House of Paine

inflation targeting

price change targets 

are  really
  wage control devices ...

in the long run
only wages  can push prices
continuously 

as the wagery like so many hounds
chase 
the profiteers
up the price pole 


but that  remains unspoken

long as it can  

 and even so 
the crank may need 
a turn or two
towards "tight" 
even when 
 the spot rate of inflation 
     has clearly come 
             unhinged from  
                  the  trend rate 
                set by  wage gains 

                      as it has this past year .....



=======================================


counterpunch:


"Employers' wage costs grew 2.3%
 over the past year "

first off

the real number is unit  labor costs 

ie
units produced divided by total wages 
compared to say last year at this time 


 divide total wages by hours worked

and we have the average wage rate 
to also compare
as above

but

the corps kats
look at unit labor cost

meaning if units rise faster then wages rise 
the deal looks better not worse 

dividing
 output  value by hours  worked 
gives us productivity  to compare to a year ago 

in capsulwe for

if productivity  increase exceeds wage increase
there is no wage push on prices 
cause 
no squeeze on margins 

play with these and you can figures
and u can find
 the change in  gross profits  

what the game is all about ...

-----------------------------------------------------

 "Factoring in 
the recent energy-driven 
increase in inflation
 the real wage is down 2.3%"

now we've moved from wages to their purchasing power 

again not the profiteers who steer the system's major gage 


but jobblwe households might agree :

"this is certainly not 
     the path  we would want 
 in an economy posting
  strong productivity gains"

------------------------------------------------

what about comp ???


 Compensation-wages plus benefits-


also grew  slowly in the third quarter
 of this year
 up 3.1% over the same quarter last year
 the slowest yearly growth in six years"

For the first time in this employers' costs report, the Bureau of Labor Statistics presented these values adjusted for inflation. 


"Both wages and compensation
 are losing ground
 in real terms 
down 2.3% and 1.5%, respectively"

--------------------------------------------------

 there is  an ongoing 
freakish  imbalance 
in the present  expansion
       as productivity 
 per hour rises rapidly
profits billow 
but  job comp limps
              even faulters 

 lagging wage and compensation 
demonstrates 
  increasing  unit labor costs
 are  not pushing up prices 

the  labor market
is far from overheating 

so why 
the  Federal Reserve rate hikes ????

and yet we've had these hikes any way 

if its not to curb wages and commodity prices

what is it for ????


the lot bubble


nope 

then why ???

stay tuned ....


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