Economy Continues To Accelerate

THE NEWS CAME OUT TODAY THAT THE ECONOMY GREW IN THE SECOND QUARTER AT A HEALTHY RATE OF 2.4%.

But that is not what you will read in the media propaganda that passes for news.

July 30 (Bloomberg) -- The U.S. economy slowed in the second quarter as a scarcity of jobs eroded consumer spending, leaving the rebound dependent on a surge in business investment.

They call this a slowdown. They say the "economy slowed."
Not so. If I am going 50 MPH and then 60 MPH and then 61 MPH. I am not slowing. I am still accelerating. The rate of acceleration has slowed, but the economy is going faster and faster.

Words make reality. Let us speak the truth.

Slack Is Good

Take it easy
Lighten up
Simplify

We are living in the slack economy now and it is good.
More leisure, no shortages of food or housing.
People still seem to think they are entitled to jobs. Not so.
If you really want a job or need a job then you must do what it takes.
Truth is, most don't really want work, just money.

So here we are in the midst of abundance. We have more than we need. It is a good world.

Long Live The Slack Economy

History Teaches Whole Civilizations Can Collapse

Maybe that is a fallacious concept.
What really happened to Rome or Athens? They did not disappear completely. But there are some civilizations that really did disappear. What comes to mind are the civilizations in the New World, Mayan, Aztec etc. And tribes disappear or go extinct.

But my thought is that a big civilization, like modern America, might collapse or disappear but that it would take hundreds of years. So the idea that things are going to collapse at any moment is fallacious.

Big changes can happen rapidly to smaller systems. Consider the recent bankruptcies of blue chip companies like General Motors. But GM is not gone. It just got restructured.

Watch out for the future.
Many systems are looking fragile. Which will survive? Which will make the changes before catastrophe hits?

Take Care No Blame

Take care of your animal

Don't blame the economy

What do I mean?

Are you an animal? Or is only your body an animal?
Your body is your animal. Take good care of your animal. Love your animal.

Don't blame the environment. Just take the best care you can.

USA Per Capita GDP Hits All Time High in 2010

This is a prediction.
And it looks very likely.
2009 per capita GDP was only .5% lower than the peak of 2008. (LOWER BY ONE HALF OF ONE PERCENT)
It won't take much to surpass 2008 this year.

But you probably won't hear this in the news.
And even if you do. They will put a negative spin on it.

If Democrats would like to hold congress, they should start telling how good the economy is. But I doubt they will do it because it goes against their grain.

Expectations Lead To Gloom

Saw this headline
"WHY GLOOM ON ECONOMY PERSISTS"

It is all about expectations.
If you expect a dollar and you get 80 cents then you are disappointed and gloomy. Whenever reality falls short of expectations people tend to feel bad. If you expect a dollar and get two then you might fell pretty good.

People are expecting too much. They are unrealistic. They almost always expect too much and are habitually disappointed.

Lower expectations and happiness should increase.
Or get rid of expectations completely. Expect nothing and be happy with what comes.
Each moment is sufficient.

Problem With Government Revenue

It is generally thought that government spending is counter-cyclical. That is, when the economy slows down tax revenues go down and government spending goes up. This is thought to be a good thing because it takes up some of the slack in the economy. For example, the public is borrowing less lately and the government is borrowing more.

But there are big problems with this approach and the problems are filling the headlines. All over the world governments have already taken on enormous debt even while economies were healthy. Now that there is a recession the government sectors are looking like economy killers rather than healers.

I see two main problem areas with government debt.
Interest on this debt is becoming very large.
Government spending is less efficient than private spending.

Solution

Change gears

Assumptions about economic growth have been made that are very false. Economies cannot grow as rapidly as has been thought without creating inflation or bubbles. Maximum good growth is probably only 1% to 2%, not 4% to 5%.
The natural rate of unemployment is higher than we are told. It is closer to 8% than to %5.
When governments make budgets they need to plan for less growth and higher unemployment and have balanced budgets at those lower levels. Trying to get back the bubble economy of the last 50 years is very foolish and counterproductive and will continue to give bad results.

Economy OK for Most People

Getting down to cases.
We hear a lot of bad cases. Those stories happen all the time regardless of economic cycles.
Even in the Old Testament they knew about cycles. Store your grain for seven years so you will have enough food during a drought.

Anyway
Coca Cola is a good case of a company doing well rain or shine.
Per share earnings

2007 $2.70
2008 $3.15
2009 $3.06
2010 $3.45 (predicted)

So earnings up 17% then down a little but 2009 is still 13% higher than 2007 and 2010 is predicted to be up again and may be 27% higher than 2007.

So here is a case of the economy being OK for a big company.
Doom and gloom sells papers but it is not the truth. The economy is OK for most people!

The Virtue Of Illness

Illness and misfortune can remind you to turn to God.

Is Attitude Everything?

Good attitude
bad attitude

what is it?

Right attitude?
Wrong attitude?

Posture
Standing
Where do you stand and how do you stand?

Are justice and peace compatible?
Is justice revenge or retribution or truth?
Truth and beauty could be justice.

What is the truth? Whatever you experience is truth, but not the complete truth.
The complete truth is everything.

Work on your posture, truth may follow

The Happy Economy

We really do have more than enough.

More than enough of all good things

Sun
wind
love

But you can never have what you want.
Wanting creates its own lack.

Thankfulness creates its own fullness.

Be full now. Accept your good. Accept the gift you are offered in every now.

