effect of USA not saving vs Germany 13% savings

[bimetalaupt]

ORIGINALLY I HAD PLANED TO POST THIS WITH INTERNATIONAL BANKING./. IT IS ALL ABOUT SAVING AND THE EFFECT ON THE ECONOMY!!!
U.S. manufacturing performance in trade has varied enormously by industry over the past 10 years, with strong surpluses in capital goods, commercial aircraft, and chemicals. Some high-tech products, such as computers and semiconductors, where one might have expected strong surpluses, actually show declining surpluses or even small deficits. The large deficits have been in apparel, other consumer goods, and automobiles.

The explanation for America's trade deficit, however, does not lie in the over-all health or productivity of its manufacturing sector. Instead, it largely is the result of a shortage of national saving. Economists long have been sounding the alarm about how the Federal budget deficit reduces national saving and hence tips the trade balance into deficit. For the foreseeable future, the over-all trade deficit will be driven by the balance between domestic saving (the part of national income that is set aside as a nation by refraining from consumption) and domestic investment (the amount businesses buy of new equipment and offices plus the amount that households put into new housing).

The nation could solve the over-all trade deficit by raising savings or reducing domestic investment, preferably the former. Since no one seems willing to do either, the trade deficit will continue. (This also explains why trade policies that often are suggested as a way to reduce the trade deficit would not work. For instance, if a new quota policy were to cut the import of autos, other imports simply would rise to take their place, U.S. exports would fall, or both.)

::)Germany and Japan, by contrast, have been running trade surpluses for many years, not because their manufacturing sectors are more productive, but because their rates of national saving are high relative to their domestic investment opportunities . Nevertheless, if productivity is not the determinant of the trade balance, it certainly is one important determinant of trade competitiveness. It also is one clear measure of competitiveness in its own right.

Even though the trade deficit is attributable to the imbalance in the macroeconomy and even though American manufacturing continues to outperform its Japanese and German counterparts in productivity, there remains a concern about U.S. international competitiveness. If the value of the dollar still were high in foreign exchange markets, it would be possible to say that U.S. manufacturing is competitive, but is being hamstrung by a high dollar. However, the dollar is not high. Since 1988, the U.S. has had both a trade deficit and a low exchange rate, one that makes wages and other costs look low compared with its main competitors. It is a puzzle that our manufacturing industries need such an assist from the exchange rate to be able to sell competitively.

There are two likely, and somewhat related, explanations. The first is that not all U.S. industries have a productivity advantage. The second is that the U.S. has lost the lead in technology and product quality in some areas.

Although over-all U.S. productivity is much higher than Japan's, the picture varies from industry to industry. According to Bart van Ark and colleagues at the Netherlands' University of Groningen, Japan is ahead in machinery and autos, while the U.S. has a huge lead in food processing and textiles. The difficulty is that Americans, in a fairly open economy, buy Japanese cars, whereas the Japanese do not buy the goods for which the U.S. has the edge. Much of the deficit with Japan involves trade in a single industry - autos and auto parts.
[/img]

[neohguy]

"Although over-all U.S. productivity is much higher than Japan's, the picture varies from industry to industry. According to Bart van Ark and colleagues at the Netherlands' University of Groningen, Japan is ahead in machinery and autos, while the U.S. has a huge lead in food processing and textiles. The difficulty is that Americans, in a fairly open economy, buy Japanese cars, whereas the Japanese do not buy the goods for which the U.S. has the edge. Much of the deficit with Japan involves trade in a single industry - autos and auto parts.

Read more: notmsnmoney.proboards.com/index.cgi?board=moneytalk&action=display&thread=851#ixzz19uaJUm1Y"

Also true with Europe. They support products made in their own country. The following article supports the positives of international trade. The one example of a country that has not learned that there are limits is the USA:
www.associatedcontent.com/article/69426/does_trade_protectionism_hinder_or_pg6.html?cat=17
...A compelling argument for the use of protectionism lies in the story of what has happened in the United States, Canada's largest trade partner and powerful neighbor, from the overuse of free trade agreements and policies. Consider these two real life examples of problems that the United States has encountered for the sake of free trade: 1. Over the next three years, a major New York securities firm plans to replace its team of 800 American software engineers, who each earns about $150,000 per year, with an equally competent team in India earning an average of only $20,000. 2. Within five years the number of radiologists in this country is expected to decline significantly because M.R.I. data can be sent over the Internet to Asian radiologists capable of diagnosing the problem at a small fraction of the cost (Scuhmer). What conclusions can we gather from these examples? First of all, the fact that a mega nation like the United States has seen such an invasion from an economic standpoint; first of all, the proliferation of education throughout the world, as well as the fact that nations such as the United States have opened their borders to people from other countries for educational purposes. Once those individuals have received an education, they are willing to earn their professional reputation by working for wages that are much lower than their competing counterparts; moreover, in those nations, many times the standard of living and prevailing wages are much lower; therefore, the workers can perform a given job at a lower rate than someone in a more developed nation. Going back to the examples that were cited previously, what occurred was a sort of exporting situation, albeit a situation where labor and services, and ultimately jobs, were exported to another country. When this occurs, the nation that loses the jobs of course loses just a little bit more economic freedom in the form of lower living standards due to unemployed or displaced workers, the loss of tax revenue for the government and of course the loss of the buying power within the country that the wages would have produced domestically. The bottom line is that whether a physical good is coming from a given country at the expense of another country, or in this case, as jobs bleed from the country, a great deal of damage is done. At the risk of an excessive quote, this statement from Schumer says it all: "if the case for free trade is undermined by changes in the global economy, our policies should reflect the new realities. While some economists and elected officials suggest that all we need is a robust retraining effort for laid-off workers, we do not believe retraining alone is an answer, because almost the entire range of "knowledge jobs" can be done overseas. We do not believe that offering tax breaks can compensate for the enormous wage differentials driving jobs offshore". The exiting of jobs from nations must not be allowed to occur, which is a caution that must be stressed within the scope of trade agreements.

