American Economics Thread

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chgough34

Junior Member
Registered Member
Chevalier said:
Not only are you failing to grasp the fact that companies pass on the cost of increased workers comp/insurance onto the consumer ie why building costs have increased despite the downturn in the economy, but you just wordcel'd your way with the sort of loquacious confidence often seen amongst indians.
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Yes, that’s called pass-through incidence. Consumers don’t buy capital goods, consumers buy well…consumer goods which reflect among other things, corporate expenses for input costs. And we know that consumer inflation is at 2-3%. Insurance is simply not a big enough part of SG&A to move the needle much
Chevalier said:
You also failed to consider why firms use lines of credit as opposed to simply using their own profits ie tax deductibility, tax planning. If interest rates rise, that's gonna hamper business costs because firms are using lines of credit for their day to day activities and an increase in interest rates means their repayments are going to far, far bigger than they initially planned.
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Interest costs are not particularly tax advantaged. It’s just an ordinary business expense. The main reason why corporates have lines of credit (not that they generally use them) is because of either temporary liquidity management or timing mismatches between payables and receivables. But alas, due to well developed equity markets and bond markets, corporates already have large cash stashes from fixed rate borrowings from the pandemic (rate hikes can’t touch that), or have limited needs for borrowing so even “high-yield” bonds are trading only a few dozen basis points above comparable treasures -
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Franklin

Captain
AssassinsMace said:
The US lies about its economy as much as they accuse China of doing it for theirs. The US lies over statistics. Yes how many times does the West use surveys saying the world is negative on China when “the World” is only Western countries surveyed?

If the US was doing great even better than ever, how come they're tight on money even when it comes helping out to their own allies? The US closest allies are doing horribly mainly because they're obeying the US and yet very little help by opening the US market more to allies. The US can't even spare digging for change in its pocket lying to the Pacific island nation of Palau that it was going to help them out if they spread anti-China propaganda for the US where now because the US lied and couldn't even hand out change from its pocket, Palau is now threatening to go to China. Those are macro indicators how bad shape the US is in. The US is so great of shape that they're angry China is cancelling agricultural orders left and right. The US doesn't need China yet they want to sell tens of billions of dollars every year in agricultural goods that are so important that it's always a top Presidential election year issue all the time.
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The evidence of a weak US economy is not that they can't help their allies abroad but that they are easing monetary policies in the face of high and growing inflation.

The US is under pressure from two opposing forces of high inflation and high debt levels. At the moment the US is balancing on a knives edge between runaway inflation and a financial crisis. It seems that they will tip towards inflation as on the fiscal side the US government has no intentions to cutback on spending and on the monetary side they have already indicated that they will ease.
 
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chgough34

Junior Member
Registered Member
US inflation is at 2-3% Y/Y depending on if it’s the pce or the cpi basket with the lagged nature of rent price cuts to continuously push down inflation for the next 12 months. It’s not inflation that’s the problem at the current rates (which aren’t moving up or down) as much that any rate cut itself would be inflationary
 
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gelgoog

Brigadier
Registered Member
chgough34 said:
The US is a net energy exporter due to innovative manufacturing - fracking and similar technologies but is a net agricultural importer; both of these for the first time in decades
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US fracked oil is composed of light hydrocarbon fractions. It needs to be mixed with either Canadian tar sands or Venezuelan heavy oil to produce diesel, aviation kerosene, and other necessary oil products. The US is a net energy exporter but it still depends on imports. Canada is also looking to evade the US's current monopoly buyer status, which means Canadian oil sells for less than supposedly sanctioned Russian oil, by building an oil pipeline to the Pacific. The Trans Mountain pipeline should start operations this year.
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gelgoog

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henrik said:
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It isn't the first time Intel tried acting as a foundry for other companies. Originally this culminated in their acquisition of Altera. Altera's FPGAs were supposed to help keep Intel's factories loaded. But after moving just one or two products to Intel factories, they cancelled the whole thing and Altera still fabs their leading edge FPGAs at TSMC to this day.

Good luck trying to move Intel's fabs to the foundry model. They typically optimize for CPUs and have custom build processes which aren't any good for the general purpose customer.
 
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gabriel.shenton

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