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Corporate profits hit record as wages get squeezed
Just four years after the worst shock to the economy since the Great Depression, U.S. corporate profits are stronger than ever.
In the third quarter, corporate earnings were $1.75 trillion, up 18.6% from a year ago, according to last week'si gross domestic product report. That took after-tax profits to their greatest percentage of GDP in history.
But the record profits come at the same time that workers' wages have fallen to their lowest-ever share of GDP.
Corporate profits hit record as wages get squeezed - Dec. 3, 2012
Fantastic. Although I'm not sure if you understand what unrealised profits are. Generally speaking, these are profits which have yet to be cashed in. Profitable, but only on paper. I'll give you one example. There are many corporations who are parking their profits offshore, as they have offshore earnings. Microsoft, Cisco, Johnson & Johnson, Apple, they're all doing it.
These are an example of unrealised profits, because the second these corporations repatriate these funds back on American soil, they will be hit with a full 35% corporate tax.
Corporations may be profitable, but it's only on paper.
I don't think you realize when you're full of shit. Go back to Canada and read a book.
Because you are looking at statistical abstractions and averages,not flesh and blood people.OK. no flat wages you say. The chart that shows that you're comment is just plain wrong, the chart is based on Real Dollars via the Department of Labor. The Department of Lbor has used Real Dollars to determine wage grow th for decades. Most financial publications and economist also use Real Dollars. Real Dollars and nominal income are both charted. You do know the difference I hope. If you did then you'd see that wages have truly been flat. If you don't understand the difference, well then I can understand your comment.
Here's and explanation of Real versus nominal.
Real vs. Nominal, High School Economics Topics | Library of Economics and Liberty
You've already posted a chart. It doesnt mean what you say it means.
There are no flat wages, only flat heads.
I offer proof based on the Department of Labor why don't you prove me wrong with some facts instead of conjecture based on,,,,,?
Capitalism runs the train. Socialism saves the people the train tries to leave behind.
yep. all the lazy, low skilled bums
Like slaves? Who ended slavery? The capitalists, or the government?
Capitalism is probably one of the best things humanity ever created. Pure capitalism can be bad but a hybrid system of it works with human nature...Wanting to improve on ones self.
Capitalism runs the train. Socialism saves the people the train tries to leave behind.
Capitalism runs the train. Socialism saves the people the train tries to leave behind.
Socialism derails the train so everyone is equally poor and miserable.
Next ridiculous metaphor you'd care to foist?
I suppose that would make sense to someone simpleminded enough to believe that an economic system must necessarily be all capitalism or all socialism.
I mean owning the market within a monopoly.
What does that even mean?
Wow, a little weak on the history I see. Read about standard oil and how they broke it up to be fair within the market place.
So, that explains companies having record profits yet workers wages have been flat in Real Dollars since the 80's.
Proof that the era of flat wages have hurt our capitalistic economy. The chart clearly shows that since the era of flat wages began, recessions take longer and longer to recover. Compare recessions when the Middle Class was strong and note the difference after flat wages really started being felt.
Anyone who just a slight knowledge of economics knows this phenomenon has been years in the making.
Well, we have record earnings. Profits are another matter. Most of these profits are unrealised.
You should also know that you are confusing earnings with profits. Earnings are your total revenue. These are used to cover things like your cost of revenue, operation cost, etc. Profits are what is left over after everything has been paid.
Corporate profits hit record as wages get squeezed
Just four years after the worst shock to the economy since the Great Depression, U.S. corporate profits are stronger than ever.
In the third quarter, corporate earnings were $1.75 trillion, up 18.6% from a year ago, according to last week'si gross domestic product report. That took after-tax profits to their greatest percentage of GDP in history.
But the record profits come at the same time that workers' wages have fallen to their lowest-ever share of GDP.
Corporate profits hit record as wages get squeezed - Dec. 3, 2012
Capitalism is probably one of the best things humanity ever created. Pure capitalism can be bad but a hybrid system of it works with human nature...Wanting to improve on ones self.
Capitalism runs the train. Socialism saves the people the train tries to leave behind.
Please note these numbers. Worker pay rose only 5.4% in Real Constant dollars from 1978-2012. And you're saying that's not flat?
