Nerfonomics

Dales Cannon

lightbrain about 4pm
Staff member
Another reason dribble down doesn’t work is any benefit given to the rich is added to their cash pile rather than been spent.. While if you gave the same benefit directly to the lower paid they would put it through the economy almost straight away..
Might as well just bypass the trickle bit..
This, lower end of town uses it now while the top end dont need it now and put it away for the next big thing.
 

Calvin27

Eats Squid
This, lower end of town uses it now while the top end dont need it now and put it away for the next big thing.
If you consider that the rich end of town have maxed out their small value purchases, then it stands to reason that any surplus they gain will simply go towards expenditures with little to no economic activity. This includes bumping up the price of property, shares and other assets. Conversely hte lower end of town will almost universally utilize a surplus on lower value good which not only has more immediate impact but also has far greater economic flow-on effects (capital velocity increases).

No serious economist actually thinks trickle down really works. The ones that do know well and good who is banking them.
 

SummitFever

Eats Squid
I see the Gig economy starts with a choice ... thats going to trigger a few I'm sure. For a rare few that may be the case but for most it's an attempt to get by and not a very god one. Gig economy is a way for companies to undermine hard fought for wages and conditions. When the government manages the economy to have around 5% unemployment so that we have reduced pressure on wage growth many are left without jobs and are forced to do whatever they can to put food on their table. Have you not heard about the people earning less than minimum wage driving Ubers or delivering for deliveroo.
Agree. The fact that the gig economy exists is a sign that there is a lack of non-gig work. The unemployment figures are also completely rubbery and the definition has markedly changed over the last 30 years. Underemployment has increased significantly and that is what fuels the gig economy and people needing multiple jobs to keep their head above water.

...My comment was more that this thread is pointless because there’s no conversation. Nerf just comes by once every six weeks, drops some neoliberal BS masquerading as intellectual musings and then disappears again without actually engaging the topic.
I think that's a little harsh. Nerf's a business owner and probably employs people. I like hearing everyone's views even though I may not agree with them. Thought provoking is always good.
 

Nerf Herder

Wheel size expert
Apologies for not having read above ..
Crazy busy and to be honest CBF arguing ... in the end happy for all to disagree provided you understand the perspective I’ve offered.

@hifiandmtb disagree with your conclusion, re my selective definition ... but meh

To end on a positive, I completely understand and at a certain level agree with all those focused on wealth gap ... but that’s not the only component of Trickle down. No longer commenting on topic. thanks


moving along ... I found this interesting.
Notes: payroll tax in this US example is completely different in AU ... I don’t believe there is an AU equivalent to that particular component of the analysis ... so I discounted it’s effects to an equivalent AU comparison. Agree with all other components

I also googled proportion of Tax paid in Australia by tax bracket. ... couldn’t attach the graphic ... but in total dollar perspective the top tax bracket pays the lion’s share of total tax revenue. Which is somewhat inline with the vid ex payroll tax effects.

Please put your comments in the Politics thread ... or solutions in the dictators thread ... tag me so I can find it presuming you CBF.
 

Nerf Herder

Wheel size expert
also started stumbling across Thomas Sowell as part of my ‘broadening my perspective’ wants ... started popping up after watching a few Milton Friedman interviews and talks.

I haven’t looked into his writings or views enough to form my own views ... but I post it here as I know it’s going to grate on many of you lolololololz


 

Freediver

I can go full Karen
Nerf are you turning into a neocon arsehole or were you always one and nobody knew? Don't make me never buy your products again because I like your droppers and slicko.
 

Haakon

Keeps on digging
I think the missing piece of Trickle Down understanding is that ... Trickle down isn't aimed at making everybody rich ... its aimed at employment.
Its not aimed at lifting the quality of employment ... thats up to the individual and choices made.

As much as I hate Hockey's "... get a better job" or Ivanka Trumps "...find something new" ... boil these down to its simplest message ... its about choice. Do something about your circumstance or dont ... aspire or dont ... work hard or chose the easy path ... use your brains or dont.

