Rolling US Economy Into The Shitbin Thread

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such a pain to shred your own, but it does make for a fresher hellscape i mean landscape

Morton Koopa Jr. Sings Elvis (Sufjan Grafton), Thursday, 28 May 2020 20:18 (two months ago) link

southwestern US teal formica shortage

Morton Koopa Jr. Sings Elvis (Sufjan Grafton), Thursday, 28 May 2020 20:26 (two months ago) link

welcome to the shitbin

Stephen Moore, economic adviser to the White House, on the jobs numbers:

“It takes a lot of the wind out of the sails of any phase 4 -- we don't need it now. There's no reason to have a major spending bill. The sense of urgent crisis is very greatly dissipated by the report.”

— Jeffrey Stein (@JStein_WaPo) June 5, 2020

𝔠𝔞𝔢𝔨 (caek), Friday, 5 June 2020 16:46 (two months ago) link

Everything's all better! Yay!

Josh in Chicago, Friday, 5 June 2020 16:46 (two months ago) link

His own obstinate GOP Senate doesn't even agree with that as of this week

I am a free. I am not man. A number. (Neanderthal), Friday, 5 June 2020 16:47 (two months ago) link

at the risk of being extremely paranoid, do we believe these numbers?

bls is of course supposed to be independent and insulated, but so are inspectors general

mookieproof, Friday, 5 June 2020 17:54 (two months ago) link

i have a friend who works in labor statistics stuff, they looked bonkers to him. i think his suggestion was that maybe a lot of covid-related work loss was being counted differently.

j., Friday, 5 June 2020 17:59 (two months ago) link

i've mentioned this elsewhere but the markets are nearing their all time highs very quickly. It's not the real economy but certain people don't seem to care as long as they can say "the economy" is fine.

Yerac, Friday, 5 June 2020 18:02 (two months ago) link

a lot of the "re-employed" are furloughed returning to work, but they could be counting people who returned to work only to be told their job would be ending permanently at the end of the week (as some friends of mine), or coming in for a day or two for re-opening meetings or having their hours severely cut so they're working at a fraction of what they made before. Many of these people can't even file for underemployment, as for example in Florida, you can only file for underemployment if you make less than $275/week, which is their maximum benefit.

so I'm sure the stats are "accurate" from the 10,000 foot view, but they probably don't mean what people think they meet when examined up-close.

I am a free. I am not man. A number. (Neanderthal), Friday, 5 June 2020 18:04 (two months ago) link

I saw that it's a lot of forloughed and hospitality workers going back to work, but employment numbers for blacks and Asians actually went down.

Josh in Chicago, Friday, 5 June 2020 18:07 (two months ago) link

let's see how many more bodies are nbd

brooklyn suicide cult (Dr Morbius), Friday, 5 June 2020 18:08 (two months ago) link

that's the other part.

I am a free. I am not man. A number. (Neanderthal), Friday, 5 June 2020 18:10 (two months ago) link

There's gonna be a different picture once the credit card and auto loan and mortgage defaults start to pile up, but that could take a while to show up in quarterly earnings results.

longtime caller, first time listener (man alive), Friday, 5 June 2020 18:45 (two months ago) link

there was a headline today that Hertz went up 825% since they declared bankruptcy and their shares plummeted.

Yerac, Friday, 5 June 2020 18:58 (two months ago) link

"Unexpected strength in employment, hours, and earnings in May implies less of a decline in second-quarter PCE than previously expected. As a result, we raised our tracking forecast of second-quarter GDP growth by 0.5 percentage point to -41.5%." —IHS Markit

— Neil Irwin (@Neil_Irwin) June 5, 2020

𝔠𝔞𝔢𝔨 (caek), Friday, 5 June 2020 19:29 (two months ago) link

oh, what a relief

all cats are beautiful (silby), Friday, 5 June 2020 19:34 (two months ago) link

Nasdaq all time high today really good stuff

𝔠𝔞𝔢𝔨 (caek), Friday, 5 June 2020 22:34 (two months ago) link

trade of a lifetime

voltmeter said i had potential (Sufjan Grafton), Saturday, 6 June 2020 00:37 (two months ago) link

https://www.washingtonpost.com/business/2020/06/05/may-2020-jobs-report-misclassification-error/

When the U.S. government’s official jobs report for May came out on Friday, it included a note at the bottom saying there had been a major “error” indicating that the unemployment rate likely should be higher than the widely reported 13.3 percent rate.

The special note said that if this “misclassification error” had not occurred, the “overall unemployment rate would have been about 3 percentage points higher than reported,” meaning the unemployment rate would be about 16.3 percent for May.

j., Saturday, 6 June 2020 04:44 (two months ago) link

My wife works in labor and employment and she has seen a lot of employers furloughing employees over the last two months. A lot of these employees won't end up being recalled.

Also, employers who received PPP loans were required to maintain certain payroll for two months as a condition to getting the loans forgiven. I would anticipate further layoffs when this period is over and employers are no longer required to maintain payroll.

