Category Archives: Economy

It’s Time For All Good Men to Stop Fearing John Galt, by Tom Luongo

It’s time to stand up and be counted on vaccinations. From Tom Luongo at tomluongo.me:

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Is America Becoming Rome Versus Byzantium? By Victor Davis Hanson

If America splits up, it won’t be the first empire to do so. From Victor Davis Hanson at The Epoch Times via zerohedge.com:

In A.D. 286 the Roman emperor Diocletian split in half the huge Roman Empire administratively—and peacefully—under the control of two emperors.

A Western empire included much of modern-day Western Europe and northwest Africa. The Eastern half controlled Eastern Europe and parts of Asia and northeastern Africa.

By 330 the Emperor Constantine institutionalized that split by moving the empire’s capital from Rome to his new imperial city of Constantinople, founded on the site of the old Greek polis of Byzantium.

The two administrative halves of the once huge empire continued to drift apart.

Soon there arose two increasingly different, though still kindred versions, of a once unified Romanity.

The Western empire eventually collapsed into chaos by the latter fifth century A.D.

Yet the Roman eastern half survived for nearly 1,000 years. It was soon known as the Byzantine Empire, until overwhelmed by the Ottoman Turks in 1453 A.D.

Historians still disagree over why the East endured while the West crumbled. And they cite the various roles of differing geography, border challenges, tribal enemies, and internal challenges.

We moderns certainly have developed unfair stereotypes of a supposedly decadent late imperial Rome of Hollywood sensationalism that deserved its end. And we likewise mistakenly typecast a rigid, ultra-orthodox bureaucratic “Byzantine” alternative that supposedly grew more reactionary to survive in a rough neighborhood.

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Empty Christmas stockings? Don’t blame COVID; blame California, by Andrea Widburg

Behind every shortage worthy of the name lurks government. From Andrea Widburg at americanthinker.com:

The conventional wisdom from the left is that COVID is the reason that shipping containers are in the waters off California with no stevedores or truckers available to take care of them.  The implication is that if people would stop being selfish and take the vaccines, the whole problem would magically vanish.  That’s nonsense.  As a couple of astute articles explain, the problem is that California has passed two laws — one for “climate change” and the other as a sop to the unions — that destroyed much of California’s trucking industry.  Add in woes unique to the industry and COVID payments that discourage people from working and…voilà!…empty Christmas stockings.

Stephen Green, at PJ Media, explains some of what’s going on.  As a preliminary matter, truckers are aging out of the job, and new ones aren’t coming along.  Because federal law requires that truckers be at least 21, kids who leave school at 17 or 18 get involved in other careers, leaving trucker shortfalls.  Women don’t offset this problem because, as is typical for most physically difficult jobs, it’s not their thing.  Those are long-term problems.

The short-term problem, though, is that California has passed laws taking trucks off the road:

Twitter user Jerry Oakley reminds us that “Carriers domiciled in California with trucks older than 2011 model, or using engines manufactured before 2010, will need to meet the Board’s new Truck and Bus Regulation beginning in 2020.” Otherwise, “Their vehicles will be blocked from registration with the state’s DMV,” according to California law.

“The requirement is to purchase electric trucks which do not exist.”

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Dollar’s Purchasing Power Plunges Further, as Housing CPI Begins to Climb, Food & Energy Soar, New Vehicle Prices Spike, by Wolf Richter

Just remember that there’s one root cause for both the supply chain issues and rising prices: fiat debt creation and monetization by central banks. From Wolf Richter at wolfstreet.com:

CPI inflation highest since 2008 and 1991.

The Consumer Price Index (CPI) jumped 0.4% in September from August. The relentless series of jumps started in January when this “transitory” inflation took off. But now, “transitory is a dirty word,” as Atlanta Fed President Raphael Bostic phrased it so elegantly, because the underlying dynamics have made it persistent: as some prices back off, others are surging.

On an annual basis, CPI jumped by 5.4%, matching the June high this year, and both are the highest since July and August 2008 (5.6% and 5.4%), and all four are the highest since early 1991, according to data released by the Bureau of Labor Statistics today.

The increase was driven by numerous factors including food and rents and gasoline and utilities and new vehicles.

Food and energy can move sharply and erratically, often following prices of commodities. With food and energy removed, the “core CPI” rose by 0.2% for the month and by 4.0% year-over-year.

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The Left Got What It Wanted—So Now What? By Victor Davis Hanson

What is happening now is all the left has ever wanted—chaos and destruction, and the reign of pure, totalitarian incompetence. From Victor Davis Hanson at amgreatness.com:

There is no schadenfreude in seeing the Left destroy everything it touches—because its claws tear all of us as well.

