Thursday, February 11, 2021

"Covid-19 Pandemic Updates 2/11/21"

"Covid-19 Pandemic Updates 2/11/21"
"When you have eliminated the impossible, 
whatever remains, however improbable, must be the truth."
- "Sherlock Holmes", Sir Arthur Conan Doyle
• "Doctor Admits Masks Don’t Work: “All Viruses Can Get Through”
 Feb 11, 2021 7:54 AM ET: 
The coronavirus pandemic has sickened more than 107,417,100 
people, according to official counts, including 27,328,455 Americans.
Globally at least 2,355,700 have died.

"The COVID Tracking Project"
Every day, our volunteers compile the latest numbers on tests, cases, 
hospitalizations, and patient outcomes from every US state and territory.
https://covidtracking.com/
Feb. 11, 2021, 7:20 AM ET
Where I Live:
- CP

"Economic Market Snapshot AM 2/11/21"

"Economic Market Snapshot AM 2/11/21"
"Capitalism is the astounding belief that the most wickedest of men will
do the most wickedest of things for the greatest good of everyone."
- John Maynard Keynes
"Down the rabbit hole of psychopathic greed and insanity...
Only the consequences are real - to you!
Your guide:
Gregory Mannarino, AM 2/11/21

"The Total Economic Collapse Is Just Getting Started

"The more I see of the monied classes, 
the better I understand the guillotine."
- George Bernard Shaw
MarketWatch Market Summary, Live Updates

CNN Market Data:

CNN Fear And Greed Index:
A comprehensive, essential daily read.
Feb 11th, Updated Daily 
Financial Stress Index
"The OFR Financial Stress Index (OFR FSI) is a daily market-based snapshot of stress in global financial markets. It is constructed from 33 financial market variables, such as yield spreads, valuation measures, and interest rates. The OFR FSI is positive when stress levels are above average, and negative when stress levels are below average. The OFR FSI incorporates five categories of indicators: credit, equity valuation, funding, safe assets and volatility. The FSI shows stress contributions by three regions: United States, other advanced economies, and emerging markets."
Daily Job Cuts

Greg Hunter, "Aristocrats vs 'We the People'”

"Aristocrats vs 'We the People'”
By Greg Hunter’s USAWatchdog.com 

"Financial writer John Rubino says massive unpayable debt has already bankrupted America, and when this happens, politics are also massively corrupted. Rubino explains, “When you bankrupt your country, your politics are inherently corrupted by that bankruptcy, and that’s what is happening to us. We created a financial system that is run by an aristocracy. It’s not a Right/Left, liberal, socialist or conservative aristocracy. Look at JPMorgan Chase, Google and General Dynamics. Look at Mitch McConnell, the big Republicans and the big Democrats. They are not socialists, and they are not capitalists - they’re aristocrats. They are mainly interested in a system where the rules apply to you and me but do not apply to them. You need to view those guys as Dukes and Duchesses whose main job is to maintain power over the peasants, then their behavior makes complete sense. Seeing them that way makes their motivation and behavior pretty much crystal clear.”

Rubino contends, “This won’t change. You’ve got to have all the peasants grabbing their pitch forks and heading to the castle before it changes. In the meantime, we are stuck with this system, and it has given us the biggest financial bubble in human history. That sounds like hyperbole and click bait, but it’s actually not. If you look at the big financial bubbles we have lived through, junk bond bubble, tech bubble and then the housing bubble, they were sector specific financial bubbles where one asset class just blew up. They became the center of a mania, crashed and almost took down the whole economy. We now have at least four and maybe five bubbles of that magnitude all going at the same time. That’s why they call it the ‘Everything Bubble.’ When this thing blows, it’s not just going to be one sector tanking. It’s going to be all the sectors tanking at once. It’s going to be astounding. I wouldn’t want to be Joe Biden when that happens. This is going to be an impossible thing to govern.”