[comokate]

It isn't just a matter of "nationality", there are cultural differences that could, and probably do, account for economic disparities. A controversial book was written about the average IQ of a nation and it's economic health:
en.wikipedia.org/wiki/IQ_and_the_Wealth_of_Nations
There is also the matter of available health care to the residents of a nation ( obviously those that do not take adequate care of their young will not have a prosperous economy ).

www.npr.org/templates/story/story.php?storyId=91971406
www.newsweek.com/2010/08/16/japan-s-good-cheap-health-care.html

I think it is interesting to note, the countries that are very high in average IQ ( lucid, intelligent people rarely point a gun at their own foot-i.e. they protect their own workers) and excellent government health care ( and if they do, they generally have a doctor tend to their wounds ) are the two countries you listed as having healthy economies-
coincidence ??

[bimetalaupt]

From one of The PROFESSORS AT INSEAD.. from
(Sami Mahroum, Director of INSEAD's Innovation & Policy Initiative, Abu Dhabi Campus.)
.. SAVINGS VS GROWTH IN THE INTERNATIONAL WORLD PRODUCTIVITY GAME..Bi Metal Au Pt

Over the past two decades, a thin consensus has been emerging on what countries should do to foster economic development and growth. The consensus revolves around a three-pillar formula representing the lowest common denominator among development economists.

The first pillar is about the importance of developing a country's human capital. Human capital fuels economic growth and contributes significantly to higher labor productivity. Human capital is also crucial for innovation and the absorption of ideas and techniques from around the world. No country can expect to grow fast and continue growing and competing internationally without an accompanying commitment from its government to investing in human capital. It is not surprising then to learn that the world invests about 4.6 per cent of its GDP on education. Countries like South Korea, Ireland and Singapore are said to owe their fast-tracking to advanced nation status to their high levels of investment in education and human capital.

The second pillar is physical infrastructure. It is an important enabler of economic activity and a prerequisite for inward investment, trade and productive activities. Over the last five decades, governments across the world have invested in building traditional infrastructure, such as transport networks, sewage systems, and power grids. The trend continues and a recent OECD report expects global investments in infrastructure over the next 20 years to grow to around US$ 70 trillion. Lately, governments have also rushed to invest in new infrastructure such as superhighway broadband networks and 3G mobile telecommunication systems, which by 2008 amounted to around 5.6 per cent of the world's GDP.

The third pillar is the hardest of them all: Good governance. These range from having efficient and transparent public sector institutions, to having strong laws on intellectual property rights (IPR), a fair competition law and an independent judicial system.

There is no doubt that this three pillars formula will help many countries mobilize their resources more efficiently. But a number of problems arise when one begins to use these as textbook prescriptions for economic development.

Let's start with investments in infrastructure. While infrastructure is seen by development economists as a key enabler of economic growth, policymakers view it more as a driver of short-term economic growth and invest in it accordingly. Very recently, both new and traditional infrastructure have benefited from new waves of investments as governments attempted to spend their way out of the global recession. But these investments are often geared towards short-term economic growth, rather than long-term economic growth. In some cases, it is not clear whether an expansion or an upgrade of infrastructure is actually needed. To give an example, 82 per cent of the US population is concentrated in cities and suburbs; just how much impact would upgrading rural America's access to the Internet have on its economic growth? Unless there is clear evidence that more people would move out of the cities to the countryside as a result of the upgrade, the impact of the new investments in broadband infrastructure on the growth of the rural economy will be dismal.

Investment in human capital has followed a similar logic and has come to be equated with more education meaning more higher education. Across much of the world, demand for higher education has soared, universities are overcrowded, staff are overworked, and the quality of graduates is suffering. The situation in the UK today is a witness to such policies. Years of New Labour's policy of getting more people into higher education have produced a glut of graduates in the labor market and strained the capacity of UK universities. In developing countries, the situation is worse. In Jordan, Egypt and across much of the Arab world, university graduates en masse are either unemployed, take under-skilled jobs, or emigrate. In fact, the oversupply of university graduates has crowded out non-university graduates from the labor market and pushed the incomes of the rest to the bottom.

