🚀 go-pugleaf

On 2007-06-28 00:49:10 -0400, David Agnew <DavidAgnew@nospam.nul> said:

> On Wed, 27 Jun 2007 22:36:48 GMT, leroyblue@pillinor.net wrote:
> 
>> On Wed, 27 Jun 2007 01:14:08 -0500, David Agnew
>> <DavidAgnew@nospam.nul> wrote:
>> 
>>> On Tue, 26 Jun 2007 22:28:54 -0500, CJT <abujlehc@prodigy.net> wrote:
>>> 
>>>> Lugar is too little, too late.
>>> 
>>> Bush has already guaranteed the bankruptcy of America and the eventual
>>> military coup that will follow.  Americans who voted for Bush deserve
>>> the government that will execute them.
>> 
>> The economy is running at peak performance. A military coup is
>> impossible in the US. You're a lunatic.
> 
> You fucking idiot.  Bush dry humps Halliburton to massive corporate
> profits and you think that matters a fuck to the Middle Class who are
> losing real adjusted wages, as well as losing their homes?  Go to
> hell, you fucking wannabee house nigga.
> 
> 
> 
> Fed ponders mortgage default explanations
> Pacific Business News (Honolulu) - June 12, 2007
> Print this Article Email this Article Reprints RSS Feeds Most Viewed
> Most Emailed Are mortgage defaults on the rise because lenders are lax, 
> or because
> borrowers see little economic incentive to keep up the payments?
> The Federal Reserve Bank of San Francisco, which has jurisdiction over
> Hawaii and the U.S. West, examined current research on the matter, and
> found several possible factors in play.
>  Mainland discussion of subprime defaults has focused on lax lending --
> the implication being that some people were never qualified to be
> given mortgages and shouldn't have gotten them.
> But FRBSF Senior Economist Mark Doms, in a report distributed Monday,
> said subprime defaults are measurably lower in areas where home prices
> are holding strong, and suggests that in these markets borrowers have
> a stronger economic incentive to keep up the payments.
> "Delinquencies have occurred during a time of seismic shifts in the
> patterns of house-price appreciation, shifts that were unprecedented
> in terms of their size and suddenness and that varied widely across
> metropolitan areas," Doms wrote. "Markets that recently experienced
> greater house-price appreciation tended to have lower delinquency
> rates and smaller increases in delinquency rates."
> Areas where house prices decelerated the most in 2006 experienced the
> largest increases in subprime delinquency rates.
> "One of several possible explanations for this relationship," Doms
> wrote, "is that, in the face of sharp declines in the pace of
> house-price appreciation, some borrowers may have lowered their
> expectations about future appreciation rates, and, hence, the
> attractiveness of the investment component of homeownership also
> declined."
> The subprime residential mortgage market -- lending to people with low
> credit scores, little credit history or other impairments -- barely
> existed in 1995 but accounted for as much as a fifth of all first lien
> mortgages made in 2006.
> The matter is of concern in Hawaii, though subprime borrowing has been
> less common in the islands than on the Mainland, because some
> economists have been predicting that a spike in mortgage defaults may
> be still to come.
> Fed ponders mortgage default explanations
> Pacific Business News (Honolulu) - June 12, 2007
> Print this Article Email this Article Reprints RSS Feeds Most Viewed
> Most Emailed Are mortgage defaults on the rise because lenders are lax, 
> or because
> borrowers see little economic incentive to keep up the payments?
> The Federal Reserve Bank of San Francisco, which has jurisdiction over
> Hawaii and the U.S. West, examined current research on the matter, and
> found several possible factors in play.
>  Mainland discussion of subprime defaults has focused on lax lending --
> the implication being that some people were never qualified to be
> given mortgages and shouldn't have gotten them.
> But FRBSF Senior Economist Mark Doms, in a report distributed Monday,
> said subprime defaults are measurably lower in areas where home prices
> are holding strong, and suggests that in these markets borrowers have
> a stronger economic incentive to keep up the payments.
> "Delinquencies have occurred during a time of seismic shifts in the
> patterns of house-price appreciation, shifts that were unprecedented
> in terms of their size and suddenness and that varied widely across
> metropolitan areas," Doms wrote. "Markets that recently experienced
> greater house-price appreciation tended to have lower delinquency
> rates and smaller increases in delinquency rates."
> Areas where house prices decelerated the most in 2006 experienced the
> largest increases in subprime delinquency rates.
> "One of several possible explanations for this relationship," Doms
> wrote, "is that, in the face of sharp declines in the pace of
> house-price appreciation, some borrowers may have lowered their
> expectations about future appreciation rates, and, hence, the
> attractiveness of the investment component of homeownership also
> declined."
> The subprime residential mortgage market -- lending to people with low
> credit scores, little credit history or other impairments -- barely
> existed in 1995 but accounted for as much as a fifth of all first lien
> mortgages made in 2006.
> The matter is of concern in Hawaii, though subprime borrowing has been
> less common in the islands than on the Mainland, because some
> economists have been predicting that a spike in mortgage defaults may
> be still to come.
> http://www.bizjournals.com/pacific/stories/2007/06/11/daily14.html

