Hurricane Season

[Monte Smith]

Heavens, it doesn't rain but it pours:

(CNN/Money) - U.S. manufacturing accelerated in November, the nation's purchasing managers said Monday, in a report that was the strongest in nearly 20 years and reinforced analysts' hopes that the long-sluggish economy is finally in a classic, self-sustaining expansion.

The Institute for Supply Management (ISM) said its index of manufacturing activity jumped to 62.8 from 57 in October. Economists, on average, expected an ISM index of 57, according to Briefing.com.

The index was the highest since 69.9 in December 1983 and has been above 50, a number that indicates expansion in the sector, for five straight months.

"It appears that the recovery is gaining momentum. Indications are that the manufacturing sector is ending 2003 on a very positive note, and all of the indexes support continued strength into 2004," said Norbert Ore, director of the ISM's survey committee. "While there are still companies lagging the recovery, they should be encouraged by the current indicators in the sector."

So I see you are still blinded by the evil schemes of the Bush admin, eh Monte? Check the damage information about Hurricane Isabel in Missouri and Iowa alone tough guy. Those number will lead you to the truth.

Pitiful lockstepping Bushi's.

Toys 'R Us, baby........



Scott A

[Monte Smith]

[bluenoter]

Just for Monte and Scott, an article from that impeccable source the Washington Times. BTW, McCain is one well-respected fella; candidates from both major parties have tried to hitch their wagons to him.

December 01, 2003

GOP senators call for restraint

By Audrey Hudson
THE WASHINGTON TIMES

President Bush and congressional Republicans must curtail spending sprees or face demands for new tax increases to cover the resulting budget deficits, two key Republican senators said yesterday.

"Congress is now spending money like a drunken sailor — and I've never known a sailor drunk or sober with the imagination that this Congress has," said Sen. John McCain, Arizona Republican and a former captain in the U.S. Navy.

Sen. Trent Lott, Mississippi Republican and former majority leader, said he supported some "big cost" items including defense and homeland security spending, but not the massive $400 billion Medicare prescription-drug package passed by Congress last week.

"I am very worried that Republicans have started just ignoring the impact of these spending bills, that the deficit is running up. It's going to take us quite some time now — years — to begin to ratchet it back down," Mr. Lott said on ABC's "This Week" program.

However, in a key procedural vote on the prescription-drug bill last week, Mr. Lott succumbed to pressure on the floor from several party colleagues and provided the needed 60th vote to waive a budget-related rule that Democrats tried to use to kill the proposal.

After casting his ballot, Mr. Lott angrily left the Senate chamber. Mr. McCain backed the Democratic bid not to ignore the Medicare budget limits and go to a final vote on the bill.

In his ABC appearance yesterday, Mr. Lott said he voted as he did because he did not believe in using parliamentary procedures to defeat legislation.

Mr. Lott said yesterday that fiscal discipline "is a problem for Republicans that we're going to have to think about, we're going to have to address in the next two or three years."

"I do think the president is going to have to put down some stronger markers — in terms of authorization of costs. He is going to have to control the appropriations spending process," Mr. Lott said. "There's going to be some fiscal restraint that's going to be required. It's got to be led by the president. I hope he'll do that."

Appearing on "Fox News Sunday," Mr. McCain said "the numbers are astonishing" and urged the president to "exercise his veto pen" on a $31 billion national energy plan.

"He's got to do that to emphasize his seriousness," Mr. McCain said.

"There was no policy initiative in the energy bill. It was just one pork-barrel project larded onto another, to the point where we're subsidizing a Hooters," Mr. McCain said.

Nondefense spending has increased overall 13 percent since Mr. Bush took office in 2001. In this fiscal year ending Sept. 30, nondefense spending rose 7 percent, the Congressional Budget Office reported.

Capitol Hill lawmakers departed for the Thanksgiving break with a $375 billion omnibus spending package on the table still to be completed as the operating budget for 10 Cabinet agencies.

Mr. Bush has never wielded a veto pen on any spending bill.

Mr. McCain agreed that the president bears some responsibility to rein in spending.

