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

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

  1. Czer

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

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    The US is no longer the world's most competitive economy
    May 30, 2019

    https://www.foxbusiness.com/economy/worlds-most-competitive-economy

    The United States no longer has the most competitive economy in the world, according to annual rankings compiled by the Switzerland-based business school IMD.

    For the first time in nine years, Singapore replaced the U.S. as the world’s most competitive economy. The U.S. dropped down to third on the list, thanks to higher fuel prices, weaker high-tech exports, fluctuations in the value of the dollar and the fading impact of President Trump’s massive tax overhaul. Hong Kong, meanwhile, remained in second place. China was ranked fourteenth.

    “In a year of high uncertainty in global markets due to rapid changes in the international political landscape as well as trade relations, the quality of institutions seem to be the unifying element for increasing prosperity,” Arturo Bris, an IMD professor and director of the World Competitiveness Center, said in a statement.

    To determine the results, the study incorporated 235 indicators from each of the ranked 63 economies, taking into account statistics like unemployment, GDP and government spending on health and education, as well as issues like social cohesion, corruption and globalization.

    The Asia-Pacific region emerged as a contender for competitiveness, with 11 out of 14 economies either improving or holding their ground, led by Hong Kong and Singapore. Indonesia leaped 11 spots to 32nd -- the biggest improvement in the region, thanks to increased more efficiency in the government sector and improved infrastructure.

    Conversely, competitiveness across Europe has struggled to gain ground. Uncertainty over Brexit sent the United Kingdom down three spots, from 20th to 23rd. The biggest climber for the region was Ireland, which rose five places to 7th as business conditions improved.

    Here’s a look at the 20 most competitive economies, according to IMD.

    1. Singapore

    2. Hong Kong SAR

    3. United States

    4. Switzerland

    5. United Arab Emirates

    6. Netherlands

    7. Ireland

    8. Denmark

    9. Sweden

    10. Qatar

    11. Norway

    12. Luxembourg

    13. Canada

    14. China

    15. Finland

    16. Taiwan, China

    17. Germany

    18. Australia

    19. Austria

    20. Iceland
     
  2. AgelessDrifter

    AgelessDrifter TZT Neckbeard Lord

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    What does competitive mean in this context
     
  3. Czer

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

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    The average millennial has an average net worth of $8,000. That's far less than previous generations.
    May 31, 2019

    https://www.sfgate.com/business/article/The-average-millennial-has-an-average-net-worth-13909188.php

    Millennials are doing far worse financially than generations before them, with student loans, rising rents and higher health care costs pushing the average net worth below $8,000, a new study shows.

    The net worth of Americans aged 18 to 35 has dropped 34 percent since 1996, according to research released Thursday by Deloitte, the accounting and professional services giant. This demographic is paying more for education and such basics as food and transportation while incomes have largely flatlined.

    "The vast majority of consumers are under tremendous financial pressure," said Kasey Lobaugh, Deloitte's chief retail innovation officer and lead author of the study. "That is particularly true for low-income Americans and millennials."

    The growing gap between the nation's wealthiest residents and everybody else, he said, is affecting the way consumers spend.

    Education expenses have climbed 65 percent in the past decade. Food costs have jumped 26 percent, health care is up 21 percent, housing jumped 16 percent and transportation rose 11 percent. And there are now expenses that most consumers didn't have to account for 20 years ago, including smartphones and data plans.

    Today's 20- and 30-somethings spend about 17 percent of their incomes on education, health care and rent, compared with 12 percent a decade ago, the study found. Discretionary spending, which includes dining out, alcohol and furniture, has remained largely flat, at about 11 percent of total income.

    "Only 20 percent of consumers were meaningfully better off in 2017 than they were in 2007, with precious little income left to spend on discretionary retail," the study found.

    The findings, researchers say, "debunk many conventional wisdoms about the new-age consumer." Millennials, they contend, are putting off home-buying and marriage not because they want to, but because rising costs are making it difficult for them to afford down payments and weddings.

    "The narrative out there is that millennials are ruining everything, from breakfast cereal to weddings, but what matters to consumers today isn't much different than it was 50 years ago," Lobaugh said. "Generally speaking, there have not been dramatic changes in how consumers spend their money."

    Overall, U.S. retail spending has grown about 13 percent since 2005, to roughly $3 trillion a year, but researchers say much of that growth is tied to population growth, not consumers spending more.

    In the past decade, the nation's highest earners - households making $100,000 or more - watched their incomes rise 1,305 percent more than those in households making less than $50,000 a year.

    There is one area, though, where consumers are spending less than they once did: Clothing. Shoppers are spending half as much on apparel as they did a decade ago, even as they buy more items, the study found.

    Lobaugh said the reasons for that shift are both economic and cultural. Retailers are churning out cheaper clothing and selling it at lower prices as they try to compete with fast-fashion chains like H&M and Zara. At the same time, American are buying more casual and athletic wear, which tends to be cheaper than business suits and formal wear.
     
  4. Czer

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

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    The richest 10% of households now represent 70% of all U.S. wealth
    May 31, 2019

    https://www.marketwatch.com/story/t...-now-represent-70-of-all-us-wealth-2019-05-24

    The rich are getting richer. It is a refrain that has certainly been uttered before, and likely will again, as Deutsche Bank Securities’ chief economist points out that the gap between the haves and have-nots in the U.S. is, indeed, widening.

    Deutsche Bank’s Torsten Sløk says that the distribution of household wealth in America has become even more disproportionate over the past decade, with the richest 10% of U.S. households representing 70% of all U.S. wealth in 2018, compared with 60% in 1989, according to a recent study by researchers at the Federal Reserve.

    The study finds that the share of wealth among the richest 1% increased to 32% from 23% over the same period.

    To make a finer point, Fed researchers say the increase in wealth among the top 10% is largely a result of that cohort obtaining a larger concentration of assets: “The share of assets held by the top 10% of the wealth distribution rose from 55% to 64% since 1989, with asset shares increasing the most for the top 1% of households. These increases were mirrored by decreases for households in the 50-90th percentiles of the wealth distribution,” Fed researchers said.

    Sløk said the financial crisis has played a significant part in this growing gap, which resulted in the Federal Reserve stepping in to stem a massive ripple of losses through the global financial system as the housing market imploded.

    As a result, the Fed lowered interest rates, which had the knock-on effect of pushing easy money into the hands of the already-wealthy.

    “The response to the financial crisis was for the Fed to lower interest rates which in turn pushed home prices and stock prices steadily higher over the past decade,” Slok said.

    “And another consequences of the financial crisis was a decline in homeownership and stock ownership among households,” he said. Homeownership usually represents the largest share of household wealth and that was hurt in during the 2008-09 recession.

    The national homeownership rate for the first quarter of 2019 was 64.2%, according to the U.S. Census Bureau. That is below the historic average of 65.2%, which dates back to the 1960s.

    Here’s a graphic from the Census Bureau showing the homeownership average since 1998:

    [​IMG]

    “So in some sense the source of higher inequality is Fed policies, which pushed stock prices and home prices higher. But the lack of changes in redistribution by fiscal policy is also playing a role,” Sløk said.

    Stocks have enjoyed a massive increase since their crisis lows.

    The Dow Jones Industrial Average DJIA, -1.41% has climbed nearly 300% since its closing low in March 2009, the S&P 500 index SPX, -1.32% has climbed 325%, while the Nasdaq Composite Index COMP, -1.51% has soared 535% over the same period.

    But homeownership hasn’t moved in step with that stock advance, and many individuals didn’t participate in the stock market’s rally after the crisis, Sløk speculates.

    “In sum, this meant that stock prices and home prices have increased but ownership has shrunk to fewer hands and as a result we now have more inequality than ever before,” he explained.

