It's Not Just Jobs That Are Needed

While I write mostly about the need for jobs and long term un and underemployment, there are always a number of related issues bubbling just below the surface for me. The past couple of days, I've seen a few articles that are seemingly unrelated but are probably more closely related than most folks realize.

The first article was from today's (Friday 1/28/11) NY Times on Standard & Poors downgrading Japan's Long Term Sovereign debt.

S.& P. lowered its sovereign credit rating for Japan to AA- from AA. That is three levels below the highest possible rating, and S.& P.’s first downgrade of Japanese government debt since 2002. With the lower grade, Japan’s debt rating is now on par with China’s, which last year overtook Japan as the world’s second-largest economy, after the United States.

S.& P.’s move came just weeks after both it and its rival ratings agency, Moody’s, cautioned that they might take a more negative stance on the United States. It highlighted just how deeply indebted many of the world’s developed economies remain — despite concerted efforts on the parts of governments to improve their balance sheets.

Yesterday was this from Reuters on Moody's considering downgrading the ratings for states:

(Reuters) - Some U.S. states face so much pressure to fund pensions for public employees that it could hurt their credit ratings, Moody's Investors Service said on Thursday.

As concerns grow over the financial health of many states after the 2007-2009 recession and how they will cut spending to cope, the ratings agency combined pension and debt data to rank the liabilities of each state.

In the past, Moody's evaluated credit risks from pensions and debt levels separately. Lower credit ratings could raise the costs to states of borrowing money.

Interesting isn't it how suddenly Moody's has to change how they figure things for rating the states and combine debt AND pension liabilities all of a sudden. One might think they have an ulterior motive in doing so.

Re-Claiming "American Made"

I haven't been doing too good of a job doing any posting here the last few weeks. It's not that my situation has changed appreciably for the better nor has the economic situation of other un/underemployed folks gotten better. But occasionally life does intrude, even when things are not going all that well.

That being said, there have been a couple of articles from the NY Times recently that I can only hope will penetrate the minds of people in power. (I shant be holding my breath mind you, but I can hope).

First up is this article from back in June on the possibility of rising wages in China possibly causing prices of Chinese made goods to rise.

Coastal factories are increasing hourly payments to workers. Local governments are raising minimum wage standards. And if China allows its currency, the renminbi, to appreciate against the United States dollar later this year, as many economists are predicting, the relative cost of manufacturing in China will almost certainly rise.

The salaries of factory workers in China are still low compared to those in the United States and Europe: the hourly wage in southern China is only about 75 cents an hour. But economists say wage increases here will eventually ripple through the global economy, driving up the prices of goods as diverse as T-shirts, sneakers, computer servers and smartphones.

“For a long time, China has been the anchor of global disinflation,” said Dong Tao, an economist at Credit Suisse, referring to how the two-decade-long shift to manufacturing in China helped many global companies lower costs and prices. “But this may be the beginning of the end of an era.”