Rubino warns, “When it becomes obvious that there are no tools to fix any of these markets that are blowing up, that shifts the attention over to currencies. Because if we can’t fix the financial markets, why would we want to hold these currencies when everything in these financial markets that these currencies kind of govern are going crazy? So, when this thing blows up, it will shift the pressure over to the dollar. Thus, this is the whole DollarCollapse.com thing. Nobody is going to want to hold the dollar or the euro or the yen. It won’t matter what the governments do because there will be nothing effective for them to do. That’s when things get really crazy, and people will be glad they have gold and silver among a handful of other things. It’s completely possible we end back up on a gold standard in 10 years with gold at $10,000 per ounce. If you are a stacker, this chaos is less terrifying to you because you know your financial life is going to be okay no matter what happens to housing, tech or whatever. We think we have lived through some tough times in the financial markets, but we have never seen anything like what is coming.”

Join Greg Hunter on Rumble as he goes One-on-One 
with the founder of DollarCollapse.com, John Rubino:

Wednesday, February 10, 2021

"8 Million More Living In Poverty, 9 Million Businesses In Danger Of Closing, 10 Million Behind On Rent"

"8 Million More Living In Poverty, 9 Million Businesses
 In Danger Of Closing, 10 Million Behind On Rent"
by Epic Economist

"The economic collapse always starts with a major breakdown that trickles down to all the main systems and institutions of our society. The health crisis was surely the kick that pushed the U.S. economy over the edge, but we have to remember that first of all, we were already nearing the edge long before the start of a global sanitary outbreak. Evidently, the consequences brought on by the crisis accelerated our downfall, but we were set to fail regardless of that. Now that the collapse has arrived and the big burst was already witnessed, many might be under the impression that things will improve from here. But don't be mistaken: there's always a way to fall further down the rock bottom. The decay of our nation was triggered in 2020, but it has only started. And today we brought you the latest numbers to prove to you that everything around us is still crumbling, and the worst is yet to come. 

To illustrate how dire our economic conditions have become, we decided to gather some numbers. Starting with the number of Americans who would still have jobs if the health crisis had never happened. According to the Congressional Budget Office, 7 million people out of work in 2021 would reportedly be working if widespread business shutdowns haven't occurred as a result of the outbreak. The CBO report stresses that this is a terrible situation for the labor market, and it calls "to immediate action, not calm, not wait-and-see". The agency projected that without effective federal assistance, the unemployment rate will remain above its pre-outbreak levels until 2024, which means millions would be unemployed for years, even after the health threat is gone. 

Additional numbers provided by the report outline that now that we're almost a year into the crisis, nearly 11 million workers remain unemployed, and at least 4 million have been unemployed for six months or longer. Over 2 million women have left the labor force, as a consequence of school closures and challenges with child care. Right now, the figures that expose their suffering point out that roughly 24 million adults, and as many as 12 million children, are struggling with food insecurity, while more than 80 million adults are having problems covering household expenses. 

According to Bloomberg, over 8 million Americans fell into poverty during the second half of 2020, which not only increased racial and income inequalities but will potentially jeopardize the future of millions of children in such tragically impoverished households. As the stimulus money keeps failing to reach those who need it the most, those numbers will inevitably continue to grow in the months ahead, especially because the federal aid is also failing to support our businesses. And that brings us to our next number. Approximately 9 million small businesses in the U.S. say that they “won’t survive” in 2021 without further government assistance, as 88% of the businesses surveyed disclosed that sales had not yet returned to pre-outbreak levels. 

Even if business eventually goes back to normal, these businesses have piled up huge mountains of debt that will not go away. That is particularly concerning since the real estate and housing markets are already overwhelmed with the number of domestic renters behind on their rent payments, which lead us to the final figures: according to the U.S. Census Bureau, 10 million tenants across the U.S. were late on their rental payment in January, and an estimated 16 million renters had little to no confidence they could pay rent in February.

