Trickle Down Economics

[Skulnik]

Have you noticed the price of gas..or u still ridin ur bicycle. Aaaaad please let us know about what our President lied about ..certainly wasn't about sending our young boys to die and get maimed for a lie.
U just loved that drunken genocidal maniac in the WH...bet you danced on every GI's grave...
And all those innocent people we butchered . 100's of thousands ...gets u all wet i bet....... But the Piece of shit that murdered 3000 plus Americans that our president brought to justice and the piece of shit that let him live u worship. Why do you hate America so much ???.

Special Report Gas Prices


Gas prices fall below $1.87

Gasoline prices declined for the 70th consecutive day and are now 55% below the record high in mid-July.


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By Julianne Pepitone, CNNMoney.com contributing writer

Last Updated: November 26, 2008: 12:50 PM ET






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NEW YORK (CNNMoney.com) -- Gasoline prices declined for the 70th straight day, falling below the $1.87 per gallon mark, according to a national survey of credit card swipes at gasoline stations.

The national average fell 1.7 cents, sinking to the lowest level since Jan. 27, 2005, according to motorist group AAA. Over the last 70 days gas prices have plummeted 52%.

Prices at the pump have dropped $1.223 per gallon from a year ago and are now down 55% from the record-high of $4.114 per gallon reached in mid-July.

A total of 38 states recorded prices below $2 a gallon, with the cheapest gas found in Missouri, where prices averaged $1.571 a gallon.

Alaska continued to have the highest price at $2.889 per gallon.

2008: A volatile year for gas

Prices at the pump have been on a rollercoaster in 2008. Soaring prices curtailed travel this summer, and Americans waited months for a reprieve. They cut back spending in order to fill their gas tanks.

When the price reached the record-high $4.114 a gallon set on July 17, gas prices had risen already 35% year-over-year.

Gas prices finally began to sink on Aug. 21, as the dollar strengthened and oil prices saw their biggest drop in 17 years.

Late August brought Hurricane Gustav threatening infrastructure in the Gulf of Mexico. The storm shut down nearly all crude oil production and 82% of natural gas production in the Gulf region. Soon after, Hurricane Ike loomed over Texas and gas prices shot up in September, reaching more than $5 per gallon in some parts of the country during the early part of the month.

On Sept. 16, gas prices started declined as crude prices began trending lower amid weakening demand.

Meanhwile, the global economic slowdown continued to churn. The government's $700 billion Wall Street bailout plan punished the dollar, and on Sept. 21, oil prices posted their biggest one-day dollar gain.

Gas prices, meanhile, have continued to sink sharply, plunging 55% from the record-high in mid-July. Oil traders fear the global economic slowdown will continue to quash demand for fuel.

The AAA figures, compiled by Oil Price Information Services, are state-wide averages based on credit card swipes at up to 100,000 service stations across the nation. To top of page

 

[Skulnik]

Where was the Dow Jones when Obama took office?

By Investopedia




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A:
When President Obama took office on Jan. 20, 2009, the Dow Jones Industrial Average slumped to 7,949.09, the lowest inaugural performance for the Dow since its creation. The S&P 500 and the Nasdaq took similar hits, dropping 5.3 and 5.8 percent, respectively, and fourth quarter earnings reports were on track to drop more than 20 percent over the previous year's figures. Bank stocks in particular were hit quite hard, with the sector in general declining by 30 percent. Bank of America Corp. dropped 29 percent, and Citigroup Inc. sank a comparatively gentle 20 percent.

While the economic backslide may have seemed to indicate that the America public was less than confident in their newly elected leader, the dip was instead widely credited to continued lack of confidence in the failing economy left behind by the previous administration. Under former President Bush, the stock market took a 2.3 percent fall on an annualized basis, reflecting the 1 percent increase achieved during his first four years and the 5.5 percent decline suffered during his second term. If nothing else, the historic lows of the Bush administration and the shaky beginnings of the Obama years definitely indicate an economy in flux.

Good news, however, was not too long in coming. Despite its inauspicious economic beginnings, the Obama administration has overseen an impressive upswing in the stock market. As of Sept. 12, 2014 the Dow Jones has more than recovered from its January 2009 slump, resting nicely at 16,987.51 for the day, more than double what it was on inauguration day. More importantly, it has maintained a healthy average between 14,719 and 17,162 for the past 52 weeks. Though there have been intermittent downturns, the Dow's general upward trend speaks well for the Obama administration's efforts at economic recovery.


Read more: Where was the Dow Jones when Obama took office? | Investopedia http://www.investopedia.com/ask/ans...ones-when-obama-took-office.asp#ixzz3xvOZKVe6
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[Skulnik]

Fucking Obama was the President when the S&P 500 hit 666, how did that POS get re-elected?

 

[Skulnik]

What Happens When the Fed Stops Propping Up Stocks?