"The president cannot say, as he has many times, that 'I'm going to tell Congress to enforce some spending discipline' and then not veto bills," said Mr. McCain, whom Mr. Bush defeated to win the 2000 Republican presidential nomination.

The increasing debt levels and deficits eventually will affect interest rates and inflation — "the greatest enemies" of middle-income families and retirees, Mr. McCain said.

Mr. Lott said the president's tax cuts have helped stimulate the economy and that a balanced budget and surplus cannot be attained every year.

However, Congress must "tighten our belts" and more closely examine spending, he said.

Yep. I agree with many of the things that were said here.

Spending does need to be reined in without question. I appreciate the tax cuts that Bush gave us, but they also need to be balanced out with a more frugal approach to government spending.

I'm certainly no economics major, and have little authority to comment about it at length, but it seems to me that trouble may be on the horizon if spending isn't brought under some semblance of control.

To tax and spend seems logical(although I disagree with it in practice).

To cut taxes and cut spending also seems quite logical.

But to cut taxes and then spend like you're on a shopping spree with your ex-husbands credit card sounds pretty dangerous in the long run.

[Monte Smith]

Unquestionably McCain is right in regards to profligate spending.

Damn, I bet Chris will slip into a cold, dark depression after reading those last two posts from us Monte. How confusing this all must be for him.






































Sweetness!!!!!!!!

The little creep and his thuggipoos have y'all bamboozled. Enjoy the fantasy while you can....

• Bush Economy: Temporary Growth, Lasting Damage
  While George W. Bush has been touting good news on the economy, the picture is not quite so rosy, especially in the long term. The Boston Globe reports that recent economic growth is not "merely a lucky accident." According to the Globe, Bush's enormous military and security spending, and two of the largest tax cuts in the nation's history are likely to result in "short-term growth and long-term damage." The Globe describes the economic policies of the Bush administration as a "crude and destructive cocktail of stimulants." Even if the recent positive economic signals temporarily take hold, "the administration's policies will weaken the economy over time, fall particularly harshly on its working middle- and low- income citizens, and fail to prepare the nation for a century of far more intense global competition."
  Source: Boston Globe, "Boom and Bust," Nov. 9, 2003.
  
  Bush Policies Will Keep Nation in Debt, Says U.S. Comptroller General
  U.S. Comptroller General David Walker refuted George W. Bush's claims that his administration can cut the federal deficit in half within five years without changing policies. According to the Los Angeles Times, "Bush has argued that by 2006, growth prompted by his $1.7-trillion tax cut plus spending cuts will pare deficits in half." Contrary to Bush's claims, Walker, the nation's chief fiscal officer stated that, "The idea that this is manageable or that we are going to grow our way out of the problem is just flat false." CBSNews.com reports that Walker went on to say that, "It's time to admit that we're in a fiscal hole and to stop digging," yet Bush has refused to change his mind about making the tax cuts permanent. Despite Bush's pledge to not "pass [problems] on to other Presidents and other generations," according to Walker, that's exactly what is about to happen. In an interview with United Press International, Walker grimly states that, "We must begin to come to grips with the dawning fiscal realities that threaten our nation's children's and grandchildren's future." Get more information on how this economic squeeze is forcing states and the federal government to cut back on aid to the nation'spoorest families, many of whom are headed by women.
  Sources: CBSNews.com, "Watchdog Declaring Deficit Crisis," Sept. 17, 2003; Los Angeles Times, "Bush's Economic Growth Forecast Called 'False'," Oct. 7, 2003.
  
  Under Bush, Rich Get Richer While Outlook for Poor and Middle Class Grows Bleaker
  The Associated Press reports that the total net worth of America's richest people rose 10 percent to $955 billion this year from 2002, according to Forbes magazine's annual ranking of the nation's 400 wealthiest individuals. Unfortunately, things are not going nearly as well for the rest of the country, according to two recently released Census Bureau reports. These reports show that median household income declined 1.1 percent in real terms from the 2001 figure to $42,409. Furthermore, the number of people in the U.S. living in poverty has risen for the second year in a row to 34.6 million, an increase of nearly 3 million people since 2000. The proportion of Americans living in poverty increased to 12.1 percent in 2002 from 11.7 percent in 2001—an additional 1.7 million people in poverty.
  Sources: Frederick, Md. News-Post, "Net Worth of America's Richest Rises After Two-Year Decline," Sept. 20, 2003; U.S. Census Bureau, "Poverty in the United States: 2002," Sept. 2003; U.S. Census Bureau, "Income in the United States: 2002," Sept. 2003

[Monte Smith]

Well, Hurricane: it's an ill wind that blows no one no good. Yuk yuk yuk. Gosh, I'm loving the breezy metaphors.