The survey describes that all of these people are at risk of eviction. Altogether, U.S. home renters now owe at least 30 billion dollars in back rent. As a result, America’s landlords have been experiencing extreme financial pain, and experts say that as soon as the rent moratoriums are finally lifted we are going to see the largest tsunami of evictions in all of U.S. history by a very wide margin. 

So taking a step back and looking at the overall picture, we can see how the effects of the collapse have infiltrated all over the economy. The industries that didn't immediately meltdown after the recession began, are now steadily decaying while the ones that were hit the hardest by the downturn are completely disintegrating right before our eyes. Jobs are being shed with every day it passes, and millions upon millions of Americans are deeply suffering from the financial setbacks the recession forced them to face. These are very dark times for the U.S. economy, and it seems like much more pain is on the horizon."

"The Fed Faces Two Choices"

"The Fed Faces Two Choices"
by Brian Maher

"A man shipwrecked bobs along in his lifeboat…The cruel sun cooks him. His thirst tortures him. His sufferings are doubled, tripled and quadrupled by this impossible irony: Water, water is everywhere - yet there is scarcely a drop to drink. Salt water in any quantity would murder him. Thus he dangles from the hooks of a lethal dilemma. He dies if he does not drink… and he dies if he does drink. The Federal Reserve offers a parallel example. It is the agonized wretch in the lifeboat. It is mad for inflation. Yet inflation is lethal...

The Cry for Inflation: Jerome Powell and his crewmates cry aloud for inflation. Inflation is the spark of growth, they believe...Inflation takes a match to the dollar. The consumer wishes to unload his dollar before the flame burns through it. Thus inflation spurs the consumer to spend. He will purchase his goods today because his dollar is a wasting asset. It will fetch him more goods today than it will fetch him tomorrow. Today’s purchases, in turn, add a figure to the gross domestic product. A benign inflation therefore keeps an economy on the jump… and business in funds.

Under deflation - conversely - tomorrow's dollar packs more wallop than today's dollar. Consumers expect lower prices tomorrow. They will therefore postpone today's purchases until the price falls to them.

The “Evils” of Deflation: What is the evil result of postponed purchasing? Goods wallow upon shelves, stockrooms overflow with surplus. Commerce loses its steam. Under extreme deflation, it may stall almost entirely. Thus is deflation the ultimate bugaboo, the ultimate fee-fi-fo-fum of most economists.

You may relish the formidable dollar gaining strength in your wallet. This buck will give you a greater bang tomorrow. Yet you are not an economist. You do not hear the music of the spheres. You do not realize deflation is your foe.

Deflation, Inflation and Debt: Deflation is certainly the ultimate bugaboo, the ultimate fee-fi-fo-fum of all debtors…Deflation raises the real value of debt. A man borrows $1 today. Under deflation, he must repay perhaps $1.07 when his creditor thunders at his door. Under inflation, the opposite dynamic obtains. The man borrows his dollar. Yet he owes merely 93 cents when his creditor knocks. The borrower escapes with a whole skin - and a bit of blubber. Yet the creditor comes away a man reduced. He lent a dollar and received cents in return. He is the victim of a swindle.

As Jim Rickards reminded us yesterday: "Inflation decreases the real value of debt. It’s easier to pay down debt because you’re paying back debt with dollars that are less valuable than when you originally borrowed them."

Deadbeat Nation: The United States is the world’s largest debtor nation. Its shoulders stoop, its back aches under a $27.8 trillion burden of debt. Total United States debt - public and private - runs to $72 trillion. It cannot endure deflation. Deflation stacks additional weight upon the shoulders… further encumbers the back… and buckles the knees. Recall, debt’s real value increases under deflation.

Inflation, meantime, eases a man’s load. Debt’s chains weigh lighter upon him. He can get on… and move ahead. Hence the Federal Reserve’s mania for inflation. It quickens the pace of commerce. It eases debt’s burden, public and private. Understand this, and you understand 12 years of monetary policy. Has it failed, largely? Yes, it has. But let it go for the moment. Let us instead return the Federal Reserve in its lifeboat… and its lethal dilemma.

