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Thread: Spanish Unemployment At ~25%, How Can This Be Sustained?

  1. #1

    Default Spanish Unemployment At ~25%, How Can This Be Sustained?

    It seems Spain now has 1 in 4 workers unemployed. I don't understand how this can be sustained for much longer, I don't think it will be.

    Anyone on the ground in Spain? Eduardo?

    http://www.bbc.co.uk/news/business-17866382

    Spanish unemployment has hit a new record high, official figures have shown.

    The number of unemployed people reached 5,639,500 at the end of March, with the unemployment rate hitting 24.4%, the national statistics agency said.

    The figures came hours after rating agency Standard & Poor's downgraded Spanish sovereign debt.

    Official figures due out on Monday are expected to confirm that Spain has fallen back into recession.

    Earlier this week, the Bank of Spain said the economy contracted by 0.4% in first three months of this year, after shrinking by 0.3% in the final quarter of last year.

    Other figures released on Friday showed that Spanish retail sales were down 3.7% in March from the same point a year ago, the 21st month in row sales have fallen.
    'Huge crisis'

    In the first three months of the year, 365,900 people in Spain lost their jobs.

    The country has the highest unemployment rate in the European Union and it is expected to rise further this year.

    “The recession is so deep that when you take one step forward on austerity, it takes you two steps back”

    Stephen King Chief economist, HSBC

    What ails the Spanish economy?

    The rate has risen sharply since April 2007, when it stood at 7.9%.

    "The figures are terrible for everyone and terrible for the government... Spain is in a crisis of huge proportions," Foreign Minister Jose Manuel Garcia-Margallo said.

    The new government has announced reforms to the labour market, including cutting back on severance pay and restricting inflation-linked salary increases, that it hopes will ease the problem.

    These measures have angered unions, which have organised widespread general strikes in protest.

    The government has also introduced drastic spending cuts designed to reduce its debt levels and meet deficit targets agreed with the European Union. These cuts are contributing to Spain's economic contraction.

    "In Spain today, a cycle similar to Greece is starting to develop," said HSBC chief economist Stephen King.

    "The recession is so deep that when you take one step forward on austerity, it takes you two steps back."

    The interest rate, or yield, on Spanish government bonds traded in the secondary market rose following the release of the unemployment figures and the S&P downgrade.

    The yield on 10-year bonds rose to 5.96%, up from 5.81%, suggesting investors were becoming more wary of Spain's ability to repay its debts.

    Also on Friday, the interest rate Italy has to pay to borrow money from international investors rose. In a sale of 10-year bonds, the government offered a rate of 5.84% compared with 5.24% at a similar sale a month earlier.

    However, the government raised 5.95bn euros ($7.88bn; 4.85bn), towards the top end of its target range.
    'Comprehensive' reforms

    Late on Thursday night, the ratings agency Standard & Poor's cut Spain's rating by two notches to BBB+, warning that the country might have to take on more debt to support its banking sector.

    S&P predicts the Spanish economy will shrink by 1.5% this year, having previously forecast 0.3% growth.

    However, the agency did make a number of positive comments about the government's attempts to bolster Spain's economy.

    "We believe that the new government has been front-loading and implementing a comprehensive set of structural reforms, which should support economic growth over the longer term," S&P said.

    "In particular, authorities have implemented a comprehensive reform of the Spanish labour market, which we believe could significantly reduce many of the existing structural rigidities and improve the flexibility in wage setting."
    See bold text for their real problem, seems we have a horror writer in charge of the economy. heh heh.
    Last edited by WilliamC; 04-27-2012 at 05:58 AM.
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    Black market

    Everywhere in Southern Europe the official unemployment is 15% + for decades now but a large portion of the population that works in the tourism,agriculture and street selling is not registered as employed so not to pay taxes.
    Last edited by Demigod; 04-27-2012 at 06:10 AM.

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    Youth unemployment is 47%

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    Quote Originally Posted by Demigod View Post
    Black market

    Everywhere in Southern Europe the official unemployment is 15% + for decades now but a large portion of the population that works in the tourism,agriculture and street selling is not registered as employed so not to pay taxes.
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    Oh, wonders of centralized moneysupply + institutionalized freeloading & socialism

    And I'm sure they're blaming the "free market" & "capitalism" for all of this mess while asking for more government intervention & more socialism/communism

    This isn't just happening by chance, people with their ignorance & opposition to freedom have brought this upon themselves; when people support government violating others' liberties for the sake of perceived personal gain, soon enough they'll see their own liberties getting violated, that's how it works!

