The U.S. labor shortage is reaching a critical point

Discussion in 'General Discussion' started by Czer, Jul 5, 2018.

  1. Velox

    Velox TZT Abuser

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    I agree, having a location-dependent MW makes sense. Although as you note it depends on how sensitive the market really is, and everything else equal, rural USA could certainly use a disposable income influx of some kind. Sweden actually has a pretty curious system with no national MW, but strong unions negotiate an implicit per-sector salary floor. This is a bit hit and miss, but has worked fairly well in keeping the working class from lagging too far behind in salary increases. I'm not sure just how flexible it is to regional considerations, but I suspect there is some leeway since it comes down to union-employer negotiations.
     
  2. Agrul

    Agrul TZT Neckbeard Lord

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    "everything else equal, rural USA could certainly use a disposable income influx of some kind" I agree with. I think MW may be limited as a tool in its ability to get that done, though. Job retraining programs, targeted subsidies etc seem more likely to succeed without adverse side effects.

    Which is not to argue against increasing the MW -- it's way too low in the US. I just suspect most published work does not include a broad enough range of conditions to properly forecast what would happen with a uniform, large MW increase nation-wide.

    My suggestion of tying MW increases to local measures of inflation also seems to have fairness issues as well: how do you ensure people don't get trapped in their local area b/c their "local MW" can't get support getting them to an area with a higher local MW? Politically, how do you explain why you're requiring that businesses give less money to people in BumFuck, NW less money than people in BigDick, SW?
     
  3. Velox

    Velox TZT Abuser

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    You would be doing it implicitly via inflation, but tying to a local CPI seems fairly explainable? E.g. MW is set to 4 Big Macs per hour :)
     
  4. Czer

    Czer I'm a poor person. The lambo is my cousin's.

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    Wealth Psychologist
    Jan 22, 2018

    https://www.investopedia.com/terms/w/wealthpsychologist.asp

    What is a Wealth Psychologist
    A wealth psychologist is a mental health professional who specializes in issues relating specifically to wealthy individuals. Wealth psychologists are also called money psychologists or wealth counselors. Wealth psychologists help their ultra-rich clients deal with issues such as the guilt they feel about being wealthy, or advise on inheritance issues and counsel parents on how to raise children who are not spoiled by money.

    BREAKING DOWN Wealth Psychologist

    Wealth psychologists assist many modern wealthy families, most of which built their wealth in one generation. They may not be comfortable with all aspects of being rich, and may have a lot of guilt associated with it. Even for those people who find themselves financially prepared, more are beginning to realize they may not be psychologically or emotionally prepared to cope with wealth. Ample evidence points to the notion that, the more people are prepared in this way, the happier they are throughout their remaining life stages. The younger people are when they begin to work toward full preparation, the more productive their lives.

    Wealth Psychology’s Role in Holistic Planning

    Financial planning that emphasized the quantitative side of life has given way to a practice intended to broaden the scope and clarity of one’s vision of the future, and the values that drive the commitment to living a full and complete life. Expectations of longer lives, uncertainty over a frail economy, fear of market risk, disillusionment with government and concerns over world chaos are contributing factors to new attitudes about money and happiness.

    Some private wealth management and financial services firms retain wealth psychologists to train their financial advisors or provide individual counseling to clients. Wealth psychologists are increasingly included as a part of a client’s advisory team engaged in a holistic financial planning process. Their focus is on helping clients better understand their values, attitudes and beliefs about money to better cope with self-limiting or self-destructive behaviors at the center of their relationship with money or with a family of wealth.

    Preparing Future Generations for Wealth

    Wealth psychology is becoming more prominent in legacy planning, preparing family members and future generations for the emotional transfer of wealth. While the precepts for effectively maximizing the transfer of assets are well established within the traditional wealth management community, the guiding principles for preparing family members and future generations for the emotional transfer of values and beliefs are often minimized or ignored. The role of the wealth psychologist is to help families bridge the communication and trust gap for building solidarity of vision and purpose among disparate family members and generations.
     