Inflation Corrodes the Value of Bonds: Assume - by some miracle of God - it gets its inflation. The fiscal authorities, as you know, are busy. One day they may break through. What then follows when inflation bubbles? Longer-term bond holders begin to grumble. They grumble because inflation corrodes the value of their bonds as rust corrodes the value of a yacht. Years of inflation will reduce their bonds to rust. Thus they demand a sort of boater’s insurance. That is, they demand higher bond yields to compensate them for the rusting. The longer-dated the bond, the more compensation they demand. Who would hold a 10-year or 30-year Treasury to term if inflation would corrode through it? Only the man with adequate insurance to guard his investment.

We now come to the fatal element. We now come to the salt in the water…

“Inflation Is the Water. Interest Rates Are the Salt Within It.” The Federal Reserve is after inflation as the man in the lifeboat is after water. The thirsting and dehydrated man cannot drink in much salt water. And the Federal Reserve cannot allow in much inflation. Why not precisely? Inflation is the water. Interest rates are the salt within it.

As an overdose of water yields an overdose of salt… an overdose of inflation yields an overdose of interest. That is because rising inflation translates to higher bond yields. Higher bond yields translate to higher interest rates. Higher interest rates increase the cost of borrowing… and increase the debt burden. Higher interest rates are therefore lethal for an economy - and a stock market - held up by cheap money.

Thus the impossible conundrum for the man in the lifeboat is the impossible conundrum of the Federal Reserve. Matthew Piepenburg of Matterhorn Asset Management: "Rising yields… lead to rising rates, and rising rates are what kills debt-driven asset bubbles… it is essential for these debt-addicted (and failed) policy makers to keep the price (i.e. interest rates) of their debt down - which means they need to keep the yields on their bonds under “control” by keeping bond demand, and hence bond prices up."

Monetizing the Debt: What if the federal government cannot attract buyers of Treasury bonds? The Federal Reserve fabricates the money to purchase the bonds itself. That is, it monetizes the debt. This bond purchasing holds prices up… and holds bond yields… and interest rates… down. It creates a false impression of demand. What is the result, Mr. Piepenburg?

"The artificial control (repression) of yields and rates means cheaper debt, and hence more binge borrowing (and hence price inflation) on everything from over-priced homes to over-pumped stocks driven by easy and cheap debt…" The “everything bubble” expands and expands - in stocks, in bonds, in real estate, in cryptocurrencies - in everything.

How can the Federal Reserve halt the lunatic cycle? Piepenburg: "The only options central bankers have left are bad ones. They can further [suppress yields] by printing trillions more fiat currencies - which means a dramatic (and further) debasement of the same; or… They can… naturally [allow] bonds to sink and yields (and hence rates) to skyrocket, thereby ushering a total blood bath in stock and bond bubbles reliant on low yields and cheap debt. We believe we have the answer. It is not option #2.

Time Reveals Truth: The show will continue until it cannot. The date is of course a mystery to us. It is on the knees of the inscrutable gods. But the Federal Reserve has engineered a false prosperity by issuing false signals - false interest rates. It conducts a massive and ceaseless warfare upon truth. But time reveals truth… as noted the Roman stoic Seneca. We fear Seneca is correct. Time in its fullness exposes truth. Here is our greater fear: This truth will hurt... and good..."

"Working Class Buried In Debt; Debt Serfdom; Money For Nothing; War On Middle Class"

Jeremiah Babe,
"Working Class Buried In Debt; Debt Serfdom;
 Money For Nothing; War On Middle Class"

Musical Interlude: Ocarina, "Song Of Ocarina"

Ocarina, "Song Of Ocarina"
"Song of Ocarina is the name of a 1991 song recorded by the musicians Jean-Philippe Audin and Diego Modena. It is entirely instrumental and is played on ocarina by Modena and cello by Audin. Released as first single from the album Ocarina, it achieved a huge success in France, topping the chart, and becoming in this country the first instrumental number-one hit."

