Daily Bread for 1.7.22: The Booming National Economy

Good morning.

Friday in Whitewater will be partly sunny with a high of 11.  Sunrise is 7:24 AM and sunset 4:38 PM for 9h 13m 08s of daytime.  The moon is a waxing crescent with 27.9% of its visible disk illuminated.

 On this day in 1901, Robert Marion “Fighting Bob” La Follette Sr. is inaugurated as governor after winning the November 6, 1900 election. La Follette was born in Dane County in 1855. A Wisconsin Law School graduate and three-term member of congress, La Follette was renowned for his oratorical style. He was the first Wisconsin-born individual to serve as governor.

 Whitewater’s struggling, long-stagnant local eonomy stands in contrast to a booming national economy. Matthew Winkler writes Biden’s Economic Performance Has Proved Unbeatable:

U.S. financial markets are outperforming the world by the biggest margin in the 21st century, and with good reason: America’s economy improved more in Joe Biden’s first 12 months than any president during the past 50 years notwithstanding the contrary media narrative contributing to dour public opinion.

Exceptional returns from dollar-denominated assets, especially the S&P 500 Index in both absolute terms and relative to its global counterparts, can be attributed to record-low debt ratios enabling companies to reap the biggest profit margins since 1950. Corporate America is booming because the Biden administration’s Covid-19 vaccination programs and $1.9 trillion American Rescue Plan reduced the jobless rate to 4.2% in November from 6.2% in February, continuing an unprecedented rate of decline during the Covid-19 pandemic.

Consider that real, or inflation adjusted, gross domestic product surged at an average annual rate of 5.03% in each of the first three quarters of 2021, and is poised to expand 5.6% for the year based on the average estimate of more than 80 economists surveyed Bloomberg. If that forecast proves accurate, it would be more than 2.8 times the average between 2000 and 2019 and double the average since 1976.

All of which makes Biden’s first year in the White House the standout among the seven previous presidents, based on 10 market and economic indicators given equal weight. According to data compiled by Bloomberg, no one comes close to matching Biden’s combination of No. 1 and No. 2 rankings for each of the measures:

  • Gross domestic product (1)
  • Profit growth (1)
  • S&P 500 performance (2)
  • Consumer credit (1)
  • Non-farm payrolls (2)
  • Manufacturing jobs (2)
  • Business productivity (2)
  • Dollar appreciation (2)
  • S&P 500 relative performance (2)

Per capita disposable income, which rose 1.08% this year, is the only comparable weakness for Biden, trailing Donald Trump’s 2.17%, George W. Bush’s 2.01%, Jimmy Carter’s 1.80% and Ronald Reagan’s 1.42%.

GDP growth in every incoming administration during the past four decades never exceeded 2.74% until 2021. Biden is now positioned to surpass Carter (5.01%) as the GDP champion of presidents since 1976. Much of the credit goes to The American Rescue Plan, which poured $66 billion into 36 million households and reduced the child poverty rate by 50%, helping the U.S. recover faster from the pandemic than most other nations.

The level of disposable personal income is a notable and critical national deficiency in an otherwise strong performance.  Whitewater knows this well, as this city has been and remains a low-income community. There is no better measure of a society’s general prosperity than individual and household income.

While some of us have done well even through a Great Recession, opioid crisis, pandemic, and pandemic recession, it matters more that many of us are doing well than that a few of us have done well. (I have no personal concerns, so to speak; Whitewater has community concerns. Those community concerns cannot be met through boosterism or delusional positivity.)

The weird, wild world of CES 2022:

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