Good governance is important, and developing countries in particular still need to make long strides in this regard. But the lack of it does not explain the double-digit growth of China and Vietnam, or Russia and India; this is unless "good" means something else, perhaps more along the definitions of Harvard University's economist Dani Roderik, or the Financial Times' editor Alain Beattie. Roderik emphasizes the stability and predictability of governance structures in an economy rather than their efficient performance; while Beattie emphasizes the effectiveness of countries' institutions rather than their transparency and correctness.

Firms from the developing world seem to understand good governance much better; Chinese, Indian and Arab telecom companies are very active and successful in regions such as Africa and Central Asia, where good governance is supposedly a rare currency. Investors, it seems, are driven more by opportunity than 'good governance' and 'good governments' seem to know that and take it into consideration while inducing foreign investors to invest in their economies. Unless there is a United Nations embargo on a country, foreign investors tend to move in on the basis of special arrangements and agreements with the government of the host country and without demanding substantial reforms to their governance culture and structure.

While infrastructure, human capital and good governance are very important, the question in the minds of many policymakers from Canada to Singapore today is: what next? Advanced economies that already enjoy high levels of human capital, infrastructure and 'good governance' are increasingly finding themselves stagnant. A visiting Finnish delegation to London once put it this way: despite all the hoopla around Finland's investment in new infrastructure, human capital, and good governance, the country still occupies a mid-table position in the EU's GDP per capita rankings.

A straightforward answer does not exist and each country probably requires its own answer. But one area worth our attention is efficacy. Countries with similar levels of socio-economic development, along with matching physical and social infrastructure, tend to display different levels of economic performance. The productivity gap between the EU and the US is consistently in favor of the latter. Northern Europe has higher productivity levels than continental and Mediterranean Europe. Malaysia and Korea started off with similar levels of human development but with different natural resource endowments (Malaysia was richer). Both invested in infrastructure, human capital, and good institutions, but South Korea still managed to grow much faster.

Efficacy is an important enigma to explore. Why is it that some countries make better use of their human capital, physical and social infrastructure than others? Why would one village benefit in gaining access to broadband connectivity more than other villages, and one country benefit from a range of talents, while others allow talent to leave? This efficacy gap remains largely enigmatic.

Closer to the policy domain, there is a clear need for a better match between investment in physical and social infrastructure and opportunity. The 'build it and they will come' approach for investment is a platform for generating inefficiencies in an economy. Infrastructure, education and good governance are enablers and not drivers of economic development, and accordingly, governments should link their investments in infrastructure and human capital to specific growth opportunities and where an expanded and upgraded capacity will make a real difference.

(Sami Mahroum, Director of INSEAD's Innovation & Policy Initiative, Abu Dhabi Campus.)

[bimetalaupt]

BUT ON THE OTHER HAND : EMPLOYMENT IS DOWN AND WE HAVE CLOSED OLD PLANT= BEST PRODUCTIVITY GROWTH IN THE WORLD

If U.S. manufacturing is experiencing a 30 year decline, how are we becoming more productive faster than every other developed country in the world?

The U.S. had the sharpest increase in manufacturing productivity -- output per hour of work -- in 2009 of the 19 industrialized economies for which the U.S. Bureau of Labor Statistics keeps data: 7.7%.

Japan had the steepest decline, 11.4%. For the first time since the BLS began keeping tabs, both output and hours worked in manufacturing declined in all 19 economies, a reflection of the unusually deep global recession. Manufacturing productivity declined in 12 of the 19 economies.

Without knowing much about the manufacturing sector of every developed country in the world, I suspect you could point to at least two reasons for this phenomenon.

First, manufacturing's decline in the US has been in labor, not production. In the 1950s, manufacturing accounted for one of every four jobs, whereas today it account for more like one in ten. At the same time, a technology revolution has allowed us to produce more and more stuff (we lead the world in manufacturing output) with a smaller and smaller share of the economy. Second, American business has, in the last few decades, relied on jobless productivity bursts to power ourselves out of recessions. That means employers try to cut labor to the bone and squeeze output from their slimmer payroll. Dramatic increases in productivity were rampant throughout the US economy in 2009 -- a good thing if you care about higher earnings, but a bad thing if you acknowledge that higher earnings were won on the back of a jobless recovery.

[bimetalaupt]

THIS SHOULD BE INTERESTING.. THEY WAY WE ARE IN THE MIDDLE OF A JOBLESS RECOVERY.. DUDLEY FROM NEW YORK FEDERAL RESERVE KEEP HAMMERING ABOUT THE LACK OF JOBS.. AT LEAST WE ARE KEEPING THE ECONOMY UP WITH IMPROVED USE OF TECH.. BETTER RE-EDUCATION AND MORE SAVINGS..
[img src="[/img]"]

SEE JAPAN AT THE BOTTOM OF THE LIST FOR IMPROVED PRODUCTIVITY.. THEY DO MAKE CARS AND EXPORT THEM AT LESS THEN THEY SELL THEM IN JAPAN..

IF WE HAD A 100% FREE TRADE WE WOULD DO BETTER THEN JAPAN OR GERMANY.. OUR NUMBER ONE CAR EXPORT IS BMW TWO SEATERS..

