EPIC Radio Podcasts:The Poetry Show Podcast featuring Dame Carol Ann Duffy

John Case has sent you a link to a blog:



Blog: EPIC Radio Podcasts
Post: The Poetry Show Podcast featuring Dame Carol Ann Duffy
Link: http://podcasts.enlightenradio.org/2017/01/the-poetry-show-podcast-featuring-dame.html

--
Powered by Blogger
https://www.blogger.com/

Summers: Markets enjoying a sugar high that will not last [feedly]

Markets enjoying a sugar high that will not last
http://larrysummers.com/2017/01/29/markets-enjoying-a-sugar-high-that-will-not-last/

This week the Trump rally continued as the Dow crossed 20,000 and our President issued a celebratory tweet. How much does this mean? To what extent is it a vindication of the economic policy approaches pursued by the new Administration? Will the post election rally continue? No one knows these answer and market timing is a fool's game but I remain persuaded that markets and the economy are most likely enjoying a sugar high that will not last a year.

First Dow 20,000 is a meaningless benchmark and crossing it means little. Its numerology not analysis to focus on round numbers. The Dow is an odd and arbitrary index which weights companies by their share price not their market value. It is highly limited in who is included with Goldman Sachs accounting for over 20 percent of the gain in the 30 stock index since election day.

Second, as Bob Rubin constantly reminded his colleagues in the Clinton administration "markets go up, markets go down" and it is a mistake to judge policy on immediate market reactions rather than concentrating on fundamentals. The observation that the best post-election pre-inauguration performance of the stock market in the last 100 years occurred during Herbert Hoover's transition underscores this point as does the market's poor performance during the Roosevelt and Obama transitions.

Third, there are indicators in markets of possible trouble ahead. While financial stocks have been very strong over the last several months, insider sales have soared.

Despite what most observers see as highly uncertain environment, market expectations of near term volatility are near record lows suggesting scope for sudden disillusionment. Rapid inflows into mutual funds could easily go into reverse.

Fourth, the fundamental basis for a big market rally is very unclear. If "pro business policies" were key over time it would not be the case that Democrat administrations have consistently seen stronger markets than Republican ones over the last 70 years. Recall also that nearly half of S&P 500 revenue is earned abroad and will not be enhanced by new US domestic policies but may be hurt by new nationalist measures. It is far from clear that corporate tax reform on the scale envisioned by the new administration will pass this year and even the hallmark 1986 Act had only modest stock market impacts. The impact of regulatory changes will be felt only in some sectors and may be offset by new populist measures such as restrictions on pharmaceutical pricing.

Fifth, and most important new governments with authoritarian tendencies have historically brought about bull markets even before they led to disaster. Governments with much stronger authoritarian tendencies than anything plausible in the USA like those of Hitler or Mussolini nonetheless saw strong markets in their early years.

I am not sure which is more difficult: predicting what President Trump will do next or timing the market. Either way after the events of the last week it is much easier to imagine downside than upside scenarios.

 -- via my feedly newsfeed

Dean Baker: Truthiness on Trade [feedly]

Truthiness on Trade
http://cepr.net/publications/op-eds-columns/truthiness-on-trade

With the official death of the Trans-Pacific Partnership (TPP) and the likely renegotiation of the North American Free Trade Agreement (NAFTA), the proponents of these deals are doubling down in their defense of the current course of US trade policy. While there are serious arguments that can be made in defense of these policies, advocates are instead seeking to deny basic reality.

These trade policy proponents are trying to deny that these policies have hurt large segments of the workforce and are claiming that the people, who believe that they were hurt by trade, are simply misinformed. The proponent's story is that the real cause of job loss was the impersonal force of technology, not a trade policy that deliberately placed US manufacturing workers in direct competition with low paid workers in the developing world.

Fortunately this is a case where the facts are clear. The people who think they were hurt by trade are right. It is the people who blame technology who are misinformed or worse.

The obvious error in the technology or automation story is that automation is not anything new. We have been seeing increases in productivity in manufacturing forever; it is not something that just happened in the last two decades. In fact, the most rapid period of technological change was in the quarter century from 1947 to 1973, not the last two decades.

