Why the economy is the way it is

[RyanS]

The point I was making is that with gas(energy )soo high, it takes away from free spending. Can buy "extas" with a $75 gas bill to fill up. Now that its $35, it adds free money to spend.

Wait until Cap and Trade policies are put into place. Energy costs will skyrocket.

Don't forget that metal values are up thanks to the fact that we are at war.

I know it's a touchy subject, but, socialized health care. It could very well be the death blow IMO. It'll be extremely spendy, something we can't afford.


Something else to consider, the National Debt is just over $11 Trillion. Well, it's actually much higher. Add in obligations that are not funded (Medicare, Social Security etc) and you are looking at $100+ trillion in debt. I read an article the other day (on Bloomberg I believe) that said we could fix that with an across the board increase in taxes by 68%.

 

[Aqua Sanctuary]

its too bad that the constitution was changed and pretty much rendered useless..

 

[hybridtheoryd16]

The reason manufacturing in the US is dying is that foreign goods are better for the short term minded, except cars but that's a union issue more than anything else. You can buy a mower from China for half the price of a quality American made one, the one from china lasts 2 years the US made lasts six. The other issue is that as plants get smarter they need less people, basically the same thing that happened with farming, combines removed the need for unskilled labor. There are however plenty of skilled labor jobs waiting for people wit skills, carpenters, electricians, plumbers etc. I have trouble feeling pity for people that don't want to adapt, being a steel worker is not a civil right, nor is having a job.

The problem isn't manufacturing in the US it's the sense that I should be paid to do X in the US. Right now we don't need steel workers but we are short (even now) on skilled SMT solder techs. If the old steel workers are willing to retrain there are plenty of jobs to go around. No one appears to want to be cross discipline or acquire skills. They want to do the same thing their grand pappy did but safer, easier and for more money.

There are still plenty of MFG jobs available but they all require skill and flexibility, plenty of C&C machinists positions in the north east as a minimum. When a product is prototyped it need to be done in such a way as to easy to get and easy to modify. 10 Shipments for intentional Air from China will drive the cost up real fast.

And the reason that all these low cost foreign items are availiable is mostly due to free trade. If they still had to pay tariff's to get these items on our shelves the market would be more level on a price point. And then the only decision would be on quality. And about the skilled labor, when the housing market goes down so does all of your list of skilled laborers. And as a tool and die maker with a baisis in mech. eng. I think you do not know the whole story about why you see a few cnc jobs out there now. Like for my self I got into this skilled trade because when I got out of high school it was considered a good trade that not just anybody could do. And it also at the time was paying more than most other 4yr degree's. And now 15 years later it is paying less than a 2yr degree in most other fields. And because of this all the young kids coming up now do not want to go to school 4 days a week and work 60-70 hrs a week for that pay. Tool and die or machinist in general work more hours per week than most other jobs. And these hours are not spent setting at a desk etheir. Another problem that the free trade act caused was that all these manufactures that had in house tool and die departments could now out source there tooling from over sea's for pennies on the dollar. So they jumped on that and laid off there skilled workers. Which flooded the market with skilled people needing these jobs which lowered the pay rate. Which chased off anyone looking to get into that trade. For the past 4yrs engineering monthly has named machinist as one of the top 3 dieing trades in america. And there market study says it is because of a lack of new qualified personal to fill the new positions. And this is why.

 

[abortedsoul]

And the reason that all these low cost foreign items are availiable is mostly due to free trade. If they still had to pay tariff's to get these items on our shelves the market would be more level on a price point. And then the only decision would be on quality. And about the skilled labor, when the housing market goes down so does all of your list of skilled laborers. And as a tool and die maker with a baisis in mech. eng. I think you do not know the whole story about why you see a few cnc jobs out there now. Like for my self I got into this skilled trade because when I got out of high school it was considered a good trade that not just anybody could do. And it also at the time was paying more than most other 4yr degree's. And now 15 years later it is paying less than a 2yr degree in most other fields. And because of this all the young kids coming up now do not want to go to school 4 days a week and work 60-70 hrs a week for that pay. Tool and die or machinist in general work more hours per week than most other jobs. And these hours are not spent setting at a desk etheir. Another problem that the free trade act caused was that all these manufactures that had in house tool and die departments could now out source there tooling from over sea's for pennies on the dollar. So they jumped on that and laid off there skilled workers. Which flooded the market with skilled people needing these jobs which lowered the pay rate. Which chased off anyone looking to get into that trade. For the past 4yrs engineering monthly has named machinist as one of the top 3 dieing trades in america. And there market study says it is because of a lack of new qualified personal to fill the new positions. And this is why.

