WAGE GAINS, HOME SALES AND THE ECONOMY

In an article from CNBC, worker wages are "keeping up with inflation and then some."*  In December the wage gain was 1.3% and in January it was 1.7%. (see figure).  The top earners are doing even better.**  However, consumer debt has topped $4 trillion, including card debt over $1 trillion, both records.

(Click on the figure to enlarge)

While wages and earnings by the wealthy go up, it appears that retail sales are declining.***  In addition, home sales have been declining.  January showed the lowest home sales in three years.***
There is some optimism, however, that housing sales may be picking up based on lower mortgage rates and slower increases in the cost of homes; however, they are still lower than a year ago.****

But is the economy really all that good?  The Federal Reserve has stopped raising rates for the time being.   Also, it has stopped shrinking its balance sheet.  The Philadelphia Fed showed a decline in manufacturing of -0.4.%  This is the first negative number since 2016.
"The loss of economic momentum appears to have carried over into the first quarter. In light of both a quiescent inflation backdrop and a projected downshift in GDP, imply an increased likelihood that the Fed's next move in interest rates is lower," wrote Joseph LaVorgna, chief economist for the Americas at Natixis.

https://www.cnbc.com/2019/02/21/bad-bunch-of-economic-data-is-not-good-news-for-stocks-with-the-fed-already-on-hold.html

GDP gains of 3% seem to be already in the past in spite of the big business tax cut and no economists are predicting such high numbers - 2% or even lower are what is being forecast.

* https://www.cnbc.com/2019/02/13/worker-wage-gains-are-keeping-up-with-inflation-and-then-some.html?forYou=true
https://tradingeconomics.com/united-states/wages
** https://www.cnbc.com/2018/07/10/heres-how-much-money-the-1-percent-really-make.html
https://www.cnbc.com/2019/02/21/consumer-debt-hits-4-trillion.html
*** https://www.cnbc.com/2019/02/25/goldman-says-the-us-economy-has-sharply-decelerated-but-these-stocks-can-still-do-well.html

https://www.cnbc.com/2019/02/21/existing-home-sales-january.html

**** https://www.cnbc.com/2019/02/21/slowest-home-sales-in-over-three-years-could-help-buyers-this-spring.html
https://www.cnbc.com/2019/02/27/pending-home-sales-rebound-4point6-percent-in-january.html

Also see: https://www.paycor.com/resource-center/minimum-wage-by-state-and-2018-increases

THE CANCER OF 10 TIMES LESS, ETC.

I realize that languages evolve,* but something has happened that is really weird.  Instead of saying "It costs one-tenth of product B" people are saying "It costs 10 times less than product B."  for a detailed discussion of this matter, see https://timesless.com/

Literally if an object that costs, say, $10 and another cost 10 times less, the cost of the second item would be -$90. (10 time $10 is $100 so 10 time less would be $10 - $100 or -$90.  What would this mean?  I think it means that the seller would pay me $90 to take his product.  Now that is a good deal!

I guess people no longer can do subtraction so they misuse multiplication to express subtraction.

This is appearing in ads so makers of ads think that this is the way most people think.  I'm afraid the battle is already lost.  I heard someone say "3 times less" today.

I have commented on disappearing words before.*  One along the same line as the above is the word "check" as in "I'll check on that."  People are saying "I'll double check on that." to which I respond, "Please check before you double check."

* http://stopcontinentaldrift.blogspot.com/2011/03/disappearing-words.html

YOU KNOW IT HAD TO BE

What political party is it that dwells on voter suppression?  Of course it is the Republicans who are involved with such actions as canceling voters right to vote because they don't have street addresses (Indians of North Dakota).

Is it no surprise then that the party always yelling about illegal voting by Democrats should be the group that actually is found to do voter fraud?  The case in point is the North Carolina 9th Congressional District where Republican Mark Harris held a slim lead over Democrat Dan McCready owing to fraudulent activity with absentee ballots.*  A re-election is called for in a 5-0 vote by the election commision.

Harris's son John Harris, who is an Assistant District Attorney in North Carolina, seems to have repeatedly warned his father about the political operative Leslie Dowless hired by his father Mark.  It turns out that Dowless is accused of ballot tampering.  Apparently workers hired by Dowless would get people to request absentee voting ballots and then collect them, which is illegal.  Then they would fill in parts of the ballot left blank.  You know who they filled in when the vote for representative was blank?