JUST A THOUGHT
Bruce

Attachments:

[bimetalaupt]

Frank
Dudley's star is also bright and clear!!!! I do understand what he said!!!!

Bruce

[decoy409]

That's the way buddy!

[bimetalaupt]

It was interesting to note the notes in the Minutes of the FOMC on savings and then the effect of savings on the European banks.. Most bank stocks are down in Europe..Just a thought,
Bi Metal Au Pt

According to the latest Call Report data, bank profita-
bility was little changed in the third quarter, remaining
positive but well below pre-crisis levels. As in the
second quarter, banks’ net incomes were supported by
declines in loan loss provisioning, while revenues de-
clined. Banks continued to boost regulatory capital
ratios, likely, at least in part, in anticipation of the need
to eventually meet stricter Basel III standards.
M2 expanded at a moderate rate in November. Inter-
est rates available on all M2 assets remained very low,
and households continued to shift their holdings of M2
assets toward liquid deposits, which continued to rise
rapidly, and away from small time deposits and retail
money market mutual funds. Currency increased
strongly, with indicators suggesting robust demand
from abroad.
The foreign exchange value of the dollar, which depre-
ciated immediately following the FOMC’s November
announcement of further asset purchases, subsequently
appreciated amid intensifying concerns about stresses
in the euro area and some apparent reassessment by
investors of the monetary policy outlook in the United
States. On net, the dollar ended the intermeeting pe-
riod up against most currencies, with particularly large
gains against the euro. The announcement of the Eu-
ropean Union (EU)–International Monetary Fund
(IMF) financial aid package for Ireland on November
28 did little to reverse the depreciation of the euro, as
investors reportedly became increasingly concerned
about other euro-area economies and the adequacy of
resources available to support them should they come
under stress. Spreads of sovereign yields in some peri-
pheral euro-area countries over those on German
bunds rose to new highs, although they fell back near
the end of the intermeeting period amid reports that
the European Central Bank (ECB) had increased its
purchases of Irish and Portuguese sovereign debt.
Banks in the euro-area periphery continued to rely
heavily on funding from the ECB, and some signs of
increased dollar funding pressures emerged. Implied
short-term interest rates for the coming year shifted
down in the euro area, as market participants apparent-
ly scaled back the pace at which they expected the ECB
to normalize policy, but rose in some other AFEs.
Ten-year sovereign yields increased significantly
throughout the AFEs, although by less than yields in
the United States. Headline stock price indexes in the
AFEs generally ended the period higher, whereas bank
stocks in Europe declined.

[itstippy]

Every single "stimulus" effort - from the Bush stimulus checks to the recent decrease in Social Security payroll withholding - has been justified as a way to get consumers SPENDING again. Get out there and SPEND, dammit! Borrow some money and SPEND IT! Stimulate us to a robust recovery! Buy Christmas stuff! Buy a new car! Buy a bigger house! Buy some green ink and cotton rag paper! What do we need to do, import some Greeks and Italians to show you how it's done?

Ben Bernanke was wringing his hands and saying we didn't save enough back in 2005. He's sure changed that tune. Spend, baby, spend!!!!!

Confusing, ain't it?
www.federalreserve.gov/boarddocs/speeches/2005/200503102/

[bimetalaupt]

Its Tippy,
Welcome aboard!!! Yes.. But my model has an increase in M2 of 10% as the best results for the GDP and Investments.. Or maybe 12.5% for a grand recovery.. The 5.4% we have is better but is not the best. The interesting thing is ok we have about a 10% UN-employment rate but GDP is about up 2.5% for 2010 and 3.5% for 2011.. Our use of Labor is very much about productivity improvement. For the USA to reach max productivity we need to save.. Thinking like Milton Friedman : M2 is related to GDP growth more then M1...It is all about saving.. as paragraph #2 said..
Just a thought,
Bruce
M2 expanded at a moderate rate in November. Inter-
est rates available on all M2 assets remained very low,
and households continued to shift their holdings of M2
assets toward liquid deposits, which continued to rise
rapidly, and away from small time deposits and retail
money market mutual funds. Currency increased
strongly, with indicators suggesting robust demand
from abroad.
EDIT: I THINK THOMAS HOENIG HAD A VERY VALID POINT ON RAISING INTEREST RATES FOR SAVERS...JUST MY PERSONAL THOUGHTS...THIS WAS HIS LAST MEETING AND HE DID SQUEEZE THIS THOUGHT INTO THE RECORDS..THE GERMAN PART OF OUR FAMILY DO NOT LIKE THE EURO.. SWISS PART ALSO BUT THAT IS A N OTHER BRANCH IN OUR TREE...Bi Metal

Read more: notmsnmoney.proboards.com/index.cgi?board=moneytalk&action=display&thread=851#ixzz1A7qcJBTO

[bimetalaupt]

Frank, Phase delay from the increase in M1!!! has caused the delay.. Banks need to add Tier1 is part of theis phase delay.. as Wm Dudley said in the speech " How goes the Recovery"....
Things in Texas are better then the nation as a whole as we are Farming and oil with manufacturing to support these parts of the economy.. I hear our saving rates is above average but as of now do not have any real numbers other then reports from Credit Unions and small Texas Farm banks. I think most of the credit unions of any size are now at home in Dallas.. As is Rabobank...From Dallas FRB.. Report on manufacturing in Texas .
Just a thought,
Bruce

Texas Manufacturing Outlook Survey

December 27, 2010

Texas Manufacturing Activity Continues to Grow

Texas factory activity increased in December, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, was positive for the fourth consecutive month.