  5. Czer

    Czer I'm a poor person. The lambo is my cousin's.

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  6. Kanmuk_Sealclubber

    Kanmuk_Sealclubber Yes

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    I’m against anything that could potentially raise the life expectancy in rural communities or discourage people from moving out of them. Those shitholes need to die.
     
  7. Utumno

    Utumno Administrator Staff Member

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  8. Czer

    Czer I'm a poor person. The lambo is my cousin's.

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  9. Samassi Abou

    Samassi Abou TZT Abuser

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    “The oil production cuts that OPEC and its partners led by Russia agreed at the end of last year are proving slower to materialize than most observers expected, with Russia breaking another post-Soviet production record in December, and Iran’s and Venezuela’s declines in output slowing down. That’s one of the main conclusions from the latest edition of the monthly Oil Market Report by the International Energy Agency.

    Russia produced 11.5 million barrels of crude daily last month and, according to the IEA, “It is unclear when it will cut and by how much.” Russia undertook to reduce its production by 228,000 bpd beginning this month, with the cuts to last until April, when OPEC+ will meet to review the results of its latest price-boosting effort.”

    https://oilprice.com/Energy/Crude-Oil/Why-OPEC-Output-Cuts-Take-So-Long-To-Materialize.html
     
  10. Czer

    Czer I'm a poor person. The lambo is my cousin's.

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    Iran Looks To Boost Oil, Gas Production Capacity With $1B Deals
    Jan 22, 2019


    https://oilprice.com/Latest-Energy-...il-Gas-Production-Capacity-With-1B-Deals.html

    Subsidiaries of the National Iranian Oil Company (NIOC) signed on Tuesday agreements with Iran-based companies aimed at maintaining and increasing the production capacity of nine ageing oil and gas fields in deals worth a total of US$1 billion, the Iranian oil ministry’s news service Shana reported.

    The agreements signed today are part of a wider plan to have 33 projects for enhancing the production capacity at Iranian oil and gas fields. The 33 projects will be worth a total of US$6 billion in three years, Shana reports.

    According to S&P Global Platts, the nine deals signed on Tuesday are expected to add nearly 90,000 bpd to Iran’s production capacity within the next three years, while the 33 projects are designed to raise Iran’s production capacity by 281,000 bpd.

    Iran’s capacity may be increased, but its oil production and exports are currently limited by the U.S. sanctions that returned in early November.

    According to OPEC’s secondary sources, Iran’s crude oil production plunged by 159,000 bpd from November to 2.769 million bpd in December. In the third quarter of 2018, before the U.S. sanctions were re-imposed, Iran’s crude oil production averaged 3.603 million bpd.

    Before the sanctions, Iran was OPEC’s third-largest producer after Saudi Arabia and Iraq, while in December, as per OPEC’s sources, the Islamic Republic was only fifth, after Saudi Arabia, Iraq, the United Arab Emirates (UAE), and Kuwait.

    At the signing ceremony for the deals to boost Iranian production capacity, Iran’s Oil Minister Bijan Zanganeh said that “We wanted to create projects only for Iranian contractors.”

    “We wanted to raise hope among local companies as [the US] wants to cause worry and upset Iranian people by the sanctions,” Platts quoted Zanganeh as saying.

    Iran will not be complying with the “fully illegal” U.S. sanctions, Zanganeh said earlier this month, in yet another defiant statement from Tehran after the American sanctions on Iran’s oil and shipping industry snapped back.

    While it stays under U.S. sanctions, Iran will not be discussing the volume or the destination of its oil exports, the Iranian oil minister noted.
     
  11. Czer

    Czer I'm a poor person. The lambo is my cousin's.

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    US pork sales to China dropped by more than 250,000 tons last year as the trade war hits American farmers
    Jan. 25, 2019

    https://www.businessinsider.com/tru...than-250000-tons-2019-1?utm_source=reddit.com

    Chinese imports of US-bred pork dropped more than 250,000 tons in 2018 as the impact of the trade war between the two nations hit the meat market.