But seriously, keep up the dismal forecast. It's fun watching a blinkered man accuse others of blindness.

"Yuk yuk," indeed, Monte


December 5, 2003

Jobless Rate Declined Again in November, to 5.9%
By KENNETH N. GILPIN

• The nation's unemployment rate ticked down in November, the Labor Department reported this morning, but employers added just 57,000 jobs, far less than consensus estimates.
  
  The bond market, which dotes on bad news, rallied on the report, pushing down both short and long-term interest rates; stock prices sagged in disappointment.
  
  But even though the rate of job creation is far below what might normally be expected two years into an economic expansion, analysts said the news in today's figures was not uniformly bad.
  
  Specifically, they noted that the drop in the unemployment rate, to 5.9 percent, puts the jobless rate at is lowest level in eight months. Unemployment peaked in June at 6.4 percent. The last time the rate was lower was in March, when unemployment stood at 5.8 percent.
  
  Moreover, the 57,000 increase in non-farm payrolls during November was the fourth straight monthly increase. Since July, payrolls have risen by 328,000, the Labor Department said.
  
  And the increase in November employment was skewed by a two-month supermarket strike in California, Missouri and a few other states. The Labor Department said that the strike took between 26,000 to 31,000 jobs out of the economy in November.
  
  Even if those jobs were added back in to the reported number, the figure would still be less than the 150,000 jobs most economists had projected were created last month.
  
  "The employment situation is improving," said Paul Kasriel, director of economic research at the Northern Trust Company in Chicago. "I am not saying it is gangbusters. But it is improving."
  
  Analysts said the Bush Administration and the Federal Reserve can take some comfort in the fact that the unemployment rate is slowly coming down. But roughly 2 million jobs have been lost since President Bush was inaugurated in January of 2001, and the issue is likely to remain resonant through the upcoming Presidential campaign.
  
  That is particularly true if the nation's productivity rate, which galloped ahead at a 9.4 percent rate productivity rate, which galloped ahead at a 9.4 percent rate in the third quarter, remains robust.
  
  Economists said the productivity gains last quarter were a blip, and will not be sustained. But even if the gains going forward are considerably more modest, employers will cautious about aggressively adding jobs.
  
  David Resler, chief economist at Nomura Securities International, said he recently did some econometric projections on the matter.
  
  "If you assume 3 percent growth in productivity, it will be the middle of next year before we get back to the peak of non-farm payroll employment, which occurred in December of 2000," he said. "If it is 4 percent, it will take a year longer, or more, before that happens."
  
  Returning to the previous peak does not count the growth in the labor force that has happened since then, Mr. Resler added.
  
  "We are in the twenty-fourth month of the alleged recovery process, and we are still dealing with sub-standard jobs growth," William Sullivan, a senior economist atMorgan Stanley, told viewers on CNBC shortly after the jobs figures were announced.
  
  "The downside of the productivity miracle is that there is less pressure on employers to hire."
  
  The on-going grocery strike had an adverse impact on overall retail employment. Retailers, who usually add jobs in advance of the Christmas selling season, instead shed 28,000 jobs.
  
  And manufacturing, which has been losing jobs for more than three years, lost a few more in November. Manufacturing employment fell by 17,000, the Labor Department said.
  
  It is 39th consecutive month that factory employment has contracted.
  
  Looking for a silver lining, analysts noted that the number of job losses in manufacturing has slowed in recent months. And the Labor Department said that both the factory work week and manufacturing overtime hours increased in November.
  
  Since July, the factory workweek has increased by 0.7 hour, to 40.8 hours. And overtime has increased by 0.3, to 4.4 hours, according to Labor Department data.
  