It would all be kind of funny if it wasn't so serious.

* https://www.usatoday.com/story/news/politics/2019/02/21/north-carolina-voter-fraud-charges-dog-house-race-mark-harris/2938521002/

PRESIDENTIAL CANDIDATES: AGES

Remember when Baby Boomers back in the 1960s used to say "You can't trust anyone over 30."  Now they seem to say, "You can't trust anyone younger than 70.

Dwight Eisenhower was the first president to turn 70 while in office (by 98 days).  Ronald Reagan also turned 70 while in office (after about a month)  and was the first to be above 70 to win an election (age 73).  Donald Trump was the first president to be 70 when elected (by 220 days).*

The Baby Boom generation was between 1946 and 1964 so the oldest will be 73 this year while the youngest will only be 55.  Aging might be a part of it.

Here are the ages:

Trump               73 in June (b June 14, 1946)
Biden                77 in November (November 20, 1942)
Eliz. Warren     70 in June (June 22, 1949)
Bernie Sanders 78 in September (September 8, 1941)
Bloomberg        77 This month, February (February 14, 1942)

If I had to pick one of these oldsters, it would be Michael Bloomberg, but he would turn 79 shortly after assuming office (if he is elected).  Of course, Bloomberg has not announced a run for the presidency yet, but he has re-registered as a Democrat.  Biden, Sanders, and Bloomberg would all be in their 80s by the end of their first term

Actually my favorite is Beto O'Rourke who will be 47 in September (September 26,1972). and my third choice would be Amy (True Grit) Klobuchar who will be 59 in May (May 25, 1960)

Some others are: Cory Booker will be 50 in April (April 27, 1969), Kirsten Gillibrand will be 53 (December 9, 1966), Kamala Harris will be 55 in October (October 20, 1964)

By my count only 19 of our presidents were even in their 60s when they finished being president and 23 were in their 50s (Grover Cleveland is counted twice because of his two non-consecutive terms).  So the total of 3 + 19 + 23 comes out to 45 Presidents.*

* https://en.wikipedia.org/wiki/List_of_presidents_of_the_United_States_by_age

WHY CONGRESS CAN'T GET ANYTHING DONE

One of the things that contributes to congress getting so little done is the power of the Leader of the Senate and the Speaker Of The House because they control which bills get voted on.  We have recently seen the power pf these chairman excellently displayed.

Recall that the Senate considered a bill that the President said he would sign and it passed unanimously in the Senate, yes, unanimously with no dissenting vote.

But the President then said he didn't like the bill so that Paul Ryan didn't even bring it up in the House.  Also a powerful lobby of Republicans was against it.  So the bill was scuttled.

But that is not all.

In the midterm elections, Democrats took over the House and, under Nancy Pelosi, voted on the the bill that passed the Senate unanimously, and passed it.  Then Mitch McConnell would not bring it up for a vote in the Senate. 

So this bill got whipsawed both ways.

It shows why it pays to permit a few renegades being elected in your party as it may lead to your party getting control of the Senate or House where the leader can control what gets voted on.

Another example was an immigration bill* passed in the Senate with 67 votes, but which John Boehner did not bring up for a vote in the House.   I feel he should have fell on his sword over this one as he later was forced to resign anyway for keeping the government open.  I can't forgive his inaction.

The bill was called The Border Security, Economic Opportunity,And Immigration Modernization Act of 2013 that was a compromise by the "gang of eight,' a group of Republican and Democratic Senators formed to come up with a bill.  It would have added 19,000 border agents for a total of 40,000, more drones, more towers.  It included a merit based system for future immigration.  A sticking point was that it contained a pathway to citizenship for many illegal immigrants already in the country prior to 2011.  For a detailed discussion of this bill, see the reference.*

* https://en.m.wikipedia.org/wiki/Border_Security,_Economic_Opportunity,_and_Immigration_Modernization_Act_of_2013

MEDICARE IS NOT FREE!

I pay $135/mo. for Medicare B that covers physicians and surgeons.  Also Medicare pays only 80% so I also have to cover the other 20%.  For this I have a backup insurance for which I pay an additional$119.03/mo.that covers the deductible period and copayments for Medicare B.