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By Anthony Mirhaydari








September 7, 2014





If you've followed the market and the economy over the last few years, you've probably got a rough understanding that the Federal Reserve is propping up stocks. Maybe you're not sure exactly how it works, but the idea is just sort of out there.

Such is the benefit of holding short-term interest rates near 0 percent since 2008 and of growing the monetary base from $850 billion then to more than $4 trillion now.

Related: The Threat That Could Scar the Economy for Decades

Technically, the Fed isn't directly helping the stock market. It's buying long-term government bonds and mortgage securities. But by lowering the cost of credit for corporations, it's helped dump trillions into stocks as CEOs have leveraged up their balance sheet by issuing debt cheaply and using that money to repurchase their own shares.

The thing is, with the Fed's latest bond buying program on track to end next month and with corporations saddled with loads of debt, the dynamic is already slowing down. In other words, stocks are already starting to feel what it's like to lose the Fed's support. And it's set to get worse.

The practice of using debt to repurchase shares has become so widespread and aggressive ? no wonder, since executive compensation is often tied to stock price and earnings per share metrics that benefit from reduced share counts ? that it is believed to be limiting actual physical investment in plants and equipment.

This could be one of the reasons that both labor productivity and the capital expenditures component of GDP growth have been weak recently (private nonresidential fixed investment is growing at around a 7 percent to 8 percent rate vs. peaks of near 12 percent hit during the last two economic expansion).

So far, this dynamic has continued because of the Fed's ongoing purchases, the bond market's ongoing appetite for risk and the ability of corporate balance sheets to handle growing debt loads. Free cash flow and profitability are the key factors here.

Some of this is starting to change. The high-yield corporate bond market ? or junk bonds ? has been showing signs of weakness over the past week. The Barclays High Yield Bond SPDR (NYSE: JNK) tested below its 20-day moving average on Thursday for the first time since July.

JNK Chart

JNK data by YCharts

If the weakness were to continue, it would limit the ability of companies to issue debt at low cost. Right now, there is a stampede to float debt after a summertime lull. Nearly $40 billion of high-grade debt was sold this past week, according to the The Wall Street Journal, the third-highest weekly total so far this year.

Overall, high-grade and junk-rated bond sales have already reached the $1 trillion issuance level for the year to date, the fastest pace on record (going back to the mid-1990s). This follows a strong performance last year. According to Andrew Lapthorne at Societe Generale, all this cheap debt has allowed corporations to be "the major net buyer of U.S. equity in recent years," with purchases totaling $500 billion in 2013.

Related: Commodity Prices, Bond Yields Send Warning Signals

With stock prices at all-time highs and the S&P 500 crossing the 2,000 level for the first time ever, these debt-fueled stock buybacks are growing increasingly expensive. And with the Fed's current bond purchase program expected to taper down to zero next month, given the strength of the economy and the steady pace of job creation, borrowing costs are likely to rise ? further raising the total cost of these debt-fueled buybacks.



The chart above from Societe Generale shows, the combination of all this has resulted in a slowdown in the pace of share buybacks to levels not seen since late 2012. Further declines are likely, since without the Fed's bond buying "facilitating the extra debt, buybacks will have to be scaled back, undermining a key support to the equity bull market," according to Lapthorne.

At this point, we don't know how much of this drop is because of the Fed's tapering, or increasingly stretched corporate balance sheets, or simply folks realizing that this borrow-for-buybacks dynamic can't last forever. The more debt a company accrues, the more it's leveraged to the business cycle. In other words, any shift in revenue will have a larger and larger impact on net income because of the steady drag of fixed interest expenses.

According to Morgan Stanley, a large chunk of corporate debt will mature in the 2017-2018 timeframe. Should we get a recession between now and then and/or should interest rates rise significantly, corporate profits will get hit hard as free cash flow dries up and existing debt must be reissued at higher rates.

This behavior was also seen at the end of the last bull market, although the gap between buybacks and capital expenditures is more severe now than it was then. More simply, companies are neglecting real investment more than they did back in 2007.

An optimistic take is that when the Fed steps away, the stock market will cool its heels, but not collapse, as companies refocus on hiring, building and expanding. That'll be great news for the overall economy and America's workers. A pessimistic outlook is that, with the loss of a major source of support, stocks could drop in a way that hasn't been seen in years, potentially destabilizing the recovery.

What?s your take? Let us know in the comments section below.

 

[Terryray]

The middle class has been shrinking for over 50 years. Until 2000, most of that shrinkage was due to more of them moving up into the upper middle class, and the rich. Here is the NY Times on that.

Since 2000, we see (up to 2010, latest for when comprehensive data is available, warning excel spreadsheet, scroll down to view the 2010 numbers - they are adjusted for inflation, not the "current dollars") we see mean income for the top 20% richest of families shrinking, along with the middle class shrinking, and the shrinking of income for the top 5% too.