An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
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Monday, December 6, 2010
Wall Street's the reason why there's no job creation!
Yesterday I decided to do some Christmas shopping so I went to Macy’s Herald Square on 34th Street here in NYC. The place was mobbed as you can imagine. I mean, I could barely get through the front door and once inside just moving around was a feat unto itself. I wanted to buy some clothes for my kids.
After walking around and sifting through piles of clothes unorganized racks (I couldn’t find anyone to help me) I ended up with a few items. When I went to pay I was confronted with a huge checkout line where there was only one person manning the register. There had to be at least six cash registers, but only one person on the job. After standing in line for 25 minutes I got fed up and threw everything down and walked out.
Then I went across the street to Old Navy where I found a bunch of other stuff, similarly selected from chaotic piles and racks and guess what happened when I went to pay? Same thing! This time, however, there were three people working a bank of 10 registers.
Then it dawned on me why we’re having a jobs crisis in this country. Companies are being forced to become miserly when it comes to their work staff so they can keep labor costs down and report bigger and bigger profits every quarter to please Wall Street analysts and fickle investors. If not, the Street will punish their stock and their executives will be out of a job. The result of this maniacal drive for profits is a horrible shopping experience for consumers, many of whom can’t find work, but could be gainfully employed were it not for the fact that we let Wall Street dictate everything we do!
Yeah Mike,
ReplyDeleteMeanwhile 200 miles west, society is returning to a "hunter-gatherer" state of existence:
"Pennsylvania deer hunters donate venison to food banks"
You cant make this stuff up! We are now harvesting wildlife for sustenance, reverting back to a society devoid of organized agriculture/animal husbandry. This is really pathetic.
I read an article about North Korea a while back that said all of the bark on trees over there was stripped off up to about the 7-8 foot height because the people were eating the bark for sustenance, this story from PA is not much ahead of this N Korea situation on the food chain.... how can anybody in DC not see this?
Yeah Mike,
ReplyDeleteMeanwhile 200 miles west, society is returning to a "hunter-gatherer" state of existence:
"Pennsylvania deer hunters donate venison to food banks"
You cant make this stuff up! We are now harvesting wildlife for sustenance, reverting back to a society devoid of organized agriculture/animal husbandry. This is really pathetic.
I read an article about North Korea a while back that said all of the bark on trees over there was stripped off up to about the 7-8 foot height because the people were eating the bark for sustenance, this story from PA is not much ahead of this N Korea situation on the food chain.... how can anybody in DC not see this?
This comment has been removed by the author.
ReplyDeleteHow long before we start eating tree bark here??
ReplyDeleteNow that's about the most rediculous leap of logic I've read in quite some time.
ReplyDeleteTo say nothing of completely ignoring data in demand for consumer loans
Many businesses are afraid to hire people because there is regime uncertainty. They don't know what tax or regulatory policies the planners in D.C. are going to issue next. There is still great fear (rightfully so) about the alleged recovery taking place as well. Robert Higgs has written extensively about the phenomenon of regime uncertainty. The same thing happened during the Great Depression.
ReplyDeleteIf this were solely about businesses looking to show a higher profit to Wall Street then why would businesses have been staffed or even overstaffed in years past? Haven't companies always tried to make their balance sheets look more attractive?
Airelon,
ReplyDeleteLearn how to spell before you criticize.
Similar situation, I suspect, with Ford's parts shortages stopping production. After having shuttered production capacity for several years, suppliers are scrambling to even keep up with low demand levels. This bumpy road ramping up is much better than the cliff down. Imagine the pot holes in the road up ahead for the building materials industry. Sales cratered by 70-80% for several years and everything has been liquidated and employees moved on. Consumers are going to be furious at those long lines.
ReplyDeletePlease, Please, Please
ReplyDeleteLets keep extending unemployment
benefits
Matt,
ReplyDeleteHunters have been donating venison to food banks for a very long time.
That's pretty much s.o.p. in rural areas. Shoot it, butcher it, keep it, or give it to the local food bank.
Venison is better for you than that fatty cow stuff that city slickers eat.
My dog gets better venison than me ( none ).
ReplyDeleteAlso, acorns were once a staple for Native Americans, and probably are more healthful than you think.
A true Thanksgiving is something like:
a. buffalo meat
b. salmon
c. trout
d. corn
e. acorn
f. squash
g. cranberries
h. wild turkey
All American.
Wall Street? Let me get this right --- So when you dump all your junk while standing in line for checkout and go to another store and do it again.......that translates into real big profits for the stores because their revenue is so high? With all their inventory now on the floor? But their expenses are low...
ReplyDeleteBrantley,
ReplyDeleteI know that I expect to wait in line at this time of year.
I took no posititon on whether the businesses are properly staffed. we really don't know their situation. I know that I would be wary of hiring anyone right now.
My point was that there is regime uncertainty. It's hard to plan when the conditions are likely to change greatly given that the planners in D.C. seem to be more capricious than usual with the fear of depression hanging around. Government is the problem.
Hi Mike!
ReplyDeleteYou may recall, you interviewed me for 30 mins on your radio show years ago. Thought I'd pass along one snippet: The QQQQ's are just 76 cents from a 9 yr high!
We are getting better than we give ourselves credit for as I am sure you will agree.
Happy Holidays
Mike Williams
Sure ... learn to form a logical train of thought that follows the data before you post ...
ReplyDeleteD