Thread: The strongest economy in the world

Most of those same people can't even save $6000 a year.

People in my paygrade with my same time in service in the military are pathetic whiners as well.

I have many peers in the military with 28 + years living paycheck to paycheck ... they opt for they huge monthly vehicle payments ... I'd rather save in one year what they will pay for the vehicle in four years of payments.

Civilian or military ... always wankin' about more money.

Originally Posted by Storekeeper

"In the past 33 months the size of America's entire economy has increased by 20 percent -- or, as National Review Online's Larry Kudlow put it, "In less than three years, the U.S. economic pie has expanded by $2.2 trillion, an output add-on that is roughly the same size as the total Chinese economy." In the 2 1/4 years before the 2003 tax cuts, economic growth averaged 1.1 percent annually; in the three years since it has averaged 4 percent per year"

I have been absent from this thread for a bit but I would guess that this quote is pretty misleading. If you look at things in the stock market there was a huge drop just after 2000 as the dot coms melted down and this was followed by enron, worldcom, tyko, etc. accounting scandals. There was a huge reduction in wealth in the US related to equity devaluation that would have drawn down the portfolios of most Americans by 20% or so.

I am not sure if this quote refers to equity valuations or to GDP figures but GDP can also be misleading. How has the GDP been measured? Was inflation included or excluded? Did it correct the dollar values to a set point in time, (the US currency is down significantly against most of its trading partners).

It all goes to show there are 3 types of liers, you have liers, damn liers and statistics. I doubt the US is in as bad of shape as it is painted since like nature global economies hate a void or any type of imbalance. As US currency weakens, US exports will increase, this should lead to increased job creation which will then lead to consumer confidence and recovery. One huge plus is that despite the debt and other issues in the US they have managed to keep non-energy related inflation in check. Personally I am seriously thinking of moving many of my Canadian investments into the US market because I think the US is undervalued.

Once the commodities prices drop we should have some flat or negative growth for a bit then the us manufacturing sector will take off, after a year or 2 of that watch for commodities to take off again. Then resource based economies like Canada will be a good buy. It's all cycles and if you do what the herd is doing you will always lose.

The hardest part is predicting when the ass will finally fall out of commodities, my guess is as soon as Asian manufacturing shows any signs of leveling off the commodity prices will implode in a nasty way.

What's the real federal deficit?
How many billions (or trillions) of dollars depends on how you do the accounting
By Dennis Cauchon
USA TODAY

The federal government keeps two sets of books.
The set the government promotes to the public has a healthier bottom line: a $318 billion deficit in 2005.

The set the government doesn't talk about is the audited financial statement produced by the government's accountants following standard accounting rules. It reports a more ominous financial picture: a $760 billion deficit for 2005. If Social Security and Medicare were included — as the board that sets accounting rules is considering — the federal deficit would have been $3.5 trillion.

Congress has written its own accounting rules — which would be illegal for a corporation to use because they ignore important costs such as the growing expense of retirement benefits for civil servants and military personnel.

Last year, the audited statement produced by the accountants said the government ran a deficit equal to $6,700 for every American household. The number given to the public put the deficit at $2,800 per household.
A growing number of Congress members and accounting experts say it's time for Congress to start using the audited financial statement when it makes budget decisions. They say accurate accounting would force Congress to show more restraint before approving popular measures to boost spending or cut taxes.

“We're a bottom-line culture, and we've been hiding the bottom line from the American people,” says Rep. Jim Cooper, D-Tenn., a former investment banker. “It's not fair to them, and it's delusional on our part.”
The House of Representatives supported Cooper's proposal this year to ask the president to include the audited numbers in his budgets, but the Senate did not consider the measure.

Good accounting is crucial at a time when the government faces long-term challenges in paying benefits to tens of millions of Americans for Medicare, Social Security and government pensions, say advocates of stricter accounting rules in federal budgeting.

Entire: USATODAY.com

Toyota posting huge gains as are many Japanese automakers while the sloth-like US automakers keep posting losses.

Man, I wonder if someone in Detroit could figure out that we are tired of gas guzzling behemouths?

Originally Posted by surasak

Toyota posting huge gains as are many Japanese automakers while the sloth-like US automakers keep posting losses.

Man, I wonder if someone in Detroit could figure out that we are tired of gas guzzling behemouths?

The gas hikes have really had an effect. The auto-makers have studied this but the recent drops in sales of the gas-guzzlers has been pretty big. Also, I think a lot of consumers are looking at the possibility of future gas prices in their current buying decisions.

It's probably going to be a big issue I hope. We waste so much oil in the United States that we could probably solve all the Middle East issues without firing a shot just by being more careful.

^ At least the recent spike in gasoline has more attention being paid to altnernative energy and fules sources.

Higher gas prices will prompt more investment in these areas.

I don't know much about Ehthanol but there are some positivies of just adding a small percentage to fuel.

Look at the different also, of the UK and Germany.

(As for the automakers, it seems that GM is really on death's door. Ford has been taking a pounding recently, also.)

There aren't many positives. Ethanol has less energy content, thus, you need more to go the same distance. Look at the drought conditions in the U.S. right now. You can't grow grain for livestock and expect to fuel our thirst for fuel.

We ought to conserve. The Japanese do it splendidly.

^

Yaeah, I know very little about Ethanol. On the drought topic, it seems that this drought is pretty bad in the U.S.

Another idea is to use switchgrass to wean ourselves off oil. The problem is that to replace gasoline with ethanol from switchgrass would require planting an area the size of California, Arizona, and Nevada with only switchgrass. Imagine that!

Biodiesel really is a better way as diesel has more BTUs per gallon than gasoline. This means better fuel economy as well.