Night of the Living Crustheads (PBKR), Saturday, 6 June 2020 12:09 (two months ago) link

Yeah friends of mine who are currently unemployed or furloughed are balking at mgmt who are poking around reopening offices. No one feels safe yet

Lately I've felt like the guy on the airplane who is the only one who can see the monster on the wing. The economy, despite a bounce-back effect in some data and a stock market recovery, is suffering a profound collapse of demand.

Don't lose the thread.https://t.co/8KXXL4SZHx

— Neil Irwin (@Neil_Irwin) June 6, 2020

𝔠𝔞𝔢𝔨 (caek), Saturday, 6 June 2020 16:55 (two months ago) link

my economy means i don't read shit in the ny times anymore

crystal-brained yogahead (map), Saturday, 6 June 2020 17:03 (two months ago) link

When the U.S. government’s official jobs report for May came out on Friday, it included a note at the bottom saying there had been a major “error” indicating that the unemployment rate likely should be higher than the widely reported 13.3 percent rate.
The special note said that if this “misclassification error” had not occurred, the “overall unemployment rate would have been about 3 percentage points higher than reported,” meaning the unemployment rate would be about 16.3 percent for May.

― j., Saturday, June 6, 2020 12:44 AM (twelve hours ago) bookmarkflaglink

these errors exist every month; if you include errors from both months the decline in unemployment is actually larger

flopson, Saturday, 6 June 2020 17:07 (two months ago) link

Two things to note about unemployment misclassification in today's jobs report:

1. If misclassified absent workers had been counted as unemployed as intended, U3 would have been +3pp higher.

2. But this error was +4.8pp last month.

So official U3 understated the M-M decline.

— Ernie Tedeschi (@ernietedeschi) June 5, 2020

flopson, Saturday, 6 June 2020 17:08 (two months ago) link

Also, employers who received PPP loans were required to maintain certain payroll for two months as a condition to getting the loans forgiven. I would anticipate further layoffs when this period is over and employers are no longer required to maintain payroll.

there is a current bill heading to the President that would extend the duration of the PPP loan forgiveness period -- (from 8 weeks to 24 weeks, i think). It's also creating this weird system where there are people on unemployment who don't want to go back to jobs that could still just be temporary because the unemployment benefits are more stable, meanwhile employers need workers in order to qualify for loan forgiveness, so there is some weird hiring going on. I am in this facebook group for accountants where people are posting that business owners w/PPP loans are asking them if they could hire their children as employees, like 9 year olds, like "will this violate child labor laws" age kids.

sarahell, Sunday, 7 June 2020 18:03 (one month ago) link

a current bill heading to the President

sorry not to know already, but do you know if this is yet to pass the Senate, or now in conference committee, or ready for its final vote, or now voted on and awaiting signature?

A is for (Aimless), Sunday, 7 June 2020 18:45 (one month ago) link

interesting if true

WASHINGTON (AP) — The U.S. economy entered a recession in February, a group of economists declared Monday, ending the longest expansion on record.

— Kyle Griffin (@kylegriffin1) June 8, 2020

𝔠𝔞𝔢𝔨 (caek), Monday, 8 June 2020 17:47 (one month ago) link

🧐

Li'l Brexit (Tracer Hand), Monday, 8 June 2020 19:43 (one month ago) link

https://i.imgur.com/qqP5V8n.png

Nhex, Monday, 8 June 2020 20:18 (one month ago) link

ehehehe

all cats are beautiful (silby), Monday, 8 June 2020 20:20 (one month ago) link

@flopson i have a biomed hedge fund friend who is MMT-curious and asked for a reasonable/intelligent book to read on the topic and i didn't know what was good but thought you might can you recommend anything?

Mordy, Tuesday, 9 June 2020 14:53 (one month ago) link

https://stephaniekelton.com/book/

"the deficit myth" just came out today!

methinks dababy doth bop shit too much (m bison), Tuesday, 9 June 2020 15:08 (one month ago) link

Does MMT depend on us being a global empire? Because that seems to be a big component of why we can carry our deficits.

longtime caller, first time listener (man alive), Tuesday, 9 June 2020 16:37 (one month ago) link

seems probable that MMT works so long as you're the global currency of choice

methinks dababy doth bop shit too much (m bison), Tuesday, 9 June 2020 16:39 (one month ago) link

Kelton was a guest on Chris Hayes' podcast fairly recently. very worthwhile discussion, esp. if you don't want to read an entire book about the subject.

Evans on Hammond (evol j), Tuesday, 9 June 2020 17:05 (one month ago) link

Doesn't being the global currency of choice basically depend on having a ton of aircraft carriers and ICMBs xp?

longtime caller, first time listener (man alive), Tuesday, 9 June 2020 18:01 (one month ago) link

ya

methinks dababy doth bop shit too much (m bison), Tuesday, 9 June 2020 18:06 (one month ago) link

@flopson i have a biomed hedge fund friend who is MMT-curious and asked for a reasonable/intelligent book to read on the topic and i didn't know what was good but thought you might can you recommend anything?

