.

"High income earners" are definitely not average americans.

Your interpretation of the economy at this point in time is laughable.

🤷‍♂️I said savings accounts are historically high, which was true.

[pacearrow02]

The reliable thing about a Jamie, is that they can't stop being a Jamie.

Back to name calling, nice.

[Galway Eagle]

Back to name calling, nice.

It's only insulting if you take it as an insult. There's no denying the similarities that can be drawn and he only pointed out the similarities

[cheebs09]

🤷‍♂️I said savings accounts are historically high, which was true.

But is it a good thing if those saving are high-income savings rather than spending? It seems like the spike up is more because high income aren't spending on vacations, nights out, etc. It doesn't seem like lower income people are able to save more and keep more of their paychecks.

[jesmu84]

🤷‍♂️I said savings accounts are historically high, which was true.

Actually what you said was average americans are surviving because their savings accounts are historically high.

That is false.

The national savings rate is high. That doesn't mean average americans have high savings rates.

[Skatastrophy]

But is it a good thing if those saving are high-income savings rather than spending? It seems like the spike up is more because high income aren't spending on vacations, nights out, etc. It doesn't seem like lower income people are able to save more and keep more of their paychecks.

Yeah, the FRED doesn't have that level of detail that I can find.  https://fred.stlouisfed.org/tags/series?t=savings

[Pakuni]

Actually what you said was average americans are surviving because their savings accounts are historically high.

That is false.

The national savings rate is high. That doesn't mean average americans have high savings rates.

Only 71 percent of Americans even have a savings account. The median amount is $3,500. A third of them are $1,000 or less.

https://www.fool.com/the-ascent/research/average-savings-account-balance/

[jesmu84]

Only 71 percent of Americans even have a savings account. The median amount is $3,500. A third of them are $1,000 or less.

https://www.fool.com/the-ascent/research/average-savings-account-balance/

Don't tell that to Pace. Everything is fine. Americans are thriving because of the significant amounts of cash in everyone's savings accounts

[#UnleashSean]

Only 71 percent of Americans even have a savings account. The median amount is $3,500. A third of them are $1,000 or less.

https://www.fool.com/the-ascent/research/average-savings-account-balance/

I don't have a savings account. I have a checking, 401k, and a brokerage. Savings are utterly useless.

[Skatastrophy]

I don't have a savings account. I have a checking, 401k, and a brokerage. Savings are utterly useless.

An annual yield of .5% on cash held is better than a yield of .1% in a checking account. Gotta put that money to work, especially when you're holding more cash than normal when you're getting ready to buy a house, or if you're if you're going into the winter of the first pandemic during your lifetime.

I guess if you don't have much money in the first place it doesn't matter though. I'm not taking a shot, I'm just thinking it through.

[The Sultan]

I don't have a savings account. I have a checking, 401k, and a brokerage. Savings are utterly useless.

Not really.  I only keep the $$ in my checking to cover my expenses between paychecks.  I keep $$ in a savings to have money I can get instantly for unexpected expenses and for things like Christmas, donations, etc. 

[Pakuni]

I don't have a savings account. I have a checking, 401k, and a brokerage. Savings are utterly useless.

Speaking of retirement savings, from the same report:

Just 54% of families headed by workers aged 32 to 61 participate in any kind of retirement plan, which means nearly half of families have no retirement savings at all, according to the Economic Policy Institute.
Meanwhile, the estimated median retirement savings across all generations is $50,000.
This figure increases with age: $23,000 for millennials, $64,000 for Gen Xers, and $144,000 for baby boomers, according to the Transamerica Center for Retirement Studies.

[jesmu84]

Speaking of retirement savings, from the same report:

Just 54% of families headed by workers aged 32 to 61 participate in any kind of retirement plan, which means nearly half of families have no retirement savings at all, according to the Economic Policy Institute.
Meanwhile, the estimated median retirement savings across all generations is $50,000.
This figure increases with age: $23,000 for millennials, $64,000 for Gen Xers, and $144,000 for baby boomers, according to the Transamerica Center for Retirement Studies.

I like when wall street folks say how important it is for everyday americans that we do all that we can as a nation to help the stock market because of retirement investments.

Except that a huge portion of average americans don't have any retirement savings at all.

[MU82]

I like when wall street folks say how important it is for everyday americans that we do all that we can as a nation to help the stock market because of retirement investments.

Except that a huge portion of average americans don't have any retirement savings at all.

Only about 55% of Americans own even 1 share of stock. That's according to an April 2020 poll by Gallup, which asks whether households owned stocks either directly or as part of a fund.