PeakTrader.com

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PeakTrader said...

According to "Information Age: People, Information & Technology in the Smithsonian's National Museum of American History:"

"Today's information age began with the telegraph (1837). It was the first instrument to transform information into electrical form and transmit it reliably over long distances."

I listed some major factors that indicated the Information Age began to mushroom around 1982 (also, I may add, television shows after 1971 and before 1982, e.g. "Kojak," further confirms that).

People who believe U.S. inflation has been understated, and real GDP growth has been lower or even negative, aren't supported by the real economy.

Americans live much better today than in the 1970s. The quantity and quality of assets and goods per American are much higher today than in the 1970s. Even the environment is much cleaner.

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Hydra said...

About environment. It takes money and wealth to do it. Environmentalists who promote consuming less don't get it.

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morganovich said...

"People who believe U.S. inflation has been understated, and real GDP growth has been lower or even negative, aren't supported by the real economy."

this argument doesn't make any sense.

first off, the period is wrong. CPI calc was changed in 1992, so comparing it to 1970 is not meaningful.

second, it does not follow that just because inflation was higher and growth lower than reported since 1992 that there was no real growth.

the late 90's were a fairly prosperous time.

the 2000's were not.

in real terms, people were not better off in 2010 than in 1999.

they had run up an incredible amount of debt. starting in the mid 90's (driven by the fact that real interest rates were often negative if you used an accurate inflation metric) household debt exploded.

from 1999 to 2008 it jumped from $5.2tn to 12.5tn.

that alone accounted for around 30% of all cumulative growth (and 6% of all economic activity) in that period.

add in the increase in federal debt over that period (4.4tn) and the number jump to 49& of growth and 10% of economic activity.

takes this out, and all "real" growth is erased if you use a realistic CPI.

people (in aggregate) are not better off now that in 1999.

they may have more stuff, but they also have more debt.

if you doubt that inflation has been higher than reported, than answer me this question:

why have we had nonstop bubbles since the mid 90's?

it's a literally unprecedented series of events to have liked bubbles of this magnitude.

equities drained into real estate drained into bonds is draining into commodities. there has been a bubble somewhere pretty much all the time for 15 years and debt levels have exploded to fund them.

you do not get that without negative real rates and loose moeny.

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Buddy R Pacifico said...

Peak Trader,

How does the television show Kojak confirm the mushrooming of the Information Age?

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PeakTrader said...

Morganovich, you continue to make statements that contradict the data.

Given U.S. living standards are much higher today than in 1980, inflation was grossly overstated after 1980, and after appropriate adjustments to reflect the dynamic economy, inflation was less overstated.

In the 2000s, the U.S. was at full employment after one of the mildest recessions in U.S. history.

I guess, you didn't notice the homebuilding boom, the auto boom, up to $800 billion a year trade deficits, etc., which raised U.S. living standards at one of the fastest rates in U.S. history.

U.S. households went into debt, because the cost of debt was cheap compared to the value of assets and goods.

That's why U.S. household net wealth hit an all-time high in 2007.

Both asset bubbles, in 1995-00 and 2002-07, left U.S. households wealthier even at the post-bubble lows than before the bubbles began.

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PeakTrader said...

Buddy, television shows of the 1970s often show what existed in society and what didn't exist.

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PeakTrader said...

US household net wealth rises
But remains below the record level set in Q3 2007.
15 June 2010

At the end of Q1 2010, the value of US household assets amounted to $68.53 trillion.

At the end of Q1 2010, the level of US total household debt was $13.97 trillion.

US net wealth now represents a very respectable 491% of household disposable income. The current ratio is actually exactly in-line with the long-term ratio, which dates back to 1952, although there have been times when the ratio has risen over 600%.

Overall the US consumer remains extremely wealthy by historical and international standards; despite the high level of debt.

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Benjamin said...

I love the Kojak comment.

Even more, see "The Honeymooners."

Also, see representations of what it meant to be "rich" in the 1960s television. A guy with a two-story house and a butler was considered "rich."

The poor are much better off than in the 1960s, and the rich--well, they have boomed to the moon.

http://www.irs.gov/pub/irs-soi/07intop400.pdf

this is an interesting PDF from IRS.

Income for the top 400 richest filers in the USA is skyrocketing, quintupling in constant dollars since 1992. Real income up five-fold for the super-rich!

Hard to imagine they are uninspired to invest their booty. The average tax rate is about 17 percent on this richest--I pay a greater fraction of my income in taxes, and I am not in the top 400. I don't even think I am in the top 500.

This is one PDF I assume no GOP website will ever talk about.

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PeakTrader said...

Few people talk about the millions of jobs rich people create.

Take Bill Gates, thousands of his employees became millionaires working at Microsoft:

The Few, the Tech-Savvy Few: Option Millionaires
February 11, 2007

The high-tech explosion over the last 20 years or so has minted stock-option millionaires by the thousands.

While no one knows the exact number of Microsoft millionaires, Seattle economist Richard Conway has estimated that approximately 10,000 were created by the year 2000.

Obviously, you're more likely to become rich hanging around a billionaire than hanging around a welfare recipient.

So, should there be more billionaires or more welfare recipients?