  Overall, the average workweek rose by 0.1, to 33.9 hours.
  
  There were a few pockets of strength in the report. Health care and social service employment rose by 25,000 last month. And hotels and lodging facilities added 13,000 new jobs.
  
  Hiring also occurred in education, government, and professional and business services.
  
  Among goods-producing industries, construction employment rose by 10,000 last month.
  
  Last month 8.7 million people were unemployed, essentially the same number that were out of work in October.
  
  Two million had been looking for work for 27 weeks or longer, close to the same as in October. They represent 23.7 percent of all those who are unemployed,
  
  The jobs report is the last — and arguably the most important — piece of economic news to be released before Fed policy-makers gather in Washington next week to consider changes in monetary policy.
  
  Private economists said it is extremely unlikely the Fed will change its current stance, and will keep the overnight Federal funds rate, the rate it most directly controls, steady at 1 percent.

[Monte Smith]

Yes, Chris, modest job gains and a reduction of unemployment claims, as I predicted earlier this week. It's easy to predict things like this when all the signs are moving in one direction.

But if you like your great news unalloyed with merely good news:

OCT FACTORY ORDERS TOP ESTIMATES

WASHINGTON - New orders for U.S. manufactured goods climbed in October at their fastest rate in over a year, the government said Friday, offering further evidence of a revival in the long-slumping factory sector.

U.S. factory orders climbed 2.2 percent in October, the fifth increase in the last six months, the Commerce Department said.

The gain, which was close to the 2 percent rise expected on Wall Street, reflected a revised 3.4 percent surge in demand for expensive, long-lasting durable goods and a 0.7 percent increase in items expected to last less than three years.

Orders for transportation equipment were up a strong 5.5 percent in October, reflecting a big gain in civilian aircraft orders. Stripping out demand for transportation-related goods, factory orders were up a less robust, but still solid, 1.6 percent.

The data added to numerous other signs the factory sector is finding its feet.



And hey, ironically, there is a late-season tropical storm hovering over Cuba. So maybe there is something to your asinine Hurricane Postulate.

[bluenoter]

Although it's an editorial, this seems to belong here. Even those who disdain Krugman or the NYT may be able to acknowledge that he's "telling it like it is."

Looting the Future

By PAUL KRUGMAN

New York Times, December 5, 2003

The thing you have to say about George W. Bush: he's got a great sense of humor. At a recent fund-raiser, according to The Associated Press, he described eliminating weapons of mass destruction from Iraq and ensuring the solvency of Medicare as some of his administration's accomplishments.

Then came the punch line: "I came to this office to solve problems and not pass them on to future presidents and future generations." He must have had them rolling in the aisles.

In the early months of the Bush administration, one often heard that "the grown-ups are back in charge." But if being a grown-up means planning for the future — in fact, if it means anything beyond marital fidelity — then this is the least grown-up administration in American history. It governs like there's no tomorrow.

Nothing in our national experience prepared us for the spectacle of a government launching a war, increasing farm subsidies and establishing an expensive new Medicare entitlement — and not only failing to come up with a plan to pay for all this spending in the face of budget deficits, but cutting taxes at the same time.

Recent good economic news doesn't change the verdict. These aren't temporary measures aimed at getting the economy back on its feet; they're permanent drains on the budget. Serious estimates show a long-term budget gap, even with a recovery, of at least 25 percent of federal spending. That is, the federal government — including Medicare, which Mr. Bush has given new responsibilities without new resources — is nowhere near solvent.

Then there's international trade policy. Here's how the steel story looks from Europe: the administration imposed an illegal tariff for domestic political reasons, then changed its mind when threatened with retaliatory tariffs focused on likely swing states. So the U.S. has squandered its credibility: it is now seen as a nation that honors promises only when it's politically convenient.

What really makes me wonder whether this republic can be saved, however, is the downward spiral in governance, the hijacking of public policy by private interests.

The new Medicare bill is a huge subsidy for drug and insurance companies, coupled with a small benefit for retirees. In comparison, the energy bill — which stalled last month, but will come back — has a sort of purity: it barely even pretends to be anything other than corporate welfare. Did you hear about the subsidy that will help Shreveport get its first Hooters restaurant?