― Mordy, Tuesday, June 9, 2020 10:53 AM (three hours ago) bookmarkflaglink

i dont recommend reading a book about MMT as i consider it largely a scam and a distraction from actually good arguments for deficit spending or debt monetization, and harmful in its anti-welfare state tendencies. i have never read a book on it, i have only read 10,000 posts. based on the reviews i’ve read so far of kelton’s book, it seems like it contains some howlers. but reading it alongside critiques would probably be good. it’s almost certainly less boring than Moser’s textbook, and she’s a good writer.

in general MMT is either (1) trivial but pretends it is radical (pretending its description of consolidated fed-treasury differs from rest of monetary economics), (2) wrong (contains a lot of weird arguments anti-welfare spending and pro-job guarantees on the basis the former is inflationary), (3) right for the wrong reasons (MMT implicitly assumes permanent demand deficiency rather than demonstrating it)

i realize i avoid getting into the nitty gritty in these threads, that’s because (1) when im on here im procrastinating doing my own nitty gritty economics research (2) getting into the morass of accounting details is how they getcha. however im teaching some friends of mine macroeconomics in a slack channel rn, will post some stuff when i get to monetary/MMT/japan. i promise you it will be super boring and disappointing :)

I don’t remember if i posted this last time but this conversation between a mainstream monetary guy and an MMT guy shows how little daylight there is and how dull the differences are http://andolfatto.blogspot.com/2019/09/a-conversation-with-eric-tymoigne-on.html?m=1

flopson, Tuesday, 9 June 2020 18:23 (one month ago) link

https://www.theatlantic.com/magazine/archive/2020/07/coronavirus-banks-collapse/612247/

The reforms were well intentioned, but, as we’ll see, they haven’t kept the banks from falling back into old, bad habits. After the housing crisis, subprime CDOs naturally fell out of favor. Demand shifted to a similar—and similarly risky—instrument, one that even has a similar name: the CLO, or collateralized loan obligation. A CLO walks and talks like a CDO, but in place of loans made to home buyers are loans made to businesses—specifically, troubled businesses. CLOs bundle together so-called leveraged loans, the subprime mortgages of the corporate world. These are loans made to companies that have maxed out their borrowing and can no longer sell bonds directly to investors or qualify for a traditional bank loan. There are more than $1 trillion worth of leveraged loans currently outstanding. The majority are held in CLOs.

j., Wednesday, 10 June 2020 15:46 (one month ago) link

stonks

mookieproof, Thursday, 11 June 2020 17:01 (one month ago) link

more like stanks, amirite?

Life is a banquet and my invitation was lost in the mail (j.lu), Thursday, 11 June 2020 17:04 (one month ago) link

to what extent is the massive fed preemptive action currently underway reducing/not reducing the risk from that?

longtime caller, first time listener (man alive), Thursday, 11 June 2020 17:14 (one month ago) link

lol at all of this

last week: stocks rise 5% on covid optimism!!!

*5 days pass, in which absolutely nothing happens that was not already widely expected*

stocks fall 5% on glum covid outlook!!!

our god is a might god (Karl Malone), Thursday, 11 June 2020 17:23 (one month ago) link

supposedly the huge gains of the last couple months were predicated on the fed taking strong action and giving investors confidence that the world would not explode

which always seemed like bullshit to me. i don't think it's a coordinated effort or anything, but the last few weeks have just seemed like willingly suspending disbelief to pump the market back in and squeeze the last juices out of it before manufacturing slowdowns and a collapsing real estate market become so obvious that even investors have to acknowledge it.

our god is a might god (Karl Malone), Thursday, 11 June 2020 17:26 (one month ago) link

to what extent is the massive fed preemptive action currently underway reducing/not reducing the risk from that?

― longtime caller, first time listener (man alive), Thursday, June 11, 2020 10:14 AM (eighteen minutes ago)

idk, but if you read the regulations/descriptions of the PPP program, it says that the loans can be resold on the secondary market ... so, if I was a cartoonish pessimist, I would suggest that the next "sub-prime" crisis will be risky PPP loans ... they have now reduced the portion of the loan that has to be used for payroll from 75% to 60% and given people/businesses 24 weeks to qualify for forgiveness as opposed to the original 8 weeks.

sarahell, Thursday, 11 June 2020 17:38 (one month ago) link

(2) getting into the morass of accounting details is how they getcha

ooooooooh!!!! do tell!

sarahell, Thursday, 11 June 2020 17:39 (one month ago) link

use of "stonks" really peaking this past month.

Yerac, Thursday, 11 June 2020 17:40 (one month ago) link

xp -- wait really? Why the fuck would anyone buy a loan that is meant to be forgiven?

longtime caller, first time listener (man alive), Thursday, 11 June 2020 17:41 (one month ago) link

how much truth is there in the apocalyptic "soon people will have to pay all their back rent/mortgage payments and everything will crash and burn" articles that are coming out now?

sarahell, Thursday, 11 June 2020 17:42 (one month ago) link


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