January 4, 2019
SOURCE: AMERICAN THINKER
MAGA: First Real US Household Income Gain Since 2000
By Chriss Street
President Trump’s ‘Make America Great Again’ economic policies that favor Main Street over Wall Street just delivered a record
for U.S. median household income and the first full year of higher real incomes since 2000.
The median household income hit an all-time high of $63,554 in November 2018, based on an analysis of the Census Bureau’s
Current Population Survey by Sentier Research. The real, after-inflation, median household income was 3.2 percent above the
$61,612 for November 2017; up 5.5 percent above the $60,231 in December 2007; up 15.4 percent from $55,083 in June 2011; and
4.3 percent higher than January 2000.
Despite almost two decades of income stagnation for 99 percent of Americans, establishment economists on the left and the right
have viciously attacked the Trump Administration’s ‘Make America Great Again’ (MAGA) policies for cutting taxes, deregulating
the economy, maximizing oil and gas production, ending foreign entanglements, renegotiating blatantly unfair trade deals, and
slapping China with tariffs.
The Nation published an article in June warning that, ‘Donald Trump’s Trade Wars Could Lead to the Next Great Depression.’
Progressive former senior strategist at bankrupt Bear Sterns and Lehman Brothers Naomi Prins hyperventilated that Donald
Trump’s attacking foreign exporting nations for using America as “the world’s piggy bank” was “making the world a less stable,
less affordable, and more fear-driven place.”
In the same month, Never-Trump’ conservatives at the Weekly Standard sneered at MAGA policies in ‘Trumpenomics for
Dummies.’ British economist Irwin Stelzer lashed out at Trump for trying to “protect our 19 and 20 Century industries” basic
industries, instead of backing
In response to MAGA’s unorthodox economic policies that delivered big income gains and drove unemployment down to its lowest
levels in almost 50 years, the Trump Administration has had to weather seven interest rate hikes based on the Federal Reserve’s
orthodox economic theory that wage growth must be restrained to prevent future inflation.
The Fed had no problem slashing interest rates 19 notches early in the Obama Administration, and then keeping interest rates
substantially below inflation in order to create asset bubbles that drove up U.S. rents and home prices. According to an EPI study,
Incomes for the top 1-percent spiked to an all-time high average of $1,316,985 in 2015, a multiple of 26.3 times the average income
for the other 99 percent of Americans.
While the Federal Reserve has been trying to protect the average American from too much personal income growth, its own
Inflation Expectation Rate for the next five years has actually fallen by 20 percent since President Trump took office in January
2017.
Managing Director David Hoffman of Brandywine Global Asset that manages $74 billion recently observed that before the Fed
raised the U.S. policy interest rate on December 19 and crashed the stock markets, the Fed Funds target interest rate when
adjusted for inflation was already above zero. He warned that the Fed’s policy for the first time in a decade is “no longer broadly
promotive of continued strong growth.”
The Fed and critics on both the left and right have fully embraced Keynesian economic theories that argue for government using
“targeted” fiscal spending and monetary credit policies to steer the U.S. economy to optimum performance. With the top “1-
percenters” controlling the bureaucratic deep state over the last 40 years, they have manipulated those Keynesian “targets” to
optimally enhance their own incomes.
Because MAGA economics rejects fiscal and monetary targeting as inherently corrupt, the “1-percenters” understand their
entitlement is at existential risk of going away. They must fight, obstruct and slow down MAGA policies before the redistribution
of income back to the 99-percent becomes overwhelmingly obvious to most American voters.
The Fed’s interest rate spikes have hammered Wall Street with a global stock market selloff that resulted in the worst December
U.S. stock performance since 1931, with the Dow Jones Index down 9.7 percent for the month. After the market value of Apple
Computer collapsed by $75 billion after warning of lower earnings due to China’s economy slowing, Dow Index entered a “Bear
Market” Dow down 20 percent from its September high.
But “Main Street” is booming, according to the latest Bureau of Labor statistics, with 7.1 million job openings on the last business
day of October. The latest Small Business Optimism Index reported its highest percentage since 1989 of companies under 250
workers planning to raise compensation in 2019 in "response to persistently high levels of unfilled open positions.”
Pretty much bullsh!t. The Fed had already indicated they would raise the rate, and the market already had it baked in - that's what markets do. The market already expects at least 2-3 more increases next year based on the feds guidance. What turned things upside down was Trump questioning the Fed and asking if he could fire Powell.
[Edited on 1/5/2019 by Sang]
The only things that determine our income is our attitude, decision-making, and work ethic.....not the government. Blaming the government for your income woes is pathetically weak. Just work hard and no law can hurt you. There are millions of businesses that flourished under Obama.....why? Because the leaders of those companies know how to sell, regardless of any politician. Blaming the government? WEAK!
Lowering taxes may have spurred some job growth .... while sinking the country greater into debt.
