Sunday, February 22, 2009

Buddy, can you spare a grosz?

Solutions put forward to stave off the worst of the global financial meltdown - now knocking angrily at the door in Poland, like some aggressive and impatient Repo Man - have split into good old fashioned rightwing and leftwing remedies. But are they all missing the point?

The deliciously named Moody ratings agency alarmed everyone last week when they published a rather moody warning that they might downgrade credit ratings of Western banks active in central and eastern Europe (CEE). Austrian banks are particularly heavily exposed after lending the region 230 billion euros, the equivalent of 70 percent of Austria’s annual GDP. If the banks went tits up in this region they could take down many of their parent banks in the West. As manager of Manchester United, Alex Ferguson once said: “It‘s squeaky bum time,” for bankers everywhere.

The zloty has sunk against major currencies over recent weeks faster than a man with a skyscraper-load of concrete in his boots. The majority of mortgages in Poland, as elsewhere in the CEE are taken out in foreign currencies. Our flat is on a euro mortgage and repayments have risen by 15 percent since last November. The majority took their loan out in Swiss francs, a plan that now looks like it had more holes in it than Emmental cheese.

After initially seeming to be getting away with it, many central and eastern European countries are now forming an orderly queue outside the doors of the World’s bank manager, the IMF, for help. Ukraine, Hungary, Belarus… There is a plan on hold for Poland, if needed.

Each month macro economic analysts sit down and key new data into computer models, press ‘send’ and watch as the screen flickers up yet another GDP growth prediction that is even more gloomy than last month’s. The government thinks maybe 2.5 percent for 2009; the World Bank this week said two percent, most independent analysts are even more moody: one percent, maybe no percent.

CEE countries inside the EU who are in the Euro Zone - Slovenia, Slovakia… - are best placed to see out the recession. Those in the EU but outside of the Euro Zone - Poland, most of them - will have a harder time but should get some protection from Brussels. Those in the CEE but outside the EU, however, appear stuffed.

The government in Warsaw looks as shocked as everyone, these days, at the pace of it all. One minister said this week that they had tried to play things down initially, because they “didn’t want to worry people.” But now the government has scrambled a package together to try and steady the ship, a bit.

Prime Minister Tusk said that if the zloty falls to 5 to the euro then his government would intervene. The day after, when the zloty didn’t fall quite that low, the finance ministry started selling euros anyway.

The pro-EU Civic Platform government have emphasised that getting into the ERM-2 mechanism as quickly as possible would help protect the zloty from such instability (although it didn’t help the pound much in the early 1990s). May or June seems to the target date.

The government has a four point strategy, apparently - bills on bank bailouts, on equity for national trading bank Bank Gospodarstwa Krajowego, on credit guarantees for businesses, and on tax relief for direct investors.

“I‘m no Obama”

But Donald Tusk warned that there would be “no massive injections” of cash into the economy. Tusk said that he was “No Obama” - as if people hadn’t actually noticed this before.

And here politicians in Poland are falling into two camps, much like the old left and right days. On the right, Donald Tusk - but in the left hand corner is Jaroslaw Kaczynski, calling for a programme of public works - a la Maynard Keynes - to protect jobs and stimulate the economy.

It’s no surprise Kaczynski is on the state borrowing and spending side of the equation. For all the emphasis on his social conservatism, he and Law and Justice have always been left on the economic front. Law and Justice, the conservative-socialists!

The World Bank report was actually much less gloomy than most. It said Poland would ride out the storm better than many in the region. But it’s still going to be rough, though not the Great Depression. There are no precedents to this. It’s something new.

And that makes me think that all the bailouts and other sticking plasters aren’t really coming to terms with what is behind this: an over producing but under consuming south Asia, and an over consuming, under producing West. This is about fundamental imbalances. But nobody seems to have a plan about that.


Anonymous said...

It seems as if governments genuinely don’t know what to do. They are applying remedies straight from the economics textbook as it was written for what should have been done to stave off the great depression. But today’s world economy is nothing like the economies of the 1930’s. There is also very little talk in the US of the consequences of deficit spending and mindlessly printing money. The US dollar is the reserve currency for the entire world and therefore if it were to collapse it would bring everything down with it.

