Wealthy people have convexity, the poor don't. With low interest rates capital and wealth grows at an exponential rate. This benefits those who are long assets. The wealth inequality is not caused by wages but by wealth. The poor don't benefit from asset inflation, in fact they suffer from it. They can't afford to buy real estate, rents are inflated, education is inflated. And that's a big one because education is the one thing they can get that can allow them to become an asset owner. Higher interest rates would lower housing cost, lower stocks, depreciate the wealth of the top 1% and narrow the gap. It would also allow seniors to earn a fair return on their life's labor in the form of return on savings. Savings btw which gets transferred to their kids upon death. The power of leverage and compounding is a beautiful thing to those who reap the benefits.
There is also the minimum wage issue, since the economy has had and will continue to have difficulty growing if a large percentage of the population can't afford to buy anything beyond basic necessities (one of the reasons why companies like RCII have done so well). Whether or not ET is the place to discuss it is another matter.
You said the FED is not private... I wonder how you can make such a statement. Does Obama Pelosi or Reid or Beohner have any say over the creation of trillions of dollars by the Federal Reserve system other than the right to pull the charter. Does Reid say hey you can lend out that money. You can't can't buy those then worthless bonds with quantitative easing. We don't even get a full accounting of the FEDS activities. The FED is absolutely a private bank.. The US govt can pull their charter... but the bank is privately owned. The stock of the regional Federal Reserve banks are owned by private banks. There is no doubt about that. The Federal Govt does get to appoint overseers but the overseers are matched by the bank reps and to change policy they must agree unanimously to do something. Essentially there is no govt control. And on the regional bank level 2/3 of the boards are appointed by private banks. The final kicker is the the electronic money creation is controlled privately not by the US Govt. by the way here is some case law from the 9th circuit. http://www.save-a-patriot.org/files/view/frcourt.html This is a 9th circuit opinion.... -------------- Lafayette L. Blair, Compton, Cal., for plaintiff/appellant. James R. Sullivan, Asst. U.S. Atty., Los Angeles, Cal., argued, for defendant/appellee; Andrea Sheridan Ordin, U.S. Atty., Los Angeles, Cal., on brief. Appeal from the United States District Court for the Central District of California. Before Poole and Boochever, Circuit Judges, and Soloman, District Judge. (The Honorable Gus J. Solomon, Senior District Judge for the District of Oregon, sitting by designation) Poole, Circuit Judge: On July 27, 1979, appellant John Lewis was injured by a vehicle owned and operated by the Los Angeles branch of the Federal Reserve Bank of San Francisco. Lewis brought this action in district court alleging jurisdiction under the Federal Tort Clains Act (the Act), 28 U.S.C. Sect. 1346(b). The United States moved to dismiss for lack of subject matter jurisdiction. The district court dismissed, holding that the Federal Reserve Bank is not a federal agency within the meaning of the Act and that the court therefore lacked subject matter jurisdiction. We affirm. In enacting the Federal Tort Claims Act, Congress provided a limited waiver of the sovereign immunity of the United States for certain torts of federal employees. . . . Specifically, the Act creates liability for injuries "caused by the negligent or wrongful act or omission" of an employee of any federal agency acting within the scope of his office or employment. . . . "Federal agency" is defined as: the executive departments, the military departments, independent establishments of the United States, and corporations acting primarily as instrumentalities of the United States, but does not include any contractors with the United States. 28 U.S.C. Sect. 2671. The liability of the United States for the negligence of a Federal Reserve Bank employee depends, therefore, on whether the Bank is a federal agency under Sect. 2671. [1,2] There are no sharp criteria for determining whether an entity is a federal agency within the meaning of the Act, but the critical factor is the existence of federal government control over the "detailed physical performance" and "day to day operation" of that entity. . . . Other factors courts have considered include whether the entity is an independent corporation . . ., whether the government is involved in the entity's finances. . . ., and whether the mission of the entity furthers the policy of the United States, . . . Examining the organization and function of the Federal Reserve Banks, and applying the relevant factors, we conclude that the Reserve Banks are not federal instrumentalities for purpose of the FTCA, but are independent, privately owned and locally controlled corporations. Each Federal Reserve Bank is a separate corporation owned by commercial banks in its region. The stockholding commercial banks elect two thirds of each Bank's nine member board of directors. The remaining three directors are appointed by the Federal Reserve Board. The Federal Reserve Board regulates the Reserve Banks, but direct supervision and control of each Bank is exercised by its board of directors. 