    Like the great French mind Frederic Bastiat has said - "State is the great fiction through which everyone endeavours to live at the expense of everyone else"
    "When plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it."
    "But how is this legal plunder to be identified? Quite simply. See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime."
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    Seems the G 20 nations are pumping money into the IMF which in turn lends it to the E.U.

    The International Monetary Fund is seeking to more than double its war chest by raising $600 billion in new resources to help nations deal with the fallout of the euro zone debt crisis.

    But most G20 countries have said that before they inject any new money into the IMF, the euro zone must first put up more of its own money to resolve its sovereign debt crisis.

    In response, finance ministers from the 17 countries sharing the euro, called the Eurogroup, on Friday raised the combined lending capacity of their two bailout funds to 700 billion euros from 500 billion.



    http://arabnews.com/economy/article602676.ece


    Last time I checked Spain is part of the E.U.
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    Good god people, socialism is a complete failure as predicted. It is never sustainable. Across the Atlantic they borrowed and taxed their way to economic growth. They tax their GDPs at around 70% on average today. Who is really left to taxed? They have borrowed to the point in which no one wants to give them any more money. The European countries have done nothing but propped up their control system to give an illusion that socialism worked. Now the bills are coming due...heck 44% of Britons want to leave the U.K. because of high taxes, high standard of living and no jobs. Many rich are also leaving France.

    Spain went into the green jobs market that destroyed 2.1 real jobs for every 1 green job the government created at a cost to the taxpayers of like $1.2 million per green job. See, Socialists and Marxists are very good at math.
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    And the real rate in the U.S. is?

  10. #9

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    Quote Originally Posted by InTradePro View Post
    And the real rate in the U.S. is?
    Close to 20% but not over.

    With black and grey market employment included around 12 to 15% would be my guess.
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  11. #10

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    in Andalusia,Canarian Island and in another regions of spain there are 33% of unemployement.
    in my region "only" 16-20%

    At the moment there are not many protests because thera are a lot of underground economy, black employement and government subsidies paid with taxes very highs

  12. #11

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    ..
    Last edited by pcgame; 05-21-2012 at 01:43 PM.

  13. #12

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    Quote Originally Posted by InTradePro View Post
    And the real rate in the U.S. is?
    Depends on which equation you use. It's somewhere between 12-18% nation wide.

    Singapore's economy which is far more free market than the U.S. - we have a highly controlled government market through tens of thousands of regulations and over 70,000 page of tax laws - only has (Singapore) an unemployment rate of 3-4%. Their debt to GDP is very small as well.

    The problem with our economy is we don't have free markets. We haven't had such since 1913 when the federal reserve and the IRS system came to be. Every generation since then the U.S. has moved closer to socialism and marxism. That's the problem.
    Last edited by Liberty74; 04-28-2012 at 09:25 AM.
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    Quote Originally Posted by WilliamC View Post
    Close to 20% but not over.

    With black and grey market employment included around 12 to 15% would be my guess.
    Only 20%? How come?
    Total US population: 312,477,519
    18-65 yr old Civilians in the USA: 196,860,836 (63% of people)
    18-65 yr olds who are Employed: 132,317,000 (BLS figure for September 2011)
    People in Prison: 2,200,000
    People in Colleges: 14,261,800 (many are IN the workforce or looking as well)
    Updated overall civilian base population: 180,399,036
    Unemployed people not in Prison or College available for work: 48,082,036

    So those figures give you...............................

    (maximum) Percentage of people working = 72.9%
    (MINIMUM!!!!!) Unemployment rate = 26.7%!!!
    (Maximum) Unemployment rate = 33%!!!!!!!!!!