The immediate consequence has been stuff like Clinton announcing in China human rights will take a back seat to economics and trade issues, this being the outcome of requiring China to continue buying and holding US debt instruments.

Anonymous said...

It's not just a matter of printing up Monopoly money. The bastards in the US who got us into this mess will be taxed at higher rates and there will be an attempt to reduce the deficit.

But this is a funny cartoon:

beatroot said...

Crucial problem is that the advanced western countries don;t produce all that much. If it wasn't for state spending - which is huge and contradicts the myth peddled by the left that neo-liberalism reigns supreme - and the finance sector and weird and wonderful ways that they circulate credit coming from China etc - there would be no growth at all in the US, UK etc.

That's what is behind this - not greedy bankers.

Anonymous said...

I'm not convinced that all types of growth have been or are a good thing. Cancer is a growth and nobody thinks its a good thing. I'm most concerned with jobs and establishing a sound infrastructure. Good growth will follow.

Anonymous said...

ge'ez said... “The bastards in the US who got us into this mess will be taxed at higher rates and there will be an attempt to reduce the deficit.”

The taxation level will not change drastically even for upper income people due to the fact money will gravitate to more tax friendly areas of the world. Capital is free to move around the globe looking for the best conditions so no one can afford to be out of line with their tax rates. But printing money is dangerous if the desired effect of stimulus doesn’t happen fast enough, thus there is a risk of the medicine killing the patient.

beatroot said. “Crucial problem is that the advanced western countries don’t produce all that much”

The problem is measuring economic strength, if your are a country that’s has a resource based economy like Australia or manufacturing based like Korea or even Germany then the contemporary methods apply well in terms of the GDP figures. But if your numbers come from a huge financial sector or service industry sector then it’s a false indicator of producing national wealth to some extent, as it can be argued that your are really dealing with a re-allocation of existing wealth. The state of the US middle class is directly related to the demise of wealth producing sectors and the growth of wealth re-allocation sectors.

In a sense the US created the very instrument, which caused it’s own economic downfall. By pushing for “free” trade versus “fair” it allowed it’s businesses to go global with their products through the use of very cheap labour in the third world. This caused the lose of American jobs on a grand scale and these jobs were replaced by low paying service sector jobs. At this point the growth of American wealth was based property appreciation, as real wages were not growing and a supposedly ever appreciating house became a bank account to support consumer spending habits and a life style that were no longer sustainable on the basis of earned wages. Yes it was financed by Arab, Chinese, European and Russia money looking for good returns and a save haven.

The greedy bankers just added the straw that broke the camels back.

The frustration of American manufactures is understandable; they have to compete in fraudulent international market place. The Chinese falsely under value their currency by 40%, pollution control standards; safety standards and labour laws are universally ignored in China. Unskilled labour to sweep the shop floor can be obtained in China for 500 Yuan (73 USD) per month in some areas.

YouNotSneaky! said...

Well here's some comments from a Macroeconomist:

For US,
- "Printing money" (although the fed hasn't resorted to that yet) usually carries the almost certain danger of upping inflation. And generally inflation is bad (puts a drag on long term growth). But this is one of those times where 'generally' doesn't apply. In fact there's actually a looming danger of deflation here. So if the US can get out of this mess by paying the cost of a few higher points of inflation then it'd be worth it.
However, the problem is that traditional monetary policy is not working right now. No matter how low the fed cuts the federal funds rate or the discount rate banks don't want to lend to each other and prefer to sit on their cash (they're afraid of a run). Same for firms. So any money injected into the system is just not doing anything.
So IF printing money had its usual effects it would be a good idea. The problem is it's not having its usual effects.

- So the alternative is fiscal Obama style stimulus. The problem here is that the eight years of Bush has left the US budget in a total mess. Big deficits (as % of GDP) also put a drag on growth and in some circumstances can trigger a crisis. Coupled with a low domestic saving rate they mean heavy borrowing from abroad (hence the trade deficit, as foreign money finances the gap between savings and investment). But you can't do a fiscal stimulus without increasing the deficit (well, you can raise taxes and spending by same amount but this is politically unpopular and the bang-for-the-buck of such a policy is small). So again, you gonna have to pay some long term cost and hope in the short run it's worth it (it gets you out of the depression). At least it seems like Obama has some kind of plan for getting the deficit down later, after 2010 or 2011.
(An alternative is just to try and ride this puppy out)