So let a foreign country do it, if they are better and can do it cheaper. Let us focus on something that we are good at.

 

[Fish Room Plus]

Raw material costs are very high due to the growth in China & India. Not so much the war. If you noticed, once China finished building the super dome, new hotels, roads, the price of raw materials started a down trend

 

[Natural_Born_Killer]

I work for an independent financial company that provides research to both corporate companies and banks.

The one thing that I have learned working here (and I'm only in sales) is that while this crisis may have started in the US, it has turned now into a global crisis.

One major factor is that for a business to grow they will need to get a loan from the bank, this is barely possible any more. Hense why there are cut backs in jobs right now.

Without these loans companies are no longer able to expand their businesses. So, people who had jobs to do no longer can do them.

The other factor in my opinion entirely is that this is a more fear driven crisis as well. If you watch the news, read the papers - its all about how bad things are, very doom and gloom. This causes people to be scared to spend money.

With out stronger consumer confidence the market cannot recover.

I am in no way an economist, and no way try to even pretend that I understand entirely what is going on. Just my 2 cents

 

[MadRussian79]

And there market study says it is because of a lack of new qualified personal to fill the new positions.

Which will drive up the salaries and push more people into the field, that's how free market works. Also the jobs in India are being outsourced to Eastern Europe because their cost of living shot up and it's no longer cost effective.

We do not need manufacturing facilities but prototype facilities are sorely lacking. Doing prototyping with over sea mfg. is (censored) having had to do it more than once.

And it also at the time was paying more than most other 4yr degree's. And now 15 years later it is paying less than a 2yr degree in most other fields.

So the environment changed and getting that 2 year Assoc. in Mech E is not something you want to do. I understand that very well as I had to work as an EMT during my first 4 years of college and at my LFS for the Masters, plus huge loans that I'm paying off. Then add to the getting laughed at by some of the voc. tech guys for wasting so much time in school. It's very hard for me to be sympothetic at this point.

 

[Pharaoh]

I used to believe Greenspan was a genius... now I know him as just a mortal man... in short I do believe the economy works in cycles... adjusts and readjusts providing we keep the capitalist format this country is built on... with the current "bailouts" i believe we are just prolonging the "adjustment" cycles...

I completely agree. Government interference in the market cycle just prolongs the rateat which the market can recover. Each little "stimulus" they put in effect just pushes the end out farther.

what we have here is the plague of any devoloped country... the work force develops a sense of entitlement therefore wages go up and production goes down... how can this be stopped? perhaps a depression?

Amen!


To speak toward the outsourcing of jobs. Yes it is unfortunate that outsourcing cuts jobs in America. It is not necessarily because of the FTA, but because it has become a bandwagon for cost savings. If given enough time, the global market will settle and companies will begin to come back to the US. One problem with outsourcing is the import/export taxes and restriction. Most companies do not fully address the true costs behind operating outside of the US. i.e. transportation, taxes, fees, etc.

For example, I worked for an electronic manufacturer that decided the best thing was to move operations overseas. This would result in a 10% cost savings on their product. After buying a location, addressing all of the regulations and setting up, they found that it was actually going to be a 5%cost increase in order to build overseas. Hence, why they are still here. It is a trend....yes, some comapnies have succeeded, but not all companies will. If it was so cheap to import things, why do Honda and Toyota have production plants in the US? Things to consider.

 

[CichlidPharmer]

This could be oversimplifying things but let me interject these immortal words into these thread, "No Money No Honey".

A lot of money went down the sewer when the Housing bubble popped all over the world, beginning in the USA!

With less money to grease the World Economy, the movement of commerce everywhere almost got to a standstill in October of last year. All those infusion of emergency cash into the system is just now taking hold and hopefully will get things moving again.

 

[chefjamesscott]

I hope you like the article. I have to disagree with a bit of what you said. There is no such thing as "the masses". Each person is an individual, and we operate as such.

If only we had private corporations that were in place over the standard of monetary existence, we'd be way better off because those corporations would actually have an incentive to make money by satisfying customer demand for a sound currency; the federal reserve is a government established bank, and with its ability to set artificial standards it distorts the market. Its hold on currency is enforced by law, removing any customer choice about the matter.

actually the federal reserve is a private corporation not a govt established bank it is private people in charge of your economy a very bad thing

http://www.usagold.com/federalreserve.html

http://www.youtube.com/watch?v=A4kxTkhwR_Q

http://www.youtube.com/watch?v=ji_G0MqAqq8

http://www.truveo.com/ron-paul-audit-the-federal-reserve-hr-1207/id/2425842122

just a couple of links for ya