America Is Getting a Raise, and Goldman Sachs Is Freaking Out AboutIt

[Yo_Mama_Been_Loggin]

On Tuesday May 23rd, investment firm Goldman Sachs sent an edition of their Global Markets Daily e-newsletter to customers. It’s the kind of email that goes out to high-rollers and high-stakes investors—the big shots who will gladly chase profits across international boundaries. The newsletter contains a combination of investment news — in this case a couple of bullet points about Chinese industrial production and OPEC’s quest for stability — and analysis for investors in the global marketplace.

Global Markets Daily is apparently not available online unless you’re a Goldman Sachs customer, but Civic Ventures obtained a copy after Luke Kawa published a piece of it in Bloomberg. Specifically, we’re interested in the second item in the newsletter, which is written by Goldman strategists Charles P. Himmelberg and James Weldon. It’s titled “What Happens to Profits if Wages Catch up with Productivity?” and it begins with some unequivocally good news.

-Wages are rising. The ‘wage tracker’ maintained by our US economics team — a composite measure of wage growth based on the four main wage indicators — hit 3.0% year-on-year in the first quarter for the first time in this expansion.-

Fantastic! Worker wages have been flat in the United States for almost the entire 21st century. If more workers have more money, surely they’ll spend it, thereby supercharging the economy with their increased demand. Good news for Goldman Sachs investors, right?

Apparently not. Here’s the very next sentence, with emphasis added:

-And as our colleagues in equity strategy have recently pointed out, rising wages are a threat to corporate profit margins (“Labor Costs and US Equities: Stocks Confront Rising Wages with Economy at Full Employment”, Portfolio Strategy Research, May 9, 2017).-

https://civicskunk.works/america-is-getting-a-raise-and-goldman-sachs-is-freaking-out-about-it-6479cb86c59

[bresue]

1. CEOs are forgetting that American workers are talking versus

https://www.glassdoor.com/blog/25-highest-paying-companies-in-america-for-2017/

a relatively new website that educates and informs job seekers.

[OrwellwasRight]

2. This is what is wrong with neoliberalism.

It purports to be pro-development, but it is actually only pro-elitist. It elevates profits above all else and smashes down rather than elevates with the working class.

Democrats need to get serious about reforming the economy, which is about a lot more than just calling Trump a lying, cheating, misogynist. We must tell a coherent story about how we create shared prosperity and an inclusive economy for all.

[angstlessk]

4. Not sure where the liberal in neoliberalism came from, but it surely

ain't liberal!

[OrwellwasRight]

6. Not in the US meaning, no.

But in the traditional European meaning, it makes sense.

http://www.bbc.com/news/world-10658070

[Lyricalinklines]

3. Workers became liabilities when corporations decided to consider them not as assets

but business expenses. Assets are something to be preserved, invested in since they add value. Expenses are a necessary evil of doing business and need to kept to a minimum and cut at each opportunity.

[angstlessk]

5. Yes, ever since the only stakeholder became the investor..and left out every other stakeholder!

the others being employees, the community...it gave them carte blanche to make employees just a cost center and destroy the environment without any backlash.

[pansypoo53219]

7. PROFIT pigs. goldman suks forever.

wall street is what is wrong. profits overtook reasonable business practices. thanks ayn rand.

[onethatcares]

8. thank gaud,

I was wondering how I'd pay for the third fifty foot yacht and Chad's haircuts on my measly profit margins.