"A Look to the Heavens"

“NGC 253 is not only one of the brightest spiral galaxies visible, it is also one of the dustiest. Discovered in 1783 by Caroline Herschel in the constellation of Sculptor, NGC 253 lies only about ten million light-years distant.
NGC 253 is the largest member of the Sculptor Group of Galaxies, the nearest group to our own Local Group of Galaxies. The dense dark dust accompanies a high star formation rate, giving NGC 253 the designation of starburst galaxy. Visible in the above photograph is the active central nucleus, also known to be a bright source of X-rays and gamma rays.”

Chet Raymo, “Tyger, Tyger Burning Bright…”

“Tyger, Tyger Burning Bright…”
by Chet Raymo

“Divinity is not playful. The universe was not made in jest but in solemn incomprehensible earnest. By a power that is unfathomably secret, and holy, and fleet.” You may recall these words from Annie Dillard’s “Pilgrim at Tinker Creek.” There is nothing intrinsically cheerful about the world, she says. To live is to die; it’s all part of the bargain. Stars destroy themselves to make the atoms of our bodies. Every creature lives to eat and be eaten. And into this incomprehensible, unfathomable, apparently stochastic melee stumbles… You and I. With qualities that we have - so far - seen nowhere else. Hope. Humor. A sense of justice. A sense of beauty. Gratitude. But also: Anger. Hurt. Despair. Strangers in a strange land. 

Galaxies by the billions turn like St. Catherine Wheels, throwing off sparks of exploding stars. Atoms eddy and flow, blowing hot and cold, groping and promiscuous. A wind of neutrinos gusts through our bodies, Energy billows and swells. A myriad of microorganisms nibble at our flesh.

We have a sense that something purposeful is going on, something that involves us. Something secret, holy and fleet. But we haven’t a clue what it is. We make up stories. Stories in which we are the point of it all. We tell the stories over and over. To our children. To ourselves. And the stories fill up the space of our ignorance. Until they don’t. And then the great yawning spaces open again. And time clangs down on our heads like a pummeling rain, like the collapsing ceiling of the sky. Dazed, stunned, we stagger like giddy topers towards our own swift dissolution. Inexplicably praising. Admiring. Wondering. Giving thanks.”
“The Tyger”

“Tyger! Tyger! burning bright
In the forests of the night,
What immortal hand or eye
Could frame thy fearful symmetry?
In what distant deeps or skies
Burnt the fire of thine eyes?
On what wings dare he aspire?
What the hand dare sieze the fire?
And what shoulder, and what art.
Could twist the sinews of thy heart?
And when thy heart began to beat,
What dread hand? and what dread feet?
What the hammer? what the chain?
In what furnace was thy brain?
What the anvil? what dread grasp
Dare its deadly terrors clasp?
When the stars threw down their spears,
And watered heaven with their tears,
Did he smile his work to see?
Did he who made the Lamb make thee?
Tyger! Tyger! burning bright
In the forests of the night,
What immortal hand or eye
Dare frame thy fearful symmetry?”

- William Blake

“The Immutable Laws of Nature, and Murphy’s Other 15 Laws”

“The Immutable Laws of Nature, and Murphy’s Other 15 Laws”
by Peter McKenzie-Brown

“The Immutable Laws of Nature”