This is like feeling proud that you are driving a brand new car .... that you purchased with a credit card .... that you might not be able to pay back.
Lowering taxes may have spurred some job growth .... while sinking the country greater into debt.
This is like feeling proud that you are driving a brand new car .... that you purchased with a credit card .... that you might not be able to pay back.
Good analogy.....
There are three kinds of lies—lies, damned lies, and statistics.
- Benjamin Disraeli
Lowering taxes may have spurred some job growth .... while sinking the country greater into debt.
This is like feeling proud that you are driving a brand new car .... that you purchased with a credit card .... that you might not be able to pay back.
Good analogy.....
Ahole Don likes to brag that anything associated with him is the best, biggest, greatest, etc. Add debt to that list. So let's think this through. Less revenue due to tax cuts & debt increases. Not to worry, text book theory is that in the long term GDP will increase with reduction in debt. We all know that text books & theories always play out, correct?
In the meantime, Trump wants to have Cabinet Secretaries reduce spending on programs. Does this surprise anyone? Wait until the GOP starts digging into Social Security & Medicare. You get what you vote for, and deservedly so.
"US national debt rises $2 trillion under Trump"
https://www.cnn.com/2019/01/03/politics/trump-us-national-debt/index.html
Pretty much bullsh!t. The Fed had already indicated they would raise the rate, and the market already had it baked in - that's what markets do. The market already expects at least 2-3 more increases next year based on the feds guidance. What turned things upside down was Trump questioning the Fed and asking if he could fire Powell.
[Edited on 1/5/2019 by Sang]
True, markets are very much forward looking. But they can also be reactionary as we have seen many times if a certain person of importance is giving a speech on a certain issue of importance. Like Friday when Federal Reserve All Stars spoke in Atlanta, their comments were received favorably and optimism and buying ensued in the markets.
We know markets can also try and influence decision making as well, trying to signal things...such as, not hiking in December, or lowering the potential for hikes in 2019. The Fed says they may do something doesn't mean the markets are going to just accept it as written in stone. You are right, Trump's comments about Powell had a negative effect, although if I remember correctly, Trump's speculation on the possibility of firing Powell (or if he even could) came days later. Powell's own 12/19 comments caused a market sell-off and were heavily criticized by analysts.
But in any event, a rising market is often a good thing. But certainly we should not let that dictate our national economic policy and agencies from conducting their own independent work.
One angle, and I think it makes sense, is the Fed has to raise rates now so they have some ammo to lower rates and spark the economy once it slows or contracts. As we have been saying all along, this period of expansion is about to become 10 years old soon...these cycles may not die of old age, but inevitably they always end at some point.
Here is a Forbes piece that recaps things from last quarter including Friday's economic data and Fed comments:
https://www.forbes.com/sites/kenrapoza/2019/01/04/only-thing-that-will-blow-up-job-market-now-is-the-fed/#53bcea9c2727
Lowering taxes may have spurred some job growth .... while sinking the country greater into debt.
This is like feeling proud that you are driving a brand new car .... that you purchased with a credit card .... that you might not be able to pay back.
Good analogy.....
Ahole Don likes to brag that anything associated with him is the best, biggest, greatest, etc. Add debt to that list. So let's think this through. Less revenue due to tax cuts & debt increases. Not to worry, text book theory is that in the long term GDP will increase with reduction in debt. We all know that text books & theories always play out, correct?
In the meantime, Trump wants to have Cabinet Secretaries reduce spending on programs. Does this surprise anyone? Wait until the GOP starts digging into Social Security & Medicare. You get what you vote for, and deservedly so.
"US national debt rises $2 trillion under Trump"
https://www.cnn.com/2019/01/03/politics/trump-us-national-debt/index.html/blockquote >
The CNN linked story doesn't mention tax revenue. Where are you seeing "less revenue due to tax cuts"? I have not seen FY2018 IRS stats yet. Estimates I have seen show Corporate receipts down, but individual receipts up and a net increase. We'll have to wait for the official numbers I suppose. Corporate taxes only accounted for 9.9% of FY2017 overall receipts, so while a meaningful component of the total, a reduction there offset by an increase in other areas can still show a net gain.
And if we are talking about adding to the national debt, let's not forget the February 2018 budget deal that increased domestic and defense spending hundreds of billions of dollars - 35 Democrats were among the 71 Senators who passed that bill and 73 of the 240 aye votes in the House were Democrat as well. This is a problem that cuts both ways, spending and deficits.
And if we are talking about adding to the national debt, let's not forget the February 2018 budget deal that increased domestic and defense spending hundreds of billions of dollars - 35 Democrats were among the 71 Senators who passed that bill and 73 of the 240 aye votes in the House were Democrat as well. This is a problem that cuts both ways, spending and deficits.
