Daily Digest

Daily Digest - July 31

Saturday, July 31, 2010, 9:43 AM
  • America's Worst Job Market: What 27.6% Unemployment Looks Like
  • Foreclosures Continue To Dramatically Increase In 2010
  • China Becomes Second Biggest World Economy
  • G.M.’s Electric Lemon
  • Why We'll See $300 Oil by 2020
  • U.S. Food Waste Worth More Than Offshore Drilling
  • Population Research Presents a Sobering Prognosis
  • Food Storage Basics

Economy

America's Worst Job Market: What 27.6% Unemployment Looks Like (bandv)

In recent years, California’s multi-billion dollar budget shortfall and its painful cutbacks have gotten plenty of attention. But even by California standards, El Centro’s situation is unusually dire. Since the recession hit, the area’s housing market has fallen apart, its wages have remained dismal, and its unemployment rate has soared.

Foreclosures Continue To Dramatically Increase In 2010 (bandv)

In a very alarming sign for the U.S. economy, foreclosures have continued to dramatically increase in 2010. But there has been a shift. Back in 2007 and 2008, experts tell us that most foreclosures were due to toxic mortgages. People were being suckered into mortgages that they couldn't afford with "teaser rates" or with payments that would dramatically escalate after a few years, and when those mortgages reset, the people who had agreed to them no longer could make the payments.

China Becomes Second Biggest World Economy (bandv)

"China, in fact, is now already the world's second-largest economy," he said in an interview with China Reform magazine posted on the website of his agency, the State Administration of Foreign Exchange.

Economy

G.M.’s Electric Lemon (NZSailor)

For starters, G.M.’s vision turned into a car that costs $41,000 before relevant tax breaks, but after billions of dollars of government loans and grants for the Volt’s development and production. And instead of the sleek coupe of 2007, it looks suspiciously similar to a Toyota Prius. It also requires premium gasoline, seats only four people (the battery runs down the center of the car, preventing a rear bench) and has less head and leg room than the $17,000 Chevrolet Cruze, which is more or less the non-electric version of the Volt.

Why We'll See $300 Oil by 2020 (Debu)

We're probably entering a period of time when the supply of oil, which is rising now more slowly than demand, will eventually catch up. Right now, oil supply is growing about 1-1.5 percent per year, and we think by 2015, it will reach a point where it's not growing at all, or say, only 0.5 percent vs. 1.5 percent demand growth.

U.S. Food Waste Worth More Than Offshore Drilling (jdargis)

Recent estimates suggest that 16 per cent of the energy consumed in the US is used to produce food. Yet at least 25 per cent of food is wasted each year. Michael Webber and Amanda Cuellar at the Center for International Energy and Environmental Policy at the University of Texas at Austin calculate that this is the equivalent of about 2150 trillion kilojoules lost each year.

Environment

Population Research Presents a Sobering Prognosis (jdargis)

With 267 people being born every minute and 108 dying, the world’s population will top seven billion next year, a research group projects, while the ratio of working-age adults to support the elderly in developed countries declines precipitously because of lower birthrates and longer life spans.

Food Storage Basics (Video, bandv)

Video on page.

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

18 Comments

Doug's picture
Doug
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Posts: 3125
Re: Daily Digest - July 31

I think the most important part of the foreclosure article is the following:

Quote:

As we discussed at length in a previous article, the big global corporations that dominate our economy are figuring out that they don't really need the rest of us anymore.  The American worker is becoming obsolete.  After all, why pay an American ten times as much to do the same job?  Big corporations can hire two people in China or India to do the same job and still pocket 80% of the difference.

In addition, big corporations don't really need the headache of making employer contributions to Social Security, setting up benefit packages and pension plans or of trying to comply with the thousands upon thousands of ridiculous regulations that the U.S. government continues to spew out.

At this point, the American worker has become extremely unattractive for large corporations, and so jobs will continue to migrate to other areas of the world.

We allowed our politicians to merge us into a "global economy", so now we are all going to have to deal with being part of a "global workforce".

As jobs continue to be offshored and outsourced, more Americans are going to become unemployed and the foreclosure crisis is going to continue to be a nightmare.

It would be nice to put a positive spin on all of this, but there isn't one.

