Demand Begets Demand

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This concept was the basis for the statement “a rising tide lifts all boats” which, according to Wikipedia, is the idea that an improving economy will benefit all participants, and that economic policy, particularly government economic policy, should focus on broad economic efforts. The phrase is commonly attributed to John F. Kennedy, who used it … Continued

Labor-Force Participation

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Since the turn of the century, U.S. labor-force participation has been weakening.  There have been numerous attempts to explain this phenomenon, with little agreement.  Most of the theories have revolved around inadequate pay, increased safety net benefits such as disability payments, and the thought that a recovering economy would solve the problem by encouraging greater … Continued

Are Real Wages Finally Firming?

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We have previously commented on the issue of lackluster U.S. economic growth.  (See our blog from  Jul-12)  Among the possible causative factors, relatively modest gains for real wages has been highlighted by many economists. We have seen unemployment steadily decline to near record lows.  At the same time, we have not seen much in the … Continued

Consumer Spending and Economic Growth

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The U.S. economy is generally believed to be substantially consumer driven.  Accordingly, trends in consumer spending are closely watched by investors and economists.  With an economy that is largely dependent on consumer spending, it is important to recognize that an individual consumer can spend only so much. Recently reported retail sales figures have been disappointing.  … Continued

A Goldilocks Economy

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According to Wikipedia, a Goldilocks economy is one that is not too hot or too cold, in other words, sustains moderate economic growth, and has low inflation, which allows market-friendly monetary policy. Where are we now? Economic growth, during the last several years, as the economy recovered from the severe decline during the “great recession”, … Continued