Rolling out of bed at 3 AM – intent on tuning up a few website issues – I was all set to work my butt off. Had a great article come to mind: Soap Bubble Prosperity!
Lo and behold: No real “work” needed today. Because there are so many moving targets, the choice of topics is wide-open. Except…
Storming – After
Side swipe of Laura dumped only an inch and a half of rain on us overnight. Else? Not so good: Hurricane Laura brings tornado threat after Louisiana landfall, Lake Charles ‘severely damaged’.
JP & The Rules of Crooked Money
Imagine yourself, for a moment, Ruler of a country. People in the country are getting uppity. Times have gotten hard. 10% of the people who once had jobs have now lost them. A plague is sweeping the land. Hysteria mounts at every turn.
The People? They all want more money. Silly people don’t realize that if they have more money, prices will magically go up so they have to spend it all.
Being a benevolent sort, though, you raise the Money Supply by 30%.
Sure, there are still 10% without jobs. And yes, the plague is still making the rounds, and yes, hysteria is everywhere. But, a great radio station exec once advised when discussing how to “position” a radio station for high listener recall (and this applies equally to politics and Fed Bosses):
“You can’t give the People what they need. And you can’t give people what they want. All you can do is give the People what they THINK they’re getting!“
Will J. Powell – speaking in a few minutes – come out and say something like this?
“The economy was ready to tank. The virus was cover. The market went down 33% so we jacked up the money supply by the same amount – figuring no one will notice…”
Does Powell Have “Free Speech?”
LOL…good one! I mean really, when you think about it, rules of decorum and such do limit people who hold off, to some degree. OK, maybe not Sheriff Joe…but less people? Yeah…
I don’t think Powell CAN be that forthright, because in reality, he’s stuck in the “Got to give people what they think they’re getting” trap. Why, the merest mention of Making Up Money at those kind of levels would scare the hell out of any sane (balance-sheet minded) business person. They have to use terms like “Increased the Fed’s lean ding capacity” which is so, so much sweeter than “We made shit up because we had no choice…”
Fortunately, sane business people are mostly off the table now. Out to pasture (pasteurized?) Trying to live out what were supposed to be the “Golden Years.” Which have instead turned into the “Can’t Have It” years.
- Can’t have a 3-week cruise. Plague Posse says so.
- Casinos are mostly closed down.
- Elaine would love some live music and romantic dinners out again. But until Victoria’s secret comes out with a line of something in Tyvek….
- Hopping in an RV is less appealing, because you don’t know which city the Marxist/communist insurgency will pop up in next…
- And there are lots of us who still think TSA should use FRESH GLOVES on each passenger. “Honest honey I got crabs on that last business trip because of TSA… I wasn’t fooling around…it was this skanky guy ahead of me…” Yeah, sure, you betcha…
The Simpsons KNEW! We’re all HOMER’s now, get it yet? Like the Twin Towers hint wasn’t enough…keep up, pipple.
Anyway, our first point this morning is keep an eye on “Stock-index futures edge lower as investors await speech by Fed’s Powell.” And if you watch it, see if you can see where the strings lead, off-stage…
GDP Suckage (Gross Domestic Product)
The world hasn’t ended with the GDP report just out. Says so, right here…but it also screams “Not peachy!” (Yet amazingly, after the tank, Dow
Fictions Futures are only down 42 points…)
“Real gross domestic product (GDP) decreased at an annual rate of 31.7 percent in the second quarter of 2020 (table 1), according to the “second” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP decreased 5.0 percent.
The GDP estimate released today is based on more complete source data than were available for the “advance” estimate issued last month. In the advance estimate, the decrease in real GDP was 32.9 percent. With the second estimate, private inventory investment and personal consumption expenditures (PCE) decreased less than previously estimated
Except! (reread the Crooked Money part): Since the heirs of Helicopter Ben have dumped 33% more money into the economy, and since GDP is reported based on what? DOLLARS!!!!
But, nothing to see here…move along. Just the start of the Second Depression, is all…
This prosperity stuff has never been long-term sustainable anyway. We need crisis after crisis because in a world without nuclear war… Where else are we going to get the demand destruction? (Upon which we can pour an 1,800 pound concrete foundation (without rebar again) so everything will break down the road, again. And thus allow us to make up another story later on?
A College Education in Finance
See, the ugly here is that Government doesn’t deliver SOLUTIONS. Only Programs. Programs cost money, expand the bureaucracy, create an excuse to tax your sorry ass into poverty and – when they need to make up money: It’s why the Golden Years are the Can’t Years now.
Trump tried to deliver a few solutions. Nasty and Schifty blocked most – they are Program lovers. Can Slow Joe to better? Of course not. He’s another Programs monster. Trump’s learning that lesson the hard – one term – way.
