Some Economics Stories

[Ad Orientem]

As interest rates look to continue rising, corporations are rushing to raise money from still below average rates while they can.

No surprise here. The rich are getting richer while most middle and working class incomes remain stagnant or are declining. The top 10% of earners took home almost 50% of all income last year.

Stock dividends are signalling economic growth.

[Libertarian666]

Yes, how vicious of those 1%-ers to pay taxes last year instead of higher rates this year!

"One of them, Berkeley's Emmanuel Saez, said the incomes of the richest Americans surged last year in part because they cashed in stock holdings to avoid higher capital gains taxes that took effect in January. "

(from the article about the top 10%...)

[Pointedstick]

In and of itself, I don't mind this. But I worry that it could trigger violence.

[WildAboutHarry]

The richest Americans were hit hard by the financial crisis. Their incomes fell more than 36 percent in the Great Recession of 2007-09 as stock prices plummeted. Incomes for the bottom 99 percent fell just 11.6 percent, according to the analysis.

I don't recall reading any lamentations in the press in 2009 about this factiod.

The income figures include wages, pension payments, dividends and capital gains from the sale of stocks and other assets. They do not include so-called transfer payments from government programs such as unemployment benefits and Social Security.

So we don't count $800 billion (SS only) plus?  That is way more than total dividends paid per year by the S&P 500 (assuming hasty internet research is correct).

Being able to earn capital gains, dividends, bond interest, etc. implies: 1) Saving and 2) Risk taking (see first quote above).

[moda0306]

The richest Americans were hit hard by the financial crisis. Their incomes fell more than 36 percent in the Great Recession of 2007-09 as stock prices plummeted. Incomes for the bottom 99 percent fell just 11.6 percent, according to the analysis.

I don't recall reading any lamentations in the press in 2009 about this factiod.

The income figures include wages, pension payments, dividends and capital gains from the sale of stocks and other assets. They do not include so-called transfer payments from government programs such as unemployment benefits and Social Security.

So we don't count $800 billion (SS only) plus?  That is way more than total dividends paid per year by the S&P 500 (assuming hasty internet research is correct).

Being able to earn capital gains, dividends, bond interest, etc. implies: 1) Saving and 2) Risk taking (see first quote above).

If my clients were any indication, lots of capital losses were harvested in 2009. I wonder if that had anything to do with this.

And a 10% hit to income for someone at the poverty line has a pretty huge impact compared to a 30% hit in income to someone who is wealthy. Nothing particularly horrible about that... Just the way it is.

[Kshartle]

As interest rates look to continue rising, corporations are rushing to raise money from still below average rates while they can.

No surprise here. The rich are getting richer while most middle and working class incomes remain stagnant or are declining. The top 10% of earners took home almost 50% of all income last year.

Stock dividends are signalling economic growth.

Wait I thought the money printing and artificially low rates were supposed to help the poor get jobs and borrow money for homes.

Are you telling me it just inflated the value of rich people's assets and allowed share buy backs and hot speculator money on Wall Street?

Who could have imagined the government program backfiring?

Krugman!!! You got me again you tricky son of a gun. It's gotta be the beard.

[Kshartle]

I'm afraid the inequality is going to get worse. And the poor are going to be living increasingly more difficult lives. The poor today live very well compared to poor 80 years ago but I think it's going to head back the other way for a bit.

No doubt the government will dream up new programs to fight inequality. Their programs always backfire though and we'll just end up with more poor.

They need to back off and let capitalism solve this inequality problem. Even if it gets more unequal with freedom everyone will be so much better off (poor & middle) they won't care. They will just know their lives are a lot better than their parents and their kids lives are going to be a lot better. No revolutions or clashes because their won't be big groups of volatile people suffering.

[MediumTex]

I'm afraid the inequality is going to get worse. And the poor are going to be living increasingly more difficult lives. The poor today live very well compared to poor 80 years ago but I think it's going to head back the other way for a bit.

No doubt the government will dream up new programs to fight inequality. Their programs always backfire though and we'll just end up with more poor.

They need to back off and let capitalism solve this inequality problem. Even if it gets more unequal with freedom everyone will be so much better off (poor & middle) they won't care. They will just know their lives are a lot better than their parents and their kids lives are going to be a lot better. No revolutions or clashes because their won't be big groups of volatile people suffering.

It's certainly true that even with today's wealth disparities, the poor in the U.S. still live very very well by historical standards.

Any time obesity is one of a group's most serious problems, you know that their lives can't be too bad.

[annieB]

This doesn't sound exceptional...