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CEO compensation, CEO-to-worker compensation ratio, and benchmarks, 19652012 (2012 dollars)
Year CEO annual compensation (thousands)* Worker annual compensation (thousands) Stock Market (adjusted to 2012) CEO-to-worker compensation ratio***
Options realized Options granted Private-sector production/nonsupervisory workers Firms' industry** S&P 500 Dow Jones Options realized Options granted
1965 807 765 39.3 n/a 562 5,805 20.1 18.3
1973 1,054 1,000 46.7 n/a 496 4,268 22.1 20.1
1978 1,442 1,368 48.6 n/a 310 2,652 29.0 26.5
1989 2,685 2,547 44.9 n/a 578 4,488 58.5 53.3
1995 5,684 6,303 44.5 50.8 810 6,731 122.6 136.8
2000 19,880 20,386 46.8 53.1 1,903 14,298 383.4 411.3
2007 18,274 12,739 49.2 53.2 1,636 14,593 351.3 244.1
2009 10,243 9,838 51.5 56.5 1,015 9,512 193.2 181.6
2010 12,286 11,225 52.0 57.2 1,200 11,235 227.9 205.9
2011 12,484 11,558 51.5 56.8 1,294 12,206 231.8 214.6
2012 14,074 10,735 51.2 56.4 1,379 12,965 272.9 202.3
Percent change Change in ratio
19651978 78.7% 78.7% 23.7% n/a -44.8% -54.3% 8.9 8.1
19782000 1,279% 1,390% -3.6% n/a 513% 439% 354.4 384.9
20002012 -29.2% -47.3% 9.4% 6.3% -27.5% -9.3% -110.5 -209.0
19782012 876% 685% 5.4% n/a 344% 389% 214.4 149.0
* The "Options realized" compensation series includes salary, bonuses, restricted stock grants, options exercised, and long-term incentive payouts for CEOs at the top 350 firms ranked by sales. The "Options granted" compensation series includes salary, bonus, restricted stock grants, options granted, and long-term incentive payouts for CEOs at the top 350 firms ranked by sales.
** Annual compensation of the workers in the key industry of the firms in the sample.
*** Based on averaging specific firm ratios and not the ratio of averages of CEO and worker compensation.
Source: Authors' analysis of data from Compustat's ExecuComp database, Federal Reserve Economic Data (FRED) from the Federal Reserve Bank of St. Louis, the Current Employment Statistics program, and the Bureau of Economic Analysis NIPA tables
CEO Pay in 2012 Was Extraordinarily High Relative to Typical Workers and Other High Earners | Economic Policy Institute
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No. I used data from the Federal Reserve, the Current Employment Statistics program and the Economic Analysis NIPA tables. Previously I used the Department of Labor. It is very apparent that all are consistent with each other.
You know, when I'm wrong I admit it. My parents taught me it takes a much bigger person to admit they are wrong than it does to not admit they are mistaken.
I'm not calling for socialism, what I am saying is that it's time for corporate America to start paying it's employees for their efforts in bringing their employer record profits/excellent profits. It'd be good for the Middle Class and this country's capitalistic consumer spending driven economy.
No. I used data from the Federal Reserve, the Current Employment Statistics program and the Economic Analysis NIPA tables. Previously I used the Department of Labor. It is very apparent that all are consistent with each other.
You know, when I'm wrong I admit it. My parents taught me it takes a much bigger person to admit they are wrong than it does to not admit they are mistaken.
I'm not calling for socialism, what I am saying is that it's time for corporate America to start paying it's employees for their efforts in bringing their employer record profits/excellent profits. It'd be good for the Middle Class and this country's capitalistic consumer spending driven economy.
You used data. You didnt understand the data you used. You assumed the data show something they do not.
Every other statement in your post is a fallacy.
No. I used data from the Federal Reserve, the Current Employment Statistics program and the Economic Analysis NIPA tables. Previously I used the Department of Labor. It is very apparent that all are consistent with each other.
You know, when I'm wrong I admit it. My parents taught me it takes a much bigger person to admit they are wrong than it does to not admit they are mistaken.
I'm not calling for socialism, what I am saying is that it's time for corporate America to start paying it's employees for their efforts in bringing their employer record profits/excellent profits. It'd be good for the Middle Class and this country's capitalistic consumer spending driven economy.
You used data. You didnt understand the data you used. You assumed the data show something they do not.
Every other statement in your post is a fallacy.
I study statistics for a living and have done quite well doing so.
You are in denial. It's a well known fact that wages have been flat since the 1980s. The Department of Labor has been consistent on this for decades, so has the Federal Reserve, economists and scholars. Being as you don't fall into any of these categories and have not presented anything to disprove the fact and won't admit reality, I'm done wasting my time.
Bush's SEC let Wall Street run a derivatives Ponzi scheme that destroyed the world economy.
George W. Bush was the goose that flew into the engine.
Obama landed the plane in the Hudson.