Other indicators of current activity also remained positive, signaling continued growth in manufacturing. The shipments index held steady at a reading of 8, and the capacity utilization index rose from 10 to 15, with 29 percent of manufacturers reporting an increase. The new orders index declined in December but stayed in positive territory, with more than three-fourths of firms noting increased or unchanged order volumes.

Measures of general business conditions remained positive in December. The general business activity index came in at 13, with nearly a quarter of respondents noting improved activity. The company outlook index edged down to 15, although the share of manufacturers who said their outlook improved rose to its highest level since May.

Labor market indicators improved notably this month. The employment index rose from 6 in November to 15 in December, reaching its highest level since early 2007. Twenty-four percent of firms reported hiring new workers, compared with 9 percent reporting layoffs. Hours worked increased again this month, and the wages and benefits index rose from 5 to 10.

Prices climbed again in December. Input costs remained on an upward trend, with the raw materials price index rising from 35 to 44. Forty-six percent of manufacturers saw an increase in prices paid for raw materials, compared with only 2 percent who saw a decrease. Finished goods prices rose for the second month in a row, although the great majority of respondents continued to note no change. More than half of respondents anticipate further increases in raw materials prices over the next six months, while 37 percent expect higher finished goods prices.

Manufacturers’ six-month outlook continued to improve. The future indexes for production and shipments edged up further; more than half of respondents expect increases in these measures in coming months. The future new orders index rose to its highest level in four years, with all firms anticipating either increased or stable order volumes. The future general business activity index advanced from 26 to 37, and the future company outlook index rose to 38, with 94 percent of firms anticipating similar or improved conditions six months from now.

The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity. Data were collected Dec. 14–21, and 96 Texas manufacturers responded to the survey. Firms are asked whether output, employment, orders, prices and other indicators increased, decreased or remained unchanged over the previous month.

Survey responses are used to calculate an index for each indicator. Each index is calculated by subtracting the percentage of respondents reporting a decrease from the percentage reporting an increase. When the share of firms reporting an increase exceeds the share reporting a decrease, the index will be greater than zero, suggesting the indicator has increased over the prior month. If the share of firms reporting a decrease exceeds the share reporting an increase, the index will be below zero, suggesting the indicator has decreased over the prior month. An index will be zero when the number of firms reporting an increase is equal to the number of firms reporting a decrease.

Next release: January 31, 2011

Comments from Survey Respondents
These comments were selected from respondents' completed surveys and have been edited for publication.

Machinery Manufacturing
The tone of the general economy as well as for our business with our customers (midstream and downstream energy markets) has improved slightly. Further improvement over the next six months seems likely at this point. However, we are all maintaining a cautious and conservative posture because there is still a lot of uncertainty.

Orders for our capital goods dried up in the last half of November and first half of December. Order activity is very similar to late 2008 and early 2009.

Chemical Manufacturing
We have gone to operating 24 hours a day, seven days a week with an increase in personnel so that we do not have to run with much overtime. We are not sure if the pace can continue, but it will be interesting to see how business holds up in the first quarter of 2011. December will be a record month for us.

We believe the level of activity will pick up in the second quarter of 2011, although we also foresee increased feed prices due to crude oil prices increasing. The increase in crude oil prices will be from commodity investment activity rather than a significant change in the supply and demand balance.

[bimetalaupt]

Chart from Dallas Federal Reserve....

[bimetalaupt]

Jan 4, 2011 23:01:11 GMT -5 bimetalaupt said:

Chart from Dallas Federal Reserve....

[/img]

Attachments:

[Aman A.K.A. Ahamburger]

B, Texas sounds like Germany. ECB likes those FED notes even at 11% don't they?

[bimetalaupt]

A Hamburger,
Yes they paid dearly for the SWAP USD!!.. Ben B. made one great deal for the Federal Reserve Bank .. Or was that William Dudley.. The Worlds Banker..The rising star of the Federal Reserve System and President of the New York Federal Reserve Bank System!!!
So what did Dudley do with all those EUROs.. He sure needs to buy a new Suit......

Just a thought,
Bi Metal Au Pt

[Aman A.K.A. Ahamburger]

There are some nice clothes in europe to buy...

