Growing Stocks of Unsold Cars Around The World
Ten pictures here. Pictured above is the build-up of imported cars at the port of Newark, New Jersey.
Professor Mark J. Perry's Blog for Economics and Finance
Ten pictures here. Pictured above is the build-up of imported cars at the port of Newark, New Jersey.
Consider the following comparisons of key economic variables today to the peaks for those variable in the early 1980s (see graph above):
The brutally cold weather (so cold that I saw a lawyer yesterday who actually had his hands in his own pockets) and all of the complaints about low temperatures got me to thinking about this.... Couldn't the government intervene in the market for temperature-reading equipment to counteract the unfair "excessively low" temperatures, just like it does in the unskilled labor market for unfair "excessively low" wages???
UK TELEGRAPH -- Freight rates for containers shipped from Asia to Europe have fallen to zero for the first time since records began, underscoring the dramatic collapse in trade since the world economy buckled in October. Shipping journal Lloyd's List said brokers in Singapore are now waiving fees for containers travelling from South China, charging only for the minimal "bunker" costs. Offering slots for free is akin to an airline giving away spare seats for nothing in the hope of making something from meals and fees.
The current economic strategy is right out of "Atlas Shrugged":
Mortgage rates fell today to an historic record-low of 4.96% (see chart above), "the lowest mark since Freddie Mac started tracking the data in 1971." That should help push the Housing Affordability Index (HAI) to a new estimated record high level of 163.1 in January (see chart below). The National Association of Realtors (NAR) has HAI data through October 2008, and I have estimated the HAI for November, December and January using the NAR methodology.
RealtyTrac, the leading online marketplace for foreclosure properties, today released its 2008 U.S. Foreclosure Market Report, which shows a total of 3,157,806 foreclosure filings — default notices, auction sale notices and bank repossessions — were reported on 2,330,483 U.S. properties during the year, an 81% increase in total properties from 2007 and a 225% increase in total properties from 2006. The report also shows that 1.84% of all U.S. housing units (one in 54) received at least one foreclosure filing during the year, up from 1.03% in 2007.
Cost of a rechargeable scientific calculator from Wards in 1975: $58.95, or 12.5 hours of work (1.5 days) at the average hourly wage of $4.72 (total private industries).
Bottom Line: If we paid the same price today as in 1975 (12.5 hours, at the average hourly wage today of $18.36), the 2009 HP calculator above would cost us $230 today. Or equivalently, consumers in 1975 actually did pay the equivalent of $230 in today's dollars for a scientific calculator.
Or we could say that the typical consumer today would earn enough money in about one-half hour (33 minutes) to purchase a brand new HP scientific calculator, whereas the typical consumer in 1975 had to work full-time for 1.5 days to earn enough money to purchase a scientific calculator then.
From University of Virginia economics professor Lee Coppock's blog Long Run Equilibrium.
We still have a long way to go before the jobless rate equals the levels of the early 1980s. So before we make comparisons to the 1930s and declare that we are in Great Depression II, how about first making comparisons to the 1980s?
WALL STREET JOURNAL -- Walgreen's will market a network of pharmacies, in-store clinics and company health centers to corporate and government employers nationwide. Under the drugstore chain's "Complete Care and Well-Being" program, participating employees at work would be able to get checkups, preventive care and other services, such as dentistry and optometry. Walgreen's Take Care health clinics would be available for basic services outside of business hours, and the chain would offer discounted prescriptions at Walgreen pharmacies. Retirees and employees' family members also would be eligible for the services. In addition, the customers would receive a 15% discount on Walgreen's private-label products such as toothpaste and diapers.
Cost of a Sears 1.5 cubic foot microwave in 1981: $469.88, or 63.2 hours of work (about 8 days) at the average hourly wage of $7.42 (total private industries).
Cost of a Sears 19-inch portable TV in 1981: $529.88, or 71.3 hours of work (9 days) at the average hourly wage of $7.42 (total private industries).
Cost of a Sears VCR in 1981: $1389.88, or 187.3 hours of work (23.4 days or 4.7 weeks) at the average hourly wage of $7.42 (total private industries).
Cost of a Sears VCR/DVD combo in 2009: $69.99 or 3.8 hours of work at the average hourly wage of $18.36.
Bottom Line: If we paid the same price today as in 1981 (187.3 hours, at the average hourly wage of $18.36), the 2009 Sears VCR/DVD above would cost us almost $3,500. Or equivalently, consumers in 1981 actually paid the equivalent of $3,500 in today's dollars. Or we could say that the typical consumer today would earn enough money on a single day before lunch (3.8 hours) to purchase a brand new VCR/DVD player, and the typical consumer in 1981 had to work full-time for almost five weeks to earn enough money to purchase a VCR then.
