Advanced Other 1477 Folder Collection
After playing the video, you can click or select the word to look it up in the dictionary.
Loading...
Report Subtitle Errors
[ MUSIC ]
>> HELLO AND WELCOME TO TALKING POINTS.
I'M DAVE KELLY, DIRECTOR OF ADVANCED MEDIA PRODUCTION
AT CAL STATE LONG BEACH.
TODAY WE'RE GOING TO BE TALKING ABOUT RECENT ECONOMIC TRENDS
AND HOW THEY AFFECT US GLOBALLY, NATIONALLY
AND HERE IN CALIFORNIA.
MY GUEST TODAY IS DR. ROBERT KLEINHENZ.
DR. KLEINHENZ IS THE CHIEF ECONOMIST
FOR THE LOS ANGELES COUNTY ECONOMIC
DEVELOPMENT CORPORATION.
WELCOME, ROBERT AND THANK YOU
FOR JOINING US ON TALKING POINTS.
>> THANK YOU, MY PLEASURE.
>> WELL, LET'S START WITH THE BIG PICTURE
BECAUSE EVERYONE HAS BEEN HEARING ABOUT CHINA
AND THE SLOWDOWN IN CHINA.
WE KNOW THEY HAD OVER THE SUMMER ABOUT A 30% COLLAPSE,
IF YOU WANT TO USE THAT WORD, IN THEIR STOCK MARKET.
THEY'VE ALSO RECENTLY SUGGESTED THAT THEIR GROWTH RATE IS GOING
TO BE ABOUT 6.9% FOR THIS YEAR, WHICH IS BELOW THE TARGET
OF 7%, JUST A LITTLE BIT.
BUT IT'S DEFINITELY DOWN FROM PREVIOUS YEARS.
AND I KNOW THAT THAT'S CAUSED SOME CONCERN.
WE'VE HEARD A LOT ABOUT IT IN THE ECONOMIC PRESS.
I'VE GOT A QUOTE HERE FROM THE WASHINGTON POST
FROM JUST A FEW DAYS AGO.
AND THIS IS THE QUOTE FROM THE POST.
IT SAYS, "IT STARTS WITH THE SLOWDOWN IN CHINA,
WHICH IS ALREADY STRAINING THE GLOBAL RECOVERY."
"THE WORLD'S SECOND LARGEST ECONOMY HAS LOST ITS APPETITE
FOR THE RAW MATERIALS THAT FUELED ITS INDUSTRIAL BOOM."
"LEAVING THE SMALLER COUNTRIES THAT SUPPLIED IT WITH RESOURCES,
STUMBLING IN ITS WAKE."
"SLOWER GROWTH ABROAD,
TRANSLATES INTO WEAKER FOREIGN CURRENCIES
AND A STRONGER U.S. DOLLAR,
WHICH MAKES AMERICAN GOODS HARDER TO SELL
IN THE GLOBAL MARKETPLACE."
WHAT ABOUT THAT?
>> YEAH, SO, YOU KNOW, CHINA IS THE SECOND LARGEST ECONOMY HERE
ON THE GLOBE.
IT HAD ASTOUNDING RATES OF GROWTH FOR DECADES,
AS IT WAS GOING THROUGH THE INDUSTRIALIZATION PROCESS.
A BIG PART OF THAT INDUSTRIALIZATION PROCESS WAS AN
EXPORT ORIENTED STRATEGY.
AND IN RECENT YEARS, THE COUNTRY OF CHINA HAS GONE THROUGH
OR BEGUN TO GO THROUGH A TRANSITION
FROM THIS EXPORT ORIENTED INDUSTRIALIZATION STRATEGY,
TO ONE THAT IS MORE CONSUMER SPENDING DRIVEN.
AND THAT MEANS THEY'LL BE LESS RELIANT ON ALL SORTS OF THINGS,
INCLUDING RAW MATERIALS.
AND INDEED, THAT DOES CAUSE RIPPLE EFFECTS THROUGHOUT THE
GLOBAL ECONOMY.
MANY OTHER SMALLER ECONOMIES AROUND THE GLOBE ARE RELIANT
ON THOSE -- THE CHINESE MARKET
FOR THEIR COMMODITIES AND OTHER PRODUCTS.
SO, THERE WILL BE SOME ADJUSTMENT TO TAKE PLACE
OF OVER SEVERAL YEARS' TIME, I WOULD EXPECT.
>> PEOPLE HAVE USED THE WORD CONTAGION TO DESCRIBE THE FEAR
OF WHAT MAY HAPPEN WITH THE CHINESE ECONOMY AFFECTING THE
U.S. ECONOMY.
IS THERE ANY REAL THREAT OF CONTAGION?
>> SO, AS THIS STORY POINTED OUT, WE'RE ALL LINKED.
SO, IF THE CHINESE ECONOMY SLOWS AND THAT CAUSES A RIPPLE EFFECT
WITH ALL THESE OTHER ECONOMIES AROUND THE GLOBE,
OUR MARKETS FOR OUR PRODUCTS
THAT WE SELL ABROAD ARE GOING TO BE WEAKER.
CHINESE EXPORTS FROM THE U.S.,
ONLY MAKE UP ABOUT 1% OF OUR GDP.
AND MORE GENERALLY, THE TRADE COMPONENT
OF THE U.S. ECONOMY IS AMONG THE SMALLER COMPONENTS
OF THE U.S. ECONOMY.
SO, WE SHOULD BE FAIRLY INSULATED
FROM THE DIRECT DOWNSIDE EFFECTS.
BUT THESE REVERBERATIONS THAT YOU MENTIONED,
WE HAVE TO BE MINDFUL OF.
