Sherman A1
Sherman A1's JournalThe Austerity Delusion
Unable to take constructive action toward any common end, the U.S. Congress has recently been reduced to playing an ongoing game of chicken with the American economy. The debt-ceiling debacle gave way to the “fiscal cliff,” which morphed into the across-the-board cuts in military and discretionary spending known as “sequestration.” Whatever happens next on the tax front, further cuts in spending seem likely. And so a modified form of the austerity that has characterized policymaking in Europe since 2010 is coming to the United States as well; the only questions are how big the hit will end up being and who will bear the brunt. What makes all this so absurd is that the European experience has shown yet again why joining the austerity club is exactly the wrong thing for a struggling economy to do.
The eurozone countries, the United Kingdom, and the Baltic states have volunteered as subjects in a grand experiment that aims to find out if it is possible for an economically stagnant country to cut its way to prosperity. Austerity -- the deliberate deflation of domestic wages and prices through cuts to public spending -- is designed to reduce a state’s debts and deficits, increase its economic competitiveness, and restore what is vaguely referred to as “business confidence.” The last point is key: advocates of austerity believe that slashing spending spurs private investment, since it signals that the government will neither be crowding out the market for investment with its own stimulus efforts nor be adding to its debt burden. Consumers and producers, the argument goes, will feel confident about the future and will spend more, allowing the economy to grow again.
In line with such thinking, and following the shock of the recent financial crisis, which caused public debt to balloon, much of Europe has been pursuing austerity consistently for the past four years. The results of the experiment are now in, and they are equally consistent: austerity doesn’t work. Most of the economies on the periphery of the eurozone have been in free fall since 2009, and in the fourth quarter of 2012, the eurozone as a whole contracted for the first time ever. Portugal’s economy shrank by 1.8 percent, Italy’s fell by 0.9 percent, and even the supposed powerhouse of the region, Germany, saw its economy contract by 0.6 percent. The United Kingdom, despite not being in the eurozone, only barely escaped having the developed world’s first-ever triple-dip recession.
The only surprise is that any of this should come as a surprise. After all, the International Monetary Fund warned in July 2012 that simultaneous cuts to state spending across interlinked economies during a recession when interest rates were already low would inevitably damage the prospects for growth. And that warning came on top of the already ample evidence that every country that had embraced austerity had significantly more debt than when it started. Portugal’s debt-to-GDP ratio increased from 62 percent in 2006 to 108 percent in 2012. Ireland’s more than quadrupled, from 24.8 percent in 2007 to 106.4 percent in 2012. Greece’s debt-to-GDP ratio climbed from 106 percent in 2007 to 170 percent in 2012. And Latvia’s debt rose from 10.7 percent of GDP in 2007 to 42 percent in 2012. None of these statistics even begin to factor in the social costs of austerity, which include unemployment levels not seen since the 1930s in the countries that now make up the eurozone. So why do governments keep on treading this path?
http://www.foreignaffairs.com/articles/139105/mark-blyth/the-austerity-delusion?cid=emc-may13promoa-content-043013&sp_mid=41417061&sp_rid=
May 1st is Global Love Day
Seems like something worthy of note.....
http://www.thelovefoundation.com/Global_Love_Day.htm
Louisiana Purchase Exposition Opens in St. Louis April 30, 1904
In 1904, St. Louis hosted a World's Fair to celebrate the centennial of the 1803 Louisiana Purchase. It was delayed from a planned opening in 1903 to 1904, to allow for full-scale participation by more states and foreign countries. The Fair opened April 30, 1904, and closed December 1, 1904. Of notable interest is that St. Louis had held an annual St. Louis Exposition since the 1880s as agricultural, trade, and scientific exhibitions, but this event was not held in 1904, due to the World's Fair.
The Fair's 1,200 acre (4.9 km²) site, designed by George Kessler,[1] was located at the present-day grounds of Forest Park and on the campus of Washington University, and was the largest fair to date. There were over 1,500 buildings, connected by some 75 miles (120 km) of roads and walkways. It was said to be impossible to give even a hurried glance at everything in less than a week. The Palace of Agriculture alone covered some 20 acres (324,000 m²).
Exhibits were staged by 62 foreign nations, the United States government, and 43 of the then-45 U.S. states. These featured industries, cities, private organizations and corporations, theater troupes, and music schools. There were also over 50 concession-type amusements found on "The Pike"; they provided educational and scientific displays, exhibits and imaginary 'travel' to distant lands, history and local boosterism (including Louis Wollbrinck's "Old St. Louis"
and pure entertainment.
19,694,855 individuals were in attendance at the fair
http://en.wikipedia.org/wiki/Louisiana_Purchase_Exposition
Retailers Account for Second-Most Data Breaches
NEW YORK — Retailers and restaurants accounted for 24% of all data breaches in 2012, second to financial organizations, which accounted for 37%, according to a new report from Verizon Enterprise Solutions here.
The Verizon 2013 Data Breach Investigations Report, which tracks cybercrime globally, cited POS terminals as a key point of attack, with POS smash-and-grab incidents comprising 111 of the 621 data breaches captured in the report.
External attacks account for 92% of data breaches, including organized crime, activist groups, former employees, lone hackers and even organizations sponsored by foreign governments, the study said.
Read More: http://supermarketnews.com/technology/retailers-account-second-most-data-breaches#ixzz2Rq2XUq43
Consumers Love Brands that Love Them
Nearly half (48 percent) of consumers between the ages 18-44 say the loyalty they feel toward brands stems from the types of experiences those brands create for them, according to a national survey conducted by Analytic Partners, a global marketing consultancy.
Such experiences can include interactions in the form of video/online gaming, social media and third-party expert information through blogs and articles.
"The general conclusion we can make from these findings is that people want to be loved by the brands that love them—loyalty has become a two way street," said Nancy Smith, founder and CEO of Analytic Partners. "No longer are the days when brands can advocate solely for themselves. In fact, the way brands spend their marketing dollars to interact with their consumers can ultimately have a real impact on profitability.
http://www.progressivegrocer.com/top-stories/headlines/shopper-behavior/id38906/consumers-love-brands-that-love-them/
Interesting quote from the article.... While fair pricing and excellent customer service are top of mind for most consumers, the baby boomer generation (ages 49-67) care more than any other age demographic that brands should be transparent about how their products are made (80 percent).
Retail Spending Declines Amid Economic Uncertainty
http://www.progressivegrocer.com/top-stories/headlines/shopper-behavior/id38928/retail-spending-declines-amid-economic-uncertainty/Consumers’ lethargic outlook continues to take a toll on retail spending, according to the “Consumer Reports Index,” an overall measure of Americans’ personal financial health. The Index's past 30-day retail measure declined for the third straight month since January.
The Consumer Reports Index's (CRI) sentiment measure was unchanged from last month at 50.1. Looking at the longer trend, however, consumers' attitudes concerning the economy are neither advancing nor retreating and sentiment has been frozen in a narrow band between 51.2 and 48.9 since November 2012.
One positive sign from the CRI’s next 30-day retail measure – which reflects planned April activity - was an uptick in planned spending for major appliances, small appliances, and major yard and garden equipment as consumers prepare for summer.
Thought this quote to be of particular interest.... "At best, consumers feel the economy is treading water,” said Ed Farrell, director of consumer insight at the Consumer Reports National Research Center. “They are still holding back on spending, largely due to the uncertainty they feel.”
Profile Information
Gender: MaleCurrent location: U.S.
Member since: Sat May 13, 2006, 07:37 AM
Number of posts: 38,958