Foreclosure rates and the general real estate economy are important, but I think this passage encapsulates the real underlying problem that is chronic and unlikely to get better until the US economy is completely wrecked.

Doug

Davos's picture
Davos
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Re: Daily Digest - July 31
Doug wrote:

...this passage encapsulates the real underlying problem that is chronic and unlikely to get better until the US economy is completely wrecked.

Doug

+1. Like when I did construction - some home can't be fixed. Bulldoze em, rebuild, move on, get over it.

cmartenson's picture
cmartenson
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Re: Daily Digest - July 31
Doug wrote:

Foreclosure rates and the general real estate economy are important, but I think this passage encapsulates the real underlying problem that is chronic and unlikely to get better until the US economy is completely wrecked.

Doug

I agree - you can't expect a competitive workforce when you have both free trade and unequal rule & regulation sets across trading partners.  The US has decided to laden itself with tens of thousands of rules, many so contradictory or buried in the code, that even full-time lawyers in specific sub-specialties are unsure of the laws.  Which is fine, I suppose, but then you can't also have free trade.  You have to pick one.

By picking both, the US is certain to fail at some point.

I wrote about this some time back in Our Slow Motion Crisis.

 

debu's picture
debu
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Re: Daily Digest - July 31

From today's FT Lex column we have this nugget re yesterday's revised US GDP figures:

In real terms, annualised quarterly output has now been hovering at about the $13,000bn mark since the beginning of 2006. That is almost five years of absolutely no growth – halfway to equalling Japan’s infamous lost decade, a feat thought to be unrepeatable in the dynamic USA. Better hope the latest GDP numbers are very wrong on the downside.

Is this possibly confirmation of the beginning of the end of growth in the US economy, too?  One wonders what will that mean for financial markets going forward.    

britinbe's picture
britinbe
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Re: Daily Digest - July 31

FT Weekend (printed copy)

The dream that died  - Edward Luce on the crisis of middle-class America.

This is the banner just below the FT title- telling!!

Poet's picture
Poet
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Posts: 1891
Re: Daily Digest - July 31
Doug wrote:

I think the most important part of the foreclosure article is the following:

Quote:

As we discussed at length in a previous article, the big global corporations that dominate our economy are figuring out that they don't really need the rest of us anymore.  The American worker is becoming obsolete.  After all, why pay an American ten times as much to do the same job?  Big corporations can hire two people in China or India to do the same job and still pocket 80% of the difference.

It would be nice to put a positive spin on all of this, but there isn't one.

Foreclosure rates and the general real estate economy are important, but I think this passage encapsulates the real underlying problem that is chronic and unlikely to get better until the US economy is completely wrecked.

Doug

For a long time, economists would say the positive spin of free trade was lower prices from cheaper goods, but that short-term outlook ignored the sad reality of the end game, which is that American corporations can't keep offshoring jobs while expecting to sell to American consumers who are too poor or unemployed to buy goods manufactured in another country. Perhaps the process was less visible to economists because America is so large and this unwinding of American prosperity has taken decades. Each corporation outsourcing a thousand jobs a year has only a small impact on the many millions of jobs out there. Debt at all levels - consumer, business, and governmental - has helped hide American poverty. But we're closer to the end game, so the writing is now clearly visible on the wall even for those free trade economists.

Economists would also put out the pipe dream that outsourcing manufacturing jobs would free up Americans to pursue higher-end jobs such as knowledge work, design, engineering, etc. However, that ignores a few realities:

1. A third of American students drop out of high school due to a poor educational system with misplaced priorities. Even the ones who graduate are often socially promoted. They do not have the relevant skills and many do not have the work ethic. It also doesn't help that we have a high teenage pregnancy rate and out-of-wedlock birth rate. All of this means increases in social spending and reduced lifetime economic contribution to make up for it.

2. Also, American college education is extremely expensive - subsidized by government and by the notion that debt for education is always "worth it" - but strongly focused on what I call economically marginal degrees: art, religious studies, history, psychology, sociology, etc. As a result, students are saddled with massive debt - the so-called "houseless mortgage" even before they hit the job market to repay lenders.

