USA: Have and have not's: There's a large group of Americans missing out on the American dream

There’s a growing tendency for mainstream economists, including several of those at the Federal Reserve, to dismiss all income disparities as the product of a skills- or education gap, a misleading explanation given weak wage growth that points to ongoing weakness in the job market. 
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So it was relieving to see, tucked in the US central bank’s latest semi-annual report to Congress on monetary policy, an analysis of recent inequality research that refutes the idea that education is the only factor behind income inequality. Race, unsurprisingly, also plays a major role, as do social and economic measures, including taxation, interest rates, and labor policies. The Fed states:

“The persistent gaps in economic outcomes by race and ethnicity in the United States raise important questions about how people ascend the economic ladder. Education, particularly a college degree, is often seen as a path to improved economic opportunities.

“However, while education continues to be an important determinant of whether one can climb the economic ladder, sizable differences in economic outcomes across race and ethnicity remain even after controlling for educational attainment. Data on earnings for two cohorts of young adult workers (aged 25 to 34) approximately a generation apart confirm both the gaps in economic outcomes and the lack of substantial upward progress for disadvantaged groups over the past quarter-century.”

Foto: source Federal Reserve 

“Overall, the representation of black and Hispanic workers in the top earnings quartile continues to lag in the later period,” the report adds.

For the complete detailed report click here: There's a large group of Americans missing out on the American dream

Wall Street: Dow 20,000 and Donald Trump as the embodiment of animal spirits: by Don Pittis

Even as stock markets climb higher and the Dow Jones industrial average flirts with the 20,000 mark, some of our wisest critics have continued to doubt the substance of the Donald Trump rally.

Rational analysts assumed that last week's hike in interest rates from the U.S. Federal Reserve, with hints of more to come, would knock the stuffing out of the market surge.

But in a world where rationality has repeatedly failed to guide us, maybe it's time to revisit the idea that irrationality — namely president-elect Donald Trump as the embodiment of animal spirits — has a far greater effect on markets than rational analysts might have us think.

The fact is, economics contains more voodoo than many of its exponents admit.

Trump's role is as cheerleader, appointing cabinet members who seem to favour business success, promoting policy that seems to support new investment and growth.

Research conducted for the Globe and Mail's Report on Business shows that even in Canada Trump is spurring executive optimism. Studies in the U.S. also show business leaders have been energized by the election results.

For many critics, economic optimism requires a certain amount of nose-holding and ear plugging.

Trump's outrageous stance on many issues, such as yesterday's comment about "Islamists who slaughter Christians," could lead to outcomes disruptive to the economy.

And the rationalists could be right. An overpriced dollar could kill off U.S. exports. A shortage of labour could block growth. Trouble in Europe or Japan could be contagious. Growing inequality or environmental outrage could lead to a political backlash.

But if the new U.S. president can concentrate on being the economic orchestra leader, convincing Americans that now is the time to succeed and invest, urging on the sections at the back and getting everyone to play in concert, maybe the great performer will have found his best role.

Read more: Dow 20,000 and Donald Trump as the embodiment of animal spirits: Don Pittis - Business - CBC News

US Federal Reserve: Yellen says she won't step down, will serve through 2018

Federal Reserve Chairwoman Janet Yellen said Thursday that she will fill out her term, regardless of the election results.

Asked during a congressional hearing if she could imagine any circumstances in which she could resign early, Yellen responded, "no, I cannot."

"It is fully my intention to serve out that term," Yellen said of her term that ends in February of 2018.

Read more: Yellen says she won't step down, will serve through 2018 | Washington Examiner