    Inequality has partly given rise to Democratic-Socialist Congresswoman Alexandria Ocasio-Cortez, who has proposed leveling massive taxes on the superrich. Her mention in early January of a radical 70% tax on the wealthy has proven divisive in Washington.

    The wealth divide has also intensified the debate about the merits of capitalism: the beating heart of the U.S.’s financial system.

    Billionaire Ray Dalio said capitalism is no longer working for most Americans, adding that the expanding wealth gap is creating a volatile environment with disturbing parallels to the economic and social upheaval of the 1930s, he said in a blog on LinkedIn last month.

    It’s unclear, what the next 10 years will look like, but some have argued that a combination of monetary policy and fiscal policy may be necessary to span the yawning divide.
     
  5. Czer

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

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    Study Finds Trump Tax Cuts Failed to Do Anything But Give Rich People Money
    MAY 29, 2019

    http://nymag.com/intelligencer/2019...E0BfsPEzmFmJghCWmmBCchckhMLYxkCb3zul-Xdnqi-u0

    The biggest effect of the Trump tax cuts is obvious: People who own businesses and other sources of concentrated wealth will have a lot more money, and the federal budget will have less. But the advocates of the tax cuts insisted it wasn’t about letting the makers keep their hard-earned money rather than handing it over to the takers. It was about incentivizing business to repatriate funds and ramp up its investments, thereby increasing growth and wages.

    The Congressional Research Service, a kind of in-house think tank for Congress, has a new paper analyzing the effects of the Trump tax cuts. It finds that none of those secondary effects have materialized. Growth has not increased above the pre-tax-cut trend. Neither have wages. After a brief and much smaller than expected bump, repatriated corporate cash from abroad has leveled off.

    It’s of course possible that the growth in wages would take longer than the year or so that has passed since the tax cut to show up. If the Trump tax cut had encouraged new business investment, it might take years for the new investment to bear fruit. But the study looks directly at business investment and finds … nothing:

    [​IMG]

    Supporters of the Trump tax cuts insisted not only that they would promote growth, but that they would promote so much growth the measure would pay for itself. Even moderates like Susan Collins repeated assurances by the party’s pseudo-economists that the plan would not increase the deficit. So far, the growth feedback from the tax cuts has made up about 5 percent of the plan’s revenue loss, a mere 95 percent shy of the predictions.

    The passage of the plan was met with a coordinated wave of corporate public-relations announcements of worker bonuses. But the paper finds no widespread increase in bonuses or worker compensation.

    When assessing these arguments, keep a close eye on the number of Republican officials or conservative policy-makers who revise their position on the Trump tax cuts in light of the data. If their true primary goal was to increase business investment, then the complete failure of a highly expensive program to achieve its stated goal would lead them to question their support. Why not cancel the Trump tax cuts and use the couple trillion dollars in lost revenue to fund a more effective growth-promoting policy?

    So far, the number of Republicans reassessing their support for the Trump tax cuts is, give or take, zero. What this suggests is that the alleged growth-incentivizing secondary effects of the plan were rationales, and the primary effect — giving business owners more money — was the hidden main goal all along.
     
  6. Czer

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

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    Morgan Stanley sees global recession ‘in three quarters’ if Trump escalates trade war
    6/2/2019
    • Investors are overlooking the threat posed by the U.S.-China trade war, which could send the global economy into recession in less than a year, according to a research note published Sunday by Morgan Stanley.
    • “Investors are generally of the view that the trade dispute could drag on for longer, but they appear to be overlooking its potential impact on the global macro outlook,” wrote Chetan Ahya, the investment bank’s chief economist.
    • Ahya noted that the outcome of the trade war at the moment “is highly uncertain” but warned that if the U.S. follows through with 25% tariffs on the additional Chinese imports, “We could end up in a recession in three quarters.”
    https://www.cnbc.com/2019/06/02/mor...on-on-the-horizon-if-trade-war-escalates.html

    Investors are overlooking the threat posed by the U.S.-China trade war, which could send the global economy into recession in less than a year, according to a research note published Sunday by Morgan Stanley.

    “Investors are generally of the view that the trade dispute could drag on for longer, but they appear to be overlooking its potential impact on the global macro outlook,” wrote Chetan Ahya, the investment bank’s chief economist.

    President Donald Trump last month raised the tariffs on $200 billion worth of Chinese goods from 10% to 25%. U.S. officials have also threatened to impose tariffs on $300 billion in remaining Chinese imports.

    Ahya noted that the outcome of the trade war at the moment “is highly uncertain” but warned that if the U.S. follows through with 25% tariffs on the additional Chinese imports, “We could end up in a recession in three quarters.”

    “Is such a prognosis alarmist? We think otherwise,” Ahya wrote.

    In particular, investors are not fully appreciating the effect of reduced capital expenditures, which could drive down global demand, according to the bank.

    An economic slowdown in early 2020 could hamstring Trump’s electoral chances. Trump has campaigned on boosting growth and lowering unemployment, and made his deal-making abilities a signature aspect of his 2016 campaign. American voters head the the polls in November of next year.

    While policymakers are likely to act to stem the effects of a trade war, “given the customary lag before policy measures impact real economic activity, a downdraft in global growth appears inevitable,” according to Ahya.

    Talks between the U.S. and China have stalled as the world’s two largest economies trade rhetorical barbs and punishing tit-for-tat economic measures.

    Earlier Sunday, the Chinese government released a white paper accusing the U.S. of starting the trade war and of being an unreliable negotiating partner. The document warned that the dispute had global implications.

    On Saturday, the Chinese Xinhua news agency reported that state authorities were investigating American delivery giant FedEx. That news followed the Trump administration barring Chinese telecom giant Huawei from dealing with American suppliers.

    Markets have tanked amid the trade uncertainty, with the S&P 500 down more than 6% last month and the Dow, as of Friday, marking losses for six straight weeks, the longest such streak in eight years.

    The hit to equities was compounded last week by Trump’s threat of new tariffs on Mexico if it does not take new action to prevent unlawful immigration into the U.S. Trump has said the U.S. will impose escalating tariffs on Mexican imports starting at 5% on June 10.

    That threat, made via Twitter on Thursday evening, sent the major American indexes down more than 1% on Friday.

    Much hangs on whether Trump and Chinese President Xi Jinping, or their representatives, are able to hash out a deal during the G-20 summit of world leaders in Japan later this month.

    It is not yet clear if the two leaders will meet one-on-one. During a press conference Sunday, Chinese Vice Commerce Minister Wang Shouwen declined to confirm if a meeting will take place.
     
  7. Czer

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

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    For the U.S. and China, it’s not a trade war anymore — it’s something worse
    JUN 01, 2019

    https://www.latimes.com/politics/la-na-pol-us-china-trade-stalemate-20190531-story.html

    What started out two years ago as an effort by President Trump to wring better terms from China on the nuts and bolts of foreign trade now threatens to become a far wider and more ominous confrontation.

    The conflict continues to be framed as a “trade war” between the world’s two biggest economies — as Washington and Beijing pursue an escalating series of tariff hikes and other retaliatory measures.

    Even as Trump moved Thursday to open a new, potentially damaging trade war with Mexico,however, the conflict with China has widened beyond the original trade-based issues.

    Beneath the surface, a new tone has begun to emerge since trade talks broke down in early May and Trump ratcheted up tariffs on imported goods from China, an action met with retaliatory duties from Beijing. Officials on both sides of the Pacific have begun to portray the U.S.-China relationship in nationalistic and emotion-charged terms that suggest a much deeper conflict.

    Recently, for example, a private group of American economists and trade experts with long-standing experience in China traveled to Beijing, expecting their usual technical give-and-take with Chinese government officials.

    Instead, a member of the Chinese Politburo harangued them for almost an hour, describing the U.S.-China relationship as a “clash of civilizations” and boasting that China’s government-controlled system was far superior to the “Mediterranean culture” of the West, with its internal divisions and aggressive foreign policy.

