Tuesday, August 22, 2017

There's a $136,400 reason so many Americans feel they haven't made economic progress

There's a $136,400 reason so many Americans feel they haven't made economic progress

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Wage stagnation has become a running theme in America's political and economic debate, yet so many statistics get thrown around it's hard to discern truth from rhetoric.
A new paper titled "Lifetime Incomes in the United States over Six Decades" sheds some fairly definitive light on the lack of economic progress millions of Americans have experienced.
Among the most striking findings, published by the National Bureau of Economic Research and summarized here: The median male who turned 55 in 2013 earned $136,400 less in lifetime income, measured in 2013 dollars, than a 55-year-old 16 years earlier.
8 22 17 income stagnation COTDNational Bureau of Economic Research
Median lifetime income slumped by 10% to 19% for men who entered the labor market in 1983 compared with those who started working in 1967, the study found.
Fatih Guvenen of the University of Minnesota and his coauthors also echo a well-documented trend of economic gains accumulating to the very rich, finding "little-to-no rise in the lower three-quarters of the percentiles of the male lifetime income distribution during this period."
Lifetime earnings increased across the spectrum for males entering the workforce from 1957 to 1967, but they rose for only the top 20% of richest men for job-market entrants in the 1967-to-1983 period. The rise of employer-based health and retirement benefits partly offsets the findings but does not alter them in a substantive way, the authors said.
But don't feel bad just for the men — women have also had a hard time.
Median lifetime income increased about 22% to 33% for women entering the job market in 1983, compared with 1957, "but these gains were relative to very low lifetime income for" women in the 1950s, the paper said.
The researchers also found that "inequality in lifetime incomes has increased significantly within each gender group."
Women's median income has more or less flattened since 1979 after inflation, the report said.
The paper also suggests income levels at the start of one's professional life can have lasting implications, as seen in the hit to starting salaries following the Great Recession.
"Our findings point to the substantial changes in labor market outcomes for younger workers as a critical driver of trends in both the level and inequality of lifetime income over the past 50 years," Guvenen and his colleagues wrote.

There’s a reason so many Americans feel they haven’t made economic progress

There’s a reason so many Americans feel they haven’t made economic progress

union workers protestUnion workers picket outside The Cosmopolitan of Las Vegas on June 14, 2013. Ethan Miller/Getty Images
Wage stagnation has become a running theme in America's political and economic debate, yet so many statistics get thrown around it’s hard to discern truth from rhetoric.
A new paper entitled "LifetimeIncomes in the United States over Six Decades" sheds some fairly definitive light on the lack of economic progress millions of Americans have experienced. 
Among the most striking findings, published by the National Bureau of Economic Research and summarized here: The median male who turned 55 in 2013 earned $136,400 less in lifetime income, measured in 2013 dollars, than a 55-year-old 16 years earlier.  

Median incomesNational Bureau of Economic Research
Median lifetime income slumped between 10% and 19% for men who entered the labor market in 1983 compared to those who started working in 1967, the study found.
Faith Guvenen of the University and Minnesota and her co-authors also echo a well-documented trend of economic gains accumulating to the very rich, finding "little-to-no rise in the lower three-quarters of the percentiles of the male lifetime income distribution during this period."
Lifetime earnings increased across the spectrum for males entering the workforce between 1957 and 1967, but they rose for only the top 20% of richest men for job market entrants in the 1967 to 1983 period.  The rise of employer-based health and retirement benefits partly offsets the findings but does not alter them in a substantive way, the authors said.
But don't feel bad just for the men — women have also had a hard time.
Median lifetime income increased around 22%-33% for women entering the job market in 1983, compared to 1957, "but these gains were relative to very low lifetime income for" women in the 1950s.
Importantly, they also found "inequality in lifetime incomes has increased significantly within each gender group." 
Women’s median income has more or less flattened since 1979 after inflation, the report said.
The paper also suggests income levels at the start of one’s professional life can have lasting implications, as seen in the hit to starting salaries following the Great Recession.
"Our findings point to the substantial changes in labor market outcomes for younger workers as a critical driver of trends in both the level and inequality of lifetime income over the past 50 years," Guvenen and her colleagues wrote. 