I am not familiar with Medicare D (Prescription Drugs) because the backup plan I refer to above has a prescription drug plan in it; however, on average the cost is said to be $33.19/mo.*  Many Part D plans also have a deductible that you pay before the Part D payments kick in.  Apparently these can be as high as $450/mo although some may be zero.*

I also am not familiar with Medicare C which is called Medicare Advantage.  These plans cost the government about 15% higher than Part B but many also provide things like "free" admission to wellness facilities.  These plans also cover some of Medicare A and Medicare D.  Medicare Advantage was constructed to bribe HMOs (like Humana) to participate.

Medicare A covers (within limits) Hospital Care, Skilled Nursing Care, Home Health Care and Hospice Care.  Here is the real sticking point.  I paid for Medicare A by a payroll tax during my working life (It is 1.45%; since 2013 and there is a 0.9% surtax on incomes over $200,000).  In the beginning, it had a cap in which the payments stopped above a certain number (like Social Security), but at some point, the cap was done away with and I paid the tax on my whole salary.

I say that Medicare A, that is very complicated,** is the real sticking point because if you have Medicare For All, there will be people early in their career that will have paid little or nothing into Medicare A.  I'm not sure how this will covered.  Someone in their 20s may not require many hospitalizations but there will be those that will.  For examples, automobile accidents, drug addiction, and rare diseases.  One solution might be to pay $411/mo. (for 2016 the rate single stay-at-home moms pay) at the beginning of your career and have the sum reduced as the years go by and you build up payroll taxes.  But can a college student or graduate afford such expenses along with educational loan payments?  More likely, early payments will be small and build up as the years go by.

Please note that MEDICARE B, C, AND D ARE ALL VOLUNTARY and you are not required to take them.  THEY ARE ALSO VOLUNTARY FOR PHYSICIANS AND SURGEONS who may or may not accept Medicare payments.  Usually, those that do have a cap on the number of Medicare patients they will accept.  Where I live, the area is loaded with retirees and they roll you through appointments pretty fast, I'd say a typical appointment takes less than 10 min, maybe 5 min.  You must be prepared when you enter to tell the physician about your problems.  If the problems are very serious, more time will be spent on you.

The above is pretty complicated and I think people who want Medicare for all do not know the costs.

NOTE ADDED 02-28-2019: A bill called Medicare For All has been introduced in the House.  It is not Medicare at all, and they should think of a new name. (https://www.cnbc.com/2019/02/27/democrat-pramila-jayapal-introduces-medicare-for-all-health-care-bill.html)

* http://stopcontinentaldrift.blogspot.com/2011/07/reunite-gondwanaland-november-2009-2016.html
** https://www.medicareinteractive.org/get-answers/medicare-covered-services/medicare-coverage-overview/summary-of-part-a-covered-services?
*** https://www.quora.com/How-do-stay-at-home-moms-get-medicare-after-age-of-65

FEDERAL SHUTDOWNS MUST STOP

The most important piece of legislation our country needs is a law that prevents the government from shutting down.

Interestingly, there is some movement by congress to end government shutdowns.
That’s led to a flurry of bills aimed at outlawing government shutdowns amid concerns that a president, at odds with Congress, could use the tactic capriciously - at the expense of closing the government and hurting hundreds of thousands of federal workers.*

I don't know why, but people concentrate on the Federal workers laid off in a shutdown when most government business is done by contractors so at least as many contractors as Civil Servants are also laid off.  And others get hurt as well such as mom and pop stores and even corporate profits as well as progress.

One proposal gaining the most momentum comes from Sen. Rob Portman. The Ohio Republican introduced the "End Government Shutdowns Act" earlier this year. It was the fifth time he's tried to permanently prevent government shutdowns, but this time around, Portman has garnered 19 co-sponsors just among his GOP colleagues, with Democrats clamoring to sign on as well, according to a Portman spokesman. Perhaps most notably, two of the four GOP negotiators tapped to hammer out a government funding compromise by Feb. 15 have signed on to Portman's effort.*

Under Portman's bill, if Congress fails to pass any of the 12 appropriations bills that fund the government each year, the measure would create an automatic continuing resolution, or stopgap funding bill – which would fund the government at the previous year’s levels. To motivate congressional action, it would also continually reduce federal spending levels with across-the-board cuts while any budget impasse dragged on.*