    Imports of prime cuts and offal combined dropped 55% in the year, following the imposition of major tariffs on the meat, which is the most consumed in China.

    According to a report from Reuters, the US sent 263,000 tons of pork to China last year, down from more than 500,000 tons in 2017. Using data from the General Administration of Customs, Reuters calculated that US exports of pork offal dropped 58% to 177,041 tons in 2018.

    China is far and away the world's largest importer of non-prime cuts of pork — things like feet, ears, and offal — with 9 out of 10 pigs ears sent overseas by US producers going to the country. The market for total offal shipments to China last year was in excess of $870 million.

    China is both the biggest consumer and producer of pork in the world, and the meat is effectively a staple food for many Chinese citizens. Demand for pork has boomed in recent years thanks to a growing population and increasing affluence among Chinese citizens.

    Previously, the country was largely able to serve demand with domestically reared animals, but population growth has led it to look overseas.

    The fall in Chinese pork imports from the US follows a similar pattern to the drop in the amount of soybeans moving between the two nations as a result of tariffs.

    Soybean exports from the US to China plunged after tariffs were first introduced, and although China has officially resumed its purchases, demand remains stifled, causing major problems for US farmers.

    In November it was reported that farmers in some US states are being forced into plowing their crops under — effectively burying them in their fields — because there is not enough room in storage facilities. All grain depots and silos are almost full, meaning farmers have to figure out their own storage or let the crops rot.

    Even after Beijing agreed in trade talks with Washington to resume American soybean purchases, prices of the legume are still down more than 7% from a year earlier and aren't expected to improve anytime soon.

    "The outlook for US soybean prices is bleak," said Yasemin Engin, an economist at Capital Economics.
     
  12. Czer

    Czer I'm a poor person. The lambo is my cousin's.

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    Wealth concentration near ‘levels last seen during the Roaring Twenties,’ study finds
    February 8, 2019

    https://www.seattletimes.com/busine...seen-during-the-roaring-twenties-study-finds/

    The 400 richest Americans – the top 0.00025 percent of the population – have tripled their share of the nation’s wealth since the early 1980s, according to a new working paper on wealth inequality by University of California at Berkeley economist Gabriel Zucman.

    Those 400 Americans own more of the country’s riches than the 150 million adults in the bottom 60 percent of the wealth distribution, who saw their share of the nation’s wealth fall from 5.7 percent in 1987 to 2.1 percent in 2014, according to the World Inequality Database maintained by Zucman and others.

    Overall, Zucman finds that “U.S. wealth concentration seems to have returned to levels last seen during the Roaring Twenties.” That shift is eroding security from families in the lower and middle classes, who rely on their small stores of wealth to finance their retirement and to smooth over economic shocks like the loss of a job. And it’s consolidating power in the hands of the nation’s billionaires, who are increasingly using their riches to purchase political influence.

    Zucman, who advised Sen. Elizabeth Warren, D-Mass., on a recent proposal to tax high levels of wealth, warns that these numbers may actually understate the amount of wealth concentrated in the hands of the rich: It has become more difficult to account for the true wealth of the ultra-rich in recent decades, in part because many hide their assets in offshore tax shelters.

    Wealth, here, is roughly synonymous with net worth: the value of everything that a family owns, minus the value of any debt. Assets such as homes, land, rental properties, stock holdings, business equity and bank accounts are included.

    The definition excludes personal possessions like cars and furniture. They’re difficult to measure, don’t produce income and would amount to a tiny fraction of the nation’s net worth if they were included, according to Zucman.

    For illustrative purposes, consider a person who owns a $250,000 house with $200,000 in outstanding mortgage debt. She also has $5,000 in her bank account and $25,000 in a 401(k). That person has a net worth of $80,000, a figure derived from the sum of all her assets ($250,000 + $5,000 + $25,000) minus the sum of all her debts ($200,000). That $80,000 puts her close to the national median of household net worth, according to previous research by Edward N. Wolff of New York University.