Read it and weep liberals and losertarian:

The federal deficit will register $260 billion this year, the lowest in four years, reflecting a strong economy and resulting growth in tax revenue, congressional analysts said Friday. The estimate by the nonpartisan Congressional Budget Office is well below its earlier predictions and also below the $296 billion White House estimate less than a month ago.
Better-than-expected revenues are driving the deficit down from last year's $318 billion figure and far below the record $413 billion posted in 2004.
At $260 billion, it would be the lowest since the $158 billion figure in 2002, the first deficit following four years of surpluses.
The deficit picture is even better when measured against the size of the economy, which is the comparison economists think is most important.
"At 2 percent of gross domestic product, the 2006 deficit would be smaller than the deficit recorded in the past three years — 3.5 percent in 2003, 3.6 percent in 2004 and 2.6 percent in 2005," said the CBO report.

Anyone want to make book on what the FY 2007 deficif will be? Who wants to start taking bets that, provided a Democratic majority isn't elected this November, that the book balance by FY 2009?

Deficit Estimated Lowest in 4 Years

There was a surplus until GWB started wasting it on useless wars. Are we ever going to get back our 'investement' in Iraq? The bill so far is $2,000 for every person living in the U.S. and growing daily. I wonder what better uses we could have found for that money.

Speaking of oil, a major Alaskan pipeline is shutting down.

Major Alaskan oil field shutting down - Yahoo! News

Whoops, another $10 a barrel folks. Thanks, GWB for failing to take any leadership in mandating better efficiency.

Originally Posted by surasak

Thanks, GWB for failing to take any leadership in mandating better efficiency.

What type of SUV or 8 cylinder truck are you driving ? You don't have one of them hybrid cars now do you ?

I have neither, I have a Honda Civic CRX HF. Better than any new hybrid. If I have need for something larger I rent it.

Originally Posted by surasak

I have neither, I have a Honda Civic CRX HF. Better than any new hybrid. If I have need for something larger I rent it.

Then I applaud you for practising what you preach. You are to be commended.

Now, why did you ask me if I was a poof on my repo ?

In fact I just spent some free time today adjusting the time and valve lash to get some more performance out of it to increase mileage even more (I use a vacuum gauge to monitor my driving...the higher the vacuum, the better the efficiency). Usually I keep it in the 15-20in/Hg range which allows maximum mileage. I find that in most vehicles I can better the EPA estimate (which, sadly, tends to be as high as 30% over the actual mileage on many vehicles). The key is avoiding jack-rabbit starts and sudden braking.

Originally Posted by Storekeeper

Now, why did you ask me if I was a poof on my repo ?

I think it's because you're in touch with your feminine side.

Sales at American automakers crashing as gasoline increases.

Fewer Americans are keeping on truckin' - The Driver's Seat - MSNBC.com

'bout time something came along to affect America's driving habits. Now if only the government would do the right thing and tax gasoline even higher to the levels of Europe it might get people to stop wasting it. Perhaps if we cut back by a few million barrels per day the price of oil just might go down as well.

Americans are spending with plastic at a staggering rate. Consumer credit-card debt has almost tripled over the last two decades—from $238 billion in 1989 to $800 billion in 2005, according to an analysis of Federal Reserve Board data by Demos, a national research and consumer advocacy group. The average American family now owes more than $9,000 in credit debt, according to Gail Cunningham of the Consumer Credit Counseling Service (CCCS) of Greater Dallas, a nonprofit financial-management group. And with credit companies mailing out a record 6 billion credit-card offers last year (according to Mail Monitor, a market research group), American families are averaging about seven cards. "It's a picture of America on the edge," says Cunningham.

Entire & Link: American Debt: Escaping the Credit-Card Quagmire - Newsweek Business - MSNBC.com

Was just going to post that...more proof that the recent 'economic growth' is being fueled by debt and not real income.

$90 billion a year being sucked out of the economy by interest and penalties....thank God I have no debt.

Originally Posted by surasak

Was just going to post that...more proof that the recent 'economic growth' is being fueled by debt and not real income.

$90 billion a year being sucked out of the economy by interest and penalties....thank God I have no debt.

What I find strange about the numbers of the U.S. economy is this:

1. Wages are down every year, for the last 6 years. For everyone.

But property values has risen dramatically (interest rates, speculation, conversions, flipping, etc.)

2. Debt is at an all-time high.


Health care costs, taxes, and other 'fixed costs' have risen.

Oil and property. All pure speculation that's driving prices up for no good reason.

Gosh, I'd hate to have an ARM and have the real estate bubble pop. My parents got eaten for lunch and dinner when this happened back in the 1980s.

I guess I'm blind about what's really going on in the US since I'm surrounded mostly by success stories. People who have done quite well in mutual and stock funds as well as being smart enough to lock in, or refinance to lower mortgage rates.

I will admit that I'm flabbergasted when I see people retiring at 30 years with $500+ a month car payments on new vehicles.

Originally Posted by Storekeeper

I guess I'm blind about what's really going on in the US since I'm surrounded mostly by success stories. People who have done quite well in mutual and stock funds as well as being smart enough to lock in, or refinance to lower mortgage rates.

Sure, there are some people who are doing smart things. Remember that most mutual funds are poor, and only seasoned investors should go into and out of stock.

Refinancing a mortgage is good. But the most important thing is the positive cash flow, IMO.

People in Kitsap have 1 owner-occupied house. But they claim they can't get the second house. Maybe this is true. Maybe not.

I know some success stories, too. But it's by people that own multiple dirt (raw land) and multiple single housing units and apartments.

Obviously if someone has good cash flow then they won't be behind in their CC payments will they?