-It's not really a case of under producing West - the West produces quite a lot and what it produces is quite valued by rest of the world. The long term problem here is the low savings rate in at least the US. So yes, it is somewhat of a over-consumption problem. But note that the W.European countries save more than Americans and yet that didn't save them from getting infected. Note also that this crisis was NOT triggered by the large US trade deficits, by Asian countries dumping US securities or a run on the dollar. The crisis was triggered by the bubble in the housing market and propagated by a completely unregulated (or wrongly regulated) financial market. All the stuff about China is something to worry about - if that happens on top of everything else, then we're totally screwed - but for now it hasn't been a problem. Yet.

For Poland
There's a number of reasons why Poland should do better than other countries in the region. The main worry is the sliding zloty though.
The thing is, prior to this crisis Poland probably benefited from having its own currency. If you adopt the euro (or fix your exchange rate) then your monetary policy will get set in Brussels. And it's going to be set with an eye to the economic conditions in France and Germany (mostly) not in Poland. If France and Germany go into recession when you're booming, Brussels will turn your boom into high inflation. If France and Germany boom when you're in a recession, Brussels will make your recession worse. So what matters is to what extent "core EU countries" business cycles are synchronized with Poland. Before ... I dunno, 2004 or so, they probably weren't synchronized enough to justify it. After that, due to increased Polish immigration and increased trade they started moving more together but it was still a close call. Now we have a crisis that's hitting all countries simultaneously. So yes, in this case it would pay to have the Euro as it would avoid all kinds of balance sheet effects (what beet is talking about with his mortgage) and the policy that is going to be good for France and Germany is likely to be good for Poland. But then, you'd have to have forseen this crisis. As to whether the present mess should push Poland into the euro faster - well, it depends on whether or not domestic monetary policy can deal with the crisis on its own and what happens to the business cycles after this is over (since the decision to go Euro is costly to reverse)

Normally I'm not a big fan of left style economics and government jumping on the Keynesian excuses to increase the size of its trough. But this are unusual times we live in.

YouNotSneaky! said...

Oh, in relation to one of the points above - productivity in US has actually been rising through out this crisis (which makes this quite an usual recession)

Anonymous said...

PiS are big on talk about spreading the wealth but they never did much about redistributing income when they were in power.

Gazeta Wyborcza is now using PiS's alleged commitment to tax and spend government as a bat to hit all non-conformists on the head. No one wants to be known as a PiS-artist. For God's sake do not - repeat do not - tax the rich. That's neanderthal PiSenomics... Even though it isn't really.

beatroot said...

The west is simply NOT producing much and the growth is minimal. If you take away public spending – which in the UK has accounted, in one way or another, for 60 percent of new jobs in the last ten years – and then take away the finance sector (which as we have seen is built on dodgy sand) then we are left with not very much. At all.

The manufacturing base was rundown in many countries throughout the 1980s and this has been replaced by finance capital, fuelled by Chinese credit.

The Chinese had to export capital like this because they were producing more than consuming. So to keep the west buying stuff (which it can’t produce itself) China kept on lending.

For the west to give a mirage of growth more and more weird instruments had to be invented. And now we see the result.
The problem, then, is not the wanker bankers, but a moribund western capitalism.

Anonymous said...

And the reason it's moribund is because it was based since the Reagan years on the explotiation of foreign cheap labor, greedy CEOs, and banker wankering -- plus the rich didn't pay their fair share of taxes. And now folks like me and my wife who worked our entire lives, lived modestly, and saved for our kids instead of going in debt now can't get financial support for our kids going to college and are having our savings stolen. Don't tax the rich? You gotta be kidding. That's the reason we're in the mess we're in right now. Greed, overconsumption, stupidy in economic planning basing everything on financial growth for some, not real growth for the common good.

Anonymous said...

geez said.. ”Don't tax the rich? You gotta be kidding”

It’s not about not taxing the “rich” it about a tax structure that does not create a disincentive to business and therefore prevents job creation. There should be two tax structures one for businesses that create jobs and tangible national wealth and one for activities that are really the re-allocation of existing wealth.

Now on to Poland, I will predict that in the next few months Poland will be looking for an international bale out plan through the IMF or the EU.

beatroot said...