    On the U.S. side, a senior State Department official, during a forum last month in Washington, warned of a deepening confrontation with China that she cast in something close to racial terms.

    In the Cold War with the Soviet Union, said Kiron Skinner, the State Department’s director of policy planning, Washington at least faced fellow Caucasians, whereas with Beijing, Washington faces a nonwhite culture.

    “In China we have an economic competitor, we have an ideological competitor, one that really does seek a kind of global reach, that many of us didn’t expect a couple of decades ago,” Skinner said. “And I think it’s also striking that this is the first time that we will have a great-power competitor that is not Caucasian.”

    On the trade issues themselves, the two sides may still be able to reach a truce, with the best chance coming with the economic summit of major nations at the end of June in Osaka, Japan. Trump and Chinese President Xi Jinping are scheduled to attend the meeting of Group of 20 leaders.

    Nothing short of a deal struck directly by the two leaders is likely to avert new rounds of punches and counter-punches over economic and financial ties, analysts say.

    But whether either leader is interested in a stand-down is unclear.

    The conflict, however, now goes beyond just the escalation of tariffs. Attitudes have hardened in recent days after the Trump administration blacklisted the telecom firm Huawei, essentially blocking one of China’s most successful global companies from buying crucial components and software from U.S. firms. (Huawei later got a temporary reprieve on some of the Commerce Department restrictions.)

    The White House is preparing similar actions against other Chinese high-tech firms, according to news reports.

    “All of that would sap most of the remaining interest the Chinese have in negotiating with the Trump administration on trade,” said Scott Kennedy, a China expert at the Center for Strategic and International Studies. China, he added, will probably “hunker down and try to get by until either the second term of the Trump administration or the incoming new administration.”

    On Sunday, China’s State Council issued an 8,300-word white paper blaming the U.S. government for escalating the trade war but expressing a desire for continued talks.

    Addressing a rare news conference, Vice Minister of Commerce Wang Shouwen said that the goal of trade negotiations should be the cancellation of tariffs by both sides, but that talks must proceed on the basis of equality.

    The U.S. should take “full responsibility” for instigating and accelerating the trade war, said Guo Weimin, vice minister of the State Council Information Office. “China doesn’t want to fight, is not afraid of fighting, but will fight if it has no choice,” Guo said.

    The widening friction has not yet had a big impact on financial markets or the broader economy. But the domestic politics, for now, seem to favor conflict, not compromise.

    At home Trump mostly gets cheers for going after an adversary many Americans believe is an unfair trading partner that has stolen valuable U.S. intellectual property in its rise to superpower status. The political risk for Trump from potential Democratic opponents in 2020 isn’t from hitting China too hard, but treading too softly or coming away with a weak deal.

    In China, the party’s propaganda organ has dusted off old patriotic films of the Korean War — when the Chinese army pushed back American forces advancing northward — and Xi’s recent countryside tour conveyed a message of girding up for a new “Long March” to resist a foreign bully.

    At this point, many experts on U.S.-China relations say, the best one might hope for is a temporary truce, and even that will be hard to come by if Trump keeps piling on the pressure.

    By the time the G-20 summit starts on June 28, the U.S. trade representative will have wrapped up public hearings on a proposed new tranche of tariffs, meaning it could at any time impose taxes on the remaining $300 billion of imports from China, including many ordinary consumer goods. Earlier rounds have imposed hefty 25% duties on about $250 billion of Chinese products.

    China’s retaliatory tariffs, at first dollar for dollar, have been more limited in recent rounds, for the simple reason that its imports of American merchandise, about $120 billion last year, are less than one-fourth of what it sends to the United States. China has added tariffs on about $110 billion of U.S. products.

    Beijing could hit back in other ways, however. Already 1 in 5 U.S. firms operating in China say they face increased inspections and slower customs clearances, according to a recent survey by the American Chambers of Commerce in Shanghai and Beijing.

    China has reportedly suspended purchases of billions of dollars of U.S. soybeans, and officials have begun to signal they could restrict supplies of so-called rare-earth elements that are important for manufacturing electric cars and other high-tech products.

    China is the world’s dominant producer of rare earths.

    Beijing also could spur boycotts of popular American products such as Apple iPhones or curtail tourism to the United States, which would be particularly painful for states such as California. And American universities already are fretting about a potential drop-off in full-tuition-paying Chinese students.

    Then there’s Boeing, the single biggest American exporter to China. Sales to China last year accounted for more than 20% of the company’s commercial aircraft revenue.

    Boeing has been embattled in recent weeks by the grounding of its 737 Max fleet after two fatal crashes. The company faces several governmental investigations related to the jet as it is working with federal authorities on software fixes in the hopes of resuming service soon.

    Beijing could withhold its own certificate of airworthiness, which would keep the 737 Max from flying in and through China, with almost certain spillover effects to other countries.

    “It strikes me as a logical sort of retaliation … and obvious where China has at least potential for some leverage with what’s going on with Huawei,” said David Bachman, a specialist in U.S.-China relations at the University of Washington in Seattle.

    If no progress takes place on trade at the G-20 summit and a new round of tariffs and counter-tariffs takes effect, the next escalation could come in mid-August. That’s when the Commerce Department’s 90-day reprieve for Huawei runs out and the Chinese start to find out how long and well Huawei can manage without key Android software updates from Google, as well as crucial chips and other hardware from American suppliers.

    For those and other reasons, including rising risks to financial markets and potentially shifting political calculus, Damien Ma, a fellow at the Paulson Institute think tank in Chicago, still sees the possibility of a limited trade deal by fall. But even then, Ma said, there’ll be no agreement unless the two presidents get personally involved and talk with each other.

    “At the end of the day, they’ll need to reset the tone a little bit and try to manage a deescalation” of the trade war, he said.
     
  8. Czer

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

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    I didn't know this was a thing until now

    The $35,000 device that celebrities and the super-rich use at home to stream movies still in theaters
    May 3, 2016

    https://www.businessinsider.com/what-is-prima-cinema-2016-5

    What happens when you are rich and famous and want to see the latest movies, but don't want the hassle of going to the multiplex? You call Prima Cinema.

    As the debate over Sean Parker's plan that would allow you to stream first-run theatrical movies for $50 a pop rages on, studio moguls in the Hollywood Hills, top CEOs, and sports legends already enjoy watching many of the current blockbusters in the comfort of their living rooms and private screening rooms.

    That's all thanks to Prima.

    The six-year-old company has avoided the controversy attached to Parker's ambitious startup, Screening Room, because it has already sold Hollywood studios on its one-of-a-kind antipiracy security. And then there's the prohibitively expensive price.

    To be a Prima Cinema customer, you must be willing to pay $35,000 to install its system and cough up $500 every time you want to watch a movie.

    How Cruise, Affleck, and Tarantino channel the old-school Hollywood mogul

    The concept for Prima Cinema dates back to the old guard in Hollywood during the 1930s.

    The " Bel Air Circuit" is an exclusive exhibition service used by movie executives and A-list stars in Hollywood who are provided first-run movies at their homes at their convenience.

    It was created by studio heads like Louis B. Mayer and Daryl Zanuck in the 1930s, when a projectionist with a screen and a projector would travel around the swanky Bel Air area in Los Angeles with 35mm or 70mm prints of movies still in theaters and set up private screenings at the houses of the rich and famous by appointment.

    The circuit still goes on today for the likes of Tom Cruise, Ben Affleck, Steven Spielberg, Quentin Tarantino, and Harvey Weinstein, except now the movies are digitally streamed.

    In the early 2000s, Prima co founder and CEO Shawn Yeager, along with his partners, realized that thanks to technology the Bel Air Circuit could be expanded to a much wider net of rich people who would love the luxury of watching first-run movies at home.