In spite of increases in productivity growth, there was relatively little net change in manufacturing employment in the three decades from 1970 to 2000. There were 17.8 million jobs in manufacturing in 1970 and 17.3 million in 2000. There were cyclical ups and downs, but the downward trend was relatively modest. To be clear, manufacturing was declining as a share of total employment, but there was little change in the absolute level of employment.

This changed in the years from 2000 to 2007. During this seven-year period, manufacturing employment fell by 3.4 million jobs to 13.9 million. Note that 2007 is before the collapse of the housing bubble that threw the economy into recession. The reason for this plunge in employment is simple, the trade deficit exploded to almost 6 percent of GDP, more than $1.1 trillion in today's economy.

To argue that this surge in the trade deficit was not associated with a loss of manufacturing jobs is absurd on its face. Does anyone seriously want to argue that if the trade deficit had remained near 1.5 percent of GDP (its mid-1990 level), that we would not have more manufacturing jobs. Or to flip the question, can we add more than $1 trillion to our annual output in manufacturing without hiring additional workers?

And these job losses were concentrated in the traditional industrial states that featured prominently in the fall election. Ohio lost 250,000 manufacturing jobs during this period, one quarter of its total. Michigan lost 280,000 jobs, more than 30 percent of its manufacturing employment. Pennsylvania lost more than 300,000 manufacturing jobs, roughly one-third of its total.

None of these numbers are seriously contestable outside of Donald Trump's alternative fact universe. They all come from the Bureau of Labor Statistics and can be easily verified by any of the commentators blaming automation, if they were interested in actually knowing anything about the issue.

In fact, this story really understates the impact of trade since the imbalances that lead to the housing bubble and the subsequent crash and Great Recession were directly tied to the massive trade deficit the United States ran in this period. For this reason, people would not be wrong to say that our trade policies were an important contributor to the Great Recession and its devastating impact on the labor market.

It is also worth pointing out we could have pursued trade policies that were not so harmful to these workers. Our high dollar policy, which began under Treasury Secretary Robert Rubin in 1996, was central to the huge trade deficits of the next decade.

Also, contrary to the folk wisdom of the elites, we have selective protectionism, not free trade. While it is easy to import manufactured goods produced by the cheapest labor anywhere in the world, even a highly qualified foreign doctor would get arrested for practicing medicine in the United States unless they first completed a US residency program. We subjected our manufacturing workers to international competition, while largely protecting our most highly paid professionals.

This reality check is important. The people who turned away from the Democrats and voted for Trump really did have legitimate grievances. Trade policies supported by the leadership of both parties had a devastating impact on the lives of millions of workers and their families.

This doesn't justify voting for a realty-challenged bigot like Trump, but it is flat out dishonest to deny the damage that our trade policies have inflicted on large segments of the country. Denying this reality is not a promising path for winning back the support of these voters, although it may make the people who benefited from these trade policies feel better about themselves.

 -- via my feedly newsfeed

EPIC Radio Podcasts: Fanny Interviews legendary labor organizer Stewart...

EPIC Radio Podcasts: Fanny Interviews legendary labor organizer Stewart...: Fanny interviews legendary organizer Stewart Acuff Jan 24th, 2017 by democracyroad Storytelling with Fanny Crawford: Fanny elicits a d...

EPIC Radio Podcasts:Fanny Interviews legendary labor organizer Stewart Acuff

John Case has sent you a link to a blog:



Blog: EPIC Radio Podcasts
Post: Fanny Interviews legendary labor organizer Stewart Acuff
Link: http://podcasts.enlightenradio.org/2017/01/fanny-interviews-legendary-labor.html

--
Powered by Blogger
https://www.blogger.com/

EPIC Radio Podcasts:Interview with Sammi Brown

John Case has sent you a link to a blog:



Blog: EPIC Radio Podcasts
Post: Interview with Sammi Brown
Link: http://podcasts.enlightenradio.org/2017/01/interview-with-sammi-brown.html

--
Powered by Blogger
https://www.blogger.com/

Eastern Panhandle Independent Community (EPIC) Radio:Monday Lineup on EPIC Radio, Jan 30, 2017

John Case has sent you a link to a blog:



Blog: Eastern Panhandle Independent Community (EPIC) Radio
Post: Monday Lineup on EPIC Radio, Jan 30, 2017
Link: http://www.enlightenradio.org/2017/01/monday-lineup-on-epic-radio-jan-30-2017.html

--
Powered by Blogger
https://www.blogger.com/