Tuesday, October 22, 2013

Daily Briefing For Tuesday, October 22, 2013

Today's Economic News

So last night I made a SWAG - a Scientific Wild Ass Guess - as to the September non-farm payroll number that came out today.  The consensus was for 180K jobs.  I pared that back a bit, guessing 174K.  The actual number paled in comparison: 148K jobs with a slight dip in U3 unemployment to 7.2 percent.  Regular readers know I prefer to look at the U6 unemployment number, which came in at 13.6 percent.  That's the lowest U6 has been since December 2008. 

There's more.  Over 90 million Americans are not in the labor force - a new record.  Female participation in the labor force reached a low last month not seen since 1989.  The National Journal proclaims our economy is stalling.

Meanwhile, one of my Five Most Interesting People On The Planet, Veronique de Rugy, wrote a piece today for the Mercatus Center* in which she compared the debt to GDP ratios of the most populous countries on Earth.  Fortunately for us, we are not number one.  That dubious distinction goes to our friends in Japan, a nation my generation was led to believe would own America by the mid-1990s.  de Rugy goes on to state the obvious, because, well, it's pretty damn obvious: "The CBO predicts that US public debt levels will approach those of Japan by 2038. While there are differences between countries, the data suggest that the United States relies excessively on debt to fund public expenditures."

Thus stories like this one should not come as a surprise to us.  Atlanta Jeff shared the news with me today: China and the European Central Bank inked a currency swap deal which would stabilize the exchange rate between the yuan and the euro.  The practical effect? "Such agreements mean the central banks can exchange currencies and firms can settle trade in local currencies rather than in US dollars."  Simplified even further: this agreement will lead to decreased demand for the dollar, making it worth less.

And while off topic, I thought I would include one more story for your edification: Slate ran an opinion piece trumpeting the death panels of the Canadian health care system.  Lest you think I engage in hyperbole, check out the headline for yourself: "Canada has death panels, and that's a good thing."  From the article: "When humanity demands haste, and justice demands expert knowledge, Ontario’s death panels offer a solution."  Hmm.

*Disclosure: I am a regular financial contributor to the Mercatus Center.


You People Are Smarter Than The Elite Think.

Speaking of death panels and the name calling of those who decried them years ago, get what a professor writing for the Yale Law School - which is effectively the University of Miami School of Law of Connecticut - Cultural Cognition Project had to say about most of you.  After determining that  "identifying with the Tea Party correlates positively ....with scores on the science comprehension measure," (emphasis original)  Dan Kahan goes on to say:

"I've got to confess, though, I found this result surprising. As I pushed the button to run the analysis on my computer, I fully expected I'd be shown a modest negative correlation between identifying with the Tea Party and science comprehension.

But then again, I don't know a single person who identifies with the Tea Party.  All my impressions come from watching cable tv -- & I don't watch Fox News very often -- and reading the "paper" (New York Times daily, plus a variety of politics-focused internet sites like Huffington Post & Politico).
 

I'm a little embarrassed, but mainly I'm just glad that I no longer hold this particular mistaken view."


To be fair, five days after he wrote the feces cyclone-inducing article referenced above, he penned an epilogue which you can read here where he expanded on his remarks.  Draw whatever conclusions you want from these articles.  Here are mine:

  1. If you are a Tea Party member, you are not an idiot.  Despite what some on the left would have you believe.

  2. Give credit where it's due:  Kahan is intellectually honest enough to say "I'm a little embarrassed, but mainly I'm just glad that I no longer hold this particular mistaken view."  We should follow his example.  We should always challenge our preconceived notions on everything.  And when we are proven wrong, we should not see that as a source of embarrassment or failure, but instead be thankful we were enlightened.

  3. Keep an open mind.  Don't be afraid to test things.  Don't be afraid of finding out your opinion isn't well grounded in fact or logic.   

I've pointed out countless times: the world is full of experts who are often wrong.  Do your own homework; reach your own conclusions.  And then challenge those beliefs regularly.





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