    American wealth is highly unevenly distributed, much more so than income. According to Zucman’s latest calculations, today the top 0.1 percent of the population has captured nearly 20 percent of the nation’s wealth, giving them a greater slice of the American pie than the bottom 80 percent of the population combined. That bottom 80 percent figure includes the 1 in 5 American households that has either zero or negative wealth, meaning that its debts are greater than or equal to its assets. According to NYU’s Wolff, the share of U.S. households with zero or negative wealth has risen by roughly one-third since 1983, when it was 15.5 percent.

    The top 10 percent of individuals, meanwhile, own more than 70 percent of the nation’s wealth, more than twice the amount owned by the bottom 90 percent. The top 10 percent have increased their share of wealth by about 10 percentage points since the early 1980s, with a concomitant decline in the share of wealth owned by everyone else. In some ways, Zucman finds, the distribution of wealth in the United States more closely resembles the situation in Russia and China than in other advanced democracies such as the United Kingdom and France.

    Several caveats to this discussion are in order. First, a person with negative net worth is not necessarily penniless. A number of the households in the negative-net-worth bucket may be young professionals, like doctors or lawyers, starting off their careers with large amounts of student debt. This is not necessarily a problem if their high earnings ultimately erase their debt and catapult them into the upper reaches of the wealth spectrum later in their careers.

    But young, high-earning professionals account for a minority of negative-net-worth families. The 2016 Survey of Consumer Finances, for instance, shows that roughly 40 percent of families in the bottom quartile of net worth had an outstanding student loan balance of any kind. High-earning professionals probably account for just a fraction of that 40 percent.

    Second, rising wealth inequality may not necessarily be a zero-sum game: The rich gobbling up a larger share of the national wealth pie may not be a problem if there’s still more pie left for everyone else, relative to several years or decades ago. There’s good reason to suspect that this may be the case for income: While incomes at the top have risen dramatically over the past few decades, incomes in the middle have risen, too, albeit much more slowly.

    But the same dynamic is not occurring with household wealth. According to Wolff, the median household wealth in the United States in 2016 ($78,100) was slightly lower, in inflation-adjusted dollars, than it was three decades ago in 1983 ($80,000). Over the same time period, the average wealth of the top 1 percent of households more than doubled, from $10.6 million to $26.4 million.

    The wealthy are becoming wealthier, in other words, and there’s good reason to think it’s happening at the expense of everyone else. As Zucman notes, this has very different implications for different groups of people. “For everybody except the rich,” he writes, wealth’s “main function is to provide security.” Middle-class families tend to use their wealth to save for rainy-day expenses or to draw down on for retirement.

    But “for the rich, wealth begets power,” according to Zucman. Our electoral system is highly dependent on outside financing, creating numerous opportunities for the wealthy to convert their money into influence and tip the political scales in their favor. As a result, politicians have become accustomed to playing close attention to the interests of the wealthy and passing policies that reflect them, even in cases where public opinion is strongly trending in the opposite direction.

    “Wealth concentration may help explain the lack of redistributive responses to the rise of inequality observed since the 1980s,” Zucman writes. The interplay between money and power, in other words, may be self-reinforcing: The wealthy use their money to buy political power, and they use some of that power to protect their money.
     
  13. AgelessDrifter

    AgelessDrifter TZT Neckbeard Lord

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    I feel like people have been saying that for years at this point

    When do the guillotines come out
     
  14. Czer

    Czer I'm a poor person. The lambo is my cousin's.

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    A record 7 million Americans are 3 months behind on their car payments, a red flag for the economy
    February 12

    https://www.washingtonpost.com/busi...?utm_source=reddit.com&utm_term=.ddb882a2e779

    A record 7 million Americans are 90 days or more behind on their auto loan payments, the Federal Reserve Bank of New York reported Tuesday, even more than during the wake of the financial crisis.

    Economists warn that this is a red flag. Despite the strong economy and low unemployment rate, many Americans are struggling to pay their bills.

    “The substantial and growing number of distressed borrowers suggests that not all Americans have benefited from the strong labor market,” economists at the New York Fed wrote in a blog post.