3. Workers in other countries earn steady money at their factory jobs and send their children to school to study engineering and science, so they, too, are moving up the value chain to higher-end jobs - and offering their knowledge work, design, engineering, etc. services for cheaper. Global telecommunications has made white collar jobs just as off-shorable as blue collar jobs.

The issue with pure capitalism is that it will always look for greater profit and cheaper costs - whether through corporate lobbying, job outsourcing, convncing government and the public to allow themselves to "self-regulate" (worked well for BP), technology improvements that allow more to be done with fewer workers, etc.

We are becoming a Third World Country. Our social and corporate welfare system, delivered through debt, is what keeps the illusion of First World Country alive. However, rather than address these issues practically and head on and openly, politicians and people keep blaming each other and their respective presidents, political parties, etc. It's like fighting over deck chairs on the Titanic. In reality, both sides have - hand-in-hand, slowly, incrementally - contributed to this desperate situation through their laws, their irresponsible spending, and their war-mongering.

Poet

Davos's picture
Davos
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Re: Daily Digest - July 31
cmartenson wrote:
Doug wrote:

Foreclosure rates and the general real estate economy are important, but I think this passage encapsulates the real underlying problem that is chronic and unlikely to get better until the US economy is completely wrecked.

Doug

I agree - you can't expect a competitive workforce when you have both free trade and unequal rule & regulation sets across trading partners.  The US has decided to laden itself with tens of thousands of rules, many so contradictory or buried in the code, that even full-time lawyers in specific sub-specialties are unsure of the laws.  Which is fine, I suppose, but then you can't also have free trade.  You have to pick one.

By picking both, the US is certain to fail at some point.

I wrote about this some time back in Our Slow Motion Crisis.

 

+1. This is truly a stupidity crisis. 

ao's picture
ao
Status: Diamond Member (Offline)
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Re: Daily Digest - July 31
Davos wrote:

+1. This is truly a stupidity crisis. 

Amen.  Every day I tell my wife they must be pumping stupid gas into the atmosphere.  People seem to be getting dumber than rocks. 

green_achers's picture
green_achers
Status: Silver Member (Offline)
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Re: Daily Digest - July 31
Davos wrote:

+1. This is truly a stupidity crisis. 

Yeah, you could say that.  It's also a greed and corruption crisis.

Davos's picture
Davos
Status: Diamond Member (Offline)
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Posts: 3620
Re: Daily Digest - July 31
ao wrote:
Davos wrote:

+1. This is truly a stupidity crisis. 

Amen.  Every day I tell my wife they must be pumping stupid gas into the atmosphere.  People seem to be getting dumber than rocks. 

LOL.

Greed yes, but blowing up the economy and putting everything (culture wise) on the line is just plain stupid.

Ken C's picture
Ken C
Status: Platinum Member (Offline)
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Posts: 753
Re: Daily Digest - July 31
Davos wrote:
cmartenson wrote:
Doug wrote:

Foreclosure rates and the general real estate economy are important, but I think this passage encapsulates the real underlying problem that is chronic and unlikely to get better until the US economy is completely wrecked.

Doug

I agree - you can't expect a competitive workforce when you have both free trade and unequal rule & regulation sets across trading partners.  The US has decided to laden itself with tens of thousands of rules, many so contradictory or buried in the code, that even full-time lawyers in specific sub-specialties are unsure of the laws.  Which is fine, I suppose, but then you can't also have free trade.  You have to pick one.

By picking both, the US is certain to fail at some point.

I wrote about this some time back in Our Slow Motion Crisis.

 

+1. This is truly a stupidity crisis. 

 

So I wonder when we might reach PEAK stupidity. For when we do then things must start to get better.

 

 

Davos's picture
Davos
Status: Diamond Member (Offline)
Joined: Sep 17 2008
Posts: 3620
Re: Daily Digest - July 31
Ken C wrote:
Davos wrote:
cmartenson wrote:
Doug wrote:

Foreclosure rates and the general real estate economy are important, but I think this passage encapsulates the real underlying problem that is chronic and unlikely to get better until the US economy is completely wrecked.

Doug

I agree - you can't expect a competitive workforce when you have both free trade and unequal rule & regulation sets across trading partners.  The US has decided to laden itself with tens of thousands of rules, many so contradictory or buried in the code, that even full-time lawyers in specific sub-specialties are unsure of the laws.  Which is fine, I suppose, but then you can't also have free trade.  You have to pick one.

