1) Yes, the world is awash in cash. Most of this cash is flooding the stock market. This makes those who get a percent of the action very happy. It does absolutely nothing for the rest of us as no real wealth is created in proportion to all this cash. As long as this cash just sits in the stock market or other financial instruments & contrivances, then all will be well. The the moment people actually start trying to spend that money, look out. It's not going to be pretty.
"Quantitative Easing" is just printing money that the government is spending. The inevitable inflation is effectively a tax, as those new dollars effectively dilute and steal value from the dollars already in the economy. The sad part is that it's a tax mostly upon those who honestly believe that they aren't getting their taxes raised; And it affects those who spend the most of their income (poor and middle class) far more harshly than it does the rich, who do not spend all of their money, and invest heavily in assets that appreciate with inflation.
3) US Poverty metrics are largely meaningless; mostly just a political prop used to justify government programs.
4) Lower child mortality exacerbates the issue we were discussing yesterday.
5) I'm not impressed by health care reform story. My rates have been going up 10% to 15% per-year; up almost $5,000-a-year since the President promised that it would be going down $2,500-a-year. People like me will be going uninsured very soon as it continues to become more unaffordable. It will be much cheaper to drop coverage in 2014, pay the "fine", and just buy the insurance should we get sick then.
This is the big reason why this model will ultimately fail. It's specifically designed to destroy private health care as we knew it.
The last part of the story is about "income inequality". This trend will continue because of two factors; we are making being on the lower rungs more sustainable as a lifestyle, (subsidies) and workforce participation is the lowest it's been since the early '80s. The best solution for "income inequality" is for more people to be working. That is not happening, and it doesn't appear as though it will be any time soon.
“The Morning Briefing” is SmartPlanet’s daily roundup of must-reads from the web. This morning we’re reading about the economic state of the globe.
1.) World drunk with cash. Markets around the world overreact to The Fed stimulus plans ignoring slowing growth, high unemployment and the possible inflationary effects of a new round of free money.
2.) Poverty down! Inequality & hunger up… Huh? New, upbeat World Bank and UN reports celebrate a global success story: Between 1990 and 2008, the world cut by half the share of the world’s really poor — those living on less than $1.25 a day. And we achieved this goal five years ahead of the “Millennial Development Goal.” Wow! But..
3.) The official poverty rate last year was 15 percent. Here’s what that misses. The Census Bureau released its income, poverty and health insurance numbers for 2011 on Wednesday and contrary to expectations, poverty was essentially unchanged, falling from 15.1 percent in 2010 to 15 percent in 2011. But more and more poverty experts are dismissing the official poverty figure. What gives?
4.) Proof that aid works? Child mortality plummets. Worldwide death rates cut by almost half in 12 years - but Africa still has challenges.
5.) Wider U.S. health coverage spurred by reform, income decline. Some 1.3 million more Americans had health insurance in 2011, as healthcare reform helped blunt a decade-long decline in private coverage and government safety nets expanded to cover growing numbers of the poor, elderly and disabled.
Image credit: Casey Serin