And the reason it's moribund is because it was based since the Reagan years on the explotiation of foreign cheap labor, greedy CEOs..

You are still trying to explain what is a structural problem by reaching for pychological factors of bankers etc. This is why people will not understand the problem and will not have solutions to be able to deal with it. It's not about the bankers.

Anonymous said...

Do structural problems fall out of the sky?

True, it's not just about the bankers.

But the problem even as you stated it in your post does not augur some automatic solution.

Your proposed solutions?

Anonymous said...

57, what business(es) are you talking about? You seem to touch upon it but need to flesh it out more. I mean all the fuckers are going to argue that they create jobs and produce tangible national wealth. And they'll squeal like the stuck pigs they are if you suggest otherwise.

Is it a disincentive to limit CEO and other upper management salaries and perks and myriad tax breaks when you take away my money to bail them out?

The extent of greed and their sense of entitlement is just sickening.

beatroot said...

Solutions? Me? have no idea, mate. But we are not going to get anywhere with this by by being in denial about what the problems are. The banker thing is just scapegoating what is systemic at a moment where the East is growing dynamically and the west is not. and that the west should start looking at where it gets its growth needs more of a manufactoring base, for sure.

Anonymous said...

Well yuh. But even the big steel CEOs were investing their profits outside of steel and any kind of internal manufacturing base. Twas more profitable in the short term. Still is.

beatroot said...

and they are very very bad men and hang their bollocks out to dry. But that would still be a distraction.

Anonymous said...

geez said.. “The extent of greed and their sense of entitlement is just sicken”

Yes I agree but this did not come about solely because of criminal wrongdoing. It is likely those who broke the law will be prosecuted. The economic fundamentals were wrong it took two events to sink the ship, the housing bubble burst and toxic debt sent through all the markets of the world began to smell.

It was irrational to be earning the wages of a janitor and trying to live a Champaign lifestyle. Yet a lot of people used the appreciation of their home values as a piggy bank and didn’t bother to put away anything for a rainy day. The government spent like a drunken sailor and didn’t care about the consequences, lets not forgot since the days of LBJ America goes to war on a fight now pay later plan.

Who were the real bad guys, look in the mirror (people like you and me):

In business there were no robber Barons, a huge pool of shareholder with voting rights broadly holds most big companies in the US, they had the prerogative to put the brakes on the salaries and bonuses but chose not to. These same shareholders chose not to stop them from shipping American jobs to Asia because it could affect our return on the investment.

We as a public chose not to educate ourselves about the issues and vote competent and responsible people into office. Most American are nearly illiterate when it comes to civics or at least astonishingly naive. We both know Hollywood manufactured perceptions trump thoughtful analysis.

Our leaders under pressure to fund their next election campaign slavishly adhere to the needs of the special interest groups. “Don’t regulate our financial sector” - ring a bell! They took the money that paid for the election campaign with total disregard for the good of the nation and general public. This was done across party lines.

America collectively choked on it’s own moral fallings as society and dragged the rest of the world with it into the financial crisis.

Anonymous said...

So I gotta foot the bill and the blame? I don't think so.

The bankers enticed folks to mortgage above their means (but the biggest problem wasn't so much janitors or Joe the Plumbers but rather folks who were already fairly well off).

And despite a huge pool of shareholders, only a few really had and still have effective control over corporate goings on.

I think we Americans came to our senses, at least more so than in quite some time, by voting Obama into office. By no means perfect in my estimation, it's still an incredible improvement over what we had before.

And BR, what isn't a distraction according to your analysis? Structural this and that, Lordy how I used to hate trying to read Marcuse.

Anonymous said...

I meant Althusser. It's reassuring to realize I forgot so much of that stuff.

Anonymous said...

Mr. Sikorski is your nose growing uncontrollably? I wonder what the Polish public would think if this made the rounds in Poland?

From an Indian Newspaper Article:

“This complicated situation has forced the Pakistan government to take some extreme steps against the Taliban in Darra Adamkhel and Swat. The Taliban killed Polish engineer Piotr Stannczak as a reaction to a big operation in the area. Some diplomatic sources have revealed that Pakistan was ready to release some arrested Taliban fighters in exchange for the Polish engineer and another kidnapped Chinese engineer, but the US raised some objections and the deal was not finalised.”

beatroot said...

