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Non-Tech : Kirk's Market Thoughts
COHR 178.97+5.0%10:38 AM EST
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To: robert b furman who wrote (5295)12/14/2017 4:57:00 PM
From: zzpat  Read Replies (1) of 26786
 
IMO, the lack of wage growth is keeping inflation and economy from growing at its potential. I'm not sure this is caused by incompetent CEOs who aren't investing in their workforces or machines creating more stuff. I don't know how to track machines making things. I know a coke plant has almost zero employees and it still generates millions of dollars worth of wealth so all that wealth has to go someplace so it can only go into the stock market. Since the rich own most stocks their income is rising the most.

Back to bank loans. IMO, the economy can't grow without credit and that's why the credit freeze after the Great Recession began almost crippled the global economy - capitalisms need credit and credit create growth. Falling bank loans when GDP is rising is not sustainable. Both have to go in the same direction for there to be a healthy economy.

I'd prefer to see both going up or both going down than a converse relationship but as others have pointed out these numbers may be lagging indicators.

The debt numbers are all over the place. This one makes the most sense to me. The recession in 2001 was caused by too much consumer debt (the Fed put us in a recession) and we're far higher now so I'm not sure about this. My first chart shows banks loans have fallen dramatically and yet debt seems high.

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