Sen. Warner (VA) has also introduced a bill that would fund all of the government except for the Executive and congressional branches.  In addition, the bill would have forced across the board cuts as time wares on to force the government to act.  I think this bill would be more effective than Portman's but is less likely to pass.  The Warner bill is also supported by fellow Democrat Rep. Gerry Connolly and even House Minority Leader Rep. Kevin McCarthy (CA)

House Speaker Nancy Pelosi, D-Calif, favors a 2011 proposal introduced by former Rep. Dale Kildee, to extend funding at previous levels until some sort of deal is reached.  I feel that Congress would like this one because then we would just have government by continuing resolution and they would never fund appropriations.

Then there is a proposal by some House Democrats called the “Shutdown to End All Shutdowns Act" This bill would also fund the government at the current level during a shutdown.  It would also hit congress and the executive branch where it hurts by prohibiting federal funds for officials well as keep Congress in session travel.  a weakness in this act is there is an exception for emergencies.

Any bill that contains a continuing Resolution might be attractive to Republicans because it would keep costs down, though I am not sure of this.  An example of this was called the Sequestration Transparency Act under Pres. Obama in which there were forced budget cuts, including the military.  Democrats thought that Republicans would never vote for such a law that reduced the military budget, but they "fooled 'em."  More Republicans voted for the Act than Democrats.**

Of all the options so far, I favor the one by Sen. Warner.  Any proposal that contains a continuing resolution is dangerous, except if the CR funded the budget by some automatic amount, like 5 or 10%.  Alas, no one is proposing this.

* https://abcnews.go.com/Politics/ban-government-shutdowns-republicans-democrats-make-law/story?id=60724848
** https://www.washingtonpost.com/news/the-fix/wp/2013/02/05/who-is-responsible-for-the-sequester/?noredirect=on&utm_term=.45e127335d53

PREMATURE BIRTHS: AGE TO VIABILITY AND MONETARY COSTS

This is a companion piece to "Abortion, Down’s Syndrome and Spina Bifida (Including Hydrocephalus)"  [http://stopcontinentaldrift.blogspot.com/2019/02/abortion-downs-syndrome-and-spina.html]

Age of Viability
To be called premature, the birth of the baby would be at less than 37 wks of gestation.
Strictly speaking, most doctors define the age of viability as being about 24 weeks of gestation. In many hospitals, 24 weeks is the cutoff point for when doctors will use intensive medical intervention to attempt to save the life of a baby born prematurely.
A baby born at 24 weeks would generally require a lot of intervention, potentially including mechanical ventilation and other invasive treatments followed by a lengthy stay in a neonatal intensive care unit (NICU).
In the hands of experienced specialists, babies born slightly earlier may have a chance at survival. Babies born at 23 weeks may survive in a state-of-the-art NICU, but the odds of survival are much lower.
The odds of survival increase as the pregnancy progresses, and even an extra week in the womb can make a difference. In general, premature babies born closer to 37 weeks will be better off than those born before 28 weeks.*

(Click on figure to enlarge)

Costs Of Premature Birth
Costs for premature and low-birth-weight babies are also higher in terms of combined medical costs for the mother and child -- $64,713, compared with $15,047 for uncomplicated births, the March of Dimes report said.**
However, individual costs can even exceed $2 million with continuing expenses
Ethan and Aidan Sinconis racked up $2.2 million in medical bills in the first 18 months after they were born. Insurance covered most of the costs, but their parents’ portion approached $450,000.
Societal costs of premature births totaled $26.2 Billion in 2007.
In 2007, the Institute of Medicine reported that the cost associated with premature birth in the United States was $26.2 billion each year. Here’s how the numbers add up: 

$16.9 billion in medical and health care costs for the baby
$1.9 billion in labor and delivery costs for mom
$611 million for early intervention services. These are programs for children from birth to age 3 with disabilities and developmental delays. They help children learn physical, thinking, communicating, social and self-help skills that normally develop before age 3. 
$1.1 billion for special education services. These services are specially designed for children with disabilities ages 3 through 21. They help children with development and learning. Children can get these services at school, at home, in hospitals and in other places, as needed. 
$5.7 billion in lost work and pay for people born prematurely***