>> AND THERE'S ANOTHER INTERNATIONAL ISSUE INVOLVING
WHAT'S REFERRED TO AS THE BRICS COUNTRIES.
BRICS IS THE ACRONYM FOR BRAZIL, RUSSIA, INDIA,
CHINA AND SOUTH AFRICA.
AND THERE'S CONCERN THAT THEY MAY BE A DEVELOPING AN
ALTERNATIVE BASKET OF CURRENCIES,
THAT'S THE PHRASE THEY USE, TO REPLACE THE U.S. DOLLAR
AS THE WORLD'S RESERVE CURRENCY.
FIRST OF ALL, MAYBE EXPLAIN TO OUR VIEWERS WHAT WE MEAN
BY WORLDS RESERVE CURRENCY.
AND IF THERE IS ANY REAL THREAT
THAT THE DOLLAR WILL BE REPLACED.
>> THIS SITUATION HAPPENS FROM TIME TO TIME.
SO, THE U.S. DOLLAR IS KNOWN
AS THE RESERVE CURRENCY AROUND THE GLOBE.
AND WHAT THAT MEANS IS THAT MANY FOREIGN TRANSACTIONS ARE
DENOMINATED IN U.S. DOLLARS.
IT'S ALSO A CURRENCY THAT CENTRAL BANKS KEEP --
LITERALLY KEEP IN THEIR VAULTS,
AS A PART OF THEIR HARD RESERVES AGAINST DEPOSITS.
SO, FOR DECADES, THE U.S. DOLLAR HAS BEEN THE RESERVE CURRENCY.
WELL, WHY IS THAT?
IT'S BECAUSE IT IS BACKED BY A STABLE COUNTRY.
AND THE VALUE OF THAT CURRENCY ITSELF IS STABLE.
AND THOSE ARE 2 THINGS, THAT TAKEN TOGETHER,
OFTEN TIMES ARE THE DETERMINANTS OF WHETHER
OR NOT A RESERVE CURRENCY WILL CONTINUE TO BE REGARDED AS SUCH
OR IF IT WILL LOSE CREDIBILITY.
IT'S ALL ABOUT THE CREDIBILITY OF THE CURRENCY
AND WHO'S BACKING IT, WHICH IS THE GOVERNMENT
OF THE UNITED STATES.
>> AND WHAT ABOUT THIS IDEA OF A BASKET
OF ALTERNATIVE CURRENCIES?
IS THAT GOING TO HAPPEN?
ARE WE GOING TO SEE THAT HAPPENING?
>> WELL, IT COULD BE THAT SOMETHING
LIKE THAT WILL HAPPEN IN THE FUTURE.
BUT DO KEEP IN MIND YOU'VE GOT TO GENERALLY LOOK
FOR SOME BACKING BEHIND A RESERVE CURRENCY.
WITH A BASKET OF CURRENCIES, I MEAN, I COULD IMAGINE
FOR EXAMPLE, THAT MAYBE THE EURO AND THE POUND AND THE DOLLAR,
COULD BECOME A BASKET BASED RESERVE CURRENCY.
I JUST DON'T KNOW THAT IT WOULD NECESSARILY TRANSPIRE.
SO, AT LEAST AT THIS TIME, I DON'T THINK THIS IS SOMETHING
THAT WE NECESSARILY NEED TO CONTEMPLATE AS BEING INEVITABLE.
>> OKAY AND IF WE TALK ABOUT THE DOLLAR BECOMING THE WORLD'S
RESERVE CURRENCY, WHICH IT CERTAINLY DID
OVER THE LAST 50, 60 YEARS OR SO.
A LOT OF THAT WAS ALSO TIED TO THE FACT
THAT OIL WAS BASED ON THE DOLLAR.
SO, WE CALL IT PETRO DOLLARS.
SO, IF THE WORLD IS STILL RUNNING PRIMARILY ON OIL,
DOESN'T THAT SECURE THE DOLLAR'S PLACE
AS THE WORLD'S RESERVE CURRENCY?
>> SURE. I GUESS IT'S A GOOD IDEA FOR US TO THINK
ABOUT THE BENEFITS THAT ACCRUE TO THE U.S.,
BY VIRTUE OF BEING THE COUNTRY
THAT HAS THE RESERVE CURRENCY ON THE GLOBE.
IT DOES ALLOW US TO ENGAGE IN THINGS LIKE DEFICIT SPENDING,
MORE SO THAN WE'D HAVE TO.
IT DOES ALLOW US TO RUN A TRADE DEFICIT.
AND THESE ARE 2 THINGS THAT HAVE BEEN A PART
OF THE ECONOMIC LANDSCAPE IN THE U.S. FOR DECADES.
SO, THE RESERVE CURRENCY, IN AND OF ITSELF,
THAT'S AN IMPORTANT ROLE FOR THE U.S. TO PLAY.
BUT IT ALSO GIVES US SOME BENEFITS, VIS-À-VIS THE REST
OF THE WORLD, THAT WE'VE TAKEN ADVANTAGE OF, I WOULD SAY,
OVER THE LAST FEW DECADES.
>> WELL, LET'S TALK
ABOUT COMMODITY PRICES, PARTICULARLY OIL.
BECAUSE THAT'S THE COMMODITY THAT MOST PEOPLE ARE AWARE OF,
ALTHOUGH THERE ARE MANY OTHERS.
CERTAINLY AGRICULTURAL COMMODITIES AND PRECIOUS METALS
AND THAT SORT OF THING.
BUT IN TERMS OF OIL, LONG BEACH HAS ALWAYS BEEN A VERY BIG OIL
TOWN AND HAS BEEN SINCE 1921 WHEN WE DISCOVERED OIL HERE.
WHEN WE LOOK AT OIL PRICES, WHEN WE GO TO THE PUMP
AND WE SEE THE PRICE GOING UP OR DOWN,