Thats not a rich or poor thing, Left or Right thing ... its life. Is this part of trickle down ??? I think it is from a psychological point of view,

More practically, think about all those Cafes (Hospitality in general. Tourism is a fantastic example of trickle down), Personal trainers, Gym providers, cleaners, tatoo artists, landscapers/gardeners, pool cleaners, strata providers, Tradies, kitchen businesses, Bicycle Workshops (not retail but workshop specific), nail saloons, Massage places, Physios, Vets ... Fucking Vets and Gyms are my pet peeves (think about all the real estate these fuckers take up and drive up rents)

Thinking Sydney ... specifically Financial Services ... all those buggers with solid incomes ... by no means do they all think they are rich ... thats the trickle down ... think about the number of cafes and or coffee specific businesses in the CBD, now versus 20 years ago. Thats from them ... How many of you have cleaners ... go to the Gym ... have tatoos ... have renovated or put in a new kitchen or bathroom in the last 5 years (think about your parents, how many renos did you live through as a kid ... zip, maybe 1) ... think about the number of people in super cars ... they can't all be bankers, billionaires and drug dealers. Thats trickle down ... you are trickle down.

My next door neighbours are Chinese ... I dont really talk to them really ... so take the following as poetic license ... they work long fucking hours, usually gone before 6am and back around 9pm ... not sure if its 7 days a week but seems like it ... I believe they are laundry people for restaurants ... or sex traffickers :p based purely on the dark tint and bars on the back windows of their SLWB Hiace ... Beamers and Mercs applenty, two story house in the inner west ... all anecdotal I know ... but thats trickle down and its also hard graft. Immigrants are a fantastic example of trickle down ... they are willing to eat shit, work hard, start a business, all usually to offer a service to support your consumption in the majority.

But as we have seen, all these fuckers above are the first to get smashed as we tighten belts and become more spend conscious. This highlights trickle down relationships in reverse per se ... in my mind.

In Summary
Think broader on what trickle down is and where it actually originates from.
If you think you aren't benefiting from trickle down then you have a choice to make.

edit: procrastination is bad ... I made the wrong choice
What’s wrong with Vets...?
 

Nerf Herder

Wheel size expert
name calling and labeling ... is the root of the troubles we are having with modern discourse, be it political, economic or socital.

its why you can't share ideas, trolls have become a thing, crossing the floor politically rarely happens, bipartisanship only happens behind the scenes.

If I were to label myself, I'd call myself a socialist that understands the value of capital. I'm a capitalist, that deeply values the contribution that labour provides.

The older I become the more anti Libertarian I become ... that said I'm not pro-big government and I agree with the root of Libertarianism. These views are relatively recent ... the anti libertarian thing has developed the more I watch Milton Friedman vids ... not because of him ... he is a friggen awesome intellect and I love his style of communication ... but its plain as day that his anti-govt views colour his economics.

Through my experience and education I've learnt that you need to be adaptive in your thinking. What I know and believe now will have to change as the environment changes, as the level of information changes, as new information becomes either more relevant or less relevant. This is why active fund managers can not sustainably outperform their benchmarks in the long or even medium term.

If you can't or more likely wont, understand what I've laid out then ... meh, not really my problem ... I think I've been pretty articulate in the sharing of my perspectives ... even to the point of using the word 'Perspective'

what I find interesting is that nobody has agreed with me even after articulating the parameters of my focus. but again meh ...

on to more interesting stuff ... economically still in line with my opening views. be interesting what the impact of tourism or services imports has after summer peaks have washed through the numbers. a little mental disclaimer ... I'm showing info bias in what I post here ... there has been negative info via CBA around Victoria etc etc ... but I read those as obvious impacts due to COVID and enforced shutdowns/slow downs which I've somewhat consistently looked to ignore as part of my own forecasting.

ie News is doom and gloom and not real.


