Fed meetings kick off today. Around 2 PM (EDT) tomorrow we will get the word on monetary plans. But, so far, a great deal of the Fed’s policy has been wound-up in double-speak.
While “holding rates” steady – thus giving the public perception of stability – they also told their operations desk to increase Fed buying of securities by – what was it? – $120 billion per month. Saying versus doing, Yoda.
Eventually, this kind of deck-stacking becomes obvious to the public. I expect we are now through the $29 trillion level of public debt. Although this figure itself is only a half-truth.
Public Debt is Much Larger
The $29-trillion federal debt, understand, does not reveal unavoidable interest expense.
This is not like owning a home – on which let’s say you owe $290-thousand – for example. Because in that case, there is a realistic (STILL slim, though) chance that some long-lost uncle’s estate could throw an unexpected $300-thousand your way. Then the house gets paid off, and you have a little something leftover.
Most modern real estate loans don’t charge “pre-payment penalties.”
The problem the government has is there’s no rich uncle possible. Sam himself is the one going underwater. In fact, from August estimates, the $1.02 trillion in borrowing through (calendar) year-end is an increase of more than $300-billion.’
Problem’s Getting Bigger
The budget scam is showing no signs of working if passed.
Given the most recent GDP figures (which should make your hair stand on end):
This isn’t found unless you bother to read the FULL BEA GDP report here – which most people don’t.
On a Q3 to Q3 basis, GDP is going up? 4.97 percent per year.
The reality of the Fed H.6 monetary base, in the same period, shows an increase of?
Well, the Fed monetary base in September of this year was 6,388.9 billion (almost $6.4 trillion). Same time last year it was $4,880.3 billion. So the effective money printing is rising at 30.912 percent annually.
I’m not saying this is orthodox but if you take 30.9% money growth and back out (rounding it to 5 percent for GDP growth) this leaves us expecting an incipient inflation rate around 26%.
Sure enough, some products (and stocks) are going up faster, while others go slower.
But since the gap is big and getting bigger…eventually the economy is doomed.
Revolutions (mainly driven by monetary fraud) tend to happen when the residual purchasing power of a currency falls below 5%.
The Minneapolis Fed Inflation Calculator gleefully tells us $1 in 1913 will now buy $27.47 worth of goods. This is reflective of the Big Economic Lie told by the financial press during the Great Depression: namely that inflation is prices going up.
A half-truth at best. The reality is it can also be stated as the purchasing power of money going down. In which case, you divide $27.47 into $1 and find the dollar is worth 3.64 percent of original issue buying power. Think of “money” as being 96.36 percent debt-saturated and you’re onto it.
We also know that the U.S. Debt to GDP ratio is going to hell. We presently owe – as a country – Treasury is hinting at $30 trillion in debt to the penny by Christmas. Yet GDP will likely still hover under $20-trillion. So we’re a debtors nation with 1.5 times (150%) more debt than production.
Biden’s Policy Blunders
In order to reverse course, America needs to increase the number of people really working. In business school training, you get a very clear differentiation between “Line” positions and “Staff” positions.
Line positions are people who produce the physical goods. Manufacturing, farmers, engineers, inventors, coders, truck drivers, longshoremen, and so forth.
Staff positions may be thought of as the “necessary but profit-eating overhead.” Examples are Human Resources, Accounting, and so forth.
Now look at the travesty of the Biden “rescue plan.” In 2,400 pages of bullshit, the Biden plan is mainly about “human infrastructure.” The BML (Big Media Lie) is investment in “human capital” will help. Our take? Too much money is going into staff not line work and line improvement.
Forbes seems to have swallowed the liberal feint; Even If The Money Flows, Will Workers Be Available To Rebuild U.S. Infrastructure? Biden is orchestrating the closing of that window. Billions talked about for housing? Not a contractor I’ve heard from has seen a dime, yet. Lumber futures were tracking toward the $500’s again. Way to go, Brandon!
It’s what politicians do, though: Talk-up the problem and never deliver a solution. But oh my God, do they ever pass out bills and raise taxes.
