(We’ll get to the Jobs report after this…)
You may not like to think in absolutist terms, but there are times when you must because the choice is binary.
This column is likely the last I will write about politics because just as electioneering is barred within so many feet of a polling place, I believe that all-pervasive (and dare I say perverted) mainstream media should be held to the same standard.
That said, there is enough data that we can summarize the ugly choice before us next week.
I have mentioned many times over the past year how Donald Trump is likely to reprise the role of Herbert Hoover, who held office before the Roosevelt empire began. Hoover was a very successful man, good ideas, but he failed to capture the heart of the business community and thus, nominally was left “holding the bag” at the front-end of the Great Depression.
If he wins, Trump will be in a rhyming position.
Although Trump did not cause the massive deficit spending that has accumulated our $20-trillion in federal debt, he will certainly be named as the culprit by the dishonest Left should he win.
Around here, there will be no such blame. We can see Truth in Data clearly enough.
As I pointed out last week, globalism is already dead and the rollover process will be painful. When the U.S.-based companies began outsourcing, they were predominantly infatuated with China, although India and the balance of Asia followed to one degree, or another.
Sadly, the Laws in Economics are pretty simple: Manufacturing will ALWAYS move to the lowest-cost labor area in order to compete with locally-made products, if the local labor cost is higher. That’s just a fact.
The reason trade is yesterday’s issue, though, is that wage in China have risen a great deal; so much so that a new Middle Class is arising. This Middle Class is expanding and China is on the verge of becoming entirely self-sufficient in many ways, not the least of which is economically, necessary agricultural imports to feed its huge population aside.
Other than globalism being “In process” of dying, which some may incorrectly label as the return of nationalism, a multiplicity of other dynamics are in play, but at the top of my list is the collapse of *dare I say straight) sex.
Recommended reading: Demography: Measuring and Modeling Population Processes.
Yes, the West has lost the Sex Race and if you want to know the reasons why places like the Twin Cities are now being taken over by imported (and many without proper vetting) is simple: Immigrant populations procreate much-faster than well-educated and moneyed populations.
Zooming out, we see that Russia has been looking at a similar demographic problem. Their answer to the equation was a somewhat stronger male figure in a leadership role than we’ve had for the past 16-years. They are also really down on the LBGT movement because that gives people a non-reproductive path. With enough marketing, such beliefs will reduce the rate of population growth.
So not only is Globalism on the ropes, and the LBGT movement decreasing demand for things like school, large homes for family-rearing and the like, but in addition we have an aging population that needs to dump financial and physical assets in the next 15-years to make ends meet.
I conceptualize this as The Great Unloading and it is what happens when the demographic bubble known and the Baby Boomers (ppst WW II war babies) need to sell stocks and second homes and the like.
As this happens stock prices will fall. How far is anyone’s guess but already today there are stories about what a fine – and long – run the S&P 500 has had.
The bad news may be seen in the following chart from our Peoplenomics (subscriber) newsletter where we think deeper than passing headlines.
Essentially, the Obama administration has, since the market low in 2009, been riding the final wave up of a stock market that is in many ways similar to the Roaring Twenties period.
There are key differences, of course. Not the least of which is that the first Great Depression was caused by the propagation of new media (radio), electricity (such as the Rural Electricity push), and the biggy: The internal combustion engine embodied in both tractors and new-fangled automobiles.
This time around it’s “Different” but only to the extent that our Roaring period has been driven by microprocessors, networks, while our version of the New Media from before is the Internet in general (which went through its Marconi and Tesla period with HTML) and we are now capping our with streaming video everyone on your phone.
Well, that’s the problem. If Trump makes it into the White House we will no doubt suffer through a Second Depression but it will be through no doings of his. He is, to put it in baseball terms, the designated hitter or guy who bats clean-up.
There is an alternative to financial collapse, of course. It’s the same one FDR used in order to end the Great Depression. And, arguably, the Kennedy administration, but even more so Johnson, did the same thing in Vietnam.
A couple of historical pointers:
The first is that the US Depression of the 1930’s was not a single event. Yes, there was what we call a primary depression that encompassed the period between approximately the Roaring Twenties and the onset of the secondary depression in ab out 1936, or so. FDR was under huge pressure to get the econly going and what he had was plenty of unused manufacturing capacity because of an odd dynamic that happens in Depression.
Essentially, business builds for expected consumption. When – due to a real depression in consumer spending – the consumption fails to appear, then capacity is idled, plants are closed, and parts and assets sold off.
At the end of the primary depression, there was still too much capacity, and when a periodic recession came along in 1937 there was only one thing to do: Kick-start the arms industry.
Thanks to support from some Americans, Hitler was on his fast-track to power, but we can also see how some of the Americans who supported Hitler early –on became benefactors of the War Effort early on. You might find this discussion of “Henry Ford and the Nazis” of interest.
