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Stagnation is the main threat the world is waking up to. People will blame other things of course. Things like MENA immigration, climate patterns, crop failure

Stagnation is the main threat the world is waking up to. People will blame other things of course. Things like MENA immigration, climate patterns, crop failures, these are second order affects of stagnation. The peripheral fails before the center. Never forget that. I have to congratulate Peter Thiel. He has managed to see a lot of this ahead of almost anybody else I can think of and this is despite being at the heart of the cozy bubble that is Silicon Valley. One of his expressions is that you can have instances of success in an ocean of general failure or something to that effect. Even on HN a few hours ago I saw a WSJ article proclaiming that everything is smashingly good these days, that three/four decade wage stagnation is a mere blip on the radar. Though I agreed with the substance of the historical facts she stated I also think this is an utterly clueless point of view on human nature that is shared by huge swathes of the middle class. I didn't live in 1850 and I cannot be expected to appreciate the good fortune of the years since then! If you live in a downcycle then that's all you know. You see the contradictions at their most dire with the pension funds. They require either massive hikes in funding or 6-7 real percent per year. Wages will have to rise suddenly and dramatically and/or else we need massive massive technological changes. Somehow I see Larry Summers getting called back into Court. Whether monetary policy is enough, that is another question.

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mrep 10y ago
Wages have not been stagnating [1]. Median wage has stagnated but that is due largely to the polarization of the labor market of which has been talked about long before Peter Thiel [2]. [1]: http://www.tradingeconomics.com/united-states/wage-growth http://www.tradingeconomics.com/united-states/wage-growth [2]: https://www.researchgate.net/profile/Melissa_Kearney2/publication/4981174_The_Polarization_of_the_U.S._Labor_Market/links/0fcfd50bd66be2418b000000.pdf https://www.researchgate.net/profile/Melissa_Kearney2/public...
- internaut 10y ago
  I agree with those statements. I'm not sure we agree on what they mean though. World becomes more zero sum when growth plateaus. Only now it is proposed that everybody and their dog get PhDs in god only knows what. Diminishing returns are exactly stagnation. I know blue collar workers making more money than people who took extensive study and got 'good' jobs. This is despite the fact those workers haven't actually had wage increases themselves! They're just working long hours for more pay. We're stuck in a rut. It could be the case that technological stagnation is created by technology itself. A hairy subject! If I remember rightly wage increases for the higher percentile aren't that great either. I mean they are better than zero but not as great as they used to be. Makes sense since their market of consumers is drying up as everybody becomes cash poor except for those making toys for the actual rich.
CyberDildonics 10y ago
An economist named Harry Dent has said the same thing for quite a while and wrote a book (which is a bit hard to read without being versed in financial terms). He had a debate with Jim Rickards where they wound up both saying deflation would happen due to demographics, but disagreed on the power and will of governments to enact inflation to counter it.
- internaut 10y ago
  The names of those guys make them sound like characters from Gotham city in Batman. I'll have to take a look at the book and debate, whizzbang financial terminology doesn't scare me.

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mrep 10y ago

Wages have not been stagnating [1]. Median wage has stagnated but that is due largely to the polarization of the labor market of which has been talked about long before Peter Thiel [2]. [1]: http://www.tradingeconomics.com/united-states/wage-growth http://www.tradingeconomics.com/united-states/wage-growth [2]: https://www.researchgate.net/profile/Melissa_Kearney2/publication/4981174_The_Polarization_of_the_U.S._Labor_Market/links/0fcfd50bd66be2418b000000.pdf https://www.researchgate.net/profile/Melissa_Kearney2/public...

internaut 10y ago
I agree with those statements. I'm not sure we agree on what they mean though. World becomes more zero sum when growth plateaus. Only now it is proposed that everybody and their dog get PhDs in god only knows what. Diminishing returns are exactly stagnation. I know blue collar workers making more money than people who took extensive study and got 'good' jobs. This is despite the fact those workers haven't actually had wage increases themselves! They're just working long hours for more pay. We're stuck in a rut. It could be the case that technological stagnation is created by technology itself. A hairy subject! If I remember rightly wage increases for the higher percentile aren't that great either. I mean they are better than zero but not as great as they used to be. Makes sense since their market of consumers is drying up as everybody becomes cash poor except for those making toys for the actual rich.

CyberDildonics 10y ago

An economist named Harry Dent has said the same thing for quite a while and wrote a book (which is a bit hard to read without being versed in financial terms). He had a debate with Jim Rickards where they wound up both saying deflation would happen due to demographics, but disagreed on the power and will of governments to enact inflation to counter it.

internaut 10y ago
The names of those guys make them sound like characters from Gotham city in Batman. I'll have to take a look at the book and debate, whizzbang financial terminology doesn't scare me.