There is a ton of material on the BLS Job Report today, but this quick Post might express it better than windier Posts. Mark Thoma would desire more quantitative easing, but I cannot find any value in a policy so obviously failed. The Fed simply does not have the pull to turn the economy around by itself, and it has no help anywhere. Business is simply using the funds to create Profits for themselves. Banks are not lending, because there are safer investment elsewhere with better Profits for themselves. The increase in Part-Time employment only means that Business is gearing for a bad Christmas Season and coming year. Labor is being shorted, and Households are losing Income, yet everyone expects Consumer Demand to remain steady–I do not!
The data I would like to preview is the activity of the used Product markets. A rise in this area will mean bad News for the economy, especially if the new direction of Start-Ups begins to resemble Repair Shops. This would mean a downgrade of Consumer Preference to older, but reliable, Products. Purchase of older Vehicles because of Price premium may be beyond Us, as also in the Sale of Used Furniture and Appliances. The Reader may find this to be far-fetched, but Dealers are relying on a $3000 Mark-Up for newer Used Cars. Vehicle Warranties will not hold up under this resort, if Consumers need transportation and cannot afford the $3000. Economists will tell you what this will do to the New Car market, if long-term New Vehicle purchasers cannot afford the $8000 Mark-Up price.
Three years of current economic trend could lead to the American economy beginning to resemble the Mexican economy, with heavy usage of aged Product. It is my fear that the American Consumer is getting ready to Downshift, and the economy will only suffer from such an assault. I have been trying to source data for my estimate, but my Guess is that Computer equipment is as Aged as it have been since the early 1980s. There is indication that Main Street Consumers are not upgrading their Software, as long as it effectively works. Blockbusters–the highest-priced of the Trade stores–has filed for bankruptcy, and the greatest Sales of DVDs are found in the Used Disk Counters. I know positively that Amazon’s Resale program has ruined independent Authors, who get nothing from Used Books. I share not the optimism of Wall Street, and am cognizant of Wall Street’s partying most heavily right before the Crash. lgl