Seems there is more commitment to the euro than initially thought. Will be interesting to see the "euro stabilization fund"

[bimetalaupt]

Jan 5, 2011 0:15:03 GMT -5 bimetalaupt said:

A Hamburger,
Yes they paid dearly for the SWAP USD!!.. Ben B. made one great deal for the Federal Reserve Bank .. Or was that William Dudley.. The Worlds Banker..The rising star of the Federal Reserve System and President of the New York Federal Reserve Bank System!!!
So what did Dudley do with all those EUROs.. He sure needs to buy a new Suit......
I thought up a pole for the fun of it.. funny answers??
Just a thought,
Bi Metal Au Pt

How much do Americans save..Do Chinese-American save 30% and German-Americans save 13% [/img]

Attachments:

[bimetalaupt]

Jan 5, 2011 0:22:24 GMT -5 Aman A.K.A. Ahamburger said:

There are some nice clothes in europe to buy...

Seems there is more commitment to the euro than initially thought. Will be interesting to see the "euro stabilization fund"

OK Patient is stabilised but critical. The suitable cure is Axel Weber.. and cutting spending.. FT said that will cause four to five countries to leave the EMU... You know the austerity thing.. They will love Axel in France. Sorry I can not use the word to tell you what they will say in GREECE!!! Moon Beam will Beam me over the head with her Moon-Blaster!!!
So where can you find a good replacement for the French to run the ECB?[/img]
This is a top secret

Attachments:

[olderstill]

The attachment in message # 21 tells the story about our saving habits. We save when tough times stare us down, not before. List the spikes adn they align with the following: Depression, WWII, the reality of post war need for capital to rebuld our peacetime production, the 1970s transition from the gold standard and failure of Betton Woods accord, the stagflation following, and the fight to get free of stagflation in the early 1980s, and the apparent growing confidence after the Reagan era.

Apparently just after the S&L scandal in the later 1980s, we were already on the downswing of our saving habits. Was this caused by the inflation of the time, the beginning of the disparity between incomes and the need for more money to pay for our wants? Or, our needs?

That dome shape from post WWII to mid-decade 2000 is a familiar pattern in so many charts!

As for the Texas stats, what would happen if we were to abduct the folks in Austin and send you the Washington crowd?
We could then switch charts and the entire nation would benefit from the transition. Feeling generous, Bi Met?

Does anyone try to explain the disparity between increase in inventory and the growing delay in delivery? Could that mean that the delivery industry has cut back on personnel and/or vehicles and is reluctant to rehire staff or invest in necessary vehicles? Both demand and supply appear to be active.

Encouraging signs in Texas stats, no doubt!

[olderstill]

As for German saving habits, current trends are not the result of any recent leadership or events. Traditionally, Germans are savers, not investors. I believe if a chart similar to that in Message #21 was available to track German performance, you'd see a consistently high rate over the period.

Despite their high tax rate, German consumer prices are lower by far than in the US. When many Europeans see our prices, they are generally surprised if not shocked.

[scaredshirtless]

I agree the inventory numbers make NO sense!

Where I live we see no shortage of truckers so not sure on that one.

I am still VERY worried about Europe though.

It ain't over yet! So (seemingly) close to retirement - I can't stand the risk.

More interest for savings would be VERY nice - and welcome!

[bimetalaupt]

Jan 5, 2011 5:43:51 GMT -5 olderstill said:

As for German saving habits, current trends are not the result of any recent leadership or events. Traditionally, Germans are savers, not investors. I believe if a chart similar to that in Message #21 was available to track German performance, you'd see a consistently high rate over the period.
CURRENCT RATE :Aug 25, 2009 ... BERLIN, Aug 25 (Reuters) - The average German savings rate rose to 12.8 percent of disposable income in the first half of 2009, ...
THE SLFRB PUBLISHED THAT THE AVERAGE OF JAPAN AND GERMANY WAS ABOUT 14% FOR 1970 THROUGH 2004 WITH NONE OF THE ANGLO-SAXON OSCILLATION.

[/img]

Despite their high tax rate, German consumer prices are lower by far than in the US. When many Europeans see our prices, they are generally surprised if not shocked.[/quote]Household saving rates. by country - from 1985 through 2004 forecast - Illustration
Annex Table 24.

Household saving rates

Per cent of disposable household income


1985 1986 1987 1988 1989

Australia 10.7 10.1 8.0 6.7 8.4
Austria 10.3 12.1 13.7 11.7 12.6
Belgium 15.9 18.5 16.9 17.0 15.3
Canada 15.8 13.4 11.9 12.3 13.0

Czech Republic -- -- -- -- --
Denmark -- -- -- 7.4 8.4
Finland 4.3 2.9 4.4 0.2 0.5
France 9.0 8.1 6.4 6.9 7.2

Germany 12.1 12.9 12.9 13.2 12.7
Italy 28.8 27.1 26.6 25.9 25.5
Japan 18.5 18.5 16.0 15.0 15.3

Korea 15.1 21.0 23.9 26.5 25.5
Netherlands 5.6 8.2 8.3 8.1 9.8
New Zealand 5.7 4.4 7.2 5.8 5.5

Norway -3.3 -6.2 -6.2 -2.8 -0.4
Portugal -- -- -- -- --
Spain 11.1 12.1 10.6 11.0 10.2
Sweden 2.8 1.6 -2.9 -4.9 -4.8

Switzerland -- -- -- -- --
United Kingdom 9.8 8.2 6.4 4.9 6.6
United States 9.2 8.2 7.3 7.8 7.5