The Democrats have always been as beholden to the Military/industrial/congressional/security complex as the Republicans. Absolutely nothing new about their support of the military despite the often used rhetoric from the far right and others who like to portray the Democratic party as weak on national defense.
For instance when Trump proclaimed that we needed to rebuild the military after eight years of the Obama administration "destroying it", anyone who knew anything about the actual defense appropriations over that time period knew Trump was full of sh*t. Of course many of his supporters believe anything he says despite the actual facts.
Lowering taxes may have spurred some job growth .... while sinking the country greater into debt.
This is like feeling proud that you are driving a brand new car .... that you purchased with a credit card .... that you might not be able to pay back.
Good analogy.....
Ahole Don likes to brag that anything associated with him is the best, biggest, greatest, etc. Add debt to that list. So let's think this through. Less revenue due to tax cuts & debt increases. Not to worry, text book theory is that in the long term GDP will increase with reduction in debt. We all know that text books & theories always play out, correct?
In the meantime, Trump wants to have Cabinet Secretaries reduce spending on programs. Does this surprise anyone? Wait until the GOP starts digging into Social Security & Medicare. You get what you vote for, and deservedly so.
"US national debt rises $2 trillion under Trump"
https://www.cnn.com/2019/01/03/politics/trump-us-national-debt/index.html/blockquote >
The CNN linked story doesn't mention tax revenue. Where are you seeing "less revenue due to tax cuts"? I have not seen FY2018 IRS stats yet. Estimates I have seen show Corporate receipts down, but individual receipts up and a net increase. We'll have to wait for the official numbers I suppose. Corporate taxes only accounted for 9.9% of FY2017 overall receipts, so while a meaningful component of the total, a reduction there offset by an increase in other areas can still show a net gain.
Yes - waiting for official numbers & any adjustments to that, but increase in spending and or reduction in revenue culprits. Bottom line is debt increase by Trump. Isn't he & GOP supposed to better than that? Geez...under Obama they practically made him beg for passage of CR's, yet under Trump the spickets are wide open.
One angle, and I think it makes sense, is the Fed has to raise rates now so they have some ammo to lower rates and spark the economy once it slows or contracts. As we have been saying all along, this period of expansion is about to become 10 years old soon...these cycles may not die of old age, but inevitably they always end at some point.
This is exactly what one of my advisers thinks........he says the numbers (that the Fed says they go by) don't support the increases.
[Edited on 1/6/2019 by Sang]
With regard to the Fed interest rate increases, keep in mind the historical record and remember that since the 2009 crash the Fed basically has kept interest rates at a NEGATIVE number for member banks and nearly as low for everyone else up until relatively recently. The Fed simply can't support ZERO borrowing indefinitely and must, as others in this thread have pointed out, return us to more of an equilibrium for lack of a better word.
While inflation numbers and unemployment are still very low, the Fed is essentially signaling that it's moving the pendulum back toward more sustainable interest rates while the economy is strong enough to sustain such rate hikes.
Also, I'm not surprised Wall Street and by extension financial advisers are not necessarily supportive of such Fed moves as these very low interest rates for the past 9 years have made stocks VERY much in demand and lucrative for the those who sell them. They'd like the propped up gravy train to continue indefinitely....
After all, when the next recession or, god forbid, big crash comes, they just ride it out as the Fed will save them again. Like a casino, the House always wins and it's really just a question of by how much. For instance, does your adviser lower his/her fee when your portfolio takes a big hit?
[Edited on 1/6/2019 by Chain]
Good points in this thread.
I'll add related to debit and deficits, the only time a majority of elected Republicans care about them is when they are not in the White House. That much has been and is abundantly clear and most of us would have no problem agreeing to.
It is a problem that is just never, ever, going to get corrected. I don't see how it possibly could. Corporate tax reform alone would've been more bipartisan had they just tackled that issue with establishment and corporate Democrats favoring such. I did not and do not think the individual tax reductions were necessary or warranted at that particular time - and of course that made the overall issue completely one-sided when it came to voting.
But even if we walk some of the tax rates back, or even if we incrementally increase them ...I don't think we can or will go back to the Eisenhower rates Ocasio-Cortez was just romancing on..or anything close to that. Additional revenues through potential additional taxes when put up against our never ending thirst for more government spending is just never going to make a dent in the national debit. Maybe, maybe, there is a day, hopefully, we can have a balanced budget and atleast stop adding to the defict, but imagining how in the world we actually begin to reduce the national debt seems like a fairy tale.