* https://www.verywellfamily.com/premature-birth-and-viability-2371529
** http://www.cnn.com/2009/HEALTH/03/17/premature.babies/index.html
http://healthland.time.com/2012/05/02/the-cost-of-premature-birth-for-one-u-s-family-it-was-more-than-2-million/
*** https://www.marchofdimes.org/mission/the-economic-and-societal-costs.aspx

ABORTION, DOWN'S SYNDROME AND SPINA BIFIDA (INCLUDING HYDROCEPHALUS)

This is a companion piece to "Premature Births, Age To viability, and Monetary Costs" (http://stopcontinentaldrift.blogspot.coA/2019/02/premature-births-age-to-viability-and.html)

I presume two of the major reasons to get an abortion are to avoid births of babies with Down's Syndrome and Spina Bifida.  Examination of the literature shows that both of these conditions can be detected prior to the third trimester (starting at 26 wks).  I conclude that prohibition of abortions in the third trimester could be avoided except in certain cases of threats to the life of the mother.  In the case of most complications, the baby could be born by cesarean section or maybe induced birth.

This is significant because a state like New York recently passed a bill allowing abortion up until birth:
In New York, Gov. Andrew M. Cuomo signed the Reproductive Health Act on Jan. 22, the 46th anniversary of the Roe decision. The new law permits abortion after the 24th week of a pregnancy when there is “an absence of fetal viability, or the abortion is necessary to protect the patient’s life or health.”
................................................................
A law introduced by a Democratic lawmaker in Virginia would also have reduced restrictions on late-term abortions to protect the mother’s health, and would have decreased the number of physicians whose opinions were required to approve an abortion, to one from three. The bill was set aside in committee.
(https://www.nytimes.com/2019/02/08/us/abortion-laws.html)

Below are brief descriptions of Down's Syndrome and Spina Bifida:

Down's Syndrome
Can Down's Syndrome be identified prior to birth?  I think the answer is yes*, prior to the third trimester, although the most successful tests are expensive.
According to the National Down Syndrome Society  (NDSS), the test is nearly 100 percent accurate in diagnosing Down syndrome prenatally. What's more, it can distinguish between complete trisomy 21, translocation Down syndrome, and mosaic Down syndrome.*

People with down's syndrome can work and sort of read although only a few graduate from high school  The life expectancy is 60 years.  Their ability to work independently is limited.  One successful job I know of was delivering mail in an office building.  they could get their routes down cold and when they came down the hall with their carts, you'd better get out of the way.  I knew of wone case of a person doing bagging at a supermarket, but he had a supervisor sitting off to the side to help out when needed so that is not exactly working independently.  I cannot find evidence of low IQ people working 40 hrs a week.  Financial support will therefore be required for many decades.

Spina Bifida
Life expectancy is 30-40 yrs.  It makes a difference where on the spine the spina bifida occurs and whether the spina bifida occurs with hydrocephalus.  IQ tends to be normal (42% have IQs above 90.) though hand-eye coordination may be low indicating difficult in writing.  If the spina bifida is low on the spine (e.g. lumbar), patients may walk with crutches, braces, or walkers with some needing no assistance.  A high percentage have trouble with bladder control and some with bowel problems.  If it is high on the spine, the legs may be paralyzed.  Spina bifida can bed detected in the second trimester.

All but 2% of the study individuals received some type of education. The majority (54%) received special education, and the remaining 44% received regular education. Only 8% of patients achieved college degrees.

At the time of the followup, 56% of the individuals were unemployed and 36% worked full-time. Employment was related to IQ ***

...............................................................

Seventy percent of the individuals lived with their parents or in an institution; 30% lived independently at the time of followup. At the time of our study, 76% of the individuals were not married or in intimate relationships.***

* https://www.verywellhealth.com/diagnosing-down-syndrome-1120396
** https://onlinelibrary.wiley.com/doi/pdf/10.1017/S0012162206000259
https://www.cdc.gov/ncbddd/spinabifida/infant.html
https://www.ninds.nih.gov/Disorders/Patient-Caregiver-Education/Fact-Sheets/Spina-Bifida-Fact-Sheet
*** https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3069297/

WHAT ARE WEAK HOME SALES SAYING ABOUT THE ECONOMY?