Drawing the Lines
Here are examples of “staff” not “line” employment growth in the American economy:
- Climate studies. US CO2 emissions were 5.1 billion tons in 2019. The rest of world? Total was 33.1 billion, so the US is 15.4 percent of the problem. Stupid Joe and the Climateers are off hell-bent to screw America while China and Russia don’t even show up to this G20-shitshow. Kill energy independence and sell it to the wokiots. Succah’s.
- CRT & Gender: Don’t even get me started – toss in gender, while we’re at it too. Enforce equality for ALL – nothing more, nothing less. NOT what we’re doing. Everyone is special and want wallet access before others.
- Excess regulation, Immigration: Again, by not enforcing the law – which is constitutionally what is required – the Biden admin’s proposed settlement to illegals of almost half a million is for “suffering” doesn’t even rise to the line/staff level. Just go find opportunists and give ’em money.
My Line versus Staff analysis of Biden (Obama’s third term) shows effort to destroy America by not following basic and simple rules of business management: Grow sales, grow the line. Spend on R&D – get out a best of class product. Virtue signaling is fine pandering to voters, but it doesn’t build things. I have seen more staff positions, especially bean-counters, wreck companies than I can count.
If you remember nothing else: The Line(s) run a company or country. Not Staff.
Too hard for ’em: They’re killing the country and we’re going to be facing bail-ins at some point. Cyprus bail-in’s require a refresher. No insured deposit of €100,000 or less would be affected, though 47.5% of all bank deposits above €100,000 were seized. MMT and deficit spending is a “lifetime piling up” event.
We’re in no hurry for it, but with these jokers mishandling our future?
The Biden posse is still anxious to get access to all your personal banking information. That plan hasn’t been taken off the table.
They’ve been sneaky and misleading on this (look surprised!) by setting a $10,000 level for IRS reporting. But that’s not how much is in the account. It’s how much transits the account per year. If you make $5 an hour, refresh on the WSJ The $10,000 IRS Tax Dragney/
Crypto’s window of middle-class tax cheating will close shortly, we reckon. Then shortages will be increased to make everything BUT “offishul money” unworkable. Government will kill competing money schemes in their sleep. Harbinger: A cryptocurrency inspired by ‘Squid Game’ crashes. The industry has questions.
Trump for his egregious personality flaws, at least understood who build the skyscrapers. Not HR and not CRT/gender studies. Biden, as a lifelong political grifter, has never made much in his life except a mess of things.
Know what’s really amazing? Jeff Bezos. A number of years back, he offered to buy a friend’s high tech company. And most people don’t realize this, but the biggest robotics company in the world is Amazon. That’s what happens when you focus on the line. He builds things: Rockets, companies….robotics… you tracking?
Buffet’s money, too: Sure he makes money on insurance (a regulatory gift horse) but he operates a railroad. And we suspect helped kill a pipeline to keep them tanker cars full.
Point is, the line and staff differentiation is clear. Useful, and pertinent to our future.
Frankly, Elaine and I are getting to an age where we can “coast to the finish line.”
But Gen-X’ers Better keep their eyes on the digital woke mobs. They’re coming for you, too.
“Little sour, are you Ure?” Well, no shit.
The news is just absurd: Which if you don’t believe, check out:
Relations with China are beginning to sour. Yahoo to Pull out of China Amid ‘Challenging’ Environment. Which will be a problem for the Big Country than Can’t Think Straight (us). If Brandon gets his way, we will have cadres of job-ready people for the no factories being planned or funded future. Way to go!
Empty Parts Bins, too: Industry Leaders & Analysts Expect the Global Chip Shortage to Extend into 2023. Thanks Biden, thanks Gruesome.
People who shouldn’t vote will make all the difference again today: Virginia governor’s race preview: The key counties to look for on Election Day. We’re all in favor of limiting voting to people who file an annual tax return and paid actual taxes, no deferred income. Oops – my extremism leaks.
Bay area win for Big Pharma: Judge Rules For Opioid Makers In $50 Billion Lawsuit Joined By Oakland, Santa Clara, County.
Scam Tech alert for Google Voice: Consumer tip: Be careful of this Google Voice scan in the Merc
Fun day shaping up, huh? B-o-r-i-n-g.
Prepper use of drones on Peoplenomics tomorrow and a lot of dope on military tech manuals…
Markets are about mixed with auto sales out as the day progresses, ADP Jobs tomorrow.
Write when you get rich,