Friday, September 17, 2004
The Economy Line: Household Wealth Hits Record High
Record Household Wealth. "U.S. household wealth swelled to a new record in the second quarter of 2004, while borrowing outside the financial sector grew at a slower pace, the Federal Reserve said on Thursday. In its quarterly 'Flow of Funds' report, the Fed said household balance sheets increased 1.4 percent to $45.907 trillion in the second quarter, compared with an upwardly revised $45.270 trillion in the first quarter of this year." ("US Household Wealth Swells To Record In 2nd Qtr--Fed," Reuters, 9/16/04)
Wall Street Journal Editorial: Good Jobs At Good Wages. "Several months of growth have blown away most of the Chicken Little stories about a 'jobless recovery,' but one doubt has lingered. Many Americans believe that service-sector 'offshoring' means that the number of high-paying jobs is flat, while companies are creating more menial positions. Well, even that myth has now been shattered. A new paper from the Chicago Federal Reserve Bank analyzes government employment numbers and finds that growth in jobs paying more than the mean now outstrips the creation of jobs on the bottom end of the bell curve. Moreover, the timing of this shift is in line with the pattern of past economic expansions. ? Yet using either method, the Fed economists found that the trend line is clear: The U.S. employment market is now in positive territory, creating more higher paying jobs." (Editorial, "Good Jobs At Good Wages," The Wall Street Journal, 9/16/04)
Unemployment Rates Lower In 45 States. "Over the year, unemployment rates declined in all four regions and in 45 states. The national unemployment rate, 5.4 percent in August, was little changed from July." ("Regional And State Employment And Unemployment: August 2004," Press Release, Bureau Of Labor Statistics, 9/17/04)
CBO Projection Finds Labor Force Participation Will Decline Unless The President's Tax Cuts Are Made Permanent. When the President?s tax cuts expire, marginal income tax rates will rise, reducing workers after-tax income and thus discouraging workers from participating in the labor force, according to a CBO projection. Average marginal tax rates are projected to rise to 25.1 percent by 2010 as a result of real bracket creep and increased exposure to the AMT. It jumps to 27.3 percent with the expiration of President?s tax cuts after 2010, and continues to drift upward by about 0.3 percentage points per year. If the President?s tax cuts are not made permanent, the labor force participation rate in 2014 falls to 65.6 percent and the labor force projection is reduced by more than 1 million relative to its unadjusted level, to 162.2 million. ("CBO's Projection of the Labor Force," www.cbo.gov, 9/04)
The Economy Line: Household Wealth Hits Record High
Record Household Wealth. "U.S. household wealth swelled to a new record in the second quarter of 2004, while borrowing outside the financial sector grew at a slower pace, the Federal Reserve said on Thursday. In its quarterly 'Flow of Funds' report, the Fed said household balance sheets increased 1.4 percent to $45.907 trillion in the second quarter, compared with an upwardly revised $45.270 trillion in the first quarter of this year." ("US Household Wealth Swells To Record In 2nd Qtr--Fed," Reuters, 9/16/04)
Wall Street Journal Editorial: Good Jobs At Good Wages. "Several months of growth have blown away most of the Chicken Little stories about a 'jobless recovery,' but one doubt has lingered. Many Americans believe that service-sector 'offshoring' means that the number of high-paying jobs is flat, while companies are creating more menial positions. Well, even that myth has now been shattered. A new paper from the Chicago Federal Reserve Bank analyzes government employment numbers and finds that growth in jobs paying more than the mean now outstrips the creation of jobs on the bottom end of the bell curve. Moreover, the timing of this shift is in line with the pattern of past economic expansions. ? Yet using either method, the Fed economists found that the trend line is clear: The U.S. employment market is now in positive territory, creating more higher paying jobs." (Editorial, "Good Jobs At Good Wages," The Wall Street Journal, 9/16/04)
Unemployment Rates Lower In 45 States. "Over the year, unemployment rates declined in all four regions and in 45 states. The national unemployment rate, 5.4 percent in August, was little changed from July." ("Regional And State Employment And Unemployment: August 2004," Press Release, Bureau Of Labor Statistics, 9/17/04)
CBO Projection Finds Labor Force Participation Will Decline Unless The President's Tax Cuts Are Made Permanent. When the President?s tax cuts expire, marginal income tax rates will rise, reducing workers after-tax income and thus discouraging workers from participating in the labor force, according to a CBO projection. Average marginal tax rates are projected to rise to 25.1 percent by 2010 as a result of real bracket creep and increased exposure to the AMT. It jumps to 27.3 percent with the expiration of President?s tax cuts after 2010, and continues to drift upward by about 0.3 percentage points per year. If the President?s tax cuts are not made permanent, the labor force participation rate in 2014 falls to 65.6 percent and the labor force projection is reduced by more than 1 million relative to its unadjusted level, to 162.2 million. ("CBO's Projection of the Labor Force," www.cbo.gov, 9/04)