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    The question is not how can it be sustained but how can the cycle be broken and get firms to start hiring again. They likely aren't going to start hiring until they are selling more goods and services and people won't be buying more goods and services until they have more money to spend (ie more jobs or raises at the ones they have). It is a vicious cycle and hard to break. If there is no demand for goods giving tax breaks to producers won't force them to expand. It may help them hire more once things do begin to pick up but while demand is weak they won't be seeking to grow.
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    The question is not how can it be sustained but how can the cycle be broken and get firms to start hiring again. They likely aren't going to start hiring until they are selling more goods and services and people won't be buying more goods and services until they have more money to spend (ie more jobs or raises at the ones they have). It is a vicious cycle and hard to break.
    I don't think it's as difficult to break as the left would imply. A common story we hear from the left is that if the government didn't step in and intervene in the markets, the economy might -never- recover and simply stagnate forever. History of course, which includes hundreds of years before significant recession intervention took place, seems to contradict this notion.

    But how can the cycle be broken you ask? The same way it has been broken in the past when there is minor or no government intervention. As companies greatly trim their fat, lay off needless workers, give more responsibilities to existing workers, cut unnecessary costs, and take austerity measures to stay afloat, productivity grows by leaps and bounds as a result of those actions. More work can be done by less people and it can be done more efficiently than before. On a national scale, this improves the buying power of all Americans since income growth is directly tied to productivity growth. There will be a period of unpleasantness during this, particularly by the workers most affected - no question about it. It may even be an extended period of unpleasantness if the bubble has been blown up too big for too long. But overall, this transitioning period for the economy where excesses and inefficiencies are wrung from the system (part of which is the process that is known as 'creative destruction' which leads to innovation) is an incredibly positive force for the economy as a whole in the long run.
    Last edited by Knighted; 04-28-2012 at 03:24 PM.

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    On a national scale, this improves the buying power of all Americans since income growth is directly tied to productivity growth.
    How did national buying power increase? Those working were not given raise and those who lost jobs or hours are making less. Who is making more? It is also possible to have productivity growth without wage growth- that can happen if the benefits of this higher productivity are taken by the employers or share holders in the form of higher profits instead of being passed along to workers or to consumers in the form of lower prices.

    It is precisely this "transitional period" we(or Spain in our example but it applies to us as well) are trying to deal with- how do we get out of it? What will get companies to hire more people?
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    Quote Originally Posted by Zippyjuan View Post
    How did national buying power increase?
    Prices are falling which mean people can buy stuff $ dollars than they earlier could; that's what matters, if you have a million dollars & you can't buy sh!t with it then what's the point so it's the PURCHASING-POWER that matters not the actual "number" of dollars that you have

    Quote Originally Posted by Zippyjuan View Post
    Those working were not given raise and those who lost jobs or hours are making less.
    Again, moneysupply was overinflated so now it's trying to claw backwards towards equilibrium so prices, wages, profits, etc will adjusted downwards so people need to be able to take up jobs at a lower levels & minimum wage laws prevent it & so does welfare - why would a person work a low-pay job if you're getting freebies worth pretty much the same amount or a little below!

    Quote Originally Posted by Zippyjuan View Post
    Who is making more? It is also possible to have productivity growth without wage growth- that can happen if the benefits of this higher productivity are taken by the employers or share holders in the form of higher profits instead of being passed along to workers or to consumers in the form of lower prices.
    Whoever market has determined to have provided better service in relation to its supply & demand makes more - at ANY given point in an economy
    So if wages don't grow then it's because that's where they are supposed to remain as per their supply & demand
    Moreover, productivity-growth in a environment where prices are falling means people are able to buy MORE for the same price than they did earlier

    Quote Originally Posted by Zippyjuan View Post
    It is precisely this "transitional period" we(or Spain in our example but it applies to us as well) are trying to deal with- how do we get out of it? What will get companies to hire more people?
    Getting rid of welfare would help as it would put people to work & actually ADD to total productivity of the economy or it needs to be "optimized" but I suppose that's highly unlikely so at least minimum wage laws need to be looked at, "regulations" on businesses need to be cut so that any new businesses can get started ASAP & existing businesses can continue to function by reducing "regulatory costs" & by possibly expanding their activities

    Again, I'd urge you to go through this book - at least the chapters "How the Price System Works", "The Fuction of Profits" & "Minimum Wage Laws" - http://www.hacer.org/pdf/Hazlitt00.pdf
    Last edited by Paul Or Nothing II; 04-29-2012 at 11:36 AM.
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    So your solution to getting employers to hire more people is to get rid of unemployment insurance? I agree that this would make more people want to go out and look for a job but how is that increasing the number of jobs available (the current problem)? There are not enough jobs to go around as it is.