DO WE REALLY PUT TOO MUCH EMPHASIS ON THAT?
AND ISN'T OIL AND OIL PRICING MUCH MORE STABLE
AND LESS CAUSING OF DISRUPTION THAN WE MAYBE HEAR
ABOUT ON THE NEWS MEDIA?
>> WELL, IT'S SOMETHING THAT CERTAINLY CATCHES THE EYE
OF CONSUMERS AND BUSINESS ALIKE
AND ESPECIALLY HERE IN CALIFORNIA.
SO, A COUPLE OF THINGS ON THIS TOPIC, YOU KNOW,
YOU DON'T HAVE MUCH ELSE TO DO WHEN YOU'RE WATCHING
THAT GAS METER RUN WHEN YOU'RE PUTTING GAS IN YOUR TANK.
SO, SOME PEOPLE, I THINK, ARE PAYING ATTENTION
AND THEY'RE SEEING THAT ONE WEEK THEIR PUTTING GAS IN THE TANK
AT $3 A GALLON, NEXT WEEK IT'S $3.50.
HERE IN CALIFORNIA, ONE OF THE REASONS FOR THAT IS
THAT WE HAVE CONSTRAINT SUPPLY.
WE HAVE A LIMITED NUMBER OF REFINERIES AND A LIMITED NUMBER
OF FIRMS THAT ARE RUNNING THOSE REFINERIES.
SO, THAT ADDS A LITTLE MORE VOLATILITY TO OUR MARKET.
OF COURSE, WE HAVE SPECIAL GAS HERE.
ALL OF THESE THINGS MAKE FOR A MORE VOLATILE SET OF PRICES HERE
IN CALIFORNIA, THEN ELSEWHERE AROUND THE COUNTRY.
AND THEN ON TOP OF THAT, WE HAVE HEAVIER TAXES ON OUR ENERGY.
SO, IT DOES CATCH THE EYE OF THE CONSUMER IN THE BUSINESS.
THERE'S NOT A LOT THAT WE CAN REALLY DO
ABOUT IT AT THE PRESENT TIME.
THERE'S A STUDY THAT JUST CAME OUT THAT SHOWED
THAT THE OIL PRODUCERS IN CALIFORNIA MAY BE COLLUDING,
BUT IT'S VERY DIFFICULT TO VERIFY.
>> IT'S ALWAYS HARD TO PROVE THOSE THINGS.
>> RIGHT.
>> WELL, LET'S TALK ABOUT THE U.S ECONOMY IN GENERAL.
WE KNOW THAT THE UNEMPLOYMENT RATE HAS BEEN COMING DOWN.
WE'RE NOW LISTING THE OFFICIAL, WHAT THEY REFER
TO AS THE U-3 UNEMPLOYMENT RATE AT 5.1%.
BUT THE U-6, WHICH IS PERHAPS A BETTER MEASUREMENT
OF THE UNCOMFORTABLE NATURE OF EMPLOYMENT IN THE COUNTRY,
IS CLOSER TO 10% OR ACTUALLY IS AT 10%.
THAT MEANS, PEOPLE THAT ARE WORKING PART-TIME JOBS,
BUT WOULD REALLY PREFER TO HAVE FULLTIME WORK, BUT CAN'T FIND IT
AND THOSE THAT ARE FULLY UNEMPLOYED.
SO, WHAT ABOUT UNEMPLOYMENT?
WE'VE SEEN IT DROP.
IT'S NOW AT ABOUT 7% HERE IN L.A. COUNTY.
ARE WE SEEING UNEMPLOYMENT STARTING TO LEVEL
OUT WITH THE DEMAND OF JOBS?
AND ALSO, WE'RE GOING TO TALK ABOUT LABOR PARTICIPATION.
BUT FIRST, WHAT ABOUT THE RATE ITSELF?
>> SO, THE RATE YOU REFER TO, THE U-3 RATE,
I CALL THE HEADLINE RATE OF UNEMPLOYMENT
BECAUSE THAT'S WHAT WE HEAR ABOUT IN THE NEWS, AS A RULE.
SO, AT 5.1%, ITS COME DOWN, IT'S ABOUT HALF
OF WHAT IT WAS DURING THE WORST DAYS OF THE RECESSION.
TYPICALLY, THE U-6 RATE, WHICH ADDS IN DISTRESSED WORKERS,
PEOPLE WHO WOULD LIKE TO WORK FULLTIME,
BUT ARE WORKING PART-TIME AND SO ON, THAT RATE IS USUALLY
ABOUT DOUBLE THE HEADLINE RATE.
SO, WHEN THE UNEMPLOYMENT RATE WAS ALMOST 10%,
THE HEADLINE RATE, THE U-6 RATE, WAS ABOUT 20%.
IT'S COME DOWN QUITE A BIT, ARGUABLY.
IT'S STILL A LITTLE BIT ON THE HIGH SIDE.
AND MAYBE SOME PEOPLE WOULD SAY THAT IT'S MORE THAN A LITTLE BIT
ON THE HIGH SIDE, BUT IT HAS IMPROVED OVER TIME.
AND OTHER ASPECTS OF THE LABOR MARKET,
BEHIND THAT HEADLINE RATE, HAVE ALSO IMPROVED.
>> WHAT ABOUT THIS LABOR PARTICIPATION RATE
THAT WE ARE HEARING ABOUT A LOT THESE DAYS?
WE NOW HAVE 94 MILLION PEOPLE NATIONALLY
THAT ARE NOT PARTICIPATING IN THE LABOR FORCE.
THAT'S A PRETTY BIG NUMBER.
>> ABSOLUTELY.
>> WHAT DOES THAT MEAN, I KNOW THERE'S SOME TRENDS,
SUCH AS BABY BOOMERS, ARE TURNING 65 AT THE RATE
OF 10,000 PER DAY NOW.
SO, ONE WOULD THINK THEY WOULD BE EASING INTO RETIREMENT?