The world is good. It is sufficient.

Expect Idiocy

"The Los Angeles City Council will consider major changes to the city's water conservation rules Tuesday morning."


Here is a good example of unintended consequences. Changing rules can have bad consequences that nobody expects. Maybe we should think hard before changing rules, or laws....



"At issue: the city's lawn-watering rules, which were cited in a recent report by an independent group of engineers as a factor in a series of water main bursts last year.

For more than a year, residents across the city have been barred from irrigating their yards and gardens on days other than Mondays and Thursdays. The new proposal, backed by the Department of Water and Power, would allow those who live at odd-numbered addresses to water on Mondays and Thursdays and residents at even-numbered addresses to water on Tuesday and Fridays.

The changes were recommended after a panel of experts concluded that the two-day-a-week irrigation rules helped trigger a series of pipe breaks by creating dramatic fluctuations in water pressure. Some water main breaks damaged homes and businesses. One created a sinkhole that swallowed part of a firetruck."

Bad Attitude Leads To Unemployment

This is a hard remark to make in a world where compassion is required.
Hard love

People who are unemployed are unemployed because of their attitude.

Is this a bad attitude? Not necessarily.

The fact remains that 90% of people who choose to be employed are employed!
9 out of 10
That is a very big ratio.

Some of the 9 have been unemployed but are working again. How did they do it?

You do what it takes to get a job. You show your character. You show you will be a plus for the employer. You are willing to work at a competitive wage.

Right attitude leads to right employment.
We all have more than we need.
Each of us has more than he needs.

Economy must grow 2% But Population only grows 1%

" Consider that the economy needs to grow roughly 2% per year just to keep unemployment from rising."

Why?
We hear this a lot.
What is the explanation?

Population is growing at less than 1% a year. Why would the economy need to grow 2% to accomodate a 1% increase in the population?

Steady State Economy What To Call It?

There is a movement advocating a steady state economy for the world. They advocate that by growing GDP we are harming the environment.

They make a good case, but they could make a better one.

To change the public mind or to just give up, that is the question.

How might the public mind be changed? Education, propaganda, advertising. A simple message.

Growing GDP is making you sick.
It causes war, mental illness, crime, misery and environmental degradation.
Unfortunately there are many apologists for growth. They actually argue that growth is good for the environment.

But a simple case needs to be made. Just a few words. A few slogans that are true. That can be backed up with good facts when needed. As positive as possible.

try this

WE HAVE MORE THAN ENOUGH

But what to call it? Steady State Economy is awkward.
Sustainable is suggested but that is already a euphemism for growth that is manageable.

How about
Growth Economy or Happy Economy?

What would be a happy economy?

Happy Economy

We Do Not Need Growth The Economy Is Big Enough

Growth is not the answer to anything unless you want more environmental degradation.
We have more than enough.
We need to slow down and take it easy and count our blessings.

We Assume Too Much

The jobless rate fell to 9.5 percent in June, still far too high to signal a healthy

economy.

That is a typical news remark. Unbiased journalism
Who is the "authority" that decrees what a healthy economy is?
We all just agree on this because we have been told what to believe.

Let us make a new assumption.
10% unemployment is a healthy economy.

What is wrong with that idea?
I'm sure everyone would object to that idea. But why? We have been told what to believe. Who really understnads what a "healthy " economy would be?

We live in an economy that makes people sick. It drives them to death. It causes war and drug addiction and depression and cancer and heart disease and VD and murder and litigation and rape and on and on.

Maybe a healthy economy would not do all those things?

Maybe if people were less impatient and less greedy and less ambitious etc.

But I don't think this will change any time soon.

What Really Caused This Recession?

People love to point the finger of blame at each other, at bankers, at foreigners, at dumb consumers, at politicians, at government taxing and spending etc.
But what really caused the recession?

ONE WORD

OVERHEATING

Things get too good and out of balance. People borrow to invest in new capacity with overly optimistic predictions and then the cash does not come in sufficient to pay the debt. This always happens. It is not a mystery.


"When a prolonged period of good economic growth and activity causes high levels of inflation (from increased consumer wealth) and inefficient supply allocations as producers overproduce and create excess production capacity in an attempt to capitalize on the high levels of wealth. Unfortunately, these inefficiencies and inflation will eventually hinder the economy's growth and cause a recession.
Investopedia Says
Investopedia explains Overheated Economy
Rising rates of inflation are typically one of the first signs that an economy is overheating. As a result, governments and central banks will usually raise interest rates in an attempt to lower the amount of spending and borrowing.

Between June 2004 and June 2006, the Federal Reserve Board increased the interest rate 17 times as a gradual means of slowing America's overheated economy."

Fewer Workers, More Output

Imagine a small economy with two types of jobs, skilled and unskilled.
You have 20 workers, 10 skilled and 10 unskilled.
Skilled workers produce $100,000 a year. Unskilled produce $10,000 a year.


all are employed so unemployment is 0%.

Total output is $1,100,000.

Recession hits.
Things get shuffled a bit.
You end up with 11 skilled working and only 7 unskilled working. (one unskilled went to school and became skilled).

Now there are two unemployed so unemployment is 10%.
But the total output is now $1,170,000, an increase of 6% in output.

Here is one way that output can be larger with fewer workers. I am sure there are many other possible reasons why this could be.

In our economy the number of workers working has declined by around 7% but output has declined by only about 1%. It is no mystery to me that less productive workers would be let go during recession. Thus the decline of output would always be less than the decline of employment.