That's what I heard too...he was inches away from being freed...

Geez - what's Althusser gotta do with the price of fish? I wrestled with that too...even trying to get some of his 'overdetermination' stuff into a theory of rapid musical sylistic change in a thesis...

...I must have been a real prat at uni...

Anonymous said...

The price of fish is structurally determined by . . .

beatroot said...

...the economic dialectic is never active in the pure state; in History, these instances, the superstructures, etc. – are never seen to step respectfully aside when their work is done or, when the Time comes, as his pure phenomena, to scatter before His Majesty the Economy as he strides along the royal road of the Dialectic. From the first moment to the last, the lonely hour of the ‘last instance’ never comes.

That's Althusser...who proves there is some beauty in bullshit.

roman said...


These financial terms you employ such as ....squeaky bum time and tits up , I've never seen these in any of my studies.
You're absolutely right about Slovenia and Slovakia riding out this recession unscathed. The people there don't have anything to start with that they now can lose.

Jan 57,

Wait for it.. wait for it. It did'nt take very long for someone to find an obscure and as yet unnamed news outlet to insinuate that Piotr's beheading by the Taliban was somehow the fault of the USA. Did'nt have to wait long! I don't want to sound like an apologist for the USA but this story is just way out there. Here's the spin those evil Yankee bastards were once again sticking their nose where it does'nt belong and it cost someone their life. Can't blame the Taliban, their just doing what comes natural when instigated by heathen foreign imperialists from the USA. I'm sure this figment of someone's imagination will wind up on every liberal progressive rag as fact. Wow, even with Bush and Cheney gone, the blame game continues.
Oh well, this time its team Obama getting the heat.

Anonymous said...

Immortal Gramscian fish head dialectic:

Anonymous said...

My humble apologies. The url above was a false fish head dialectic. This is the correct dialectic and much more dramatic:

YouNotSneaky! said...

"The west is simply NOT producing much and the growth is minimal. If you take away public spending – which in the UK has accounted, in one way or another, for 60 percent of new jobs in the last ten years – and then take away the finance sector (which as we have seen is built on dodgy sand) then we are left with not very much. At all."

I don't know enough details about UK's economy to be able to say anything definitive here. But for US it's just not true. There's a caveat here - under Bush income growth was low, a notch below 1% per year (productivity growth did better). But that's basically Bush. The economy did quite well under Clinton. And what you are talking about is supposed to be a "long run" problem so it makes sense to look at it from at least the early 90's on.
And the growth since the 90's has been around 2% (higher if you throw out Bush). And 2% is very respectable for a developed country - in general, unless they munk it up, poor countries like China SHOULD grow faster than rich countries simply because they haven't hit diminishing returns as much.

BTW, you know there are historical parallels to these discussions. In late 19th century it was British growth that was slowing (as they were starting to get into diminishing returns) while US and Western Europe was booming. People were comparing UK to US back then just like people are comparing US and the "West" to China now (obvious differences being political). In 19th century people would see the decline in the agricultural sector and bemoan the loss of an "agricultural base" and freak out about how they were going to feed everybody. But apparently it's possible even with agriculture less than 5% of GDP. Just like it's possible to have all the gadgets and "physical stuff" with manufacturing less than 20% of GDP.
Financial services are 8% of GDP which is probably a point or two too much (and part of what we're seeing now is the restructuring of the economy away from the bloated finance sector) but it just cannot account for the growth in GDP that we observe. Say growth in the financial sector has been 3% per year. That's a contribution to overall gdp growth of .08*.03=.25% leaving 1.75% to come from other sources. And not all of that growth in financial sector has been bad scams and the like. Some of it's quite legit.

beatroot said...

And the growth since the 90's has been around 2% (higher if you throw out Bush). And 2% is very respectable for a developed country

What’s remarkable about the US and UK economies in the last 10 or 15 years has been this long, comparatively stable, but unspectacular growth. “No more boom and bust,” said the then finance minister now prime minister Gordon Brown in the UK. Which of course, was bollocks. The growth was to do with both an increase in public spending plus the growth of finance sectors. The finance sectors were built on sand, as we now can see. And the feeling of wealth people had was based on the growth in value of assets like housing - built on dodgy credit - and stock market prices.