cut paste below re contents
Economic Update
Balance of payments – Q2 2020
The current account posted its fifth consecutive quarterly surplus of $A17.7bn (around 3.7% of GDP) in Q2 20.
The trade surplus increased in the quarter and the net income deficit narrowed.
Net exports will contribute around 1.0ppt to Q2 GDP growth.
We expect Q2 20 GDP to fall by 5.4%/qtr.
The current account posted a record surplus in Q2 20 of $A17.7bn. This was the fifth consecutive quarterly surplus. The large surplus was driven by both a bigger trade surplus and a smaller net income deficit in the quarter.
Australia’s current account surplus is providing support to the Australian dollar. We expect the AUD/USD to appreciate to around $US 0.75 by the end of the year.
The trade surplus increased to $A23.9bn in Q2 20. The wider trade surplus was driven by the services side.
Exports of services fell by 18.4% but services imports effectively halved. Tourism (holidays) makes up a much larger part of Australia’s services imports compared to exports. And the border closures are having a huge impact on tourism and therefore a disproportionately large impact on our imports. In contrast our services exports are weighted towards education. And many students were in the country before the travel restrictions really tightened up. Some are also studying online. We expect services exports and imports to remain weak until borders are reopened.
Exports of goods fell by 5.3% in Q2 20 with falls across all the major categories. The major commodity exports saw falls with the exception of iron ore. Coal (‑14.6%) and LNG (‑16.6%) in particular saw large falls with both prices and volumes lower in the quarter. Iron ore exports rose by 8.7% on higher prices and strong demand from China due to commodity intensive fiscal stimulus.
Imports of goods fell by 3.7% in the quarter. All the major categories fell. Consumption goods were down by 4.4% because of a huge 45.3% drop in vehicle imports. A 43.4% drop in fuel imports on the back of the lower oil price weighed on intermediate goods imports.
The terms of trade was broadly steady in the quarter (+0.2%). Export prices fell 1.2% in the quarter while import prices were down 1.7%. A steady terms of trade means there are no income gains or losses as a result of relative changes in the prices of goods and services that we trade.
The net income deficit narrowed to $A5.59bn in Q2 20 from $A9.9bn the previous quarter. Both income credits and debits were lower in the quarter. Foreign shares held by Australians performed better than domestic shares held by foreigners in relative terms in the quarter. This helped to narrow the net income deficit.
The volume of exports fell by 6.7% in Q2 20 while imports were down by 12.9%. Net exports are expected to add around 1.0ppts to Q2 20 GDP growth
 

pink poodle

気が狂っている男
The main stimulant for trickle down economics destabilizes the government and empowers the oligarchy. It leaves those of lower middle class and down in a subsistence situation, generally scraping by on a week to week basis.


Also in a macro sense, some American analysis for consideration.

 

Nerf Herder

Wheel size expert
https://today.duke.edu/2019/01/road-trump-began-reaganomics-loss-middle-class-economist-says

Perspective on the US experience ...

I add this not for the political aspects ... but more related to other likely impacts leading to the ‘hollowing out of the middle classes’

Ie, globalisation ...

I also add that the West’s contribution to globalisation was a pivot away from product ... or manufacturing, towards services ... where services is two prolonged... high value services ... or professional services (Higher paid, higher educational requirement) vs low value services ... tourism, hospitality, what the gig economy has morphed into (less stable, less secure, lower paid, sold as flexible work)

I provide no data, so I just postulate.

https://apple.news/AbaYb5Nf5Mpy3-EkVRuyG6Q
This one relates to Biden’s economic plan ... and effectively calls it socialism... what a crock. Basically because a business is nationalised or not even nationalised ... just invested into by the govt, then it morphs into socialism because the govt applies undue pressure on management over market forces.

don’t worry about grants, low cost loans or VC much like the Singapore or Middle Eastern countries ... all effective ‘arms length’ investment tools used by markets.

Similarly, I use Australia Post as an example of a Nationalised business that is paying the govt a dividend, that is run as a corporate. Ie where management disproportionately benefits over the shareholders ... ie tax payers.
As long as it pays a positive dividend to the Fed ... they don’t give a shit and allow it to run as it wants. Eg in covid they have experienced a continuing boom in parcels. Yet got approval to reduce letter delivery and a price rise across the board. All while cutting full time positions and increasing contractor numbers and securing big fat bonuses for management even though they were supposed to take a 20% pay cut.

Meh
 

pink poodle

気が狂っている男
Similarly, I use Australia Post as an example of a Nationalised business that is paying the govt a dividend, that is run as a corporate.
No it isn't. It is a government corporation, being a government entity that is legislated to provide goods/services in the pursuit of a profit. This is generally the last step before privatisation. Nationalisation of a business is the reverse of that. The best examples of that come from Cuba as the communist regime was established. Though I prefer the example Chile under Allende and the copper mines. Both those nations endured some interesting American feedback for enacting nationalisation.
 

Nerf Herder

Wheel size expert
Good video, sits here well:

I’m a firm believer in Luck ... but my view is likely different to yours lolololz
I’ve read a few papers on luck, leadership, success etc ... my view is somewhat in line with this vid ... but I do agree with your vid and also aspects of what Obama was eluding too in my vid. In the end you can’t do it on your own. Mentors, Networks of peers are invaluable and used by many successful

back on topic ... investments
My son and I have been playing with equities and research ... he has been doing his research, ID’ing stocks ... we’ve been discussing why he likes the company/industry and we’ve been monitoring ... mainly via charting

this week has had a shed load of doom and gloom ... so I jumped into a couple of his favs.
Got instantly drilled lololololz.

but the fundamentals are good ... so I backed his call.
He is the analyst ... I’m the trader ... So my fault lololz.

he has surprisingly sound logic For a 14yo.
 
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