We know the Obama years saw a dramatic jump in the national debt and his detractors are quick to point this out and his supporters are equally quick to explain it away. A chunk of that debt wasn't necessarily of his doing (inherited from FY 2009 when he took office), and some of it perhaps necessary to save the economy/country from spiraling further into the economic abyss and then afterwards, there was the Republican push out of House that also tried to keep spending in check, which slowed the growth of debt in the later Obama years. Here is a fair look at the debt from Reagan-Obama:
"Don't Blame Obama For Doubling The Federal Deficit":
https://www.forbes.com/sites/chuckjones/2018/01/15/obamas-federal-debt-grew-at-a-slower-rate-than-reagan-h-w-bush-or-w-bush/#51b08ca71917
[Edited on 1/6/2019 by nebish]
For instance, does your adviser lower his/her fee when your portfolio takes a big hit?
In a way - I pay a percentage, so if my portfolio is down, they make less......
The DJIA on election day 2016: 18,332.43
The DJIA on January 4, 2018: 23,433.16
For those who have been freaking out lately about the Stock Market and paying fees your stupidity is your problem.
Getting back to markets and the Fed for a minute,
Market's Fed Forecast now is no hikes for 2019 and a cut in 2020.
Talk of saying was Powell too "dovish" with Friday's comments?
Average hourly wages grew at 3.2%. Wage growth is good right? We want more people to make more money?
Well not in the eyes of the Fed as they worry about inflation stemming from too much wage growth.
It's like when is good news bad news? Just when some hourly workers feel like they are getting ahead, here comes the Fed to raise everyone's interest rates.
It all has to work together, the pendulum swings back and forth.
And if we are talking about adding to the national debt, let's not forget the February 2018 budget deal that increased domestic and defense spending hundreds of billions of dollars - 35 Democrats were among the 71 Senators who passed that bill and 73 of the 240 aye votes in the House were Democrat as well. This is a problem that cuts both ways, spending and deficits.
LOL
And if we are talking about adding to the national debt, let's not forget the February 2018 budget deal that increased domestic and defense spending hundreds of billions of dollars - 35 Democrats were among the 71 Senators who passed that bill and 73 of the 240 aye votes in the House were Democrat as well. This is a problem that cuts both ways, spending and deficits.
LOL
Good contribution to the thread.
For instance, does your adviser lower his/her fee when your portfolio takes a big hit?
In a way - I pay a percentage, so if my portfolio is down, they make less......
As do i, in my Vanguard Roth IRA (one of the lowest cost Index Fund organizations in the business), but not for most brokerage accounts. Those of us who have additional investments beyond an IRA, Roth IRA, 403B, 401K, Simple IRA, etc. most likely pay fees beyond a set percentage.
We don't have any ongoing fees as our broker doesn't do any buying or selling on our behalf, it's not a managed account. So the only fees we pay are one-time individual sales commissions on our choices when purchasing stocks, funds or bonds. Then the mutual fund pays the broker though 12b1 fees, so no direct fees for those either (just the specific fund has an expense that comes out of the return which are pretty small, tenth and quarters of one % usually). I did buy some gold and silver etfs and the broker charges an ongoing fee on those. I don't like that because there is no reason, they aren't doing anything to justify an expense on their end; I just haven't decided when to sell that yet. Physical commodity ownership is better I think.
Wow, not a single person here acknowledged that overall growth of middle class income was a great thing and a long time coming. Lots of good data sprouting during the Trump years.
Plus gas is 2 bucks a gallon or less, you morons.
Except in Nancy's neighborhood (CA), of course.
Wow, not a single person here acknowledged
Victim Goober everyone.
Wow, not a single person here acknowledged that overall growth of middle class income was a great thing and a long time coming. Lots of good data sprouting during the Trump years.
Plus gas is 2 bucks a gallon or less, you morons.
I mentioned the over 3% growth in wages.
Gas varies depending where you live. But yeah it is $1.80-$2.15 where I frequent. I actually feel based on crude prices gas is high still, but it never quite comes down where it used to be once it rises. Trump told everyone why oil is low “it’s not an accident, it’s talent”. He actually said that his talent that lowered oil prices. Nothing about maybe an oversupply or global demand fears. Nope, anything good is always Trump’s doing and anything bad is the Democrats fault. And I say this you know I defend his positions when warranted. He, or his administration, gets credit for extending and expanding the economic growth. He doesn’t deserve any credit for where oil prices are currently at.
Wow, not a single person here acknowledged that overall growth of middle class income was a great thing and a long time coming. Lots of good data sprouting during the Trump years.
Plus gas is 2 bucks a gallon or less, you morons.
If we are using gas prices as a measure of success as a leader, you must think the president of Venezuela is a genius since gas is only 3 cents a gallon there.
OPEC and other related oil producing countries will be cutting anywhere from 800,000 to the 1.2 million barrels a day based off their December meeting, cuts which appear on target for January (or exceeded those levels). Trump want to take credit for that too? He may've convinced them to keep pumping this summer but his influence at this point on their decisions isn't a factor.
your stupidity is your problem
you morons
Why don't you two just get a room?
Goob,
Can you concretely explain how the President has been responsible for the lower gas prices?