But, at the end of the day, the “respectable growth” you talk about, Sneaky, was really just a hot air fart.

YouNotSneaky! said...

Again, if you're talking last 8 yrs under Bush, then sure. But the 90's were quite good for growth and it wasn't just finance (which is too small on its own to account for bulk in growth) and the public sector (which didn't grow that much as Clinton balanced the budget).

Here's some data to play with:

Note for example that 1992-2000 "Private industries" grew faster than GDP which means it grew much faster than the public sector. Even for 2000-2007 "Private industries" grew only slightly slower than GDP. Note also that strangely enough, agricultural sector didn't grow at all during Clinton, but grew much much faster than GDP under Bush. Mining in both periods also grew much faster than overall GDP.

Finance grew at about 7.4% per year from 1992-2000 and at 5.8% from 2001 to 2007. Which is higher than overall growth but not by that much. In contrast mining grew by 6.6% under Clinton and 11.7% under Bush. Even Manufacturing grew at a respectable 4.5% under Clinton (then you get the measly 1.8% under Bush which doesn't even keep up with inflation).

So it's not really a structural problem of not being able to produce much. It really was just shitty economic policy under Bush.

Anonymous said...

Being too lazy to look it up (and I'd probably get frustrated trying to find it)... if the finance sector was 8% of the US GDP last year (I'm assuming you were using last year's numbers), what percentages were the other sectors by designation? And was there considerable shifting over the past decade or so between the various sectors or have the relative percentages remained pretty much the same?

And istm there needs to be some agreement over what constitutes growth and what measures to use to gauge it to continue this discussion on common ground.

beatroot said...

The Financial Times had a telling article about the role of the state in creating jobs in the UK in the decade. If it wasn’t for the public sector (and finance and services…) the UK economy would be a bit of a mess.

Alistair Darling, the chancellor, and Gordon Brown, the prime minister, correctly claim that the number of jobs created under Labour is equivalent to the number on the dole under the Conservatives. But up to two-thirds would be classified by most people as being in the public sector.
The picture that emerges when the employment patterns of female workers are scrutinised is especially stark. According to the Office for National Statistics' Annual Business Inquiry, of the 1.07m additional jobs taken by women between 1998 and 2006, 963,000 were in the sectors where the public sector predominates…

So, take out public sector and finance boom then what is left? The West depends on a very dodgy sort of economic factors, most of which is fuelled by China etc…

That’s not real sustainable growth and unless there is a new radical thinking about the economy, then these problems we see now will look like chicken shit…

YouNotSneaky! said...

It's mostly for 2007, I was too lazy to search for the most updated numbers but beet's talking about long term structural phenomenon so 2007 should be fine.

In terms of shares and how they changed:
Finance went from 6.5% of GDP in 1992, to 7.5% in 2000 and 8.3% in 2006. So yeah it increased. And in fact if a relatively small sector like finance increase it's share by about 2% points in a relatively short amount of time then folks will notice. But it's still 8.3% of GDP. Which means its contribution to overall growth of GDP cannot be that large.
During the same time
Agriculture went from 1.5% of GDP in 1992, to 1% of GDP in 2000 to .95% in 2006 (I think I got this number wrong in the above).

Manufacturing went from 15.7% in 1992 to 14.5% in 2000 to 11.8% in 2006. So yeah, that fell too, but so what.

Construction went from 3.6% in 1992 to about 5% in 2006.

Government went from 14% to 12.25% to 12.5%. So contra beet, for US the gov sector actually shrunk (and it did this under Clinton! It went back up under Bush)

Computer systems design and related went from .6% to 1.3% to 1.1%

Professional and business services (consulting, lawyers) went from 10% to 11.6 to 11.8
This is actually the largest increase in shares.

As for growth, I basically mean an increases in per capita real (adjusted for inflation) income. I'm open to modifying this definition of growth but like you say, we gotta be specific.

Anonymous said...

That's a total of something like 52%, so where's the other half? Health and education jump out at me.

And you say so what about the drop in manufacturing. Why so what? I'm not altogether convinced that so many people can be retrained for other types of jobs. I'll be happier when I see certain industries converting into producing the materials for new green infrastructure and green reconstruction projects. The money's there through the stimulus bill but who really knows how it's all going to pan out?

