Will Rising Food & Gas Prices Curb Demand?
The answer is no, because food and gas are examples of inelastic goods; as the price rises demand is largely unchanged. That’s why no matter how much the boo hoo hoo liberals and Ron Paul knuckle draggers complain about ‘pain at the pump’ and rising food prices it has no effect on consumption. People will keep maxing out their credit cards on food and gas, even if gas retests four dollars a gallon within eighteen months (which it will). The graph below illustrates how miles driven (blue) dips only slighly as gas prices surge.
Unlike Germany or France the United States isn’t a nanny state thanks to welfare reform. People need to get to work, and have no choice but to spend $4 a gallon on gas, which explains its inelasticity. No gas = no commute = lose job = homeless. We need to learn to embrace rising gas and food prices instead of complaining.
For inquiring minds here’s some solutions solutions to your food and gas woes: Get a better paying job. Robert Kiyosaki says you can choose to be rich, which is great advice because being rich is better than being poor. Or use more credit card debt. Or consider shopping (and I know this may sound unappetizing) at PetCo for Gourmet Fancy Feast wet cat food. Cat food is high in protein and very cheap. If you want to be creative get tortillas and turn it into a cat chow taco. A case of 24 3-OZ cans of Fancy Feast costs only $15.
How To Land a Good Job
It doesn’t have to be like this
All we need to do is make sure we keep buying
Stress test? Job Loss? Flu? Recession? What…Me worry? Noooo.
I’m getting tired of all the wining about job loss and recession. If you can’t find a job improve your skill set or work for less pay. In this guide I will show you how to do the former. That’s my way of ‘giving back’ to those who have been impacted by the worst supposed recession since the 30’s or 70’s or whenever.
As we know, the manufacturing jobs are being outsourced, insourced or automated, but there is still hope for job seekers. The service sector (fast food, Wall-Mart door greeter, nail & waxing salon, legal, healthcare) and high tech (facebook, apple, google, web 2.0, twitter) are growth industries because they create value and profit for employers. This is capitalism & free markets at work.
To work in the higher paying high tech industries it is recommended that you become technologically literate. If you don’t already own a computer, buy one. If you already have a computer make sure it plugged in and has internet and so you can send email.
Then proceed to compose your resume with notepad (make sure your computer has a keyboard before attempting this)
It is advised that your resume include your name, phone number, email address (to show technological proficiency), birthday, height, birth weight, birth height, present weight, hair & eye color, waistline (in an effort to improve efficiency companies are penalizing employees who have heath risk factors such as obesity). The resume should also list your hobbies and talents so that you stand out. For example, list your favorite TV show, travel destinations, movie, sports team, or Looney Toons character. If you have any unique skills (e.g., ability to hold your breath a really long time, extra sensory perception), be sure to list them.
Finally, proceed to email it to employers or put it on monster.com.
Once you’ve completed these steps you will have a competitive edge, and you should start getting high paying job offers almost immediately (check your email!).
I hope this helps.
Someone Call the Whambulance
Non-farm payrolls and other economic indicators are Friday morning
8:30 Non-farm payrolls
10:00 Wholesale Inventories
1:00 PM Fed’s Lacker speaks on economic recovery
None of these will have a negative impact on stocks tomorrow, just as I was right yesterday about the stress tests being a dud. Unless the updated unemployment rate is god awful (10% or higher) the market will brush it off.
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A recent article titled Thursday’s Unemployment Figures: What About Continuing Claims? written by seeking alpha contributor Karl Denninger brought tears to my eyes…from laughter.
he writes..
..Ah. So the number the market “liked” was down 10,750, but the truth is that 133,000 more people lost their jobs than found one last week. That’s very bad news; those are real people who can’t pay their bills and are unable to find a new job to replace the one they lost…
Someone call the whambulance ASAP.We got an acute case of crybaby-itis.
When you try to merge economics with sociology you wind up with sentimental, welfare, humanistic drivel, as opposed to objective economic analysis.
The job loss isn’t such a big deal because the free market will smooth out the edges, and the majority of jobs being shed are inefficient, redundant manufacturing based ones. This is why the potential closure of GM has had no negative impact on the stock market. Outsourcing, automation, and insourcing of manufacturing jobs provide a more profitable alternative than expensive American labor.
The author also fails to realize that unlike Germany or France the United States isn’t a welfare state. People who can’t pay their mortgages will have to relocate to a smaller, more affordable residence. The unemployed could try to relearn new skills or become entrepreneurs by creating services that people want, instead of whining for a handout…boo hoo hoo can’t pay mortgage..boo hoo hoo lost me job…pleaaaaase give me a handout Obama
Stress Test Results Released
Stress test results in: An additional $74 billion is needed.
To be honest, I am very pleased at these results. The market will brush it off. Had been $746 billion we would be be looking at a much worse situation.
Here’s a bank by bank list of capital buffer shortfall:
American Express (AXP): $0
Bank of America (BAC): $33.9B
BB&T (BBT): $0
Bank of New York Mellon (BK): $0
Capital One (COF): $0
Citigroup (C): $5.5B
Fifth Third Bancorp (FITB): $1.1B
GMAC: $11.5B
Goldman Sachs (GS): $0
JPMorgan (JPM): $0
KeyCorp (KEY): $1.8B
MetLife (MET): $0
Morgan Stanley (MS): $1.8B
PNC Financial (PNC): $0.6B
Regions Financial (RF): $2.5B
State Street (STT): $0
SunTrust Banks (STI): $2.2B
U.S. Bancorp (USB): $0
Wells Fargo (WFC): $13.7B
Tomorrow all of these are gonna be up 5-15%. Spy rally 2%. QQQQ rally 2.5%? maybe. Not surprisingly there was no stress. Why? Because if the banks need $74 billion the fed will give it to them, and it’s only 1/10 of the Obama stimulus package.