    The San Diego-based company took two years not just to create a set-top box that would prevent piracy, but also sell the studios on handing over their most prized movie titles. Tough as it might seem, Yeager and his partners had an unlikely ally: the 2008 financial collapse.

    "In some ways it was perfect timing," Yeager told Business Insider. "It was probably the only time in the last 100 years that due to the pain that bubbled from that you could convince a studio that theatrical distribution in the home was viable. Before then they would have just shut you down."

    By 2010, Prima had raised its first capital. Universal even invested and provided the first titles for the service (other studios have equity stakes). Now the company offers movies from Universal Pictures, Paramount Pictures, Lionsgate, The Weinstein Company, Focus Features, Samuel Goldwyn Films, Magnolia Pictures, STX Entertainment, and Gravitas Ventures (it's still in talks to show titles from companies like Disney, Warner Bros., and Sony).

    Ultratight fingerprint ID security for '$1 billion worth of assets'
    The reason Prima got the backing of so many major studios is simple: It created a secure path for studios to stream movies directly to the Prima devices with, the company claims, zero worry of piracy.

    As Yeager puts it, Prima security has to be even more intense than what movie theaters have.

    "We have literally created the most secure distribution platform for filmed entertainment in the world," he said.

    Let's break that down: Prima doesn't just inspect its own technology to prevent piracy; it also looks into the people using it. A background check is done on all potential customers before they can get their hands on a device, to make sure they have good intentions. A "lengthy" contract, according to Yeager, spells out the responsibilities of streaming the content from the studios.

    If a customer owns a screening room, it can have no more than 25 seats. You must have a screen that's at least 100 inches on the diagonal. You also need a static IP address and a fast internet connection, because when you're paying this kind of money, the last thing you want is a movie freezing in the middle of playing.

    Because of that, all of the movies available on Prima for the upcoming weekend are downloaded into the device three days in advance.

    "That means at any given point there can be between $300 million and $1 billion worth of assets sitting in your home," Yeager said.

    Then there's one last step to enjoy the service: Prima uses biometric authentication to activate its device, meaning that the company enrolls your fingerprint on the device so you will have to swipe your finger every time you want to see a movie.

    "We basically create a forensic trail from the time the film leaves a studio all the way through the time a client purchases a movie," Yeager said. "So your cousin that's in town can't just sit down and watch a movie."

    And if you ever wanted to bring the Prima to your cousin's, forget it. The hard drive has been built to stay in one place forever. At 65 pounds and made of mild steel, the device has sensors, so if it's ever moved it would know.

    It's all about the experience
    Though Yeager would not reveal how many customers Prima has, he did say that CEOs of major corporations, celebrities, and sports stars are all among Prima owners. And often they're using it multiple times a weekend.

    "This one client tells us he'll watch the same movie four times over a weekend," Yeager said. "He'll watch it on a Friday, his kids will come by and watch it Saturday, then they'll have friends over Saturday night, and then Sunday people from out of town will watch."

    Just a reminder: You have to pay $500 every time you watch a movie on Prima, so that's a cool $2,000 spent over a weekend.

    And the Prima experience is only going to improve this summer when its 4k version comes out. To give you a sense of how that will look, Blu-ray is an 8-bit format, and 4k Prima will be 12-bit (it's currently 10-bit).

    "The new Blu-ray standard is just now getting to where Prima has been for five years," Yeager said. "With the 4k, if you have the equipment and build the room correctly, you will have the best theatrical experience."

    And it will come with a cost. You're probably looking at $50,000 to purchase the 4k version (at the moment, Yeager isn't planning to change the $500 per-viewing price).

    So why isn't Prima getting any flak in Hollywood? Simply put, it's too high-end to hurt the theater business in any significant way. Plus, the money to purchase titles goes straight to the studios, which count it toward the films' box office.

    "We have literally created an entirely new market segment that didn't exist for this industry," Yeager said.

    In other words, if you're, say, Brad Pitt, and you want to watch "Jason Bourne" when it comes out this summer, you're almost definitely not going to deal with the headache of showing up to a public venue to do it. Especially if, like Brad Pitt, you can fairly easily afford to download it with Prima.

    From Yeager's point of view, Sean Parker's Screening Room is a direct disruption to the current exhibition model. He doesn't think the movie business will go for it simply because they don't stand to make money off of it.

    "The movie business is smart enough to realize that you never want to trade analog dollars for digital pennies, which is what would happen under that scenario," he said.

    Asked if Prima would ever consider a scaled-down version of its service that would be more affordable for the average moviegoer, Yeager replied that "he'd never say never," but for now the company is focused on bringing the full theatrical experience to the home — with all the security and high-resolution quality that entails.

    "It's the experience that matters," he said. "That's what keeps people coming back for films. And we think we have the best experience in the world."
     
  9. AgelessDrifter

    AgelessDrifter TZT Neckbeard Lord

    Post Count:
    43,908
    I would rather spend six bucks and go to the theater
     
  10. Czer

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

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    China Summons Tech Giants to Warn Against Cooperating With Trump Ban
    June 8, 2019

    https://www.nytimes.com/2019/06/08/...tion=click&module=Top Stories&pgtype=Homepage

    SAN FRANCISCO — The Chinese government this past week summoned major tech companies from the United States and elsewhere to warn that they could face dire consequences if they cooperate with the Trump administration’s ban on sales of key American technology to Chinese companies, according to people familiar with the meetings.

    Held on Tuesday and Wednesday, the meetings came soon after Beijing’s announcement that it was assembling a list of “unreliable” companies and individuals. That list was widely seen as a way of hitting back at the Trump administration for its decision to cut off Huawei, the Chinese electronics giant, from sales of American technology. The United States has accused Huawei of stealing trade secrets and conducting surveillance on behalf of Beijing.

    Details about the meetings, the latest move in two weeks of high-stakes economic brinkmanship between the United States and China, were shared by two people familiar with them, who asked not to be named because they were not authorized to discuss them and could face retribution. The companies summoned by Chinese officials included a number of the world’s most important semiconductor firms, as well as other tech giants.

    The breakneck unraveling of the world’s most important trade relationship has left companies and governments around the world scrambling. While the dispute had already been nettlesome for Chinese-U.S. relations, the sudden ban on Huawei last month caught many by surprise, raising the stakes by striking at the heart of China’s long-term technological ambitions.

    Now, each of the two superpowers appears to be crafting new economic weapons to aim at the other. What was once a fraught, but deeply enmeshed, trade relationship is threatening to break apart almost entirely, raising the specter of a new geopolitical reality in which the world’s two superpowers would compete for economic influence and try to freeze each other out of key technologies and resources.

    “This is now extremely delicate because the Trump administration, through its brinkmanship tactics, has destabilized the entire relationship, commercial and otherwise,” said Scott Kennedy, a senior adviser at the Washington-based Center for Strategic and International Studies who studies Chinese economic policy.

    The meetings this week were led by China’s central economic planning agency, the National Development and Reform Commission, and attended by representatives from its Ministry of Commerce and Ministry of Industry and Information Technology, who addressed their remarks to a broad range of companies that export goods to China, according to the two people familiar with the gatherings.

    The involvement of three government bodies suggested a high level of coordination and likely approval from the very top of China’s opaque leadership structure. The intervention seemed designed to rally support for Huawei, though the company was not specifically mentioned, the two people said.

    “There is a strong perception in Beijing that the U.S. government is intent on blunting China’s technology rise, and that if this process is not slowed or stopped, the future of China’s entire digital economy is at risk,” said Paul Triolo, the head of geotechnology at the consultancy Eurasia Group, adding that the spat had major political implications for Xi Jinping, China’s president and the head of its ruling Communist Party.

