Source: http://www.marketwatch.com/story/its-the-momentum-of-the-economic-data-thats-worrisome-2014-10-15
Here is some sad news to our country. US retail sales fell 0.3%, producer prices dropped last month, Empire State manufacturing index saw a big tumble.
The author claims that it was the downward sloping in gasonline price, European and Latin American weak consumption towards our goods, our weak domestic consumption are the victims which slowered US economic recovery.
Though, it is a miracle that unemployment rate is below 6%. He suggests that the continued job growth should lead to wage growth, which will lead to more consumption. Therefore, it cures a lot of our problems.
His suggestion is not really that correct. When we increase more jobs, it will decrease MPL. MPL is considered wage. So wage should go down when increasing employment. However, in the long run, because there are so many labor, they will decrease labor employment. Therefore, employers will increase the wage. Then, with better wage, people will try to consume more.
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