(I have a hiatus in my posting because I got caught in a scam and have to spend a lot of time getting new credit cards and changing passwords.  I'm still working on it, but have the most important things done.  Fortunately my credit card company involved recognized the charge as phony and refused to accept the charge.  The scammers wanted me to call them and tell them the charge is all right, but I said I'm not calling anyone and cancel the order.  It started with a message supposedly from my security company ( professional looking job), but the phone number was to someone else unbeknownst t me.).


I continue to think that home sales reflect on the economy.*
Home sales usually are directly tied to an economy's health and rise and fall with economic activity. As economies slow, the supply of money tends to become more restrictive. As money becomes harder to borrow, fewer home buyers enter the housing market. With restrictive lending requirements making fewer buyers available, inventories of homes go up or take longer to sell. A greater supply of a product coupled with lower demand for it generally forces prices downward.*

The market for homes continues to lag** even after the huge tax cut.  I guess this is a reflection that the tax cut was mainly for the wealthy.

House hunters signed 2.2 percent fewer contracts to buy existing homes in December, according to the National Association of Realtors.

These so-called pending sales are a future indicator of closings in one to two months. The Realtors' pending home sales index was also down a dramatic 9.8 percent compared with December 2017.

This marks 12 straight months of annual declines. It is also the lowest December sales reading since 2013.**

So if home sales lag, it shouldn't be a good sign for the economy.  At the same time, unemployment application have fallen markedly, even with the partially closed government.***

Initial claims for state unemployment benefits dropped 13,000 to a seasonally adjusted 199,000 for the week ended Jan. 19, the lowest level since mid-November in 1969 when 197,000 applications were recorded, the Labor Department said on Thursday. Data for the prior week was revised lower to show 1,000 fewer applications received than previously reported.***

Sales of homes is not the only thing in the pits economically:****
Daniel Richard stands in a 250-acre field, surveying the ruins of his hard work: Rotting soybeans as far as the eye can see.
............................................................
This is just one field Richard had to leave unharvested. In total, about 800 acres, 40 percent of his crop, sit dried out and useless.

“We lost the demand in the market with the tariffs. There were no exports. They weren’t shipping out. China wasn’t buying, of course China buys about, a little over 50 percent of our crop.”****

Also, the price of copper is down.  copper is considered to be a good indicator.  Employment in manufacturing is also down.
Today’s manufacturing output is at least 5 percent greater than it was in 2000, but it has become much more capital intensive and much less labor intensive. Accordingly, workers in the sector are more likely to have at least some college education than their counterparts of years past. But there are far fewer manufacturing workers overall, with about 7.5 million jobs lost since 1980. These job losses have likely contributed to the declining labor force participation rate of prime age (between the ages of 21 and 55) U.S. workers. In “The transformation of manufacturing and the decline of U.S. employment,” (National Bureau of Economic Research, Working Paper 24468, March 2018), economists Kerwin Kofi Charles, Erik Hurst, and Mariel Schwartz examine the factors that have played a role in the decline of prime age manufacturing workers since 1980 and focusing in the 2000s.*****

Another note of caution is that small  business confidence has dropped significantly.
https://blogs.wsj.com/economics/2019/02/04/real-time-economics-small-business-sends-a-warning-signal/

All this said, the economy overall looks good from the viewpoint of employment and corporate earnings, but there certainly are mixed signals.

* https://homeguides.sfgate.com/economy-affect-housing-market-50583.html
** https://www.cnbc.com/2019/01/30/pending-home-sales-drop-in-december-despite-much-lower-interest-rates.html
https://tradingeconomics.com/united-states/existing-home-sales
https://www.cnbc.com/2019/01/22/december-existing-home-sales-down-6point4percent-vs-1point3percent-expected.html
*** https://www.cnbc.com/2019/01/24/weekly-jobless-claims.html
**** https://www.newsmediaone.com/surging-tariffs-force-tough-choices-in-louisiana-for-soybean-farmers/
*****
https://www.bls.gov/opub/mlr/2018/beyond-bls/the-fall-of-employment-in-the-manufacturing-sector.htm
https://www.bls.gov/web/empsit/ceshighlights.pdf