12 U.S.C. Sect. 301. The directors enact by-laws regulating the manner of conducting general Bank business, 12 U.S.C. Sect. 341, and appoint officers to implement and supervise daily Bank activities. These activites include collecting and clearing checks, making advances to private and commercial entities, holding reserves for member banks, discounting the notes of member banks, and buying and selling securities on the open market. See 12 U.S.C. Sub-Sect. 341-361. Each Bank is statutorily empowered to conduct these activites without day to day direction from the federal government. Thus, for example, the interest rates on advances to member banks, individuals, partnerships, and corporations are set by each Reserve Bank and their decisions regarding the purchase and sale of securities are likewise independently made. It is evident from the legislative history of the Federal Reserve Act that Congress did not intend to give the federal government direction over the daily operation of the Reserve Banks: It is proposed that the Government shall retain sufficient power over the reserve banks to enable it to exercise a direct authority when necessary to do so, but that it shall in no way attempt to carry on through its own mechanism the routine operations and banking which require detailed knowledge of local and individual credit and which determine the funds of the community in any given instance. In other words, the reserve-bank plan retains to the Government power over the exercise of the broader banking functions, while it leaves to individuals and privately owned institutions the actual direction of routine. H.R. Report No. 69 Cong. 1st Sess. 18-19 (1913). The fact that the Federal Reserve Board regulates the Reserve Banks does not make them federal agencies under the Act. In United States v. Orleans, 425 U.S. 807, 96 S.Ct. 1971, 48 L.Ed.2d 390 (1976), the Supreme Court held that a community action agency was not a federal agency or instrumentality for purposes of the Act, even though the agency was organized under federal regulations and heavily funded by the federal government. Because the agency's day to day operation was not supervised by the federal government, but by local officials, the Court refused to extend federal tort liability for the negligence of the agency's employees. Similarly, the Federal Reserve Banks, though heavily regulated, are locally controlled by their member banks. Unlike typical federal agencies, each bank is empowered to hire and fire employees at will. Bank employees do not participate in the Civil Service Retirement System. They are covered by worker's compensation insurance, purchased by the Bank, rather than the Federal Employees Compensation Act. Employees travelling on Bank business are not subject to federal travel regulations and do not receive government employee discounts on lodging and services. more... at the above link...
I'd seek work in engineering but 1) at 70yo I'll never get a fu%^ing interview 2) If I got hired I'd have to work with a bunch of fu$&ing immigrants that wouldn't have lunch with me and if they did they would talk their native language. Fuck that boring shit, better to go into trading nowadays, been like that for decades.
Our company is small. We don't import employees because we can't justify the visa hassles. We pay market rates but the engineers aren't there to accept the jobs. I think the h1b visa is really a tech thing because they can't find enough workers here and so they import. Some companies exploit the wage arbitrage but that is really a myth (according to a friend whose company does it). Between quality problems, miscommunication, and rising wages overseas, you are better off having it programmed locally. I have a friend who is a security guard. He asks me to put in a good word at the office for him to get a job in the factory. I told him that I could do that, but he would still be making $9/hour. Instead get a technical degree as a machinist and then make $25/hour. In 10 years, he'll be making $50/hour as there will be very few people to make jet engine components or intricate gun parts. There are lots of jobs out there for people with skills. If my friend took a free blueprints reading course provided by the local employment board his compensation would be $15/hour as he would be considered semi-skilled. I'm happy he listened to my advice and he enrolled in the local community college. He will improve the quality of life for himself, his wife, and his children to be. \ It's not hard to get a good job, but it requires a little investment (mostly time) on the individuals side.
Thanks. As to your friend the security guard, I agree, vocational training is very valuable, and someone actually learns a trade. Wish it was emphasized more for kids going through high school. Lot of young people coming out of college with useless degrees (as was mentioned earlier in the thread), debts up to their eyeballs, have had to lower their expectations in the real marketplace. As with trading, one has to tweak/change with a changing market, or forever be left behind.
I hope the job is still there for your friend Jem. I dont know if 3d printer manufacturing will be able to replicate titanium rotors for jet engines , however, the great American "machine shop" is on the way out. I even beleive most of the design engineering and programmimg associated with these industries will die as well. Even i can see that a Computed Tomography front end(todays medical CATscanner) will convert the cross sections(x ray vision like sub millimeter slices) of virtually any solid into code for the 3d printer. Sooner than we think and another example of technology and its impact on labor.
Ucanteatbond, Of course the government and military have had and always will have secret space programs. It absolutely escapes me why some beleive a PR rep should keep the citizens informed when vigilant efforts NOT to do so, at times, fail so miserably and cost lives and treasure. By the way, Mavericks "take" on the last 50 years is spot on , but i doubt you go back further than Zerohedge, circa 2009, which is actually a resurrection of Bill Fleckensteins blog, circa 1990s. Always permabears , doomsday preppers (Goldbugs of the 70's), and conspiracy theorists. ...You're actually a boring cliche, come to think of it.
Now i dont want to get too crazy here but when, not if, 3d print manufacturing takes off and is applied to the textile industry as well, how will this effect emerging markets and China? Genral Electric, Siemens, Phillips NV will probably lead in supplying this technology as they dominate imaging technologies today. A scanner and printer will have a whole new meaning. This will be serious job loss. Envision a robotic distribution center for reference. US oil,gas,energy and also manufacturing, independence and dominance once again. A crazy alternative scenario to the prevailing "US is finished" scenario . We will see.