A Position on the Economy for 2008

[Flipx99 5,000+ posts]

I like his writing. Sometimes in the podcasts he sounds rather senile because of age. He wrote two pretty good books. One is like the PM you sent but focuses on America.

 

[2002XLT 5,000+ posts]

This is actually pretty much what my financial strategy is going to be this year. The last year i was able to find the deals you are talking about. By buying bulk, or waiting for deals (no matter what the product was/is) i was able to make quite a bit back. To me, since i dont have tons of money to throw into long-term investments right now, im making a good chunk of change and just trying to put money into different things. I think next year i will be able to take this even further and im hoping to be able to significantly raise my cash income.

 

[AllStar1500bd 5,000+ posts]

Flip, what are your thoughts on raising of the minimum wage and its effect on inflation?

 

[Flipx99 5,000+ posts]

I am opposed to raising the minimum wage...(I hate inflation, I rather think in terms of purchasing power...which is similar but easier to grasp)

What you look at the function of wages of the middle class, they are negatively affected by increasing the minimum wage. While they make too much to be benefitted from the increases, they are the principle "buyers" of minimum wage earning labor. ie they shop at supermarkets and fast food establishments that employ much of this minimum wage. The middle class also owns many of the mom and pop places that employ these folks. What most people miss is the employer's part in paying income tax. As the employee makes a greater wage due to legislation, the employer also faces a greater tax burden in additon to the increased wages.

So, no, I am not for a minimum wage of any kind, not even the one currently in place.

Also consider this, of those who make the minimum wage, primarily where do they spend their money? At places such as fast food, supermarkets, resturants, etc. Well, those business will have to raise prices to accomdate the increased wages. The purchasing power of those most benefitted from the increase does not increase significantly.

In my honest opinion, the primary purpose for rasing the minimum wage is a tax increase that people for some reason do not take the time to think about.

 

[AllStar1500bd 5,000+ posts]

Perfect response, I couldn't agree more. What's interesting is that Oregon has raised its minimum wage 4-5 times in the past 8 year or so. I tried googling for the exact increments, but couldn't find them.

As my economics teacher would say, inflation is el diablo //content.invisioncic.com/y282845/emoticons/fyi.gif.9f1f679348da7204ce960cfc74bca8e0.gif

//content.invisioncic.com/y282845/emoticons/biggrin.gif.d71a5d36fcbab170f2364c9f2e3946cb.gif

 

[Flipx99 5,000+ posts]

So inflation is good. I mean, everyone likes raises right? As I become better and more effecient at my postition, I make more money for my company and they reward me with increased pay. That pay has to come from somewhere...Plus so many interest rate hedge consider inflation to make the math work.

1-3% inflation is okay....It comes with increases in the money supply.

 

[AllStar1500bd 5,000+ posts]

Everything in moderation.

 

[miker 5,000+ posts]

Haha.. Inflation.. Germany comes to mind.. lol

Anyway, I am just wondering if you are including mortgages in debt???

 

[Flipx99 5,000+ posts]

Haha.. Inflation.. Germany comes to mind.. lol
Anyway, I am just wondering if you are including mortgages in debt???

No. I was just meaning consumer debt...ie credit cards, small loans, stuff like that....things purchased on wants rather than needs. It wouldn't hurt to pay more than the stated amount each month to increase the equity in your home, but that is something I am becoming cautious about.

When I pay two or three times my truck payment, I may only save $2-300 in interest. If I kept it liquid, I might be better able to tak advantage of some investments that I cannot take advantage of now. That is what I am trying to get at...it might be a time do alter your financial strategy so you can "pounce" on opportunities quickly rather than having your money tied up.

 

[miker 5,000+ posts]

No. I was just meaning consumer debt...ie credit cards, small loans, stuff like that....things purchased on wants rather than needs. It wouldn't hurt to pay more than the stated amount each month to increase the equity in your home, but that is something I am becoming cautious about.
When I pay two or three times my truck payment, I may only save $2-300 in interest. If I kept it liquid, I might be better able to tak advantage of some investments that I cannot take advantage of now. That is what I am trying to get at...it might be a time do alter your financial strategy so you can "pounce" on opportunities quickly rather than having your money tied up.

Ok, I see..

Kinda sucks for us... We are just getting ready to sell our house this spring, but seems like selling it may be hard to accomplish...

 

[Flipx99 5,000+ posts]

I would not. That is the time I am going to buy. //content.invisioncic.com/y282845/emoticons/wink.gif.608e3ea05f1a9f98611af0861652f8fb.gif

However, real estate is a local market kind of thing. Middle TN is way way overbuilt. So I am waiting to a few builders go bellyup before I do much of anything.