In the Real World of Work and Wages, Trickle-Down Theories Don’t Hold Up
By ROBERT H. FRANK
When asked why he robbed banks, Willie Sutton famously replied, 
“Because that’s where the money is.” The same logic explains the call 
by John Edwards, the Democratic presidential candidate, for higher 
taxes on top earners to underwrite his proposal for universal health 
coverage.
Providing universal coverage will be expensive. With the median wage, 
adjusted for inflation, lower now than in 1980, most middle-class 
families cannot afford additional taxes. In contrast, the top tenth of 
1 percent of earners today make about four times as much as in 1980, 
while those higher up have enjoyed even larger gains. Chief executives 
of large American companies, for example, earn more than 10 times what 
they did in 1980. In short, top earners are where the money is. 
Universal health coverage cannot happen unless they pay higher taxes.
Trickle-down theorists are quick to object that higher taxes would 
cause top earners to work less and take fewer risks, thereby stifling 
economic growth. In their familiar rhetorical flourish, they insist 
that a more progressive tax system would kill the geese that lay the 
golden eggs. On close examination, however, this claim is supported 
neither by economic theory nor by empirical evidence.
The surface plausibility of trickle-down theory owes much to the fact 
that it appears to follow from the time-honored belief that people 
respond to incentives. Because higher taxes on top earners reduce the 
reward for effort, it seems reasonable that they would induce people to 
work less, as trickle-down theorists claim. As every economics textbook 
makes clear, however, a decline in after-tax wages also exerts a 
second, opposing effect. By making people feel poorer, it provides them 
with an incentive to recoup their income loss by working harder than 
before. Economic theory says nothing about which of these offsetting 
effects may dominate.
If economic theory is unkind to trickle-down proponents, the lessons of 
experience are downright brutal. If lower real wages induce people to 
work shorter hours, then the opposite should be true when real wages 
increase. According to trickle-down theory, then, the cumulative effect 
of the last century’s sharp rise in real wages should have been a 
significant increase in hours worked. In fact, however, the workweek is 
much shorter now than in 1900.
Trickle-down theory also predicts shorter workweeks in countries with 
lower real after-tax pay rates. Yet here, too, the numbers tell a 
different story. For example, even though chief executives in Japan 
earn less than one-fifth what their American counterparts do and face 
substantially higher marginal tax rates, Japanese executives do not log 
shorter hours.
Trickle-down theory also predicts a positive correlation between 
inequality and economic growth, the idea being that income disparities 
strengthen motivation to get ahead. Yet when researchers track the data 
within individual countries over time, they find a negative 
correlation. In the decades immediately after World War II, for 
example, income inequality was low by historical standards, yet growth 
rates in most industrial countries were extremely high. In contrast, 
growth rates have been only about half as large in the years since 
1973, a period in which inequality has been steadily rising.
The same pattern has been observed in cross-national data. For example, 
using data from the World Bank and the Organization for Economic 
Co-operation and Development for a sample of 65 industrial nations, the 
economists Alberto Alesina and Dani Rodrick found lower growth rates in 
countries where higher shares of national income went to the top 5 
percent and the top 20 percent of earners. In contrast, larger shares 
for poor and middle-income groups were associated with higher growth 
rates. Again and again, the observed pattern is the opposite of the one 
predicted by trickle-down theory.
The trickle-down theorist’s view of the world is nicely captured by a 
Donald Reilly cartoon depicting two well-fed executives nursing 
cocktails on a summer afternoon as they lounge on flotation devices in 
a pool. Pointing to himself, one says angrily to the other, “If those 
soak-the-rich birds get their way, I can tell you here’s one coolie 
who’ll stop” working so hard.
This portrait bears little resemblance to reality. In the 1950s, 
American executives earned far lower salaries and faced substantially 
higher marginal tax rates than they do today. Yet most of them competed 
energetically for higher rungs on the corporate ladder. The claim that 
slightly higher tax rates would cause today’s executives to abandon 
that quest is simply not credible.
In the United States, trickle-down theory’s insistence that a more 
progressive tax structure would compromise economic growth has long 
blocked attempts to provide valued public services. Thus, although 
every other industrial country provides universal health coverage, 
trickle-down theorists insist that the wealthiest country on earth 
cannot afford to do so. Elizabeth Edwards faces her battle with cancer 
with the full support of the world’s most advanced medical system, yet 
millions of other Americans face similar battles without even minimal 
access to that system.
Low- and middle-income families are not the only ones who have been 
harmed by our inability to provide valued public services. For example, 
rich and poor alike would benefit from an expansion of the Energy 
Department’s program to secure stockpiles of nuclear materials that 
remain poorly guarded in the former Soviet Union. Instead, the Bush 
administration has cut this program, even as terrorists actively seek 
to acquire nuclear weaponry.
The rich are where the money is. Many top earners would willingly pay 
higher taxes for public services that promise high value. Yet 
trickle-down theory, which is supported neither by theory nor evidence, 
continues to stand in the way. This theory is ripe for abandonment.
Robert H. Frank, an economist at the Johnson School of Management at 
Cornell University, is the author of “The Economic Naturalist,” which 
will be published next month. Contact: www.robert-h-frank.com.
-- 
"Naturally the common people don't want war: Neither in Russia, nor in 
England, nor for that matter in Germany. That is understood. But, after 
all, IT IS THE LEADERS of the country who determine the policy and it 
is always a simple matter to drag the people along, whether it is a 
democracy, or a fascist dictatorship, or a parliament, or a communist 
dictatorship. Voice or no voice, the people can always be brought to 
the bidding of the leaders. That is easy. All you have to do is TELL 
THEM THEY ARE BEING ATTACKED, and denounce the peacemakers for lack of 
patriotism and exposing the country to danger. IT WORKS THE SAME IN ANY 
COUNTRY."
 
--Goering at the Nuremberg Trials