Wall Street Journal: Dearth of Demand Seen Behind Weak Hiring (borders, Obama)

[ovcatto]

The main reason U.S. companies are reluctant to step up hiring is scant demand, rather than uncertainty over government policies, according to a majority of economists in a new Wall Street Journal survey.

Dearth of Demand Seen Behind Weak Hiring - WSJ.com

[Fiddlehead]

I would say this is probaby true. Based largely on the Borders thread. Seems like consumption is just down.

But, I do think companies are more concerned with short term profits than stimulating the economy through hiring. Many (not all, of course) have the money to do so, but they think they can make more elsewhere.

[InformedConsent]

So... Obama and the Dems' solution is to tax even more money out of the economy and kill demand even more?

[HappyTexan]

Consumption in the US is down while consumption in emerging nations is on the rise.
That's why the multinationals have such good profits; the profits are coming from other countries.

[ovcatto]

Originally Posted by InformedConsent

solution is to tax even more money out of the economy and kill demand even more?

Ah, take money out of the economy? What does the government do with tax dollars rush off to secret buildings filled with mattresses where they stash all that taxed money?

You need to be rflayao...

[InformedConsent]

Originally Posted by ovcatto

Ah, take money out of the economy? What does the government do with tax dollars

Some of it filters back into the economy, but a lot of it is wasted.

You do know that for every $1 taxed out of the economy and spent by the Federal Government, $1.10 worth of economic growth is destroyed, right?

[ovcatto]

Originally Posted by InformedConsent

You do know that for every $1 taxed out of the economy and spent by the Federal Government, $1.10 worth of economic growth is destroyed, right?

Did you read Barro, Redlick (2010) or did you just skim the blog that pointed to it?

http://mercatus.org/sites/default/fi...nd%20taxes.pdf

[shorebaby]

I tend to believe that business people know better why they don't hire, than economists. Of course lack of demand is part of the reason, but increased productivity is happening.

I don't think economists know as much as business owners about what motivates them.

[Kirdik]

Originally Posted by ovcatto

Ah, take money out of the economy? What does the government do with tax dollars rush off to secret buildings filled with mattresses where they stash all that taxed money?

You need to be rflayao...

Supposedly the government pays off its debt with that money.

[ovcatto]

Originally Posted by shorebaby

I tend to believe that business people know better why they don't hire, than economists. Of course lack of demand is part of the reason, but increased productivity is happening.

I don't think economists know as much as business owners about what motivates them.

Ah, since for the most part economist work in the private sector, for investment banks and other financial institutions you apparently assume that economist do not discuss these issues with the businesses that their institutions are charged with investing in. A very wrong assumption on your part.