YouNotSneaky! said...

Yeah, there's others I just got a bit tired calculating all the shares. Educational services, health care, and social assistance all together are at about 7.7% currently with 6.8 being health care and social services. Arts, entertainment, recreation, accommodation, food services are at a respectable 3.6%. Information (which includes publishing, movies, tv) is 4.5%. And then there's bunch of others - but that's the thing, bulk of GDP is spread over many diverse sectors so you really can't say that anyone of them is responsible for overall growth, even a relatively bigger one like finance. For a large diversified economy like US growth's gotta come more or less from across the board improvements.
I'll explain the thing about manufacturing separately.

Frank Partisan said...

This crisis killed neoliberalism.

Conservatives like using borrowing percentage rates, to control the economy. When the interest rate went to zero, conservatives were out of the game.

The Great Depression was solved by WWII and rebuilding Europe. We can't have a WWIII, because the US has all the weapons. There can only be small wars. Defense spending doesn't stimulate the economy like in WWII.

This is the first world economic crisis. There is a world capitalist economy, being dealt with, in a protectionist manners.

Capitalism has cycles. There will be a recovery. In addition there will be much residual damage. Just like the Earth's surface has cycles, and earthquakes leave residual damage.

beatroot said...

This crisis killed neoliberalism.

Ren, this neoliberalism thing was and is a myth. There never was no neoliberalism...the state and public sector are what props up capitalism. Always has. And the Left being for the state and against private sector etc misses the point...the state is not an antithesis to is part of its fabric.

Anonymous said...

But video killed the radio star as per the Buggles.

And I'm very surprised about: "Educational services, health care, and social assistance all together are at about 7.7% currently with 6.8 being health care and social services."

I expected the first two to be much bigger.

And I am also surprised by the relative balance of all the sectors - indicative as you say of an advanced economy.

So maybe things aren't as out of whack and as bad as I was thinking.

As long as the unemployment rate doesn't keep rising....

YouNotSneaky! said...

The unemployment rate will still probably go up a point or two.

Here's a nice easy way to compare this expression to past expression:

In terms of unemployment currently, we're worse than the 1990 and the 2001 recessions, about the same as the 1981 and 1960 ones and better than the 1948, 1953 and 1957 ones (I'm skipping the others because those were weird in terms of timing)

Anonymous said...

"There never was no neoliberalism... the state and public sector are what props up capitalism. Always has"

That the state aids capitalism (e.g. "welfare for the rich") does not mean there is no such thing as neoliberalism, only that neoliberals are lying when they talk about free and undistorted markets.

Anonymous said...

Who are these "neoliberals"? What is the definition of "neoliberal" making it different than "liberal"? Is this something out of The Matrix?

We Change Europe said...

Votes for Europeans possible:

We-Enlarge: The Europeans are enlarging their Union!

We-Elect: The Europeans elect their President!

Anonymous said...

The Nazis didn't get you, heh?

Anonymous said...

ge’ez what did you do with him, it’s been too quiet?

Anonymous said...

Anybody in Warsaw know what's going on with the BR?

Anonymous said...

But you are very very happy to give in, if it's for me, aren't you, honey?

Anonymous said...

Whether or not you have it reveals人間のほんとうの価値を暴露してしまうと思う。

Anonymous said...


Anonymous said...

Marriage License?
よくわかんんないけど、とにかく、3回もnon US citizenと結婚離婚を繰り返しているるるさんのこと、怪しいやつだと疑われても困るな~
あの寂れたビーチとかでwedding, not banquetを挙げる必要があるかも?
We need to get "at least Not so stupid" lawyer who can handle it propery on time.

Anonymous said...

で、did you get back the goose?
Never mind. It's not duck anyway.

Anonymous said...


Anonymous said...

More Information About Cialis (tadalafil) :

Buy Cialis

Anonymous said...

I really like your blog.. very nice colors & theme. Did you make
this website yourself or did you hire someone to do it
for you? Plz answer back as I'm looking to construct my own blog and would like to know where u got this from. many thanks

Feel free to visit my web site best payday loan lenders
My web site :: cash a check online

Anonymous said...

jordan shoes
adidas yeezy
pg 4
kyrie irving
supreme clothing
travis scott jordan
supreme official
Golden Goose
golden goose