    “Mr. Xi and the party will be seen as unable to defend China’s economic future” if the confrontation with the United States does major damage to Huawei and throws off China’s rollout of the next generation of wireless technology, called 5G, Mr. Triolo added.

    More broadly, the warnings also seemed to be an attempt to forestall a fast breakup of the sophisticated supply chains that connect China’s economy to the rest of the world. Production of a vast array of electronic components and chemicals, along with the assembly of electronic products, makes the country a cornerstone of the operations of many of the world’s largest multinational companies.

    As the trade relationship between the United States and China has broken down, fears have risen in China that major companies will seek to move production elsewhere to avoid longer-term risks. In the meetings this week, Chinese officials explicitly warned companies that any move to pull production from China that seemed to go beyond standard diversification for security purposes could lead to punishment, according to the two people.

    The Chinese officials appeared to have differing messages for the companies, depending on whether they were American or not, the people added.

    To those from the United States, they warned that the Trump administration’s move to cut off Chinese companies from American technology had disrupted the global supply chain, adding that companies that followed the policy could face permanent consequences. The Chinese authorities also hinted that firms should use lobbying to push back against the government’s moves.

    “The Chinese government has regularly resorted to jawboning multinationals to try to keep them in line when there are disputes between China and others that could lead these companies to reduce their business in China,” Mr. Kennedy said.

    The Chinese agencies did not respond to requests for comment.

    In the past, China has used America’s tech behemoths as a tool of diplomacy. For example, during a high-profile visit to the United States in 2015, Mr. Xi stopped in Seattle before heading to Washington. There, he met with a who’s who of American and Chinese tech executives as a way to emphasize the depth of the countries’ economic ties, even as President Barack Obama’s administration sought to chart a course that would push back against China’s anti competitive trade practices and investment rules.

    This time, such a play is less likely to be effective, said Mr. Kennedy, because it forces the companies to choose between complying with pressure from Beijing and violating U.S. law.

    “American companies aren’t going to violate American laws, especially in such a high-profile context where their actions are scrutinized,” he said. “The companies are between a rock and a hard place, but that hard place will win out.”

    The Chinese officials told companies from outside the United States that as long as they kept up their current relationships and continued to supply Chinese companies normally, they would face no adverse consequences. They also stressed China’s commitment to open trade and its protections of intellectual property, according to the people familiar with the meetings.

    The Trump administration’s ban on sales to Huawei was a blow to semiconductor companies that supply parts used in Huawei’s telecom gear. Several American companies slashed tens of millions of dollars from their quarterly revenue expectations. About 60 percent of all semiconductors sold are connected in some way to China’s supply chain, the consulting firm KPMG estimates.

    Resolving the mercantilist standoff may be difficult, said Mr. Triolo, because progress in the trade talks has become linked to progress on the Huawei tech ban, but the Huawei issue cannot be dealt with through the official trade channels. For example, the dispute has been inflamed by fraud charges the United States has brought against the Huawei executive Meng Wanzhou, who is awaiting extradition proceedings in Canada, and obstruction and other charges against the company itself.

    A separate negotiation between high-level officials over Huawei is probably the only way forward, Mr. Triolo said — that, or an even less likely possibility: “Huawei would have to send a team to Washington to admit guilt and negotiate what could be a humiliating agreement with U.S. authorities.”

    “So far, there is no sign that either Beijing or Huawei is considering that option,” he said.
     
  11. Czer

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

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    So not really a security threat and Russia is having China help build their telecom sector

    Mnuchin says Trump could ease up on Huawei if trade talks advance
    JUNE 9, 2019

    https://www.reuters.com/article/us-usa-trade-mnuchin/mnuchin-says-trump-could-ease-up-on-huawei-if-trade-talks-advance-idUSKCN1TA0G0?

    (Reuters) - U.S. Treasury Secretary Steven Mnuchin said on Sunday that President Donald Trump might ease U.S. restrictions on Huawei if there was progress in the trade row with China - but absent a deal, Washington would maintain tariffs to cut its deficit.

    “I think what the president is saying is, if we move forward on trade, that perhaps he’ll be willing to do certain things on Huawei if he gets comfort from China on that and certain guarantees,” Mnuchin said. “But these are national security issues.”

    Washington has imposed and then toughened import tariffs on Chinese goods in a bid to reduce the United States’ trade deficit and combat what it calls unfair trade practices.

    It has also accused the Chinese telecommunications giant of espionage and stealing intellectual property, allegations that Huawei Technologies Co Ltd, a leading provider of next-generation 5G technology, denies.

    Washington has put Huawei on a blacklist that effectively bans U.S. firms from doing business with it, and has put pressure on its allies also to shut Huawei out, arguing that Huawei could use its technology to carry out espionage for Beijing.

    Mnuchin said the United States was prepared to come to a deal with China, but also to maintain tariffs if necessary.

    “If China wants to move forward with the deal, we’re prepared to move forward on the terms we’ve done. If China doesn’t want to move forward, then President Trump is perfectly happy to move forward with tariffs to rebalance the relationship,” Mnuchin said.

    Commenting on an immigration deal between Mexico and the United States, Mnuchin said he believed that Mexico would meet its commitments, but added that Trump “reserves the right” to impose tariffs if the commitments were not met.

    Trump himself tweeted on Saturday that “Mexico will try very hard, and if they do that, this will be a very successful agreement between the United States and Mexico”.
     
  12. Czer

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

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    The risks are rising that the dollar could lose its special global standing
    JUN 9 2019

    https://www.cnbc.com/2019/06/07/the...r-could-lose-its-special-global-standing.html
    • There are a number of factors suggesting that, over time, the US dollar may be at risk of surrendering its position as the world’s global reserve currency, argues Fitch Ratings analyst James MacCormack.
    • Economic sanctions and protectionist trade initiatives are two of the leading causes.
    • China and the euro zone have been actively touting their currencies as reserve and transaction substitutes.
    Even exorbitant privileges can be lost and there are a number of factors suggesting that, over time, the US dollar may be at risk of surrendering its lead, if not its role, as the world’s preeminent reserve currency.

    Some of these factors relate to U.S. policy decisions, others to policy decisions and developments elsewhere, but all point in the same direction. The primary reasons for the dollar’s continued dominance are inertia and the lack of viable alternatives, neither of which U.S. policymakers should find comforting for the longer term.

    The most obvious U.S. policy contributions to a diminished role for the dollar are from economic sanctions and protectionist trade initiatives. All else equal, protectionist policies divert trade away from the U.S., and may induce new trade partners to settle in currencies other than the dollar.

    Sanctions do the same, and since they may effectively preclude dollar settlement, the implications for the dollar are more acute. In addition to the Treasury Department’s list of 6,300 Specially Designated Nationals and more than 20 countries against which some type of sanctions are in place, the extraterritoriality of certain sanctions to affect persons and entities in other jurisdictions extends their reach further.

    Competition from abroad
    While U.S. policies have clearly pushed some countries, such as Iran and Russia, away from the dollar, officials in China and the euro zone have been actively touting their currencies as reserve and transaction substitutes.

    The Chinese renminbi was added to the International Monetary Fund’s Special Drawing Rights basket in 2016, joining the dollar, euro, yen and British pound, in a development the Fund said “enhances the attractiveness of the RMB as an international reserve asset.” The renminbi was introduced as a numeraire in commodity markets in 2018 when crude oil futures began trading in the Shanghai International Energy Exchange.

    A number of European officials have talked up the role of the euro, with European Commission President Jean-Claude Juncker telling the European Parliament in his 2018 annual program address that it is “absurd” that 80% of European energy imports are settled in dollars. France, Germany and the U.K. set up the Instrument in Support of Trade Exchanges (INSTEX) earlier this year to work around U.S. sanctions on Iran, and while it may be more politically symbolic than economically effective, INSTEX confirms that even allies will seek dollar alternatives if policy differences with the U.S. cannot be bridged.

