The Economy Guy

The Euro strengthened, and gold, oil and gasoline moved sideways.

In the news today….

Central banks own a lot of US Treasuries and a lot of other US debt.  For example, in the past it was very popular for Central Banks to purchase Fannie and Freddie debt.  With the poor state of affairs for these institutions, Central Banks are now selling their Fannie/Freddie debt and purchasing US Treasuries.  This will put a floor under the price of US Treasuries, and possibly give impetus to lower interest rates.  Interesting!!!!!

Worker healthcare costs are on the increase as are deductibles and co-pays.  This is the way 58% of companies plan to handle the increase in health care costs.  The US medical system is broken – as health care management companies rake in the profits and services dwindle to patients.

Boeing workers have approved a strike to start in 48 hours, and negotiators will meet one last time with government parties to try to stop the strike.  Boeing offered an average of $34,000 in money and benefits to each worker over a 3 year period – but this was rejected.  This is a sign of our times, and could be the first of a series of strikes that could hit the US economy just when it will hurt it most.  The cause – inflation – workers see their standard of living dropping as high fuel and food costs rise – and how about medical costs – and in the near future – just about everything is going to start going up.  Workers also see massive profits in their companies – so they know the company can afford the cost.