Another democrat who solved an economic problem was John Kennedy. We read in this account from Wikipedia that Kennedy had a collapsing economy to face down:
“The Kennedy Slide of 1962, also known as the Flash Crash of 1962, is the term given to the stock market decline from December 1961 to June 1962 during the Presidential term of John F. Kennedy. After the market experienced decades of growth since the Wall Street Crash of 1929, the stock market peaked during the end of 1961 and plummeted during the first half of 1962. During this period, the S&P 500 declined 22.5%, and the stock market did not experience a stable recovery until after the end of the Cuban missile crisis. The Dow Jones Industrial Average fell 5.7%, down 34.95, the second-largest point decline then on record.”
We can see the Obama administration has been a real sham when comes to living up to the Nobel Peace Prize accorded him. We now have more wars than when we started and tensions with the Russians have never been so high, including for most of the Cold War.
It is a certainty that Hillary Clinton will continue the errant course charted by Angela Merkel in Germany, namely importing their economic stimulus. The gamble – and it’s a bad one in my view – is that bringing in huge numbers of marginally legal immigrants will stimulate the economy and, in effect, make up for the facts of losing the Sex Race.
Just today we read how New York City is providing benefits to 1-million immigrants. This is unassailable data that proves where the Obama administration has gotten its “job growth claims” and it’s why we are not already in a Greater Depression.
Another near-certainty is that the Federal Reserve will raise interest rates at their December meeting, and when that happens, whoever the president is will have to contend with a massively declining market.
The 10-year Treasury was up to to the region of 1.81% Thursday. A look at the charts reveals that’s up half a point since July interest rates lows of July. The Fed will have to follow and things may be expected to be chaotic.
It’s axiomatic that when rates go up,markets go down.
In the meantime, the supposedly non-partisan Federal Reserve has been pumping the money supply for all it’s worth. As of this week:
Then there is the matter of Clinton record of accomplishment. I mean other than covering up for her reprobate husband, other than the allegations of using her State Department position in concert with the Clinton Foundation to engage in a “pay for play” approach to personal wealth-building.
I would assume that if Hillary had really done anything of note, it would be shouted from the hilltops. But that doesn’t seem to be the case. Having a poor record, we see how “Obama talks about himself 207 times in 84 minutes — while campaigning for Hillary .“
If you like Obama, we could (literally and figuratively, I supposed) see Clinton as “Obama on steroids.” I figure that’s a dangerous situation. But then so are Depressions, it’s just they don’t flash and glow so much.
While the odds are good that you’ve already made up your mind who to vote for, my sense is the nation has a choice next week.
One choice is a crooked lawyer/politician who has gotten filthy rich at the public’s expense. Whose time at the State Department was highlighted by serial failures and continues even now to be driven by a Nasty Nest of Neocons who live on brinksmanship and who change party loyalties to maintain America’s shadow government. They will not be transitioned out.
The other is a businessman who plays by the same Tax Code as democrats and has made billions. Yes, estimated net worth is $3.7-billion. Yet he’s seen to it that his children can run heavy equipment because he understands the value in actually making and doing.
With the specter of wider war with Clinton which offers a clear escalation path to nuclear, or a seasoned businessman to face the coming Great Unloading, I think it’s a pretty simple choice.
With luck, this will be the last time I will write either Trump or Clinton until polls close next week. The mainstream media has been co-opted and is crooked to the core so we can only look to ourselves and history to discern the Nation’s direction and future best course.
And here’s how to keep voters home: “US Warns Of Possible Al-Qaeda Terrorist Attack On Monday Targeting NY, Texas And Virginia.”
Thank you for voting…anyway.
Fresh Jobs Report
No surprises here. Those won’t come until after the election. So the last numbers are have read like this…
“Total nonfarm payroll employment rose by 161,000 in October, and the unemployment rate was little changed at 4.9 percent, the U.S. Bureau of Labor Statistics reported today. Employment continued to trend up in health care, professional and business services, and financial activities.
The unemployment rate, at 4.9 percent, and the number of unemployed persons, at 7.8 million, changed little in October. Both measures have shown little movement, on net, since August 2015. (See table A-1.)
Among the major worker groups, the unemployment rate for Hispanics declined to 5.7 percent in October, while the rates for adult men (4.6 percent), adult women (4.3 percent), teenagers (15.6 percent), Whites (4.3 percent), Blacks (8.6 percent), and Asians (3.4 percent) showed little change
We do have to mention that the Alternative Measures of Labor Utilization show true unemployment at 9.5%. See Table A-15 U-6 here.
The CES Birth Death model helped, too, padding 899,000 jobs make up out of the statistical aether. Significant wehen the Labor Participation rate dropped a 10th and part of why futures an hour before ther open was down 16.
I expect the market to rally into the election and a “Buy the rumor, sell the news” to follow. Depending on if we go war track in Syria or Depression track and. Nukes or hunger, hell of a choice.