    It will be some time before the renminbi or euro poses a serious challenge to the dollar – and they may never do so – but Chinese and European policymakers will be actively looking for opportunities to expand the roles of their currencies, while the US approach toward the dollar in this regard can be characterized as benign neglect, at best.

    Finding safe haven elsewhere
    It is difficult to directionally disentangle the causes and consequences that tie the dollar as the world’s reserve currency to U.S. Treasury securities as the globally preferred risk-free asset. But it is worth considering whether a decline in the role of the dollar might be preceded by foreign investors – central bank reserve managers in particular – seeking risk-free dollar assets other than Treasurys.

    It is certainly conceivable that the link between Treasuries and the dollar could break down. And if investors were to accept dollar liabilities of issuers other than the U.S. Treasury as risk-free substitutes, they would also likely consider those issuers’ non-dollar liabilities similarly. However, highly rated borrowers whose liabilities could be risk-free substitutes for US Treasurys are typically sovereigns as well, and they almost always borrow in their own currencies.

    There is another much smaller group of highly rated borrowers that regularly issue debt in dollars as well as other currencies – supranational institutions. State Street Global Advisors estimates that central banks hold about one-third of supranationals’ debt compared with 18% of sovereign debt. Central banks hold an even bigger share of supranationals’ dollar debt, suggesting reserve managers can and do separate the desire to be invested in dollars from the desire to be invested in US Treasuries.

    Even so, the supranationals market lacks size, and will never come close to the Treasury market in terms of depth and liquidity, limiting its role in central bank diversification of risk-free foreign-currency assets.

    The wheels are in motion
    Final arguments that the dollar could lose its role as the preeminent reserve currency are based on it already happening, albeit slowly.

    IMF data reveal the dollar share of foreign reserves fell from a high of 73% in 2001 to 62% at the end of last year. Similarly, the World Gold Council confirms that central banks bought more gold in 2018 than at any other time since the gold standard ended in 1971, extending a string of large net purchases that began after the global financial crisis.

    If the trends continue of switching from dollars to other currencies, and from currencies collectively to gold, the dollar’s reserve currency status will continue to give ground, but only gradually. Global market preferences for the dollar as the currency of choice and for U.S. Treasurys as the favored risk-free asset show no signs of meaningful past or pending dramatic change.

    At the same time, beyond some marginal adjustments, global central bank reserve management practices – the ultimate consideration in bestowing reserve currency status – are still centered on the dollar. Paradoxically, the most powerful forces acting to diminish the dollar’s global role are US initiatives to penalize foreign transgressions of American policies and priorities.

    The real paradox is that successive actions along these lines may eventually have a cumulative deleterious effect on the dollar that ultimately harms US interests much more.
     
  13. AgelessDrifter

    AgelessDrifter TZT Neckbeard Lord

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  14. Czer

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

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  15. Czer

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

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    Top 1% Up $21 Trillion. Bottom 50% Down $900 Billion.
    June 14, 2019

    https://www.peoplespolicyproject.org/2019/06/14/top-1-up-21-trillion-bottom-50-down-900-billion/


    Every quarter, the Federal Reserve puts out the Financial Accounts (aka “Z1” or “Flow of Funds”), which provide economy-wide aggregates for nearly every kind of asset and liability there is. Every three years, they put out the Survey of Consumer Finances (SCF), which is a household survey that records many of the same kinds of assets and liabilities that are in the Financial Accounts. In a perfect world, the assets and liabilities in the SCF would sum up to the aggregates in the Financial Accounts, but for various reasons they do not.

    Recently, the Federal Reserve released a new data series called the Distributive Financial Accounts, which combine the Financial Accounts and the SCF to provide quarterly estimates of the distribution of wealth in America that do sum to the aggregates in the Financial Accounts. The series goes back to 1989, the first year the modern SCF was administered and runs to the fourth quarter of 2018, the last quarter for which there is Financial Accounts data.

    The insights of this new data series are many, but for this post here I want to highlight a single eye-popping statistic. Between 1989 and 2018, the top 1 percent increased its total net worth by $21 trillion. The bottom 50 percent actually saw its net worth decrease by $900 billion over the same period.

    [​IMG]

    To derive this, I initially take the nominal net worth aggregates for each wealth group that are provided by the Federal Reserve and subtract out consumer durables. Consumer durables are things like cars and fridges that many academics who work on wealth distributions do not consider wealth. The top 1 percent owns around 32x as many consumer durables (in dollar terms) as the bottom 50 percent owns. So the subtraction of them reduces the inequality between the top 1 percent and bottom 50 percent.

    From there, I adjust the 1989 figures to 2018 dollars using the CPI-U-RS price index. This is what the Federal Reserve also does to adjust wealth figures over time in its Survey of Consumer Finances reports.

    What the final product reveals is a 2018 where the top 1 percent owns nearly $30 trillion of assets while the bottom half owns less than nothing, meaning they have more debts than they have assets. This follows from 30 years in which the top 1 percent massively grew their net worth while the bottom half saw a slight decline in its net worth.
     
  16. Czer

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

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    U.S. recession odds rise to 40-45% in six months: DoubleLine's Gundlach
    JUNE 13, 2019

    https://www.reuters.com/article/us-...-gundlach-idUSKCN1TE36Q?utm_source=reddit.com

    (Reuters) - Jeffrey Gundlach, chief executive officer of DoubleLine Capital, said on Thursday the odds of the United States sliding into a recession in the next six months have risen to 40-45% and the odds were 65% within the next year.

    Gundlach, who oversees more than $130 billion in assets under management, said the yield curve and the New York Fed recession probability showed a rising chance of recession.

    “Several indicators suggest a recession could take place in one year,” Gundlach said on an investor website, adding consumer indicators point to “the front edge of a recession.”

    Earlier this year, he said a recession was not on the horizon, but the U.S.-China trade war and the weak momentum of the global economy have raised red flags for him.

    Gundlach said the Fed probably will not cut rates in June but likely will later in summer. Gundlach says the bond market indicates the Fed will cut rates by a quarter percentage point either two or three times by year end.


    As for the bond market, Gundlach, who has long forecasted 6% on the 10-year Treasury yield by the next presidential election or a year after, said if the government would not get involved in the manipulation in bond yields, the 10-year bond yield would rise to 6% by 2021. The 10-year yield is currently about 2.1%

    If the United States starts heading on the path to 6%, the Fed “will not let the market price” and “manipulate interest rates down,” Gundlach said.

    Gundlach said he is not backtracking on his 6% investment call. “We will go to 6% for sure if there is true free market pricing. The Fed has added a lot of information this year, which is contradictory to prior information,” he said.

    As for the investing environment, he said 2019 is opposite of last year’s: “Gold is making money, bitcoin is making money, stocks are making money, bonds are making money,” Gundlach said.

    “I’d rather own gold than bitcoin,” he said.

    Gundlach said the S&P 500 Index has outperformed the major tech stocks since mid-2018, which he thinks will be the peak of the stock market. Gundlach says U.S. deficits “are showing no signs of going away” and that the budget deficits may get “much, much worse in the next recession.”

    Overall, Gundlach said the U.S. government has a very bad debt-to-income problem, even in a supposedly growing economy. Gundlach says true liabilities of the U.S. government are around $23 trillion to $24 trillion.

    Gundlach said if the budget deficit and current account deficit increase, that could be a precursor for a further decline in the dollar.
     
  17. Czer

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

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    The One Percent Have Gotten $21 Trillion Richer Since 1989. The Bottom 50% Have Gotten Poorer.
    6/16/2019

    http://nymag.com/intelligencer/2019/06/the-fed-just-released-a-damning-indictment-of-capitalism.html

    Some Democratic presidential candidates say that America’s economic system is badly broken and in need of sweeping, structural change. Others say that the existing order is fundamentally sound, even if it could use a few modest renovations. The former are widely portrayed as ideologues or extremists, the latter as moderates.

