Coffee, tea or uranium enrichment?
Boeing reportedly just signed an agreement with Iran Air so that the official airline of the potentially rogue nation can buy about 100 commercial aircraft from the American company. Rumor has it that the deal is worth $25 billion but there are still plenty of details that need to be hammered out before you can plan your Tehran vacay. Iran is definitely hard up for some new aircraft because it has just 250 aircraft and only 162 of them can fly, if that. The rest need spare parts. But with sanctions that have been in place for decades, those spare parts have been impossible to come by. Apparently the U.S. government feels that Iran held up its end of the dubious nuclear accord, however, the U.S. treasury still needs to give its seal of approval, along with every other human being in DC and beyond. You may not like the idea of the U.S. doing business with Iran but Boeing factory workers feel otherwise, as do Boeing shareholders who are chomping at the bit to get in on the profitable action. The fact is, the country is seen – and not just by the U.S. – as a promising growth market and there is plenty of money to be made there. European aircraft companies, Airbus and ATR, already have their agreements lined up with the Islamic Republic. Unfortunately, the Supreme Leader Ayatollah Ali Khameni is not so enthusiastic about buying aircraft from the United States and doesn’t see it an a priority. But then again, his state sponsors terrorism. So do we really care what his priorities are? Didn’t think so.
The upper middle class is thriving. At least that’s what the Urban Institute and economist Stephen Rose are saying. And just what makes a person upper middle class anyway? Glad you asked. If you find yourself in a three-person family that generates an annual income between $100,000 and $350,00, then you, my friend, are a thriving member of the upper middle class. Congratulations. I think. Stephen Rose argues that the true divide is not between the rich and poor, but rather it’s divided between the wealthy combined with the upper middle class, and everybody else. Warms the heart, no? The upper middle class was, once upon a time in 1979, 13% of the population. But in 2014, that class made up almost the 30% of the population. While the wealthy used to be just .1% of the population, that group is now 1.8% of the population. The middle class shrunk, presumably because some became wealthier and some…did not, and now makes up 32% of the population, compared to almost 39% back in 1979. The middle class, by the way, is defined as a family generating income between $50,000 to $100,000 annually. Just as there is an upper middle class, there is also a lower middle class which is defined as generating an annual income between $30,000 – $50,000. Generating an annual income anything less than that is probably not where you want to be. But on a high note, the standard of living has gone up for nearly all Americans, no matter what class they’re in.
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Janet Yellen appeared before the Senate Banking Committee and among the many fiscal pearls she imparted, she said that the Central Bank would go forward cautiously on its plan to gradually increase rates. Even though many experts were sure a June rate increase was in the works, “considerable uncertainty” with regard to the U.S. economic outlook, global economic issues, a hiring slowdown and the looming “Brexit” vote in Britain nixed any thought of an increase. Janet Yellen did stress that the U.S. is not taking sides on the Brexit issue but cautioned that there will likely be economic consequences to the U.S, which sounds awfully ominous. There is concern that a Brexit would increase the value of the dollar, and that is not always a good thing, as evidenced by the dozens of companies that have lost millions of dollars in revenue and profits this year because of the strong dollar overseas. Ms. Yellen would like to see, among other things, a rebound in hiring and some growth improvement in the economy. No major surprises from the Brits would be nice too. Also during the meeting, Sen. Elizabeth Warren commented on the lack of diversity among the members of the Central Bank. Ten out of the 12 members are men, not there is anything wrong with those gentlemen. But still. Anyways, Chairwoman Yellen graciously replied: “It’s important to have a diverse group of policy makers who can bring different perspectives to bear.”Amen!