The Higher The Unemployment Rate The Less Relevancy Unions Are

It looks as if our economic recovery in 2012, if you can call it that, may not be sustainable. Even with this little uptick we are watching the unions grow in power and try to take advantage of the incremental increases in corporate profits. The corporations are building up their war chest so they can have the cash they need for expansion as the economy gets good and as the fog of uncertainty subsides. However, apparently it appears that the unions want that money for themselves. That shortsighted thinking could cost many of them their jobs.

Further, the unions must realize that if the unemployment rates get back up to 10% their relevancy will also dissipate. If unions make demands, corporations can merely close down, re-group, and hired cheaper labor elsewhere. Not to mention the fact that many corporations which have been in the manufacturing sector have purposely kept some factories open in the United States even though they are not as profitable due to union demands, lawsuits, rules and regulations, and US taxes. Do you doubt what I’m saying? You shouldn’t, and it’s not just China either.

Did you know Mexico is now the fourth largest automobile manufacturer? It’s true. Six or seven years ago Mexico was only in sixth place for car exports. Today, they’re right behind Japan, Germany, and South Korea. When unemployment is high, unions are less relevant because the workers under their ranks should be happy to have a job, and when they go on strike, they end up doing more damage for their members than if they didn’t do anything.

Recently, US Airways had their flight attendants vote to go on strike during the Christmas holiday. Talk about socking it to a company when they really could use some quarterly profits to appease their shareholders after some rather dismal economic years in the airline industry. All those flight attendants are going to end up doing is sending more business to the competitors, and weakening the company. A weakened company cannot pay higher salaries, better benefits, or pay the cost to satisfy all the grievances of whining unions.

It is interesting that the unions are causing unemployment rates to go up, and yet at the same time as they do they are losing more power to serve their political will. Maybe in the end that is a good thing because it prevents them from getting out of control as the public and private unions have in Greece, Spain, Portugal, Argentina, Italy, and other nations. It’s not that the unions haven’t overstepped their bounds here the United States, they certainly have.

The future problems we will have with underfunded pensions, increased healthcare costs, and lack of government services not to mention the high prices we pay for all the goods and services we buy, well, much of that we can blame on the unions. It seems to me that the unions are their own worst enemy, but it is amazing when you state that fact and look at the evidence, that they certainly don’t want to hear it. It’s as if they have their own little religion all to themselves. That’s pretty amazing, we live in interesting times. Please consider all this and think on it.

Robotic Age – Unemployment, Birth Rates, Population Controls, Economics, and Illegal Immigration

If you talk to someone in a labor-intensive business, someone who is an owner of the business who can’t get the labor they need, they will say that illegal immigration laws are out of control, and need to be loosened, and we need to allow more work visa programs, and stop playing games. If you talk to someone who is a union worker, they might curse up and down about how illegal aliens are coming into our country, doing poor workmanship, and hurting our unemployment figures.

If you talk to someone in economics, they will explain to you that we need 2.2 people being born for every couple in our society or civilization, and without that birthrate, we cannot maintain our GDP growth, and the economy will falter, meaning there will be defaulted loans, businesses won’t make enough money, and we won’t be able to afford all of our obligations to retiring workers.

If you talk to a politician, they will tell you during times of high unemployment, that their number one concern is creating jobs. During times of low unemployment and high economic growth, those same politicians will tell you that they aren’t worried about illegal immigration at all rather they want to streamline the rules to let more people in.

My question is; what are all these people going to say as we enter the “Dawn of the Robotic Age?” You know, it’s merely upon us, and as artificial intelligence gets better, robots will be doing all the jobs, and as the cost to create these robotic workers is lower due to economies of scale, that’s when things will get very interesting, just as they did when Eli Whitney brought forth the cotton gin. If robots are doing all the work, then what will people do to stay busy, or earn a living to pay for all the things that they need to survive, send their children to college, and pay for the retirement?

Will humans build the robots that replace them? And what happens when the robots start making their counterparts? An interesting case study along this line of thinking was when Germany built all the industrial machinery to be used in the factories in China. The Germans make great machines, but each time they sold a machine to China, then China was building things. Now the Chinese are making everything that the Germans used to make, including factory machinery, and they are making many of the things that the United States used to make, and they are looking to secure or take more of our specialized industries.

Yes, they have cheaper labor, and are using the same tools. Today it costs a lot to buy a robotic machine to use in a factory, therefore China can still compete with low-cost labor, but as those robots become cheaper, and as the Chinese wages goes up, then they will have the same problem as the rest of the world in the future Robotic Age. We need to solve this problem before it hits us, and all the world economies at the same time. It will be nice to live in that future utopia, but we are going to have to adjust our economic structure to do it. Indeed I hope you will please consider all this and think on it.

Unemployment, A Tentacle to Drag Us Under?

IN June 17,801 million people were “officially” unemployed in the E.U.

According to Eurostat, the E.U’s official statistics office, this figure is higher than May’s unemployment figure by 123,000 making Junes figure a record breaker. The highest unemployment number since the E.U was formed in 1999.

“Another horrible set of labour market data for the Eurozone, which bodes ill for consumer spending and growth prospects,” said Howard Archer, chief European economist at IHS Global Insight.

Not the most optimistic and uplifting comment there, but Mr Archer is merely pointing out what we can all see.

What’s more to add to the woes analysts are pin pointing Germany as being next in line for unemployment rises.

Eurostat also said that inflation was unchanged at 2.4 % in July which remains above the ECB’s mandate target.

The unemployment is just one of the tentacles attached to the nightmare animal that is the European quagmire of debt burden and recession!

Jonathan Ravelas, chief market economist at BDO Unibank was quoted as saying “What the European Union did in the last two years was to provide the necessary steps to prevent a default. However, the problem continues to evolve as the global economy slows down,”

He also said he expected Europe’s debt crisis to be at the forefront all the media headlines for the next few years, which, he says is at best optimistic.

So more doom and gloom you say?

We’re not here for doom and glow, just opportunities!

Ok, so we can’t ignore the global downturn and overall market depression but that doesn’t mean there isn’t still A LOT of money to be made every day.

Seriously,

Local market are still moving continuously the FTSE companies are still leap frogging each other every single day, and were there’s movement there’s profit!

Barring a complete Euro break-down the markets will continue to fluctuate.

A spanner in the works though and the straw which could break the E.U’s back would be the collapse of the US markets.

The paper, spit and prayers holding together America’s financial foundations is so unstable right now.

A sharp fall on the NASDAQ could completely wash away the false economy created by the FED. Obviously American politicians and American based credit agencies like Moody’s, Standard & Poor’s and Fitch are going out of their way to shift the focus from home to Europe across the water but it’s hard to believe it’s much worse and the numbers coming out of America show things there are in a lot worse condition.

One to keep an eye on sure, but until it happens keep your better eye on the markets as they bounce up and down everyday.