    And it’s certainly true that Bernie Sanders and Elizabeth Warren are ideologically “extreme,” if our baseline is the median member of Congress or the median policy agenda pursued by recent American presidents. But it’s not clear why these would be the appropriate metrics.

    After all, we do not equate calls for sweeping change (whether from recent precedent or from current consensus) with extremism in all circumstances. When young people in an Islamist autocracy take to the streets demanding basic civil rights, we do not regard them as radicals, or the regime’s apologists as moderates. Our assessment of the dissenters’ ideological character does not hinge on how far their values depart from those of the status quo order — but rather on how far that status quo departs from our consensus values.

    Thus, whether it is truly extreme or moderate to demand sweeping changes to American capitalism depends on the degree to which the existing system aligns with common-sense views of what a just or rational economic system should look like.

    Happily, the Federal Reserve just released some data that makes the state of this alignment easier to gauge. In its new Distributive Financial Accounts data series, the central bank offers a granular picture of how American capitalism has been distributing the gains of economic growth over the past three decades. Matt Bruenig of the People’s Policy Project took the Fed’s data and calculated how much the respective net worth of America’s top one percent and its bottom 50 percent has changed since 1989.

    He found that America’s super rich have grown about $21 trillion richer since Taylor Swift was born, while those in the bottom half of the wealth distribution have grown $900 billion poorer.

    [​IMG]

    Notably, this measure of wealth includes liabilities, such as student debt. And it does not include consumer goods, such as computers or refrigerators, as economists do not conventionally view such products as wealth assets. But if one did include the Fed’s data on the distribution of consumer goods, the wealth gap between the top one percent and bottom 50 would actually be even larger.

    So, is an economic system that distributes its benefits in this manner consistent with Americans’ common-sense views of economic justice? If not, would incremental changes be sufficient to bring it into alignment with the median American’s values? Or would more sweeping measures be required?

    Put differently: Does the average American believe that, over the past three decades, our nation’s richest one percent have contributed roughly $22 trillion more to our collective well-being than the poorest 50 percent have? Does she think that the tens of millions of working-class people who spent the past 30 years cooking other Americans’ dinner, cleaning their toilets, caring for their children, harvesting their crops, ringing up their groceries — and performing the countless other poorly remunerated forms of labor that our society demands — collectively produced an infinitesimal fraction of the value that America’s corporate lawyers, hedge-fund managers, venture capitalists, specialist physicians, heirs and heiresses, and other high-paid professionals did?

    Survey data (and common sense) says otherwise. In 2011, Michael Norton of Harvard Business School and Dan Ariely of Duke University published a study on Americans’ views of how wealth was distributed in their society, and how they felt it should be distributed. They found that, in the average American’s ideal world, the richest 20 percent would own 32 percent of national wealth. In reality, the top quintile owned 84 percent as of 2011. And that share has grown in the intervening years. Today, the one percent alone commands roughly 40 percent of all America’s wealth.

    [​IMG]

    Given all this, any politician who insists that American capitalism is “already great” is clearly a far-right extremist whose indifference to inequality puts him or her wildly out of step with ordinary people. But is it the case that Warren and Sanders would take things too far in the other direction?

    Not remotely. I do not have the relevant data or skills to project precisely how the full implementation of either candidate’s agenda would influence America’s wealth distribution. But neither candidate is calling for a series of reforms that would place the United States far outside the Western European norm. In fact, both Warren and Sanders have cribbed their signature policies from European nations. As the 2018 World Inequality Report demonstrated, policy choices do matter — and income inequality is much lower in Western Europe than it is in the U.S.

    [​IMG]

    But even Scandinavia’s social democracies feature far more inequitable distributions of wealth than Americans think to be fair, according to Ariely and Norton’s survey. What’s more, it will take a lot of redistribution just to prevent America’s current wealth gap from growing even larger. The fundamental challenge in combating inequality is that wealth begets more wealth. Those who can afford to invest in bonds get to collect annual interest payments; those who invest in stocks or real estate typically see their capital assets annually appreciate. Thus, most years, our nation’s collective capital stock directs loads of passive income to America’s wealthiest citizens. As Vox’s Matt Yglesias observes, much of the explosion in wealth inequality that the Fed documents can be attributed to the fact that the one percent began 1989 owning a wildly disproportionate share of corporate equities and private businesses. The passive income generated by these assets would have allowed the one percent to pull away from everyone else, even in the absence of soaring wage inequality.

    [​IMG]

    Nothing short of progressively redistributing ownership of capital assets could bring our nation’s wealth distribution into alignment with its values. For the moment, neither Warren nor Sanders has released a detailed plan for doing that on a large scale. Their current platforms would be less likely to significantly reduce wealth inequality than to merely slow its growth.

    Perhaps “we should adopt redistributive policies and institutions that are common throughout Western Europe, so as to prevent the one percent’s share of national wealth from rising too far above 40 percent” sounds like an extreme proposition to you. But the alternative — or at least the alternative’s implications for wealth inequality — would strike the average American as far more radical.
     
  18. Czer

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

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    CEO Pay Skyrockets To 361 Times That Of The Average Worker
    May 22, 2018

    https://www.forbes.com/sites/dianah...-to-361-times-that-of-the-average-worker/amp/

    If you have any doubt about our country’s disappearing middle class, check out the current CEO-to-employee pay gap.

    In the 1950s, a typical CEO made 20 times the salary of his or her average worker. Last year, CEO pay at an S&P 500 Index firm soared to an average of 361 times more than the average rank-and-file worker, or pay of $13,940,000 a year, according to an AFL-CIO’s Executive Paywatch news release today.

    Despite increasing protests from unions and consumer groups, the average CEO pay climbed 6% last year. Meanwhile, the average production worker earned just $38, 613, according to Executive Paywatch.

    The good news, if there is any, is that this year CEOs have to disclose the pay gap between them and their median employees — one of the ongoing benefits of the Dodd-Frank Act.

    “This year’s report provides further proof of America’s income inequality crisis,” said AFL-CIO Secretary-Treasurer Liz Shuler. “Too many working people are struggling to get by, to afford the basics, to save for college, to retire with dignity, while CEOs are paying themselves more and more. Our economy works best when consumers have money to spend. That means raising wages for workers and reining in out-of-control executive pay.”

    Discussing just how out of control that pay is, Executive Paywatch points out the average wage – adjusted for inflation — has stagnated for more than 50 years. Meanwhile, CEO’s average pay since the 1950s has grown by 1000%.

    Most galling, for many, is that CEOs often get full pay, bonuses and a golden parachute even when their companies fail and go bankrupt, receive taxpayer bailouts or pay millions in fines for fraud, according to Al Lewis of MarketWatch. CEO firings? No problem. In his 2013 article “Fraud, Failure and Bankruptcy Pay Well for CEOs,” Lewis reported the average golden parachute for CEOs forced out of their jobs was valued at $48 million.

