THIS IS MY 108TH BLOG ON UNDERSTANDING MONEY
TOOLS
In this blog I will comment on some of the games businesses
use today, and then as usual make comment on some other issues, like the
economy. It’s an eclectic blog!
As in most industries today there is greater supply of
workforce than jobs available. Ironic that we want Globalization! The main
reason, of course, is pay the employees less. You see this conflictive reporting daily in the news;
unemployment down, tremendous job situation. 94.6 million Americans not working! You watch segments of the news and so
many college graduates unable to find any work except minimum wage and still
living at home with their parents.
Yes, student loans are over $1 trillion and without good paying jobs
these college grads will never pay down their loans let alone want to get
married and be able to afford a home.
I believe Donald Trump will be a good president and attempt
to bring through badly needed changes. Will he get the old line in Congress and
the Senate to go with him? First
off, lowering taxes should benefit all although in the short term raise our US
debt. The lowering of the highest
corporate rate to 15% should help prevent companies from leaving the US. Building new manufacturing plants here
with incentives is very important. The reality is we can prevent companies from
leaving and start producing more here, however new companies and renovation of
existing plants will provide for more automated and robotic plants. Technology will be needed but not a
large labor force as we needed 20-30 years ago.
One common trend employers and human resource departments
are using is requesting managers to low-ball employee evaluations. This serves two purposes: 1) to keep
employees on their toes and get them to work harder and better, and 2) leave
justifications to terminate an employee so the employee has little legal
recourse against the company.
Silicon Valley is screaming for more HB-1 workers (as we
have discussed these are foreigners with working visas). The tech companies are not that
compassionate, they want cheaper employees. It has been a while since I got the latest figures, but
India was graduating 6 times the number of engineers that we were here in the
USA, mostly in technology. India
has over 1 billion people, but the ratio of engineers to the population is
still very high. Our American
companies will replace American workers at the drop of a hat. They even go to the extent of sending
people over to these countries and train to their specializations. It is similar in the medical and
pharmaceutical fields. Hospitals and drug stores hiring from Pakistan and
India. These people have to have
attended schooling and then pass state boards? For most, the schools they went to are not nearly as good as
in the USA. Secondly, what they do
is go to a training school in the USA that teaches how to pass the boards.
I have been watching the news about fast food chains hiring
more workers; most of these jobs are at minimum wage. What is happening especially in the Southwest is that they
are replacing current staff and hiring people who are bi-lingual in English and
Spanish. With the influx of people
from Mexico and South America many who eat inexpensively at fast food restaurants
the employees need to be able to communicate in both languages. The push for
$15/hour wages. I see it just expediting the automation of fast food
restaurants, corporations working leaner.
No matter who won the presidential election it didn’t really
matter as I believe we have already started into a recession. Americans just don’t realize it. There has been a temporary bullish blip
because Mr. Trump was elected.
Look at corporate earnings. Only a few companies are carrying the
markets. Wall Street controls the
companies and it is all bottom line.
No long-term outlook. Wall
Street tells companies what they want and how to accomplish it; also, who to
hire and in what positions for higher management, accounting firms and law
firms. The game now is for Wall
Street to lower expectations in advance, and then announce a company has met or
beaten expectations sending the price of the stock higher. On average, corporate earnings haven’t
increased since 2006 and yet the inflationary spiral has hit the stock markets
and real estate the most.
Over the long term presidential decisions will benefit or
hurt our country. Interest rates
are creeping up. It is more likely
the Feds will raise interest rates at long last this December and this is going
to have a negative effect on bonds.
The longer-term effect of all the money we printed is coming to roost
with inflation. Raising interest
rates will affect the world. Our
exports will be diminished; currency wars. As most noted, China just lowered
their Yuan for it’s trading benefit.
When George W. Bush was elected we knew oil and gas was
going to be the industry as Mr. Bush was going to protect the family assets.
Oil prices went up significantly.
Similarly I am guessing Mr. Trump will protect the real estate
industry. Right now we are peaking
with very high real estate prices in most of the populated areas in the
country, especially those cities within a 100 miles of the oceans. In real estate, know your buyers. For foreign buyers of residential homes
currently 27% are Chinese buying homes that average just under $1 million, and
many are cash buyers.
Oil investments?
OPEC has just agreed to limit production. My opinion is why invest in a product that has more supply
than we will ever need? The price
can only go up because of cartel or futures trading manipulation, and that can
give way at any point. Too many
oil-producing countries do not get along, and too many are in dire financial
need to sell all the oil they can get to pay debt. The IMF and Central Banks loved to get these countries into
debt, then will force them to sell off assets to the wealthy to pay debt;
Greece is a fine example of losing control of assets. The other problem I see
here for unification of OPEC’s controls is that similar to the European Union
there is far too great a disparity of country wealth to hold a unification
together for very long.
So much for this blog!
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