• Law of Mechanical Repair: After your hands become coated with grease, your nose will begin to itch and you’ll have to pee.
• Law of Gravity: Any tool, nut, bolt, screw, when dropped, will roll to the least accessible place.
• Law of Probability: The probability of being watched is directly proportional to the stupidity of your act.
• Law of Random Numbers: If you dial a wrong number, you never get a busy signal; someone always answers.
• Law of Variable Motion: If you change traffic lanes or checkout queues, the one you were in will always move faster than the one you are in now.
• Law of the Bath: When the body is fully immersed in water, the telephone will ring.
• Law of Close Encounters: The probability of meeting someone you know increases exponentially when you are alongside someone you don’t want to be seen with.
• Law of the Damned Thing: When you try to prove to someone that a machine or device won’t work, it will.
• Law of Biomechanics: The severity of the itch is inversely proportional to the reach.
• Law of the Spectator: At any theatrical, musical or sporting event, the people whose seats are furthest from the aisle always arrive last. They are the ones who will leave their seats several times to go for food, for beer, or to the toilet and who leave before the end of the performance or game. Those who occupy the aisle seats come early, never move once, have long gangly legs or big bellies and stay seated beyond the end of the performance. The aisle people also are very surly folk.
• Law of Coffee: As soon as you sit down to a cup of hot coffee, your partner will ask you to do something which will last until the coffee is cold.
• Murphy’s Law of Lockers: When only 2 people are in a locker room, they will have adjacent lockers.
• Law of Plane Surfaces: The chance that a slice of marmalade toast will land face down on a floor is directly correlated to the newness and cost of the carpet or rug.
• Law of Logical Argument: Anything is possible when you don’t know what you are talking about.
• Law of Physical Appearance: If clothes fit, they’re ugly.
• Law of Public Speaking: A closed mouth gathers no feet
• Law of Commercial Marketing: As soon as you find a product that you really like, it will cease production or the store will stop selling it.
• Law of Psychosomatic Medicine: If you don’t feel well, make an appointment to see to the doctor and by  the time you get there, you’ll feel better. If you don’t make an appointment you’ll stay sick.

“Murphy’s Other 15 Laws”

1. Light travels faster than sound. This is why some people appear bright until you hear them speak.
2. A fine is a tax for doing wrong. A tax is a fine for doing well.
3He who laughs last, thinks slowest.
4A day without sunshine is like, well, night.
5. Change is inevitable, except from a vending machine.
6Those who live by the sword get shot by those who don’t.
7. Nothing is foolproof to a sufficiently talented fool.
8. The 50-50-90 rule: Anytime you have a 50-50 chance of getting something right, there’s a 90% probability you’ll get it wrong.
9. It is said that if you line up all the cars in the world end-to-end, someone would be stupid enough to try to pass them.
10. If the shoe fits, get another one just like it.
11. The things that come to those who wait, may be the things left by those who got there first.
12. Give a man a fish and he will eat for a day. Teach a man to fish and he will sit in a boat all day drinking beer.
13. Flashlight: A case for holding dead batteries.
14. God gave you toes as a device for finding furniture in the dark.
15. When you go into court, you are putting yourself in the hands of twelve people who weren’t smart enough to get out of jury duty.”

The Poet: Robert Frost, “Acceptance”

“Acceptance”

“When the spent sun throws up its rays on cloud
And goes down burning into the gulf below,
No voice in nature is heard to cry aloud
At what has happened.
Birds, at least must know
It is the change to darkness in the sky.
Murmuring something quiet in her breast,
One bird begins to close a faded eye;
Or overtaken too far from his nest,
Hurrying low above the grove, some waif
Swoops just in time to his remembered tree.
At most he thinks or twitters softly, ‘safe!’
Now let the night be dark for all of me.
Let the night be too dark for me to see
Into the future. Let what will be, be.”

- Robert Frost 

The Daily "Near You?"

Ferreiras, Faro, Portugal. Thanks for stopping by.

Gregory Mannarino, "Market Updates Plus! NWO: Covid Concentration Camps, Jail Time, Fines"

Gregory Mannarino,
"Market Updates Plus! 
NWO: Covid Concentration Camps, Jail Time, Fines"

"A 40-Year Trend Comes to an End"

"A 40-Year Trend Comes to an End"
By Bill Bonner

RANCHO SANTANA, NICARAGUA – "Early August, 2020. Was that some kind of hinge point? The end of an era? If so, it’s time to dump anything that depends on a stable U.S. dollar – bank accounts… insurance policies… annuities… bonds. But it’s early days… and this kind of rollover is often not confirmed for years.