    Could getting rid of the Federal minimum wage help? According to statistics from the US Bureau of Labor Statistics, as of 2011 about three percent of the entire work force was paid the US minimum wage or less. Getting rid of or changing this would likely have only a very tiny (if any) impact on the overall unemployment in this country. http://www.bls.gov/cps/minwage2011.htm

    Companies are mostly not hurting for cash to hire people with- they are sitting on about $1 trillion right now.
    http://www.reuters.com/article/2012/...80T07420120130
    U.S. corporations are sitting on record levels of cash - nearly $1 trillion for companies in the Standard & Poor's 500 index
    You talk of supply and demand- the problem is the lack of demand for labor which is what needs to be addressed to reduce unemployment. Getting rid of welfare or unemployment insurance increases the supply of labor- which already has an excess- and does nothing to address the demand issue.

    Again supply and demand- companies are not seeing enough demand for their goods and services to warrant them increasing their demand for labor- even if, as was suggested, you lower the cost of that labor via getting rid of minimum wage laws.


    Prices are falling which mean people can buy stuff $ dollars than they earlier could; that's what matters, if you have a million dollars & you can't buy sh!t with it then what's the point so it's the PURCHASING-POWER that matters not the actual "number" of dollars that you have
    Perhaps you can show me where you see prices falling and by how much? Inflation is low but we are not seeing deflation so to claim that we are better off as a total economic unit because falling prices have more than offset the incomes lost from job losses is ludicris. The overall economy has a lot less money to spend and significangly lower purchasing power than we had five years ago with lost wages and incomes while prices have not been going down to offset that. Purchasing power as a country is way down. Some are better off (those who kept jobs and got raises) but many are worse off in terms of purchasing power.
    Last edited by Zippyjuan; 04-29-2012 at 12:08 PM.
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    Quote Originally Posted by pcgame View Post
    i thought eduardo was banned
    he is, i guess that spanish charm wasn't enough to keep him from getting banned

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    The solution for increasing demand is simple. Lower prices.

  22. #21

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    Quote Originally Posted by Zippyjuan View Post
    Perhaps you can show me where you see prices falling and by how much? Inflation is low but we are not seeing deflation so to claim that we are better off as a total economic unit because falling prices have more than offset the incomes lost from job losses is ludicris. The overall economy has a lot less money to spend and significangly lower purchasing power than we had five years ago with lost wages and incomes while prices have not been going down to offset that. Purchasing power as a country is way down. Some are better off (those who kept jobs and got raises) but many are worse off in terms of purchasing power.
    Perhaps you should read the thing in the context it was said - my reply was a reply to your reply to "Knighted" about the fact that if governments didn't do anything to "fix" the economy then prices would start falling & purchasing-power would increase.
    BUT is that what the government has been doing? NO, they're busy trying to "stimulate" the economy with stimulus-packages & low interest-rates & trying to prop up the prices & create inflation so why would prices fall?
    It was a general statement by "knighted" about "what would happen if government just let the economy be on its own!" & my reply was in that context.

    Quote Originally Posted by Zippyjuan View Post
    Could getting rid of the Federal minimum wage help? According to statistics from the US Bureau of Labor Statistics, as of 2011 about three percent of the entire work force was paid the US minimum wage or less. Getting rid of or changing this would likely have only a very tiny (if any) impact on the overall unemployment in this country. http://www.bls.gov/cps/minwage2011.htm
    If minimum wage laws are so benign then why have them in the first place? Again, if people are offered X amount of free stuff then why would they work a job only to receive a payment in a similar range? Those are unproductive consumers, if they actually had to produce to consume instead of getting free stolen stuff then there would be net increase in REAL WEALTH - goods & services - & lower prices

    Quote Originally Posted by Zippyjuan View Post
    Companies are mostly not hurting for cash to hire people with- they are sitting on about $1 trillion right now.
    http://www.reuters.com/article/2012/...80T07420120130

    You talk of supply and demand- the problem is the lack of demand for labor which is what needs to be addressed to reduce unemployment. Getting rid of welfare or unemployment insurance increases the supply of labor- which already has an excess- and does nothing to address the demand issue.