    A car loan is typically the first payment people make because a vehicle is critical to getting to work, and someone can live in a car if all else fails. When car loan delinquencies rise, it is usually a sign of significant duress among low-income and working-class Americans.

    “Your car loan is your No. 1 priority in terms of payment,” said Michael Taiano, a senior director at Fitch Ratings. “If you don’t have a car, you can’t get back and forth to work in a lot of areas of the country. A car is usually a higher-priority payment than a home mortgage or rent.”

    People who are three months or more behind on their car payments often lose their vehicle, making it even more difficult to get to work, the doctor’s office or other critical places.

    The New York Fed said that there were over a million more “troubled borrowers” at the end of 2018 than there were in 2010, when unemployment hit 10 percent and the auto loan delinquency rate peaked. Today, unemployment is 4 percent and job openings are at an all-time high, yet a significant number of people cannot pay their car loan.

    Most of the people who are behind on their bills have low credit scores and are under age 30, suggesting young people are having a difficult time paying for their cars and their student loans at the same time.

    Auto loans surged in the past several years as car sales skyrocketed, hitting a record high in 2016 of 17.5 million vehicles sold in the United States. Overall, many borrowers have strong credit scores and repay their loans on time, but defaults have been high among “subprime” borrowers with credit scores under 620 on an 800-point scale.

    The share of auto loan borrowers who were three months behind on their payments peaked at 5.3 percent in late 2010. The share is slightly lower now — 4.5 percent — because the total number of borrowers has risen so much in the past several years. Still, economists are concerned because the number of people impacted is far greater now and the rate has been climbing steadily since 2016 even as more people found employment.

    Experts warn Americans to be careful where they get their auto loan. Traditional banks and credit unions have much smaller default rates than “auto finance” companies such as the “buy here, pay here” places on some car lots.

    [​IMG]

    Fewer than 1 percent of auto loans issued by credit unions are 90 days or more late, compared with 6.5 percent of loans issued by auto finance companies.

    “The No. 1 piece of advice I have is to not get your financing from a car dealership,” said Christopher Peterson, a law professor at the University of Utah and former special adviser to the Consumer Financial Protection Bureau. “Shop separately for the vehicle and the financing. Go to a credit union or community bank to get a low-cost loan.”

    Rates can vary substantially depending on a borrower’s credit score and where they obtain a loan. A “prime” borrower with a credit score in the range of 661 to 780 can get an auto loan rate of about 4.5 to 6 percent, according to NerdWallet. In contrast, a subprime borrower is typically looking at rates between 14.5 and 20 percent.

    After the financial crisis, the government placed heavy restrictions on mortgages to make it harder to take out a home loan unless someone could clearly afford to make the monthly payments. But experts warn that there are far fewer restrictions on auto loans, meaning a consumer has to be savvier about what they are doing when they take out a loan.

    "Predatory lending practices and a lack of real transportation options leave many households trapped in debt with few ways out,” said Faye Park, president of the U.S. Public Interest Research Group, which advocates for consumer protections.

    Repossessing a car is also a quick process thanks to technology and the laws in many states. Some cars are installed with devices that prevent the car from turning on if someone misses a payment and it has become easier to geo-locate a car to tow it away.

    “It’s a lot easier to repossess a vehicle than to foreclose on a home,” Taiano said.

    He noted that non-prime and subprime auto loans increased from 28 percent of the market in 2009 to 39 percent in 2015, a reminder of how aggressively lenders went after borrowers who were on the margin of being able to pay. More lenders are giving people six or seven years to repay now vs. four of five years in the past, according to Experian, another tactic to try to make loans look affordable that might not otherwise be.

    While defaults on auto loans are a red flag, they are unlikely to take down the entire financial system as mortgages did in the lead-up to the 2008-2009 financial crisis. The total auto loan market is just over $1 trillion, far smaller than the $9 trillion home mortgage market.

    The amount of money people borrow to buy a car is also much smaller — typically under $35,000 — vs. a home loan, where people often borrow several hundred thousand dollars.

    [​IMG]