WishbookWeb was created in October 2006 to be a place to come and freely view the Christmas catalogs of the past. We've gone out and purchased catalogs, mostly on Ebay. Once we get them, they are carefully disassembled and scanned. This process destroys the binding, but leaves each page free to be scanned as flat as possible. As an example, a 400 page catalog takes roughly eight or nine hours to scan and crop. Most of our catalogs have been scanned at 300dpi and permanently stored as tiff files, although the viewable jpegs on the site are lower resolution than that. Once a catalog is scanned, the loose pages are stored, in case they are needed at a later date.
Cost of a Sears Washer in 1949: $104.95 or 83.3 hours of work (10.5 days or 2.1 weeks) at the average hourly manufacturing wage of $1.26.
Cost of a Sears washer in 2009: $322.99 or 17.9 hours of work (2.2 days) at the average hourly manufacturing wage of $18.03.
Bottom Line: If we paid the same price today as in 1949 (83.3 hours at the average hourly wage of $18.03), the 2009 Sears washer above would cost us $1,502.
Several commenters on this CD post about toasters suggested that the 1949 toaster is of better quality than today's toasters. Maybe. I don't think anybody would make the same claim about the 1949 washer. Would anybody really trade their current washer for the one pictured above from 1949 that requires manual wringing?
Cost of Sears Toaster in 1949: $16.95 or 13.5 hours of work at the average hourly manufacturing wage of $1.26:
Cost of Sears toaster in 2009: $19.99 or 1.1 hours of work at the average hourly manufacturing wage of $18.03:
Bottom Line: The price of a toaster in 1940 was 12.3 times more expensive in 1949 (13.5 hours) than in 2009 (1.1 hours), when the price is measured in the number of hours worked at the average manufacturing wage. If we paid the same price today as in 1949 (13.5 hours at the average hourly wage of $18.03), a toaster today would cost $243.40. See related post below.
I have been purchasing some old Sears and Montgomery Wards catalogs on Ebay to have accurate, historical retail price data on typical consumer goods in various years, and then be able to compare the prices consumers pay today for various household goods to prices in previous periods, measured in the number of minutes or hours worked at the average wage to earn enough money to purchase the items. Here is the first in a series of CD posts comparing today's prices to a previous year:
You can now sign up for daily emails of new Carpe Diem posts, with the full text, all of the graphs, charts, tables and photos, etc. Just go to the bottom of the right sidebar (in the Links section) and enter your email address. I have used this feature to receive daily updates of the excellent Cafe Hayek blog for about the last year, and I really like it so I just figured out how to add it Carpe Diem. Try it out if you want, you can unsubscribe at any time.
The eight states enjoying the greatest net in-migration of people from other states between 2000-2008 all have Right to Work laws. But of the eight states suffering the worst out-migration, only Katrina-hit Louisiana has such a law (see chart below).
Washington Post -- President-elect Barack Obama has offered the job of surgeon general to Dr. Sanjay Gupta, the neurosurgeon and correspondent for CNN and CBS, according to two sources with knowledge of the situation. Gupta has told administration officials that he wants the job, and the final vetting process is under way. He has asked for a few days to figure out the financial and logistical details of moving his family from Atlanta to Washington but is expected to accept the offer.
Good News: Crime is declining in the U.S., see chart above.
From Vanguard founder John Bogle's WSJ article last week "Six Lessons for Investors":
1. Virginity of a 22-year old California student who has a degree in Women's Studies and wants money for a master's degree in Family and Marriage therapy.
According to Princeton economist Uwe E. Reinhardt, writing in the NY Times:
By Judith Cone, Vice President for Emerging Strategies at the Ewing Marion Kauffman Foundation:
A reader comments:
Here is one comment on how you might improve your blog. I find many times that I am not sure when you are quoting others and when it is your own commentary. You use italics a lot, but I am not sure if you are doing this to indicate a quote, or if you use italics in general. I bet that other readers notice the same thing.Response: When I started Carpe Diem in the fall of 2006, I tried very hard to use the "blockquote" feature of Blogger to offset/indent direct quotes and clearly separate and distinguish my commentary from the quotes of others. I finally gave up because it was too difficult and time-consuming to get the spacing and layout of the post to look right. As the next best alternative, I started using italics for direct quotes, and non-italics for my own comments.
In his column today George Will discusses America's increasingly perverse legal culture, and reviews what he considers to be 2009's most needed book on public affairs -- Philip Howard's "Life Without Lawyers: Liberating Americans from Too Much Law." Will talks about the "bubble wrap approach to child rearing" produced by the "cult of safety," and by trial lawyers "congregating at the intersection of human tragedy and human greed."