IS THAT WHAT'S HAPPENING?
>> SO, YES, THE LABOR FORCE PARTICIPATION RATES BEEN
DECLINING FOR SEVERAL YEARS.
IN THE IMMEDIATE AFTERMATH OF THE RECESSION, THE CONCERN WAS
THAT THIS WAS SYMPTOMATIC OF SOMETHING STRUCTURALLY WRONG
WITH OUR LABOR MARKET.
AS TIME HAS PASSED, WE HAVE TAKEN THE STANCE,
I MEAN ANALYSTS HAVE SORT OF SURMISED
THAT IT'S MORE AN ARTIFACT OF THE DEMOGRAPHICS.
AND SO, YOU'RE RIGHT, THE BABY BOOMERS ARE LEAVING THE LABOR
FORCE, AS THEY HIT RETIREMENT AGE.
THE INTERESTING THINK ABOUT THAT IS IT'S NOT QUITE WHAT YOU SEE
ON THE SURFACE.
THE LABOR FORCE PARTICIPATION RATE
OF OLDER AMERICANS IS ACTUALLY ON THE RISE,
RELATIVE TO HISTORIC STANDARDS.
AND AT THE SAME TIME AND THIS IS WHAT SHOULD BE MOST CONCERNING,
YOUNG ADULT LABOR FORCE PARTICIPATION RATE IS LOW
AND HAS BEEN FALLING FOR THE LAST FEW YEARS.
AND I THINK THAT'S PARTLY STILL SYMPTOMATIC OF THE LONG SHADOW
OF THE GREAT RECESSIONS THAT'S EFFECTED YOUNG ADULTS
IN A LOT OF WAYS.
>> AND WHEN WE TALK ABOUT THE NATIONAL ECONOMY,
WE HAVE THIS ONGOING DIALOGUE IN OUR PRESS ABOUT WILL THEY
OR WON'T THEY AND THAT'S THE FEDERAL RESERVE,
IN TERMS OF INTEREST RATES.
AND THEY'VE BEEN HELD NEAR OR AT ZERO FOR SEVERAL YEARS NOW.
AND PEOPLE KEEP SAYING WELL,
I THINK THE NEXT MEETING THEY'RE GOING
TO RAISE IT AND THEN THEY DON'T.
AND TYPICALLY THEY SITE THE LOW LABOR PARTICIPATION RATE,
WE'VE BEEN TALKING ABOUT, THEY TALK ABOUT LOW INFLATION RATE.
AND THEY ALSO TALK ABOUT THE SLOW RATE OF WAGE GROWTH,
WHICH IS ALSO A PROBLEM.
SO, WILL THEY OR WON'T THEY SOON?
AND WHY WOULD THEY, IF TIMES ARE SO UNCERTAIN?
>> YOU'RE RIGHT.
THE MORE COMPLETE PICTURE OF THE LABOR MARKET GOES BEYOND
THAT HEADLINE RATE OF UNEMPLOYMENT.
IT LOOKS AT LABOR FORCE PARTICIPATION RATE;
ABOUT WHICH WE ALREADY SPOKE.
IT ALSO LOOKS AT WAGE GROWTH AND THE SHARE OF PEOPLE
WHO HAVE FULLTIME WORK.
ALL OF THOSE INDICATORS ARE MOVING IN THE RIGHT DIRECTION.
ARGUABLY, THE FED COULD RAISE RATES NOW
AND OVER THE NEXT SEVERAL QUARTERS,
WITHOUT DOING MUCH DAMAGE OR SLOWING
DOWN THE NATIONAL ECONOMY ALL THAT MUCH.
SO, FROM THE NATIONAL PERSPECTIVE,
FROM THE U.S. PERSPECTIVE, IT COULD DO SO.
BUT IT'S ALSO LOOKING AT WHAT'S HAPPENING AROUND THE GLOBE.
AND WE'RE LOOKING AT ECONOMIC WEAKNESS AMONG OUR
TRADING PARTNERS.
WE ALREADY TALKED ABOUT SMALL ECONOMIES, EMERGING ECONOMIES
AND HOW THEY'RE STRUGGLING AT THIS TIME.
A HIGHER FED FUNDS RATE AND A HIGHER RATE STRUCTURE
FOR THE U.S., IS GOING TO DO DAMAGE TO THE CREDIT MARKETS
IN THESE OTHER PLACES.
SO, THE FED COULD RAISE RATES.
I THINK IT'S HOLDING OFF IN LIGHT
OF THE INTERNATIONAL PICTURE.
BUT IF YOU WANT A PREDICTION, I THINK IT WILL BE THIS DECEMBER.
>> ALL RIGHT.
ON THAT NOTE, WE'RE GOING TO TAKE A BREAK.
STAY WITH US.
WHEN WE COME BACK, WE'LL TALK MORE SPECIFICALLY
ABOUT CALIFORNIA.
STAY TUNED.
[ MUSIC ]
>> SHOULD YOUR COMPANY BUY OR SELL?
EXPAND OR NOT?
RELOCATE OR SIMPLY STAY THE SAME?
IF YOU LIKE TO EXAMINE PAST AND PRESENT PREDICTIONS,
INTEGRATING FINANCES AND PEOPLE
AND MAKE FUTURE PREDICTIONS BASED ON ALL THAT INFORMATION,
A CAREER IN ECONOMICS IS FOR YOU.
YOU CAN BECOME A PART OF THIS EXCITING FIELD WITH A DEGREE
FROM CAL STATE LONG BEACH.
[ MUSIC ]
>> WELCOME BACK TO TALKING POINTS.
I'M DAVE KELLY.
MY GUEST TODAY IS DR. ROBERT KLEINHENZ.
ROBERT, BEFORE WE LEFT, YOU DIDN'T COMPLETELY ANSWER
