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People are working, unemployment has been falling like a stone since 2017. That money is going to go somewhere (and for most that is not 'the bank'). It's going

People are working, unemployment has been falling like a stone since 2017. That money is going to go somewhere (and for most that is not 'the bank'). It's going to get spent or put into investments. We're going to continue to see strong commodity prices (and most of these have been rising into the headwind of a stronger dollar) until unemployment creeps up, or real wages falls too far behind inflation rate. I think the increased commodity supply that would normally rebalance pricing before demand does is going to be delayed. Why? Though interest rates are low, loans aren't going into commodity capital projects (because risk and returns ratios don't look good to lenders when compared to inflation rate? not sure).

munk-a 5y ago
I think there is an issue with that logic - it doesn't account for the ever accelerating wealth inequality. People are working a ton right now - and creating massive amounts of value. It's so freaking easy to get consumer goods delivered next day that we're all forgetting that this service would likely cost fifty+ dollars in the early 90's - there are similar trends across the economy. The issue is that a lot of that created value is being isolated out of circulation and is pooling in investors that can, at a moments notice, pull the rug out of a number of great companies if they sense a panic. Wealth inequality creates the opportunity for instability in the form of extreme sudden market rushes alongside reducing the purchasing power of most folks. We're in a rough spot.
- splistud 5y ago
  Very complex situation, and we likely agree on some of it. I won't rehash that part. Some seldom-described (or taboo) opinions: Part of the dislocation (behavior inconsistent with historical macro economics 101) is caused by dollars exiting the system faster than they used to. Remember the graphics/vids we all saw of people passing dollars around the community and the total supply expands? Now, good portions of those dollars are naturally shunted out of our system to where the manufacturing took place. Worse, some of the money in the graphics that went to Bill's hardware store disappears (because Bill's store is still in town, but he has a subsidiary in a foreign country and captures most of his revenue there). Then there's income inequality. In addition to the depredations of two generations of greedy bastards, we have to understand that we import (legally or not) way too much unskilled/lowskilled labor, and that this has a negative affect on the entire bottom half (more-or-less) of the wage structure in our nation. It has a salutory affect (though i think one that is smaller than some imagine) on the top half, in that pressure on wages for unskilled to middling skilled workers results in more return on work and investment at the top of corporate structures, and other fields that compete with them for talent.
onlyrealcuzzo 5y ago
The US population grows by almost 2M per year - almost 40M since 2000. The workforce since 2000 has only grown by 17M. Workforce participation is down.

munk-a 5y ago

I think there is an issue with that logic - it doesn't account for the ever accelerating wealth inequality. People are working a ton right now - and creating massive amounts of value. It's so freaking easy to get consumer goods delivered next day that we're all forgetting that this service would likely cost fifty+ dollars in the early 90's - there are similar trends across the economy. The issue is that a lot of that created value is being isolated out of circulation and is pooling in investors that can, at a moments notice, pull the rug out of a number of great companies if they sense a panic. Wealth inequality creates the opportunity for instability in the form of extreme sudden market rushes alongside reducing the purchasing power of most folks. We're in a rough spot.

splistud 5y ago
Very complex situation, and we likely agree on some of it. I won't rehash that part. Some seldom-described (or taboo) opinions: Part of the dislocation (behavior inconsistent with historical macro economics 101) is caused by dollars exiting the system faster than they used to. Remember the graphics/vids we all saw of people passing dollars around the community and the total supply expands? Now, good portions of those dollars are naturally shunted out of our system to where the manufacturing took place. Worse, some of the money in the graphics that went to Bill's hardware store disappears (because Bill's store is still in town, but he has a subsidiary in a foreign country and captures most of his revenue there). Then there's income inequality. In addition to the depredations of two generations of greedy bastards, we have to understand that we import (legally or not) way too much unskilled/lowskilled labor, and that this has a negative affect on the entire bottom half (more-or-less) of the wage structure in our nation. It has a salutory affect (though i think one that is smaller than some imagine) on the top half, in that pressure on wages for unskilled to middling skilled workers results in more return on work and investment at the top of corporate structures, and other fields that compete with them for talent.

onlyrealcuzzo 5y ago

The US population grows by almost 2M per year - almost 40M since 2000. The workforce since 2000 has only grown by 17M. Workforce participation is down.