By picking both, the US is certain to fail at some point.

I wrote about this some time back in Our Slow Motion Crisis.

 

+1. This is truly a stupidity crisis. 

 

So I wonder when we might reach PEAK stupidity. For when we do then things must start to get better.

 

 

There is always hope. Until recently this quote made little sense to me. Now it makes perfect sense.

"Only two things are infinite, the universe and human stupidity, and I'm not sure about the former." ~ Albert Einstein

 

Nacci's picture
Nacci
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Posts: 194
Re: Daily Digest - July 31

I have been hearing much about the Obama Administration's plan to double exports in the next five years.     http://blog.taragana.com/business/2010/07/07/obama-claims-us-can-double-...   http://www.npr.org/templates/story/story.php?storyId=128365800   This foreshadows a National policy of further weakening the Dollar.  I have also been hearing buzz about how deflation is an even greater threat than inflation and is considered the far graver short term threat.  To accomplish this my prediction is a second stimulus package directed towards the common man prior to the 2012 election.  This will inflate the money supply in a way that will both gain political capital for the Democrats and stimulate the economy almost instantly.  This will also undermine the Dollar in a very public way making our exports cheaper overseas. I also consider War an export.  Nacci.

idoctor's picture
idoctor
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Posts: 1731
Re: Daily Digest - July 31

I have been hearing much about the Obama Administration's plan to double exports in the next five years.

LOL this is so obvious & will be easy for them......it is already well under way. We just keep exporting our jobs & stupidity along with our outsourcing of unemployment....it's a snap.

r101958's picture
r101958
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Posts: 257
Re: Daily Digest - July 31

The only way they will double exports is to devalue the dollar. This is also the only way that jobs will return to the U.S. If the dollar was inflated away or devalued by 1/2 then imports would become much more expensive (including oil). U.S. products would then be able to compete. At that point the question becomes 'can the inflation be stopped?'. That is why a one time devaluation might become a more attractive alternative.

bikemonkey's picture
bikemonkey
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Posts: 45
Re: Daily Digest - July 31

Call me paranoid, but something about theeconomiccollapse.com website seems a bit fishy.  There are no publish dates on the articles, nor are there authors namens on the articles.  Each of the articles seems to gently try to illicet an extreme response.  I don;t know what to make of it, but it does not add up to journalistic standards, even in today's internet.  And where is the Aboutus link?  There is not one.

Now, more than ever, we all need to question our sources and check our facts with a veracity akin to the fall of Yellow Journalism.  Now there is a term worth looking up. 

Those that offer information with nothing to hide, should stand by it.  This source, alas, does not.

presentmoment's picture
presentmoment
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Posts: 57
Re: Daily Digest - July 31 - Poet's Posting

 

I appreciate reading your post.  It seems we as a species have been very destructive.  I have hard time to think of any other species which has proven to be more destructive than us.  Our actions toward each other during wars, plundering/polluting only one home we have, all the lies and justifications to uphold our views, illusions, greed, on and on and on.

 

sjmvideo's picture
sjmvideo
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Joined: Feb 2 2010
Posts: 34
Re: Daily Digest - July 31
Ken C wrote:
Davos wrote:
cmartenson wrote:
Doug wrote:

Foreclosure rates and the general real estate economy are important, but I think this passage encapsulates the real underlying problem that is chronic and unlikely to get better until the US economy is completely wrecked.

Doug

I agree - you can't expect a competitive workforce when you have both free trade and unequal rule & regulation sets across trading partners.  The US has decided to laden itself with tens of thousands of rules, many so contradictory or buried in the code, that even full-time lawyers in specific sub-specialties are unsure of the laws.  Which is fine, I suppose, but then you can't also have free trade.  You have to pick one.

By picking both, the US is certain to fail at some point.

I wrote about this some time back in Our Slow Motion Crisis.

 

+1. This is truly a stupidity crisis. 

 

So I wonder when we might reach PEAK stupidity. For when we do then things must start to get better.

 

 

Aw come on! Everyone knows that PEAK Stupidity is a Myth. Cool

At least as long at there continues to be population growth.

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