THAT QUESTION ABOUT WHY THE FED WOULD WANT --
WHY THEY WOULD WANT TO RAISE INTEREST RATES,
IF WE HAVE THE TIME OF ECONOMIC UNCERTAINTY?
WHAT WOULD BE THE MOTIVATION FOR THAT?
>> YEAH. AND IT'S A VERY GOOD QUESTION,
I SHOULD HAVE MENTIONED IT EARLIER.
THE REASON THAT THE FED WANTS TO DO THIS IN THE FIRST PLACE,
SO KEEP IN MIND THAT RAISING INTEREST RATES IS
LIKE PUTTING THE BRAKES ON OUR ECONOMY.
AND THE ONLY REASON THE FED WOULD WANT TO DO THAT IS,
AT THE PRESENT TIME, IS TO MOVE THAT PARTICULAR POLICY TOOL
TO A MORE NEUTRAL POSITION.
SUCH THAT IF THE ECONOMY SHOULD SLOW DOWN OR TIP INTO RECESSION
AT SOME POINT DOWN THE ROAD, IT HAS THE CAPACITY TO ACTUALLY USE
THAT TOOL TO GET THE ECONOMY GOING AGAIN.
KEEP IN MIND THAT THE FED REALLY HAS BEEN THE PRIMARY POLICY
MAKER, AS FAR AS ECONOMIC POLICY IS CONCERNED.
OVER THESE LAST SEVERAL YEARS,
GIVEN WHAT'S BEEN HAPPENING ON CAPITOL HILL.
AND SO, THE FED KNOWS THAT IT NEEDS
TO MOVE ITS FUNDS RATE POLICY TOOL TO NEUTRAL.
IT'S GOING TO TAKE SOME TIME TO DO THAT.
AND IT DOESN'T WANT TO SLOW DOWN THE ECONOMY, BUT IT NEEDS TO DO
THAT IN ORDER TO POSITION ITSELF FOR WHAT MIGHT BE
OUT THERE IN THE FUTURE.
>> SO, IT'S TRYING TO CREATE SOME BREATHING SPACE,
I GUESS, WHEN THAT DAY COMES.
>> CORRECT.
>> OKAY, WELL, LET'S TALK ABOUT CALIFORNIA
AND SPECIFICALLY WHAT'S GOING ON HERE IN THIS STATE.
WE'VE ACTUALLY HAD SOME GOOD NEWS LATELY IN CALIFORNIA.
WE HAVE A BUDGET THAT'S NOT IN DEFICIT.
IT'S ACTUALLY IN SURPLUS THIS YEAR.
AND SPENDING FOR THINGS LIKE EDUCATION,
ACTUALLY TICKED UP A BIT THIS YEAR.
SO, ARE WE OUT OF THE WOODS YET?
>> YEAH, I THINK WE ARE OUT OF THE WOODS, IN THE SENSE
THAT WE HAVE A REVENUE STREAM.
PARTLY VOTED UPON AND VOTED IN, I SHOULD SAY,
BY THE VOTERS HERE IN CALIFORNIA.
A REVENUE STREAM THAT'S GOING TO ENSURE THAT WE HAVE THE CAPACITY
TO COVER THESE EXPENSES.
SO, BY THAT I'M TALKING ABOUT THE INCREASE
IN THE SALES TAX RATE, INCREASES IN MARGINAL TAX RATES.
ALL THESE WERE PUT INTO PLACE JUST A FEW YEARS AGO.
KEEP IN MIND THAT THERE IS A SUNSET ON THEM.
SO, WE'LL HAVE TO SEE WHETHER OR NOT THESE ARE KEPT
OR IF THEY'RE DROPPED AT SOME POINT IN THE TIME.
BUT CURRENTLY WE'RE DOING PRETTY WELL
WITH RESPECT TO OUR STATE BUDGET.
>> WELL, ONE OF THE VULNERABLE ASPECTS OF THE STATE BUDGET
IN CALIFORNIA IS THE INCOME STREAM AND WHERE IT COMES
FROM IN TERMS OF STATE INCOME TAXES.
TALK ABOUT WHERE THAT VULNERABLE SPOT IS.
>> SURE. AND SO, THE INCOME TAX IS THE LARGEST SOURCE OF REVENUE
FOR THE STATE OF CALIFORNIA.
FOR THE STATE ITSELF, AS OPPOSED TO ALL
OF GOVERNMENTS INCLUDING LOCAL, IT'S THE BIGGEST SOURCE.
AND THE BIGGEST CONCERN, WITH RESPECT TO THE INCOME TAXES,
WE RELY VERY HEAVILY ON HIGH INCOME EARNERS
FOR A BIG CHUNK OF THAT.
AND THOSE ARE INDIVIDUALS WHO SEE THEIR REVENUES COME
IN THE FORM OF STOCK RETURNS AND SO ON.
AND WE KNOW THAT THE STOCK MARKET IS VOLATILE.
SO, THAT PART OF THEIR INCOME IS VOLATILE AND IN TURN,
THEREFORE THE INCOME TAX REVENUE STREAM IS VOLATILE.
AND SO, THAT'S OFTEN BEEN WHAT'S GOTTEN THE STATE
OF CALIFORNIA INTO TROUBLE.
WHEN THE STOCK MARKET PLUNGES, THOSE RETURNS PLUNGE
AND THE TAX PROCEEDS PLUNGE.
SO, THAT'S THE SORE SPOT
OR I SHOULD SAY THE WEAK SPOT IN THE TAX SYSTEM.
>> ALL RIGHT, WELL, OBVIOUSLY WE'VE SEEN SOME BRIGHT SPOTS
IN THE ECONOMY OF LATE.
WHAT ARE THOSE BRIGHT SPOTS IN THE CALIFORNIA ECONOMY?