Toss in that the money is made up and we just saved you from a $50-thosuand dollar shellacking in higher Ed. Give thanks, Hallelujah! Kiss the ground! Now, wipe off your face, and let’s continue to ring three of this f*cking circus… Homer.
Weekly Jobs Data
While Wall Street hit fresh records (admittedly denominated in value-deficient paper), whose backs do you think they were standing on? Hands? Anyone????
“In the week ending August 22, the advance figure for seasonally adjusted initial claims was 1,006,000, a decrease of 98,000 from the previous week’s revised level. The previous week’s level was revised down by 2,000 from 1,106,000 to 1,104,000. The 4-week moving average was 1,068,000, a decrease of 107,250 from the previous week’s revised average. The previous week’s average was revised down by 500 from 1,175,750 to 1,175,250.
The advance seasonally adjusted insured unemployment rate was 9.9 percent for the week ending August 15, a decrease of 0.2 percentage point from the previous week’s revised rate.
Near as we can figure it, a lot of the social violence going around is going on because rabble rousers are telling folks that America has failed to DELIVER.
In 1960, one person working at a union job – say UAW Detroit – could support a family, own a home, and drive a car. Let’s see what the presidential scorecard looks like, shall we?
There were five democrat presidents since 1960. And 5 and a half republicans. No, make that 5 republicans. (Accounting department explains: One of the presidents was Nixon and Ford got part of his term. Trump has not completed a term yet and God knows what he could have gotten done – except for the demoncrats making up sh*t in the House of Cards…so yeah…5 and 5…)
Between 10 terms, both parties combined managed to:
- Shit-can making ends meet on single 40-hour a week job.
- Made marriage due to financial pressures almost mandatory.
- Since there were never enough good partners anyway, the whole LBGTQ deal allows partnering but we see behind the curtain the TAX PURPOSES of this move…you following this?
- Moved the Car industry overseas…
- …oh, we could go on all day, but how many families have two people working so they can pay (with the second income) for a car, day care, meals and sitter and tutors, and can’t raise a garden, and they need insurance on the second car and… You know this is all a TRAP, right? Second jobs nets a cheeseburger and fries, but you can’t sit down…
Like the old Yellow Pages ads, though, both political parties “Never stop selling...” Which is why – at the Second Circus in two weeks – we read how Mike Pence Warns Of An Unsafe America Under Biden: Takeaways From Day 3 Of The RNC.
We figure 10 data points hinting no one is safe no matter who wins.
All in the name of?
Whee! Almost forgot to mention in that BEA GDP release:
Profits from current production (corporate profits with inventory valuation and capital consumption adjustments) decreased $226.9 billion in the second quarter, compared with a decrease of $276.2 billion in the first quarter (table 10).
Profits of domestic financial corporations increased $39.5 billion in the second quarter, in contrast to a decrease of $42.2 billion in the first quarter. Profits of domestic nonfinancial corporations decreased $170.1 billion, compared with a decrease of $190.5 billion. Rest-of-the-world profits decreased $96.2 billion, compared with a decrease of $43.5 billion. In the second quarter, receipts decreased $139.7 billion, and payments decreased $43.4 billion.
10% unemployed? Financial profits up? No fairness in cutthroat capitalism, though.
OK, Homer, why do you think that might be? CEO paydays! Bigger fool stock pricing. Soap Bubble Prosperity, Bubba; yes sir. Land of the free – land of the IQ-90’s.
OH “Poor Him” Dept.
Gotta tell you, reading this I was moved. Brought a tear to my eye. OK, it was of laughter.
Do they think everyone in Portland is stupid enough to forget their Marxist tantrums at “Portland Commissioners Grill FBI, DOJ Over Terrorism Task Force“? If they can’t handle the job, Portland voters should “help” them by removing their workload.
Poor Little Globalists
While America was lulled into gender-checking – bully-bashing – and a sham impeachment on social, China got pretty much a free pass to work their Belt and Road Initiative (BRI). This ensures China will dominate areas like Afghanistan, Pakistan, and enough of the Middle East to run railroads to Africa. Which is their version of American expansionism a hundred-and-fiddy-back here.
Roping satellite states in with visions of a higher standard of living, China’s on a roll. And today, in Foreign Policy, there’s a great whine titled “The Pakistan Army’s Belt and Road Putsch.”
‘Course, what the often erudite Foggy Bottom types STILL haven’t grasped – even with Pompeo trying to wake the dead, is “You snooze, you loose.”
Part of the (this is big picture stuff, be warned…) MAGA concept was we would – as a country – get back in the game. Too many distractioned and a (manufactured?) disease, and a failed impeachment later we get? Whiners.
Enough. I’ll save the ViseGrips for tomorrow. For now? Chow-chasing festival is about to begin.
Write when you get rich,