What was the purpose for the insane opposition of the Left between 2017 and 2021? To usher in a planned nihilism, an incompetent chaos, a honed anarchy to wreck the country in less than a year?

Then

No sooner had Donald Trump entered office than scores of House Democrats filed motions for impeachment, apparently for thought crimes that he might, some day, in theory, could possibly commit.

Foreign Policy published an article by a liberal Obama Administration lawyer outlining all the ways to remove an elected president as soon as possible—including consideration of a military coup.

The FBI and the entrenched bureaucrats at the Justice Department continued their prior failed efforts during the campaign to seed the lies of the fabricated Steele dossier and Fusion GPS. A 22-month-long and $40 million hoax ended with the special counsel himself, a doddering Robert Mueller, swearing under oath that he essentially knew nothing about the dossier or Fusion GPS—the twin catalysts that had prompted his very own investigation.

Fired FBI Director James Comey—a lion on Twitter, and a lamb when under oath—on over 240 occasions testified to the Congress that he either did not know or could not remember, when asked details about the collusion fraud that the philosopher G-man had helped perpetuate.

No one worried about the weaponization of government. So, we went right from the nefarious legacy of John Brennan (who lied under oath to Congress twice), James Clapper (who lied under oath to Congress once), James Comey (who leaked confidential presidential memos), Andrew McCabe (who gave false testimony to federal investigators), Lisa Page (who was fired from the special counsel’s legal team for various unprofessional conduct), Peter Strzok (about whom there is not enough space to detail his transgressions), and the now convicted felon Kevin Clinesmith onto the next round of impeachments.

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Contagion! By James Rickards

In a massively over-indebted and interconnected world, financial collapse can spread like wildfire. The Chinese property sector may be the beginning of the conflagration. From James Rickard at dailyreckoning.com:

There has been a litany of bad news recently, including the U.S. August humiliation in Afghanistan, China’s aggressive actions against Taiwan and increased tensions with Iran, North Korea and Russia.

It will take the U.S. years, possibly decades, to recover from the debacle of August 2021 and the collapse of American prestige. All of these geopolitical events combine to undermine confidence in U.S. power.

When that happens, a loss of confidence in the U.S. dollar is not far behind.

And, perhaps most importantly of all recent bad news, is a market meltdown and slowing growth in China.

Greatest Ponzi Ever

I’ve long advised my readers that the Chinese wealth management product (WMP) system is the greatest Ponzi in the history of the world. Retail investors are led to believe that WMPs are like bank deposits and are backed by the bank that sells them. They’re not.

They’re actually unsecured units in blind pools that can be invested in anything the pool manager wants.

Most WMP funds have been invested in the real estate sector. This has led to asset bubbles in real estate (at best) and wasted developments that cannot cover their costs (at worst). When investors wanted their money back, the sponsor would simply sell more WMPs and use the money to pay back the redeeming investors.

That’s what gave the product its Ponzi characteristic.

The total amount invested in WMPs is now in the trillions of dollars used to finance thousands of projects sponsored by hundreds of major developers. Chinese investors are all-in with WMPs.

Now the entire edifice is collapsing as I predicted it would.

The largest property developer in China, Evergrande, is quickly headed for bankruptcy. That’s a multibillion-dollar fiasco on its own. Evergrande losses will arise in WMPs, corporate debt, unpaid contractor bills, equity markets and unfinished housing projects.

China’s entire property and financial system is on the verge of a world-historic crack-up. And it won’t remain limited to China.

It comes back to contagion.

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What the Record Spike in “Quits” Says about the Job Market, Inflation, and How Labor Gained Pricing Power, by Wolf Richter

The non-transitory inflation is feeding into wage rates. From Wolf Richter at wolfstreet.com:

One more reason “transitory” and “temporary” have become a silly joke. Even the Fed is backing off promoting it.

By Wolf Richter for WOLF STREET.

The number of people who quit jobs voluntarily – to work for another company that offered higher wages and benefits and a signing bonus; to change careers entirely; to stay home and take care of the kids; to spend  more time with their money; or whatever – spiked by another 242,000 people to a record of 4.27 million in August, up 19% from August 2019.

This is what the Bureau of Labor Statistics reported today in its JOLTS report, based on a survey of 21,000 nonfarm business establishments and government entities.

The spike comes amid a very tight job market, with labor shortages cutting into sales and production, and contributing to transportation bottlenecks, amid record job openings that have been spiking for months, and amid aggressive efforts by companies to hire people away from other companies, which creates this spike of quits.

