
Credit Suisse Warns That Workers Are Gaining Ground and U.S. Equities May Suffer - dismal2
http://www.bloomberg.com/news/articles/2016-05-31/credit-suisse-warns-that-workers-are-gaining-ground-and-u-s-equities-may-suffer
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foota
I understand the business implications of a higher cost for labor and that the
primary intent of the advisory is positive, but yikes, this perspective is so
pro-business that it reads like a caricature.

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cmrdporcupine
Straight out of Das Kapital... Only backwards

An old friend used to always point out to me that if you want to know what's
really happening in the world, read the 'bourgeois' financial press, not the
'news'. Ideologues can and will lie and distort at will in tabloids and on TV
news, but if your customers are businesses looking to make money, you have to
tell things closer to the truth, that's what they're paying for.

~~~
honkhonkpants
Marx got a lot of things wrong but he was spot on in his descriptions of
capitalism.

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vixen99
He certainly didn't understand how wealth is created and confused a temporary
situation with an abstract truth.

It is not socialism that has brought millions of people across the world out
of utter poverty in the last 20-30 years.

"Economists with the National Bureau of Economic Research released a working
paper in 2009 on global poverty concluding that the world had seen a
significant decrease in extreme poverty—defined at the time as living on $1 or
less per day—between 1970 and 2006. While even a significant decrease in
extreme poverty still leaves much room for additional gains, the decrease in
rates of extreme poverty during this period of time is stunning. "

[http://www.firstthings.com/web-exclusives/2013/11/whats-
behi...](http://www.firstthings.com/web-exclusives/2013/11/whats-behind-the-
stunning-decrease-in-global-poverty)

[http://www.cesj.org/resources/articles-index/karl-marx-
the-a...](http://www.cesj.org/resources/articles-index/karl-marx-the-almost-
capitalist/)

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rcarrigan87
Unlike corporations, people don't hoard their money. They spend it. So this is
a good thing for everyone long-term.

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nickff
Unless someone is literally putting their money under the mattress, the money
is in a bank which is loaning most of it out, so the money is almost never
actually "hoarded".

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joobus
Excess reserves are near a record high:
[https://research.stlouisfed.org/fred2/series/EXCSRESNS](https://research.stlouisfed.org/fred2/series/EXCSRESNS)

Banks are just sitting on their cash. Also, the Fed is paying the banks not to
loan out this money, currently 0.5%.

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toomuchtodo
The solution is negative interest rates for banks and corporations, positive
interest rates for individuals.

Forces business investment (or dividends), but promotes savings for
individuals.

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skylan_q
It's actually higher prime interest rates. Sure, people can borrow at 3%
interest (or whatever is provided) but why would banks want to necessarily
want to loan out at such a low interest rate?

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toomuchtodo
I don't understand the question. Are you asking why would banks use negative
rates?

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skylan_q
Pretty much. What's in it for the banks to loan out at incredibly low rates?
Remember that there isn't only an aversion to high interest rates for people
trying to secure loans. The banks want higher interest rates to make loaning
worthwhile.

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kafkaesq
Heavens -- can't let _that_ happen, now can we?

Someone better think of a way to nip this trend in the bud, before things...
get out of hand.

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johngalt
Many comments are painting this as a bunch of monocle wearing old money
aristocrats lamenting the peasants demanding more.

In reality what the report is saying is this: businesses are having to hire
more people at higher wages _without the corresponding increase in earnings._
Earnings in excess of costs is the point of equity markets. Ignore that and
you have Venezuela. The evil capitalists that you all describe would happily
double worker wages if it meant doubling earnings.

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syngrog66
> The evil capitalists that you all describe would happily double worker wages
> if it meant doubling earnings.

fair point. but another point is that, for the last 20 years or so, they've
been increasing return to owners (to capitalists) without an equivalent return
to labor. now that it's starting to shift a little bit more towards labor
relative to capital? oh noes!

EDIT: mine plus aaronbrethorst's point: 1+1=3

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somethingsimple
This makes me feel dirty for being an index investor. I want my index funds to
make me money, but not at the expense of American workers' quality of life.

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monochromatic
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Actually, it speeds up performance and makes the content easier to read by
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matthiasb
I am not using an ad blocker but I still got that message... slowing
performance and making my experience worse ;-(

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jschwartzi
Neither am I, though I am finding that that message makes it easier to not
read any Bloomberg articles.