And it's not just legislation: hardly a day goes by without an administrative decision that just happens to confer huge benefits on favored corporations, at the public's expense. For example, last month the Internal Revenue Service dropped its efforts to crack down on the synfuel tax break — a famously abused measure that was supposed to encourage the production of alternative fuels, but has ended up giving companies billions in tax credits for spraying coal with a bit of diesel oil. The I.R.S. denies charges by Bill Henck, one of its own lawyers, that it buckled under political pressure. Coincidentally, according to The Wall Street Journal, Mr. Henck has suddenly found himself among the tiny minority of taxpayers facing an I.R.S. audit.

Awhile back, George Akerlof, the Nobel laureate in economics, described what's happening to public policy as "a form of looting." Some scoffed at the time, but now even publications like The Economist, which has consistently made excuses for the administration, are sounding the alarm.

To be fair, the looting is a partly bipartisan affair. More than a few Democrats threw their support behind the Medicare bill, the energy bill or both. But the Bush administration and the Republican leadership in Congress are leading the looting party. What are they thinking?

The prevailing theory among grown-up Republicans — yes, they still exist — seems to be that Mr. Bush is simply doing whatever it takes to win the next election. After that, he'll put the political operatives in their place, bring in the policy experts and finally get down to the business of running the country.

But I think they're in denial. Everything we know suggests that Mr. Bush's people have given as little thought to running America after the election as they gave to running Iraq after the fall of Baghdad. And they will have no idea what to do when things fall apart.

So true--thanks, Rita.

[Monte Smith]

Paul Krugman?? Hey, we're talking economics here!

[Monte Smith]

This as reproduced in the NYT this Sunday. I love it:

[Monte Smith]

Har har har, Mr. Sunshine. You do understand that "the old economy" means the non-90s internet bubble Clinton "New Economy," right?

[Monte Smith]

Some more experts are predicting stormy weather.

2004 Will Be the U.S.'S Best Year Economically in Last 20 Years, The Conference Board Reports in a Revised Forecast
Thursday December 11, 11:01 am ET

NEW YORK, Dec. 11 /PRNewswire/ -- Revising its year-end economic forecast sharply upward, The Conference Board today projected that real GDP growth will hit 5.7% next year, making 2004 the best year economically in the last 20 years.

The forecast, by Conference Board Chief Economist Gail Fosler, expects worker productivity, which set a 20-year record in the third quarter, to rise at a healthy 3.6% next year. That would follow a gain of 4.3% this year.

The economic forecast is prepared for more than 2,500 corporate members of The Conference Board's global business network, based in 66 nations.

KEY BAROMETERS FLASHING GROWTH

"Growing business spending and continued strength in consumer spending are generating growth throughout the U.S. economy," says Fosler. "This burgeoning strength is reflected in The Conference Board's widely-watched Leading Economic Indicators, the Consumer Confidence Index and the Help-Wanted Advertising Index. While the labor market, a critical factor in sustaining growth, is growing slowly, a pick-up in hiring may already have begun."

Real consumer spending, which continues to fuel growth, will increase at a 4.7% pace next year, up from about 3.2% this year. Another gain of 4.3% is projected for 2005.

While the U.S. economy is expected to generate more than one million new jobs next year, the unemployment rate will edge down only slightly, averaging 5.6% in 2004.

The Conference Board forecast notes that as the U.S. economy bounces back, so is Europe, although growth will be subdued compared to most other major parts of the world. "For all the concern about a weak dollar," says Fosler, "the dollar will be worth more than the euro by the end of the year."

Real capital spending, which will rise by only 2.7% this year, will climb 11.7% next year and another 8.6% in 2005. Pre-tax corporate operating profits will top $1 trillion next year, up from a projected $928 billion this year. Another trillion-dollar-plus gain in profits is expected in 2005.

The continued recovery in business profits, which was a key ingredient in funding new investment (crucial in making 2004 a strong growth year), depends on price relief. Business profits will benefit from both improved volume and recovering profit margins in 2004, as inflation creeps back toward 3% by the end of the year.
Source: Revised Conference Board Economic Forecast
December 2003