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Southwest Airlines Is Collapsing – A Glimpse Of The Future And Hope, by Charles “Sam” Faddis

The power of no. Only by exercising that power do we have a prayer of freeing ourselves from the tyranny descending across the world. From Charles “Sam” Faddis at andmagazine.com:

Joe Biden’s federal vaccine mandate is toothless. He cannot make it work. He cannot enforce it, and so the federal government has tried to ‘back door‘ a national vaccine mandate by pushing corporations to do their dirty work. Maybe the feds can’t really order you to take the jab, but if they can prevent you from earning a living without the vaccine, they can achieve the same objective.

It seems simple enough and strangely fitting for a government that is increasingly indistinguishable from giant multinational corporations, Big Tech, and the oligarchs that run the entire enterprise.

Except, a funny thing is happening. The people, those Neanderthals clinging to their Bibles and guns, who are supposed to do what they are told, pay taxes and fight the corporate wars are pushing back. Deserted by their elected representatives, who answer to their corporate masters, average Americans are refusing to comply.

Take a look at Southwest Airlines, and you will see exactly what this new civil disobedience looks like. You may also see the future.

The White House has pressed the airlines to adopt vaccine mandates using the leverage of federal contracts. United knuckled under first and announced a vaccine requirement. Southwest recently announced its employees had until December 8, 2021, to get vaccinated or lose their jobs.

The pilot’s union for Southwest Airlines responded to the mandate by filing suit and trying to block the action, but the pilots themselves are not waiting for court action to make clear where they stand. They have started using vacation and sick days and refusing to show up for work. Other employees have followed suit.

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Our Economy Is Starting To Break Down On A Very Basic Level, by Michael Snyder

Once you get past the title (Starting to break down? The economy’s been a debt-supported wreck since at least the turn of the century.) and the first sentence (I know many people, including me, who weren’t optimistic at all back in January, especially after January 6), this isn’t a bad article. Michael Snyder’s never at a loss for reasons to be pessimistic, but he supports his case well. From Snyder at themostimportantnews.com:

Do you remember how much optimism there was last January?  Many Americans were entirely convinced that really bright days were just around the corner, but instead things have taken a dramatic turn into the dumpster over the last 9 months.  The Afghanistan debacle was the worst foreign policy embarrassment in modern American history, the Biden administration is trying to deal with an unprecedented crisis on our southern border, and the way that our politicians are handling the pandemic is causing extremely deep divisions throughout our society.  In addition, our economy is starting to break down on a very basic level.  On a widespread basis, goods are not getting to the places they need to be when they need to be there, and services are often not available when people need them.  As time has passed, the “malfunctioning” of our economy has spread, and now the coming mandates threaten to make things a whole lot worse.

Just look at the chaos that was caused in Florida on Sunday

Southwest has canceled 1,018 Sunday flights as of 2 p.m. ET, according to flight tracker FlightAware. That’s 28% of the the airline’s scheduled flights and the highest of any U.S. airline by a wide margin.

American Airlines has canceled 63 flights, or 2% of its operation, while Spirit Airlines canceled 32 flights, or 4% of its flights, according to FlightAware.

Overall, more than 1,800 flights were canceled during the weekend, and Southwest is publicly blaming the problems on “weather challenges”

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The Great Southwest Airlines Rebellion? by Ron Paul

Let’s hope the great Southwest Airlines Rebellion sparks even greater rebellions across the country. From Ron Paul at ronpaulinstitute.org:

The incredible cruelty and folly of forced vaccines finally came home to roost. The vaccine mandate backlash has been bubbling just under the surface, but now it has spilled out into the open, threatening to completely derail an already crumbling economy and to obliterate a deeply unpopular US President and Administration.

Seemingly out of nowhere what appears to be a Southwest Airlines rebellion has taken flight this weekend. According to media reports, scores of pilots and other Southwest employees have coordinated the taking of “sick days” to use them up in advance of a Southwest Airlines mandate to get the jab or lose the job. Over Saturday and Sunday more than 2,000 flights have been cancelled, with airports experiencing full-on mayhem.

The Southwest Airlines Pilots Association is suing the airline over the imposed vaccine mandate, bolstering the claim that there is a “sick out” underway among angry Southwest pilots.

The mainstream media is doing its best to keep a lid on the expanding rebellion against the vaccine mandates, and Southwest Airlines itself is blaming the cancellations on bad weather and a lack of air traffic controllers. However, the weather problems that Southwest claims to be experiencing seem unique to that carrier: no other airline (thus far) is reporting such weather-related cancellations. And FAA spokesperson Steve Kulm told USA Today that “No FAA air traffic staffing shortages have been reported since Friday.”

Will other pilots, such as at American Airlines, follow suit? Rumors are circling that this is only the beginning.

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