>> WELL, IN AN OVERALL SENSE, WE HAVE SEEN
THAT THE UNEMPLOYMENT RATES COME DOWN.
SO, IT WAS 12 1/2% WHEN IT WAS AT ITS WORST.
IT'S NOW JUST UNDER 6%.
MOST IMPORTANTLY, I THINK, WITH RESPECT TO THE UNEMPLOYMENT RATE
IN CALIFORNIA, IT'S JUST ABOUT 1% HIGHER THAN THE NATIONS RATE,
WHICH IS 5.1, AS WE SAID EARLIER.
IT'S NORMALLY ABOUT 1 AND A HALF GAP BETWEEN THE 2.
SO, FOR US TO HAVE CLOSED THAT GAP TO SOMETHING LESS
THAN THE LONG TERM NORM, IS VERY GOOD.
ON TOP OF THAT, THE JOB GROWTH IN THE STATE
OF CALIFORNIA HAS BEEN QUITE STRONG FOR THE LAST 4 YEARS.
WE'VE BEEN ADDING JOBS AT A RATE OF ABOUT 3% YEAR OVER YEAR
VERSUS THE U.S. AT 2%.
SO, ARGUABLY OUR STATE ECONOMY IS FIRING ON ALL CYLINDERS
AND GOING FASTER THAN THE NATION'S ECONOMY AS A WHOLE.
>> WHAT ARE THE KEY INDUSTRIES
THAT ARE POSITIONED TO GROW AND PROSPER?
>> SO, WE'VE SEEN GROWTH IN PROFESSIONAL
AND BUSINESS SERVICES.
I JUST WANT TO STOP FOR A SECOND AND EXPLAIN WHAT THAT MEANS.
WE'RE TALKING ABOUT ARCHITECTURAL, ENGINEERING,
LEGAL SERVICES, IT CONSULTING SERVICES,
MANAGEMENT CONSULTING SERVICES,
OTHER TYPES OF ENGINEERING CONSULTING SERVICES.
AND SO, THERE'S BEEN A LOT OF GROWTH ALL
AROUND THE STATE IN THAT AREA.
WE'VE ALSO SEEN CONTINUED GROWTH
IN HEALTHCARE RELATED EMPLOYMENT.
INCREASES IN LEISURE AND HOSPITALITY.
INCREASES IN CONSTRUCTION.
THESE ARE THE AREAS WHERE WE'VE SEEN THE MOST GROWTH.
AND IT'S WORTH NOTING THAT IN TALKING
ABOUT ALL THOSE INDUSTRIES, YOU'RE LOOKING AT INDUSTRIES
THAT KIND OF COVER THE ENTIRE WAGE SPECTRUM.
SO, THAT'S GOOD.
>> SO, IT'S A GOOD TIME TO BE A CONSULTANT IN ONE
OF THE TECHNICAL FIELDS, IT SOUNDS LIKE.
>> OH, INDEED IT IS.
YOU KNOW, NOT ONLY IN THE SILICON VALLEY,
BUT ALSO DOWN HERE IN SOUTHERN CALIFORNIA,
BOTH LOS ANGELES COUNTY AND ORANGE COUNTY.
AND OF COURSE, DOWN IN SAN DIEGO.
IT CONSULTING AND OTHER KINDS OF INFORMATION BASED CONSULTING,
ARE GOING GANG BUSTERS.
NOT TO MENTION THE BIO MEDICAL SIDE OF THINGS.
SO, THERE'S A LOT HAPPENING
IN THESE EMERGING INDUSTRIES THESE DAYS.
THE JOB COUNTS AREN'T QUITE AS BIG AS THE NEWS ITEMS
THAT YOU HEAR ABOUT, THOUGH.
>> WHAT ABOUT THE ENTERTAINMENT INDUSTRY?
AS WE'RE TAPING THIS PROGRAM,
THEY'RE ACTUALLY FILMING A MAJOR MOTION PICTURE ON OUR CAMPUS.
NOT HERE IN THE STUDIO, BUT ELSEWHERE.
WHAT ABOUT THE OUTLOOK FOR THE ENTERTAINMENT INDUSTRY?
THERE'S BEEN A LOT OF TALK OVER THE LAST SEVERAL YEARS
ABOUT RUNAWAY PRODUCTIONS, MEANING THEY RUN AWAY
FROM CALIFORNIA AND GO TO CANADA
AND OTHER STATES IN THE SOUTHEAST.
WHAT ARE WE SEEING IN TERMS OF TRENDS THERE?
>> SO, THE RUNWAY PRODUCTION STORY REALLY BEGAN
IN THE EARLY 2000'S, WHEN A COUPLE OF STATES CAME
UP WITH INCENTIVE TO TRY TO LURE PRODUCTION AWAY FROM CALIFORNIA.
THEY WERE SUCCESSFUL.
AND SO, WE SAW THAT EMPLOYMENT
IN THE INDUSTRY FELL PRETTY CONSISTENTLY,
STARTING IN THE EARLY 2000'S THROUGH THE PRESENT.
SO, THE STATE OF CALIFORNIA HAS HAD A TAX CREDIT PROGRAM
IN PLACE FOR A FEW YEARS.
IT REVAMPED IT LAST YEAR WITH THE IDEA BEING
TO ENCOURAGE TELEVISION PRODUCTION AND ALSO
TO GIVE INCENTIVES FOR BIG FEATURE FILMS.
IN THE PAST, IT JUST MADE NO SENSE GIVEN
THAT THE INCENTIVE STRUCTURE FOR THOSE 2 AREAS
OF THE ENTERTAINMENT INDUSTRY TO COME BACK.
SO, WE'RE SEEING AN INCREASE IN TELEVISION PROGRAMMING.
THAT'S GOOD.
THE FEATURE FILM PROGRAMMING ISN'T QUITE WHERE WE WOULD
