stock_creeper's  Instablog

Of any political affiliation, the welfare liberal is perhaps the biggest proponent of fiscal restraint, regulation and frugality at the government and personal level. They want consumers to save more and for politicians to spend less on defense, tax cuts and homeland security, but they also want the government to increase taxes on the most productive members of society (the one percent) to fund social safety nets so these economically unproductive moonbats can hoard more money.

If the penny went out of circulation millions of liberals would be fucked because their life savings would be worthless. The 1974 and 1999 penny shortages were probably caused by liberals and I would estimate a trillion dollars of wealth is tied up in household penny jars, dating back to the Great Depression. Of course, this could be avoided if the liberals used a bank, but they don't trust them because they took bailout funds.

For years the left has prematurely written-off the US consumer as being 'maxed out' due to supposedly nefarious republican policies. If only the stimulus were bigger consumers would spend more. If only Bernanke would raise rates liberals like ourselves wouldn't have to rely on social security to supplement our penny reserves. By permanently keeping interest rates at zero Bernanke is prodding Americans to max-out the credit card and to invest in higher yielding assets like stocks. Without consumerism or investment, companies would have little incentive or lack the financial means to develop new technologies and the economy would stagnate. Fortunately, Bernanke's efforts appear to be working. Quarter after quarter consumer spending keeps beating estimates, and the left is forced to postpone their predictions for the 'consumer Armageddon' that will never come.

American consumer spending last month increased by the most in seven months.

What high gas prices? American consumer spending last month increased by the most in seven months, even though the rise in their incomes was less impressive.

Spending was up 0.8% in February after increasing 0.4% in January, according to the Commerce Department.

Even when adjusted for inflation, much of it gas price-related, spending was still up 0.5% -- the best showing in five months. Analysts had worried that the rising cost of fuel would force consumers to cut back elsewhere.

Full article: http://articles.latimes.com/2012/mar/30/business/la-fi-mo-consumer-spending-income-savings-20120330

This agrees with my earlier predictions that surging gas prices would not hurt consumer spending, but would instead depress the personal savings rate as consumers spend more money on gas without cutting back anywhere else.

The working class is being supplanted by the leisure and creative class due to the rapid development of productivity enhancing technologies. The future is a better one of more structural unemployment, more debt, and risk taking but also less labor intensive. The penny saved is a penny earned era is over. If American middle-class workers want to be competitive they need to be more productive and quit complaining about the economy. Go back to school and improve your skills, but at the same time keep spending.

The liberal strategy:

1. Create a fake crisis or take an existing problem and blow it out of proportion (like student loan debt, maxed out consumers, deficit spending, or JP Morgan's trading loss)

2. Go on a road show writing articles , book TV appearances, and give speeches blaming republicans, the fed, and supply side economics for this imaginary crisis. Choose only facts that agree with your viewpoint or, better yet, make exaggerated predictions of the gloom that will befall society if action isn't taken immediately.

3. Wait for policy makers to capitulate by implementing regulation or taxation. Fortunately, they seldom do. Paul Krugman has written thousands of op-ed columns for New York Times critical of the Clinton, Bush and Obama administration yet none have any effect on policy.