Musing on Economics
December 01, 2019
There are just five weeks from the end of a decade that saw prosperity spread far and wide. For starters, the US macroeconomy – the big picture – is in solid shape. The unemployment rate is 3.6%, just a tic above September's 3.5% reading - the lowest since 1969. What some people call the "true unemployment rate" (known to the Labor Department as the "U-6" rate), which includes discouraged workers and part-timers who say they want full-time work, currently stands at 7.0%, and recently touched lows not seen since the peak of the first internet boom nearly twenty years ago. Average hourly earnings are up 3.0% from a year ago, compared to an increase in 1.8% in consumer prices. "Real" (inflation-adjusted) earnings are likely to be up again for the year, making the seventh consecutive year of higher real wages. In the past year, median usual weekly earnings for workers age 25+ with less than a high school diploma are up 9.0%. In the year before, these wages were up 6.5%. This is faster growth than for those with college and graduate school degrees. Making jobs plentiful is still the best way to raise living standards. US equities have recently hit all-time highs, pushing IRAs, 401ks, pension funds, and retirement wealth higher. Both workers and investors have good reason to be grateful.
The day-in, day-out lives of people the world over have improved because of the grit and determination of inventors and entrepreneurs. A decade ago, we couldn’t instantly order a car to pick us up via our phones and then watched its progress toward us in real time, not left to wonder when and if the car would ever show up? We couldn’t optimize our travel routes with free apps that tell us the best time of day to take the route in question, or where to turn to cut travel time? Mobile displays were 2” in diagonal, thick and the contrast ratio was atrocious. The largest direct view TV was 36” and it was thicker than it was wide, and the resolution was 480p. Car and truck technology that used to be reserved for the upscale, like adaptive cruise control or blind-spot warnings, even self-parking cars and backup cameras The CRISPR gene-editing system is poised to revolutionize medicine, potentially helping us fight the big ones like cancer and HIV, as well as tackle non-health problems.
Put it all together and we have so much to be thankful for. There has quite simply never, in the history of mankind, been a better time to be alive. Our ancestors could find faults in some things in the world today, but they'd be left speechless at our abundant (and growing!) opportunity.