Wow. A 79% increase from 2020 budget to 2024-2025 budget is significant by any standard even with a 43% increase in revenue. No wonder the government wants to increase taxes. Our society seems to have lost any idea of storing up (i.e., saving) for an emergency or having to deal with less prosperity. (I am thinking of Joseph in Egypt.)
Unfortunately, governments often need to create a 'rainy day' mechanism in which to store the surplus before they can "save" since the budget is structured to disburse or spend all of the budget. This is part of the problem the federal government has since your department's budget is typically reduced the next year unless you spend all of your current year's budget. (It really is a nonsensical idea and is considered taboo to even discuss changing.)
My experience is you are always going to be "stretched thin" until you decide to be content with the decisions you make with the limited time you have.
Bookshelf.
Excellent point. "Retailers expect strong record spending this holiday season while the NY Fed just released a study where the number of people reporting concern about their ability to make debt payments hit its highest level since 2020. How to weigh these various factors is far from clear."
I believe the retailers are 'more' right than the NY Fed since people are conditioned to believe that going into debt is fine or in some cases 'perfectly normal.' I also agree with that our policies are "– contributing to greater “financialization” of the economy."
The reasons mentioned above, and others is why PIP has increased our position in the Financial Sector to include recently buying MA. I am including the below text in the October PIP Monthly Meeting notes.
k. Buying on credit.
1. The Kiplinger Letter reports buy now, pay later plans are gaining popularity, especially among the young.
2. A recent Edmunds report found a disturbing trend: An increasing number of consumers with auto loans had negative equity. As of the third quarter that ended Sept. 30, Edmunds said 24.2 percent of trade-ins applied toward a new vehicle purchase had negative equity. The average upside-down loan spiked to an all-time high of more than $6,400. Of those with negative equity, 22 percent owed $10,000 or more, and 7.5 percent owed $15,000-plus.
3. The average interest rate on US credit card balances has moved up to 21.8%. With data going back to 1994, that's the highest rate we've ever seen.
I believe you are correct in identifying the political difficulty of moving back to or even advocating a gold standard as a significant challenge. Unfortunately, the gold standard is low (or even nonexistent) on most citizen's list of priorities given the churn in current society. In addition, most citizens don't have any idea what the gold standard is since the US ended international convertibility to gold over 50 years ago under President Nixon in 1971. However, it is worth discussing. And it will be discussed
when the pain threshold is exceeded, and it directly impacts most citizen's way of life or putting food on the table so to speak.
Good morning.
Thank you for the Report.
Reflection.
Wow. A 79% increase from 2020 budget to 2024-2025 budget is significant by any standard even with a 43% increase in revenue. No wonder the government wants to increase taxes. Our society seems to have lost any idea of storing up (i.e., saving) for an emergency or having to deal with less prosperity. (I am thinking of Joseph in Egypt.)
Unfortunately, governments often need to create a 'rainy day' mechanism in which to store the surplus before they can "save" since the budget is structured to disburse or spend all of the budget. This is part of the problem the federal government has since your department's budget is typically reduced the next year unless you spend all of your current year's budget. (It really is a nonsensical idea and is considered taboo to even discuss changing.)
My experience is you are always going to be "stretched thin" until you decide to be content with the decisions you make with the limited time you have.
Bookshelf.
Excellent point. "Retailers expect strong record spending this holiday season while the NY Fed just released a study where the number of people reporting concern about their ability to make debt payments hit its highest level since 2020. How to weigh these various factors is far from clear."
I believe the retailers are 'more' right than the NY Fed since people are conditioned to believe that going into debt is fine or in some cases 'perfectly normal.' I also agree with that our policies are "– contributing to greater “financialization” of the economy."
The reasons mentioned above, and others is why PIP has increased our position in the Financial Sector to include recently buying MA. I am including the below text in the October PIP Monthly Meeting notes.
k. Buying on credit.
1. The Kiplinger Letter reports buy now, pay later plans are gaining popularity, especially among the young.
2. A recent Edmunds report found a disturbing trend: An increasing number of consumers with auto loans had negative equity. As of the third quarter that ended Sept. 30, Edmunds said 24.2 percent of trade-ins applied toward a new vehicle purchase had negative equity. The average upside-down loan spiked to an all-time high of more than $6,400. Of those with negative equity, 22 percent owed $10,000 or more, and 7.5 percent owed $15,000-plus.
3. The average interest rate on US credit card balances has moved up to 21.8%. With data going back to 1994, that's the highest rate we've ever seen.
I believe you are correct in identifying the political difficulty of moving back to or even advocating a gold standard as a significant challenge. Unfortunately, the gold standard is low (or even nonexistent) on most citizen's list of priorities given the churn in current society. In addition, most citizens don't have any idea what the gold standard is since the US ended international convertibility to gold over 50 years ago under President Nixon in 1971. However, it is worth discussing. And it will be discussed
when the pain threshold is exceeded, and it directly impacts most citizen's way of life or putting food on the table so to speak.
Shalom.