1990 1991 1992 1993 1994

Australia 9.1 6.0 5.5 4.3 5.6
Austria 13.8 14.7 11.8 10.7 11.6
Belgium 18.0 17.9 19.0 19.4 19.3
Canada 13.0 13.3 13.0 11.9 9.5

Czech Republic -- -- -- 3.2 -0.7
Denmark 11.2 10.8 9.7 8.3 4.2
Finland 2.9 7.8 10.0 7.6 2.6
France 7.8 8.7 9.7 10.4 9.8

Germany 13.9 13.0 13.0 12.3 11.6
Italy 25.9 25.0 23.4 23.2 21.8
Japan 13.4 14.8 14.1 14.3 12.1

Korea 23.4 25.5 24.4 21.9 21.3
Netherlands 11.6 7.2 8.3 6.8 7.1
New Zealand 3.3 5.5 3.4 3.3 0.4

Norway 0.8 2.9 5.0 6.1 5.2
Portugal -- -- -- -- --
Spain 12.3 13.4 11.9 14.3 11.9
Sweden -0.3 3.1 7.7 11.5 11.3

Switzerland 8.7 9.9 10.1 10.8 9.1
United Kingdom 8.0 10.0 11.4 10.8 9.3
United States 7.8 8.3 8.7 7.1 6.1


1995 1996 1997 1998 1999

Australia 4.5 5.5 3.7 2.3 2.1
Austria 11.5 9.6 7.1 8.0 7.7
Belgium 18.8 17.0 15.7 14.5 14.1
Canada 9.2 7.0 4.9 4.9 4.1

Czech Republic 15.7 16.6 15.5 14.7 14.5
Denmark 6.9 5.6 3.6 5.0 1.7
Finland 6.0 2.0 4.4 3.1 3.8
France 11.2 10.0 11.3 10.8 10.4

Germany 11.2 10.8 10.4 10.3 9.8
Italy 20.0 21.2 18.1 15.0 13.9
Japan 11.9 10.9 10.2 11.6 10.6

Korea 18.0 16.9 16.5 23.1 17.5
Netherlands 14.9 13.6 13.4 12.9 9.6
New Zealand 0.6 0.6 -0.7 -1.5 -0.3

Norway 4.6 2.2 2.8 5.8 5.5
Portugal 12.0 11.2 9.8 8.9 8.5
Spain 14.4 14.2 13.4 12.2 10.8
Sweden 8.6 7.1 4.5 3.2 3.4

Switzerland 9.4 8.7 10.1 8.6 8.9
United Kingdom 10.0 9.1 9.5 6.0 5.1
United States 5.6 4.8 4.2 4.7 2.6

Estimates and projections
2000 2001 2002 2003 2004

Australia 4.0 3.5 2.5 3.0 3.3
Austria 6.7 5.5 6.2 6.1 6.4
Belgium 13.4 13.0 14.5 14.3 13.7
Canada 4.8 4.6 5.3 5.3 5.7

Czech Republic 9.2 8.7 11.6 13.1 13.7
Denmark 4.0 5.3 4.8 5.3 4.9
Finland 0.3 2.4 2.8 3.0 2.6
France 10.8 11.4 11.9 11.3 10.5

Germany 9.8 10.1 10.4 10.1 10.2
Italy 12.3 13.2 15.8 16.3 16.1
Japan 10.3 10.7 9.9 9.9 10.1

Korea 11.8 10.0 9.5 10.1 11.4
Netherlands 6.7 11.2 13.1 13.4 13.0
New Zealand -0.8 2.4 3.5 2.3 2.0

Norway 4.7 4.5 5.2 5.3 5.8
Portugal 10.1 11.0 11.2 11.4 11.3
Spain 10.0 10.3 10.6 10.7 10.6
Sweden 2.3 4.9 8.0 7.8 7.0

Switzerland 8.3 8.7 8.9 9.0 8.9
United Kingdom 4.2 6.1 5.1 5.4 6.0
United States 2.8 2.3 3.7 4.5 4.7

Note: The adoption of new national account systems, SNA93 or ESA95, has
been proceding at an uneven pace among OECD member countries, both with
respect to variables and the time period covered. As a consequence,
there are breaks in many national series. See Table "National Account
Reporting Systems and Base-years" at the beginning of the Statistical
Annex and OECD Economic Outlook Sources and Methods
(http://www.oecd.org/ eco/sources-and-methods). Countries differ in the
way house- hold disposable income is reported (in particular whether
private pension benefits less pension contribution are included in
disposable income or not), but the calculation of household saving is
adjusted for this difference. Most countries are reporting household
saving on a net basis (i.e., excluding consumption of fixed capital by
households and unincorporated businesses). Five countries, Belgium,
Denmark, Italy, Spain and the United Kingdom and reporting gross
household saving. In most countries the households saving include saving
by non-profit institutions (in some cases referred to as personal
saving). Other countries (Czech Republic, Finland, France, Japan and New
Zealand) report saving of household

Attachments:

[sangria]

Hi itstippy.

I remember the $200 tax refund/rebate/stimulus during the Nixon administration. It was intended to jump start the economy out of a recession.