The price of Bitcoin and Ethereum is slipping but Bitcoin Cash is rising

The price of Bitcoin and Ethereum is slipping but Bitcoin Cash is rising

Bitcoin and Ethereum, the two biggest cryptocurrencies by market value, are slipping on Tuesday, while Bitcoin Cash recovers after Monday's fall.
Bitcoin is down 2.2% against the dollar to $3,912.36 at 11.15 a.m. BST (6.15 a.m. ET), a one-week low. Bitcoin has been pulling back after a rapid rally last week that saw it pass $4,000 and $4,400 per coin for the first time ever in a matter of days.bitcoinMarkets Insider
Meanwhile, Ethereum is down 3% against the dollar to $310.32, extending a run of range-bound trading for the digital currency that has seen it struggle to break above $350.
Bitcoin Cash, the cryptocurrency split out from Bitcoin at the start of the month, has been on a tear. The new digital currency rose as high as $1,000 over the weekend but fell sharply on Monday as some traders viewed the rally as overdone. After falling back to earth, some are now seeing value and Bitcoin Cash is up 15.6% to $696.39.
Get the latest Bitcoin price here.

Singapore court OKs contempt proceedings against Lee Kuan Yew grandson

Singapore court OKs contempt proceedings against Lee Kuan Yew grandson

SINGAPORE - Singapore's High Court on Monday granted leave for the attorney-general's office to begin contempt of court proceedings against Li Shengwu, a grandson of the city state's late founding leader Lee Kuan Yew, over comments he made last month about the country's legal system.
According to correspondence released by Li, the attorney-general's chambers (AGC) had offered to stop pursuing the case against Li, whose uncle is the nation's current Prime Minister Lee Hsien Loong, if by Monday afternoon he apologized for a Facebook post from July 15. In that post Li had said that "the Singapore government is very litigious and has a pliant court system."
In a reply to the AGC's offer, Li wrote in a letter dated Aug. 18: "The truth matters: I cannot confess to a crime I did not commit in return for a discontinuance of the legal proceedings against me."
Senior State Counsel Francis Ng - from the attorney general's chambers - has previously described the Facebook post as “an egregious and baseless attack” on the Singapore legal system.
Li, who is currently a junior fellow at Harvard University in Cambridge, Massachusetts, earlier on Monday posted Facebook links to the offer letter and his response.
In that response, Li said the AGC has now accepted he doesn’t need to delete his now amended Facebook post.
On Aug. 4, Li said he did not mean to attack the Singapore judiciary and he had amended the “private” post to avoid misunderstanding, though he hasn’t disclosed what changes he has made. The AGC declined to provide comment on the correspondence Li released
Li’s troubles are related to a family feud that has erupted between Lee Kuan Yew’s three children over the fate of Lee’s house. The dispute has been simmering since Lee Kuan Yew died in 2015 but exploded into public view this summer in a highly unusual display of discord at the top of a country that usually keeps such matters behind closed doors.
The AGC said in a statement on Monday it would now file a "substantive application" with the High Court for an order of committal against Li.
"If Mr Li is overseas, the AGC will file an application for service of documents out of Singapore," the attorney general's office said.  Reuters

GOLDMAN SACHS: This may not be the big correction that markets have been waiting for

GOLDMAN SACHS: This may not be the big correction that markets have been waiting for

Calls for a stock market correction, a decline of 10%, have been growing lately, but Goldman Sachs say the recent sell-off wasn't the start of one. 
The S&P 500 logged a second straight weekly decline Friday, and the cumulative 2.1% drop was the steepest since the two weeks before the November US election. Some earnings misses and corporate America's exodus from President Donald Trump's advisory councils have recently weighed on investor sentiment.
Analysts who study the market's fundamentals would point to solid earnings growth, low inflation, and persistently low interest rates as a fertile environment for stocks. But Goldman's Sheba Jafari and her colleagues used technical analysis — specifically the Elliott wave theory — to show that a big correction is still further away.
The Elliot Wave Principle identifies up-and-down trends in the market on charts. Its basic idea is that human behavior tends to move and then revert in recognizable cycles, especially when traders are acting like a herd; what goes up eventually comes down.
A complete cycle has eight waves — the first five are impulsive, while the last three are corrective.
"Being that this is just the 4th of 5 from Feb. '16, it should in theory have at least one more advance (wave 5/(5)/III)," Jafari said, illustrating with the chart below. "The bigger/more material correction (wave IV) would then come after a full 5-wave sequence is in place."
Screen Shot 2017 08 21 at 10.16.58 AMGoldman Sachs
"It is important to emphasize that the topping process in Jan./Jul. '15 lasted approximately seven months (from one key week to another)," Jafari said. "The correction itself ran another 18 months thereafter (into the Feb. '16 low). Said another way, it's certainly not going to be a quick process but the patterns/wave count emerging do seem increasingly analogous to the '15/'16 topping process."

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