LIKE IT TO BE, BUT I THINK THAT IT'S PROBABLY ONE
OF THESE THINGS WHERE WE'RE GOING
TO HAVE TO, YOU KNOW, BE PATIENT.
AND I WOULD THINK THAT IN TIME, 2 OR 3 YEARS' TIME,
WE SHOULD BE ABLE TO SEE A RETURN OF SOME OF THAT ACTIVITY.
I DON'T THINK WE'RE GOING TO BE, YOU KNOW,
SEEING JOB COUNTS RETURN TO WHERE THEY WERE BACK
IN 1999, WHICH WAS THE PEAK.
BUT WE SHOULD SEE SOME ACTIVITY COME BACK.
>> WHAT ABOUT IN THE GLOBAL LOGISTICS
AND INTERNATIONAL TRADE ARENA?
ARE WE SEEING GROWTH THERE?
DOES THAT LOOK PRETTY STABLE?
>> ALSO SEEING NOT JUST GROWTH IN JOBS,
BUT ALSO GROWTH IN REAL ACTIVITY.
SO, HERE IN SOUTHERN CALIFORNIA, AS WELL AS UP IN THE BAY AREA,
THERE WAS A WEST COAST PORT STRIKE EARLIER THIS YEAR
THAT DIVERTED A LOT OF ACTIVITY OVER TO THE EAST COAST.
AND IT REALLY STYMIED BUSINESS HERE LOCALLY.
AND THEN ON TOP OF THAT, THE SHIPS THAT ARE MAKING THEIR CALL
AT THESE PORTS, THE CONTAINER SHIPS,
ARE ABOUT TWICE THE SIZE WHAT THEY WERE,
EVEN 6 OR 7 YEARS AGO.
AND SO, THERE WAS A CONGESTION, KIND OF ISSUE,
THAT THEY NEEDED TO ADDRESS.
SO, MANY OF THESE KINKS HAVE BEEN WORKED OUT.
WE'RE ABOUT EVEN WITH LAST YEAR, IN TERMS OF TOTAL PORT ACTIVITY
IN SOUTHERN CALIFORNIA.
BUT WE EXPECT TO SEE NEXT YEAR WILL BE BETTER.
AND IN CONJUNCTION WITH THAT PORT ACTIVITY,
WE'VE SEEN JOB COUNTS RISE.
>> SO, GOOD NEWS ON A LOT OF FRONTS
THAT WE'VE BEEN TALKING ABOUT NOW.
SO, THINGS ARE ACTUALLY LOOKING UP.
THERE ARE BRIGHT SPOTS.
WE HAVE TO TALK ABOUT SOMETHING THAT'S NOT SO BRIGHT
AND THAT IS THE RATE OF POVERTY IN CALIFORNIA.
WE ARE THE LARGEST STATE IN THE NATION,
SO ONE WOULD ASSUME WE WOULD HAVE A LARGE PERCENTAGE
OF THE POPULATION IN POVERTY AS WELL.
BUT WE ARE ACTUALLY, ACCORDING TO THE CENSUS BUREAU,
SUPPLEMENTAL POVERTY INDEX OF 2013,
SO THAT'S A COUPLE OF YEARS AGO.
WE WERE NUMBER 1 IN THE NATION,
23.4% OF OUR RESIDENTS BELOW THE POVERTY LEVEL,
SUPPLEMENTAL POVERTY LEVEL, WHICH IS ABOUT A FAMILY
OF 4, AROUND 25,000 A YEAR.
SO, WHAT DOES THAT SAY ABOUT OUR FUTURE PROSPECTS,
IF WE HAVE ALMOST A QUARTER
OF THE STATE LIVING BELOW THE QUOTE,
UNQUOTE "LIVABILITY INDEX?"
>> SURE. THIS IS NOT AN INDICATOR WHERE WE WANT
TO BE NUMBER 1, CLEARLY.
AND WE REALLY HAVE A BURDEN HERE BECAUSE THE COST OF LIVING
IN THE STATE OF CALIFORNIA IS HIGH.
IT'S PARTICULARLY HIGH IN THE METRO AREAS,
WHERE THE VAST MAJORITY OF OUR POPULATION LIVES.
AND SO, WE HAVE A HUGE PROBLEM WITH RESPECT TO POVERTY
THAT HAS BEEN SEEMINGLY INTRACTABLE.
THERE ARE PROGRAMS AT THE FEDERAL LEVEL,
AS WELL AS THE STATE LEVEL, TO DO THINGS LIKE SUBSIDIZE HOUSING
FOR LOW INCOME HOUSEHOLDS.
BUT WE HAVE TO LOOK AT SOME OF THE ROOT CAUSES.
WE HAVE TO CONSIDER OVER TIME, NOT JUST FOR THE PURPOSE
OF REDUCING POVERTY, BUT FOR THE OVERALL BENEFIT OF THE ECONOMY,
TRYING TO GET MANY OF THESE INDIVIDUALS,
WHO ARE OF WORKING AGE, TO THE POINT
WHERE THEY GET THE EDUCATION,
MAYBE COMPLETE A HIGH SCHOOL DEGREE
AND CAN BECOME GAINFULLY EMPLOYED.
AND THEN HELP TO MOVE THEMSELVES
AND THEIR HOUSEHOLDS OUT OF POVERTY.
>> SO, THAT MAY BE ONE OF THE TROUBLE SPOTS
THAT WE REALLY NEED TO FOCUS ON.
>> CORRECT.
>> OKAY, WELL, LET'S TALK
ABOUT ANOTHER INITIATIVE THAT'S BEEN UNDERWAY RECENTLY.
AND THAT IS THE DRIVE TO BRING THE 2024 OLYMPICS
TO LOS ANGELES.
THOSE OF US THAT WERE AROUND DURING THE 1984 OLYMPICS
AND HAD THE CHANCE TO EXPERIENCE THOSE,