Didn't work. Every recipient went out and put $200 in the bank.




















"G'damn bastards!"

[bimetalaupt]

Sangria,
I heard from my father that the bank opened a record number of savings accounts with those checks..I think the bank added to the $200 if you brought in the check. Well this would go to M2 and with Phase delay it could take up to 12 months to be effected on the GDP.!! Was that the cause of our 10% savings in 1982??

Just a thought,
Bi Metal Au Pt

[bimetalaupt]

Jan 5, 2011 5:36:45 GMT -5 olderstill said:

The attachment in message # 21 tells the story about our saving habits. We save when tough times stare us down, not before. List the spikes adn they align with the following: Depression, WWII, the reality of post war need for capital to rebuld our peacetime production, the 1970s transition from the gold standard and failure of Betton Woods accord, the stagflation following, and the fight to get free of stagflation in the early 1980s, and the apparent growing confidence after the Reagan era.

Apparently just after the S&L scandal in the later 1980s, we were already on the downswing of our saving habits. Was this caused by the inflation of the time, the beginning of the disparity between incomes and the need for more money to pay for our wants? Or, our needs?

That dome shape from post WWII to mid-decade 2000 is a familiar pattern in so many charts!

As for the Texas stats, what would happen if we were to abduct the folks in Austin and send you the Washington crowd?
We could then switch charts and the entire nation would benefit from the transition. Feeling generous, Bi Met?

Does anyone try to explain the disparity between increase in inventory and the growing delay in delivery? Could that mean that the delivery industry has cut back on personnel and/or vehicles and is reluctant to rehire staff or invest in necessary vehicles? Both demand and supply appear to be active.

Encouraging signs in Texas stats, no doubt!

Older Still ,
Thank-you Sir. A lot of members of this area remember the hard time after the oil boom. I think that is reflected in the fast growth over the last two years of Credit Union Accounts in all three local cities( Abilene, Midland and Odessa,TX). We see a lot of Heavy Traffic on the Union Pacific Heavy Rail through the area. About 10 years ago after the T&P merger they spent $$$ to upgrade the track to very heavy bed and rails for the super heavy cars.. This is real good with all the new Turbines we have added over the last five or six years. Today the grid is one more thing working for the area.
The data I had backed your thought to the tea...For a good Earl Grey ..

Thank-you again,
Bruce

[bimetalaupt]

RELATION OF SAVING TO SPENDING

[bimetalaupt]

Jan 7, 2011 18:18:40 GMT -5 bimetalaupt said:

RELATION OF SAVING TO SPENDING

SAVING RATIO [/img]

Attachments:

[bimetalaupt]

A pillar of economics is the life-cycle theory of consumption. It holds that an individual saves little as a young adult, a lot in his middle ages, and not at all when he retires.

A new study finds that the baby-boomer generation — the 79 million Americans born between 1945 and 1964 — has broken that rule with a vengeance and are ill prepared for retirement as a result.
boomers_cs_20080605083725.jpg

The study, by the McKinsey Global Institute, the think-tank arm of the consultants McKinsey & Co., carefully examined the saving behavior of various generations. The “silent” generation, the 52 million Americans born from 1925 to 1944, followed the classic pattern closely, with their household savings rate rising from below 15% in their early 20s to about 30% in their late 40s. But that pattern is almost absent for early boomers, those born 1945 to 1954; their saving rate tops out about 20%; and it’s completely absent for late boomers, those born 1955 to 1964, whose saving rate so far has remained stuck at around 10%.

“Our analysis shows that the Boomers’ missing savings peak accounts for most of the collapse in the U.S. household saving rate from its peak of over 10 percent in themid-1980s to around 2 percent today,” write the report’s authors, Diana Farrell, Eric Beinhocker, Ezra Greenberg, Suruchi Shukla, Jonathan Ablett, and Geoffrey Greene.

There are two reasons for the collapse in their saving: “the ‘wealth effect’ from asset appreciation and increased access to credit.” During boomers’ lifetimes, the proportion of people in their 50s with mutual funds rose from 14% to 64%, while the share of households with mortgages almost doubled.

The net effect, said the report, is that boomers carry far more debt than other generations. Because of inadequate saving, two-thirds of baby boomers are unprepared for retirement, defined by McKinsey as able to sustain 80% of their spending as they age.

The solution, they say, is to work longer. If the median age of retirement were to rise two years, from 62.6 today to 64.1 in 2015, the number of “unprepared” households would be cut in half.

“An increase in the median retirement age of this magnitude may not sound like much, but this is a number that has shifted slowly: Over the three decades from 1970 to 2000, the median retirement age declined by the same amount. So the challenge is to reverse that trend, but at a much more rapid pace.”

[bimetalaupt]

Jan 7, 2011 18:18:40 GMT -5 bimetalaupt said:

RELATION OF SAVING TO SPENDING

BOOMER'S SAVING RATE!! NEED TO IMPROVE!!![/img]

IT IS ALSO "KNOWN" THAT INCREASE RETIREMENT AGE TO 67 WILL SOLVE THIS PROBLEM

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