    Again supply and demand- companies are not seeing enough demand for their goods and services to warrant them increasing their demand for labor- even if, as was suggested, you lower the cost of that labor via getting rid of minimum wage laws.
    It's irrelevant how much cash companies have. Just because you have cash doesn't mean you should start buying at whatever price something is being offered, of course, some may do it but it's not prudent. And companies are NOT in the business of dolling out free money, they are considering the rate-of-return on their capital; companies are "buyers" of labor & laborers are "sellers" of their services so if companies are not hiring it means prices (wages/salaries/etc) are too high for them to want to "buy".

    If you have a big stock of goods with you & nobody wants to buy it, what does that mean? If you wish to sell them immediately then you must lower the prices to competitive levels.
    But again, minimum wage laws & welfare doesn't help the process at all, instead by stealing & transferring capital from the productive people to the unproductive, the economy is squeezed even more; & as I've said before, there's always "regulation" & "regulatory costs" to deal with

    Quote Originally Posted by The Gold Standard View Post
    The solution for increasing demand is simple. Lower prices.
    +1

    EXACTLY! It's that simple if one actually understands how the markets work.
    But instead a lot of people will ponder over statistics, graphs & all kinds of useless mathematical models & overcomplicate things unnecessarily.
    On the other hand, if one understands how the markets work then it's not that hard to realize the "solutions".
    But unfortunately, most people simply don't understand the markets - because they are incapable or misguided or just intellectually lazy.
    Last edited by Paul Or Nothing II; 04-30-2012 at 02:26 AM.
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    It's irrelevant how much cash companies have. Just because you have cash doesn't mean you should start buying at whatever price something is being offered, of course, some may do it but it's not prudent. And companies are NOT in the business of dolling out free money, they are considering the rate-of-return on their capital; companies are "buyers" of labor & laborers are "sellers" of their services so if companies are not hiring it means prices (wages/salaries/etc) are too high for them to want to "buy".
    The point about companies having tons of cash was to show that it is not that labor is too expensive for them to afford. It is that they don't need more labor since there is not enough demand for their products to justify hiring more people. Lowering the minimum wage will not impact it. They have plenty of money to pay workers if the demand requires them to take on more employees. They aren't going to hire more until that demand for their products is high enough. Again- the problem is a demand for labor- not its price or supply.
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    So your solution to getting employers to hire more people is to get rid of unemployment insurance? I agree that this would make more people want to go out and look for a job but how is that increasing the number of jobs available (the current problem)?
    I can tell you how. Abolishing unemployment insurance would immediately force most of the population to work - no more being picky and only taking jobs that paid as much as their old ones. When there is a glut of workers actually seeking work, the country is in a situation where there is a large surplus of labor and a shortage of demand. In basic economics, what happens when there is a surplus of a commodity and a shortage of demand? Prices fall. In this case, the price of labor falls in the form of wages. In the short term, these lower wages allow labor intensive businesses (manufacturing) to become profitable once more, causing them to jumpstart previously stalled operations in the country or allowing new labor intensive businesses to start up. This is exactly how China managed to create millions of jobs practically overnight from its previous subsistence farming populace once it began opening its economy to the world. Lower wages attract labor intensive industries. In the short term, this means more jobs.

    How did national buying power increase? Those working were not given raise and those who lost jobs or hours are making less. Who is making more? It is also possible to have productivity growth without wage growth- that can happen if the benefits of this higher productivity are taken by the employers or share holders in the form of higher profits instead of being passed along to workers or to consumers in the form of lower prices.
    I expected more from you Zippy. I've always regarded you as a fairly educated fellow, but you fell into a trap set to snare amateurs with your statement above. You're completely ignoring the role of competition in the markets. Employers/share holders cannot simply pocket higher profits while price gouging consumers. Competition does not allow it. In today's global markets, companies seeking larger profits aim to do so by increasing revenues by capturing larger market shares, NOT by jacking up profit margins. However, from the above statement, you seem to think that a company can simply raise prices indefinitely on consumers. I recommend starting your own business and trying that. You'll be filing for Chapter 11 practically overnight.
    Last edited by Knighted; 05-02-2012 at 10:37 PM.