    Among other findings from the Executive Paywatch release:
    • The CEO of Mondelēz International, which makes Nabisco products, including Chips Ahoy, Oreos, and Ritz Crackers, makes 403 times its median employees’ pay: CEO Irene Rosenfeld received $17.3 in 2017, according to an SEC disclosure. But in what might be an example of the gender gap in CEO pay, Mondelēz’s new CEO, Dirk Van de Put made more than $42.4 million in total compensation in 2017 – more than 989 times the company’s median pay for employees. “Mondelēz continues to be one of the most egregious examples of CEO-to-worker pay inequality,” stated the Executive Paywatch news release. The company… is leading the race to the bottom and continuing to embrace inequality.” Executive Paywatch noted that last week, however, most Mondelēz shareholders voted against the company’s advisory vote on executive compensation.
    • Mattel, the well-known toy maker, had the highest pay gap of all the S&P 500 companies. Mattel’s median employee is a manufacturing worker in Malaysia who made $6,271, resulting in a CEO-to-employee pay ratio of 4,987:1.
    • In contrast, Warren Buffett’s company Berkshire Hathaway Inc. “had the lowest pay ratio of all S&P 500 companies: Just 2:1.” (This may help explain Buffett’s enduring popularity.)
    With the publication of the CEO pay in relation to their employees, consumers now have the opportunity vote with their wallets. According to a PBS story, glaring CEO-worker pay gaps “are a major turnoff for consumers.” Online research from Harvard Business School found that U.S. consumers were willing to pay more for everything from towels to TVs from companies where the CEO-worker pay gap was relative low, according to PBS. Even when the products cost less from companies with a higher CEO-to-employee pay ratio, most consumers refused to buy from them. Now that’s something CEOs might want to think about at their next compensation meeting.
     
  19. Czer

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

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    Thanks, Uncle Sam! After tax cuts, Texas Instruments spent $5 billion on stock — three times more than R&D
    6/23/2019

    https://www.dallasnews.com/opinion/...truments-spent-5-billion-stock-three-times-rd

    What did corporate America do with its big tax cut? It spent over $800 billion on company shares last year, pushing stock buybacks to their highest level ever.

    Close to home, Texas Instruments paid $5.1 billion to repurchase shares in 2018 — twice as much as the year before and more than any Texas company in the S&P 500.

    TI’s effective tax rate dropped from 39% in 2017 to 17% last year, thanks to corporate tax cuts approved in late 2017 by Republican lawmakers and President Donald Trump.

    The tax measure, which had broad support from American businesses, has been Trump’s signature legislative achievement. It prompted several large companies to hand out $1,000 bonuses to workers, and supporters said it would spur business investment, higher wages and a stronger economy.

    “We haven’t seen the business expansion or increase in U.S. employment that many had hoped for, but companies are a lot more profitable,” said Howard Silverblatt, senior analyst for S&P Dow Jones Indices, which tracks buybacks and other metrics for the S&P 500.

    For those 500 companies, which account for most of the stock market capitalization, the effective tax rate declined by almost 7 percentage points in 2018, he said. For S&P companies in information technology, including TI, Apple, Oracle and the like, the effective tax rate plunged by over 25 percentage points.

    “That difference is pure cash,” Silverblatt said.

    [​IMG]

    For TI, the lower tax rate translated into $1.3 billion in savings, according to TI’s 10-K filing, and its free cash flow jumped by a similar amount.

    “Our strategy is to return all free cash flow to shareholders,” TI wrote in the 10-K.

    That’s been an excellent outcome for owners of the Dallas semiconductor company. Over the past five years, TI’s total return tops 166% — more than twice the total return of the S&P 500 Index.

    TI has been crushing it for several years, steadily sharpening its industry focus and boosting efficiency. In the two years before the tax cuts, operating margins topped 35%, making all employees eligible for big profit-sharing checks. Last year, TI’s operating profit margin hit 42.5%, according to its proxy statement.

    Texas Instruments did not return phone calls and emails to its corporate communications staff.

    Even with sky-high margins and profits — and the savings from lower corporate taxes — TI still asked for some big tax breaks from local government.

    In April, TI said it would build a $3 billion chip plant in Richardson. To land the deal, Collin County, Plano ISD and Richardson agreed to pony up $375 million in tax breaks, stretching from 10 to 17 years.

    The state also threw in $5 million from the Texas Enterprise Fund.

    [​IMG]

    In the U.S., many economic development incentives are going to “mega-deals” that give special breaks to the biggest, most productive companies, said Nathan Jensen, a professor at the University of Texas at Austin. He often criticizes such deals, including the TI plant, arguing that companies would expand without public money.

    “Even after a lowering in the corporate tax rate, I don’t see any shift in behavior of these firms,” Jensen wrote in an email. “They are still extracting maximum incentives and politicians are willing to give them out!”

    TI told the state that Singapore and New York also offered “significant and competitive” incentives, which is how the economic development game is played.

    “We have this system where everyone’s competing with tax breaks, and on the whole, it’s wasteful and highly regrettable,” said Gary Hufbauer, a nonresident fellow at the Peterson Institute for International Economics.

    [​IMG]

    After the corporate tax cuts, business investment rose last year, he said, but it’s not continuing at a robust level. Tariffs and other trade policies are stoking uncertainty and offsetting the positives from the tax cuts, he said.

    TI increased spending on capital expenditures by $436 million last year, the biggest spurt since 2010. But it boosted dividends by a greater amount and spent an additional $2.5 billion on stock buybacks.

    TI’s research and development spending rose by just $51 million last year. Total 2018 spending was over three times higher on stock buybacks than on R&D.

    Many experts doubted that corporate tax cuts would result in big increases in R&D and capital expenses. That’s because many companies were already cash-rich. And with low interest rates, they could access cheap debt if they believed an investment was justified, said Steven Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center.

    “What have we truly seen from the tax cuts? A lot of stock buybacks,” Rosenthal said. “The market is acting efficiently and rationally by taking these surplus profits and sending them to shareholders. It’s a demonstration that companies didn’t really have much use for the money.”

    [​IMG]

    There are costs from cutting the corporate tax rate so sharply. Last year, federal taxes on corporate income fell by nearly $120 billion, a decline of 35%, according to the U.S. Bureau of Economic Analysis. That contributed to a rising deficit, even during a booming economy.

    The annual shortfall, which was $442 billion in 2015, approached $800 billion last year. It’s projected to top $1 trillion by 2022.

    “We just have a bigger hole to dig ourselves out of,” Rosenthal said.

    [​IMG]
     
  20. Czer

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

    Post Count:
    24,717
    Robots May Displace 20 Million Manufacturing Jobs by 2030
    June 25, 2019

    https://www.bloomberg.com/news/arti...isplace-20-million-manufacturing-jobs-by-2030

    Robots are on track to wipe out almost a tenth of the world’s manufacturing jobs with the brunt borne by lower-income areas in developed nations, Oxford Economics says.

    While automation should boost the economy as a whole, it is likely to create greater inequality as employment losses are concentrated in certain industries and countries. Manufacturing could lose 20 million positions by 2030, making the sector 8.5% smaller than “if robots were not remaking the market,” according to the research firm’s report.

    Job Losses Per Robot

    [​IMG]

    The pockets of workers most vulnerable to automation can often be found in rural areas with a traditional, labor-intensive industrial base, Oxford Economics said. Oregon is the U.S. state most likely to be affected, while the worst-hit region in the U.K. is likely to be Cumbria.

    “In many countries, such regions have often been left behind as metropolitan centers prospered, and those dynamics have generated political polarization. This highlights the importance of taking policy action to cushion the likely impact of robotization in these vulnerable areas.”
    -- “How Robots Change the World” by Oxford Economics

    The report highlights how the structural shift in the labor market is throwing up new challenges as an increasing array of tasks are automated. It says more than half of U.S. factory workers displaced by robots over the past two decades were absorbed into three employment categories -- transport, construction and maintenance, and office and administration work. Yet those categories are the most vulnerable to automation over the next decade.

    The IMF has also highlighted the risk of rising inequality, and the OECD said last year that geography was a key factor because of the clustering of certain industries. For example, it found the proportion of jobs at risk of being taken over by robots was far higher in western Slovakia than around Oslo.

    Oxford Economics said that metropolises such as London, Tokyo, Paris or Seoul are likely to be less affected, though even some traditional manufacturing hubs could fare well.

    “Regions that surround knowledge-intensive cities such as Toulouse and Grenoble in France, or Munich and Stuttgart in Germany, typically show much lower levels of vulnerability,” it said.