KNOW THAT WAS REALLY A FANTASTIC DEMONSTRATION OF THE, I GUESS,
THE COLLECTIVE SPIRIT HERE IN L.A. AND THE REGION AROUND IT,
TO PUT ON A GREAT SHOW AND TO ACTUALLY MAKE MONEY DOING SO.
BUT A LOT OF PEOPLE ARE SAYING IT'S NOT GOING TO BE THE SAME.
IT WON'T BE THE SAME KIND OF OLYMPICS
BECAUSE WE'VE LOST A LOT OF THAT CIVIC
AND CORPORATE UNITY THAT WE HAD THEN.
AND A LOT OF THE FORTUNE 500 COMPANIES THAT WERE BASED HERE,
HAVE NOW LEFT THE AREA.
WHAT DO YOU THINK ABOUT THAT?
>> WELL, I MEAN, YOU MAKE A GOOD POINT BECAUSE YOU NEED
TO REALLY HAVE A LOT OF FORCES COME TOGETHER IN ORDER
TO MAKE AN OLYMPICS A SUCCESSFUL EVENT FOR EVERYBODY INVOLVED.
AND LOS ANGELES DID A GREAT JOB IN 1984.
YOU LOOK AT THINGS TODAY, THERE WILL BE A NEED FOR THEM --
FOR PEOPLE, FOR BUSINESSES, FOR GOVERNMENT OFFICIALS
TO RALLY AND WORK TOGETHER.
WE HAVE NOT SEEN A LOT OF THAT IN LOS ANGELES FOR MANY YEARS.
YOU'RE RIGHT, WE'VE LOST MANY CORPORATE HEADQUARTERS.
ONE OF MY CONCERNS ABOUT LOS ANGELES COUNTY IS
THAT WE DON'T REALLY HAVE A LOT OF LARGE CORPORATE CIVIC LEADERS
WHO CAN BE CHAMPIONS FOR A CAUSE.
WHETHER IT BE FOR THE 2024 OLYMPICS,
WHICH WE ALL HOPE WILL COME OR FOR OTHER CAUSES THAT AROUND
WHICH WE AS RESIDENTS OF LOS ANGELES COUNTY AND PERHAPS ALL
OF CALIFORNIA, SHOULD BE RALLYING AROUND.
SO, IT'S A REAL CAUSE FOR CONCERN THAT WE DON'T HAVE
THAT KIND OF LEADERSHIP OR AT LEAST NOT VISIBLE AT THIS TIME.
THIS WOULD BE A GREAT OPPORTUNITY
FOR PEOPLE TO STEP UP.
>> WE'VE ONLY GOT ABOUT 30 SECONDS LEFT IN THIS SEGMENT.
MY LAST QUESTION TO YOU IS SOMETHING THAT WE'LL NEED
TO GET AN ANSWER IN ABOUT 20 OR 30 SECONDS.
AND THAT IS, WHAT ABOUT HOUSING IN CALIFORNIA?
AND WE ARE SEEING A DEMOGRAPHIC SHIFT
WITH THE BABY BOOMERS RETIRING OR HEADING TOWARD RETIREMENT,
MILLENNIALS COMING UP,
IS THE NEXT BIG LARGE POPULATION SECTOR.
HOUSING; IS IT GOING TO BE MORE LIKE MANHATTAN,
LIKE MANHATTAN NEW YORK, NOT MANHATTAN BEACH
AND LESS LIKE MISSION VIEJO?
>> I THINK THAT THERE ARE PREDICTIONS
THAT THE MILLENNIALS WOULD BE LESS INCLINED
TO HAVE SUBURBAN TYPE LIFESTYLES.
I THINK THE JURY IS OUT ON THAT.
WHEN THEY GET MARRIED, HAVE A FAMILY, THEY MAY CHOOSE TO MOVE
FROM THE LOFT IN DOWNTOWN LOS ANGELES TO SOMEPLACE
IN HUNTINGTON BEACH OR SIMILARLY,
FROM SAN FRANCISCO TO THE EAST BAY.
SO, I THINK WE'LL HAVE TO WAIT AND SEE ON THAT.
>> ON THAT NOTE, WE'LL HAVE TO COME TO A CLOSE.
THANK YOU FOR BEING WITH US TODAY.
>> THANKS, DAVE.
>> AND THANK YOU FOR JOINING US
ON THIS EDITION OF TALKING POINTS.
JOIN US SOON FOR THE NEXT EPISODE.
UNTIL THEN, I'M DAVE KELLY, HAVE A NICE DAY.
[ MUSIC ]
    You must  Log in  to get the function.
Tip: Click on the article or the word in the subtitle to get translation quickly!

Loading…

Economic Trends: Global, National and California

1477 Folder Collection
richardwang published on November 18, 2015
More Recommended Videos
  1. 1. Search word

    Select word on the caption to look it up in the dictionary!

  2. 2. Repeat single sentence

    Repeat the same sentence to enhance listening ability

  3. 3. Shortcut

    Shortcut!

  4. 4. Close caption

    Close the English caption

  5. 5. Embed

    Embed the video to your blog

  6. 6. Unfold

    Hide right panel

  1. Listening Quiz

    Listening Quiz!

  1. Click to open your notebook

  1. UrbanDictionary 俚語字典整合查詢。一般字典查詢不到你滿意的解譯,不妨使用「俚語字典」,或許會讓你有滿意的答案喔