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    You are making the assumption that all markets are completely free and highly competitive- most actually are not. The less competitive the market for a product, the easier it is for the owners of capital to keep the benefits from gains in productivity instead of passing them along. In the US, incomes have been lagging increases in productivity for decades now.

    http://stateofworkingamerica.org/cha...wth-1947-2009/
    Last edited by Zippyjuan; 05-03-2012 at 12:04 PM.
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    You are making the assumption that all markets are completely free and highly competitive- most actually are not. The less competitive the market for a product, the easier it is for the owners of capital to keep the benefits from gains in productivity instead of passing them along. In the US, incomes have been lagging increases in productivity for decades now.
    Actually, I'm not. Unlike some, I have no such illusions about the free market. We don't have a free market. And some companies in specific industries are most certainly far better insulated from competition than others. However, even if we can cherry pick a few companies better insulated from competition, the net effect across all industries is still a fiercely competitive market, and increasing globalization in recent years has only made this more true. Anyone on the inside of a fortune 100 company (the biggest profit rakers in the nation) can tell you that there is no money cow that the companies are milking more and more from every year. It's a hard fought battle to stay dominant in the market.

    I've seen the productivity chart relative to family income before, and it is perplexing. There are some factors that might explain it though, at least partially. For one, your chart is measuring median family income. Single parent families are far more common today than they were 30 years ago, which would have the effect of lowering this metric even though true incomes have may have increased. For two, these are inflation adjusted metrics that have changed many times in the last few decades, and on top of that, different adjustments are used for productivity and income growth. Does this explain the entire lag? I don't know - but it does explain some of it.

    But I don't buy your explanation about the cause being that the owners of capital are keeping more and more of the productivity gains. For starters, if that's true, what triggered this turning point in the mid 1970's? Do you think business owners were completely altruistic before this and overnight decided to be more greedy? No, they were subjected to the same market forces all along of supply/demand of labor - the same forces that determined wages in 1950 and the same forces that determined it in 2010. Besides, if the owners of capital are pocketing more of the gains, then why have corporate profits as a share of GDP remained virtually steady over the last 80 years?

    Last edited by Knighted; 05-03-2012 at 07:07 PM.

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    Quote Originally Posted by Zippyjuan View Post
    The point about companies having tons of cash was to show that it is not that labor is too expensive for them to afford. It is that they don't need more labor since there is not enough demand for their products to justify hiring more people. Lowering the minimum wage will not impact it. They have plenty of money to pay workers if the demand requires them to take on more employees. They aren't going to hire more until that demand for their products is high enough. Again- the problem is a demand for labor- not its price or supply.
    Ok, so why isn't there additional demand for those companies' products? Because people aren't willing to consume more at EXISTING PRICES but if prices were lower then demand would go up automatically but in order to drop the prices, they need to be able to buy labor at lower prices, which they can't right now due to the fact that minimum-wage & welfare sets the price-floor for labor
    And that's why companies deem it wiser to just sit on the money than to hire more employees because they wouldn't be in a position to sell MORE at EXISTING price-levels
    Labor, physical & mental, is the basis of all prices
    Further, I'd say that unemployment is almost always voluntary because labor, like any other economic factor, is a limited resource so there's always demand for it - the question always is the price (wage/salary/etc) - so labor will only remain unsold if it is asking for a price which is too high for businesses to be able to sell their products for a profit

    Quote Originally Posted by Zippyjuan View Post
    You are making the assumption that all markets are completely free and highly competitive- most actually are not. The less competitive the market for a product, the easier it is for the owners of capital to keep the benefits from gains in productivity instead of passing them along. In the US, incomes have been lagging increases in productivity for decades now.
    It's IRRELEVANT, whether markets are free or not, prices & profits are ALWAYS dictated by supply & demand
    Even if you literally kill off all of your competitors, it does NOT mean you can charge whatever price you want for your product; yes, prices would go up but only because supply will have gone down because you alone mayn't be able to produce as much as all producers together could have but then people definitely wouldn't consume as much as they otherwise would have at lower prices & instead they might go for substitutes or consume slowly/sparingly.
    so again, your profits will be dictated by supply & demand, for marginal sales you make you must lower the price further or it won't get sold; selling fewer stuff means fewer GROSS profits, simple as that & that's why even a monopoly must try to hit its prices at an "equilibrium level", not only selling too low results in less profits or even losses but even selling too high results in fewer sales & fewer profits or even losses (your product may be perishable, it may go out of fashion or even simply having them in stock & not "monetizing" it, loses you valuable time in which you could have put that money elsewhere to make profits)

    And "owners of capital" are NEVER (barring extreme exceptions) interested in "passing on the gains", they are always looking to maximize gains on their capital, just as laborers are never interested in "passing on the gains" to the businesses; all are trying to maximize their gains as much as they can at all times, the only thing that restrains businesses' appetite for profits & laborers' appetite for wages is the supply-demand situation dictated through the Price System
    There is enormous inertia a tyranny of the status quo in private and especially governmental arrangements. Only a crisis actual or perceived produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable
    - Milton Friedman

  28. #27
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    Quote Originally Posted by Demigod View Post
    Black market

    Everywhere in Southern Europe the official unemployment is 15% + for decades now but a large portion of the population that works in the tourism,agriculture and street selling is not registered as employed so not to pay taxes.
    Perhaps not quite so high as that. These only goes through the first 5 months of 2010:

    "Government is not the solution to our problem; government is the problem."
    Ronald Reagan, 1981

  29. #28

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    First, we have to understand the perspective of the Spanish people. Until the last part of the 20 century Spain social and economic rates were of the lowest of Europe. Having one of the longest dictatorship in the century, Spain began a better cycle when democracy appeared.
    With “the open markets fiction”, with a big bubble in housing and tourism, and a lot of companies making big and juicy money abroad, specially in Latin America. Spain made its best at the end of the 90s and the earliest 2000s, and made great numbers from the European welfare state traditional perspective, people felt like “oh well, we are a big country like Italy or France, and we have great relationships with US and the UK – The Azores summit -", so answering your original question, is there a chance that this situation would change the way Spain politics and economy works? No, People there like also happen in other countries like in Greece still prefer to wait and be leaded by the IMF, the WB and the European financial elites. These countries are still guided by the illusion of prosperity of the late 90s. Of course there are movements and questions that people is begging to make, as instance, part of the young people of spain is making some noise they called themselves “Los indignados” is like a return of the French may (68) but there are not real ideas of what to do or where to go. The level of political discussion in Europe is quiet poor. The answer that eurepean countries are finding , leaded by the establishment are those that are being taken in countries like Greece or Italy: follow IMF recipes, and changing the governments not because of peoples vote but for the financial elite choice.
    If there is something that may change or at least Spanish people are making questions about is the Monarchy system. There is gonna be a lot of discussion about this subject however at the end of the day they will keep their system and the King will keep his job and also the next one, and this will happen because for a lot of people the King is the symbol that can keep Spain together. Spain is a country with a lot of nations inside that from time to time get the will to get independent.
    So do not expect changes from Spain they will keep themselves in the EU and will follow the recipes from Euro Bank and so on.
    In Europe at the end of the day are looking forward for staying in the Euro Zone, and living in the late 90s, they will do anything to go back to that moment, only Germany can live without that illusion.

  30. #29

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    Spain would be in much better condition if it had the capacity to control its own money supply. It doesn't, so Spain will continue to get crushed.

  31. #30

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    Quote Originally Posted by pcgame View Post
    i thought eduardo was banned
    I'd tell you eduardo's new screen name, but he'd have to kill you. And then I'd have to kill him.
    Last edited by heavenlyboy34; 05-06-2012 at 05:18 PM.
    Quote Originally Posted by Ron Paul
    The government is incapable of doing what it's supposed to do. A job like the provision of security is something best left to private institutions.
    My music/art page is here"government is the enemy of liberty"-RP
    That which doesn't kill me has made a grave tactical error
    Quote Originally Posted by Anti Federalist View Post
    This whole board is a thoughtcrime in progress.
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    Quote Originally Posted by danke View Post
    I carry my man purse for fashion, not function.

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