No Need to Worry: Besides, there’s nothing to worry about. At least, that was the line coming from the White House at a recent press briefing, via Jared Bernstein, a member of the Council of Economic Advisers. “Janet Yellen is our Treasury secretary. She knows a little something about inflationary risks,” he reassured us. But relying on Janet Yellen to protect us from inflation is like asking Stevie Wonder to drive a school bus; it’s asking for trouble.

And it’s why August 2020 could turn out to be such an important date. Since then, bond yields – an important early warning of incoming consumer price inflation – have been going up. The yield on the 10-year Treasury, for example, has more than doubled from its August 2020 rate of 0.52%. After 40 years of lowering inflation and bond yields, the tide may have turned, in other words. If so, in the years ahead, we will see a huge wave of job losses and bankruptcies, as businesses, government, and consumers are forced to refinance debt at higher rates. We’ll see retirement savings – often resting on a bed of U.S. Treasury bonds – collapse. And we’ll see consumer prices rise… as real incomes go down.

“Don’t worry about it,” say the experts. The thinking, if you can call it that, is that the economy is performing “under capacity.” That means there is plenty of slack that must be taken up before prices can rise. People are not fully employed… factories are quiet, etc. They expect no upward price pressure until everything is going full bore, pedal to the metal. Only then, goes the logic, do business or labor have any “pricing power.” Things need to get better, they believe, before inflation takes hold.

Two Routes to Inflation: Inflation happens, grosso modo, (according to the classic Quantity Theory of Money) when the supply of goods and services goes down compared to the supply of “money” that bids for it. That can happen in one of two ways.

Either the economy heats up (cyclical inflation)… and businesses need more labor and raw materials to keep up with the demand. Shortages then arise. Everyone tries to keep up with the whirlwind of getting and spending, leading to higher prices… Or… the other possibility (systemic inflation) is that the economy cools down. Fake money, false price signals, regulation, bubbles, giveaways, and COVID-19 shutdowns could simply cause a cutback in buyable output… while the supply of available money continues to rise.

Closer Look: So let’s look more closely… Last year, the output of money – as measured by the Federal Reserve’s balance sheet – rose by $3.25 trillion. The output of goods and services, on the other hand – as measured by GDP (even somewhat faked by a huge increase in government spending) – fell by $300 billion. This looks like “systemic” inflation to us.

Another way to look at it… Goods and services are produced by people who work. The number of hours they work (setting aside productivity increases, which are very slow) is a good measure of output. Well, since the crisis of 2008-2009, the total number of hours worked in America is practically unchanged. But the Nasdaq – a rough measure of how much hot money is coming into the stock market – is up 500%.

Wacky and Weird: And then, there’s the unbridled wackiness of it all. Two weeks ago, the GameStop saga played itself out… in all its tinseled mania. And now, The Wall Street Journal reports that since Elon Musk said Tesla had bought $1.5 billion worth of bitcoin, and that the company would soon begin accepting bitcoin in payment for its autos… the market value of the two of them together – bitcoin and TSLA – rose $110 billion on the news.

Go figure. What we figure is that there’s so much loose change under the seat cushions, it’s becoming uncomfortable to sit down. Look for prices for just about everything to rise as the real economy – the part that actually produces goods and services – cools down…

Regards,"

Musical Interlude: The Who, "Overture" from "Tommy"

The Who, "Overture" from "Tommy"

"Realize Who You Are..."

"How It Really Is"

"The Whole Problem..."

 

"What Collapsed the Middle Class?"

"What Collapsed the Middle Class?"
by Charles Hugh Smith

"What collapsed the middle class? In many ways the answer echoes an Agatha Christie mystery: rather than there being one guilty party, a number of suspects participated in the collapse of the middle class. Can we consolidate these dynamics into a few core causal factors? I've made the case in the past few posts that yes, we can: many of these causes are part of a single dynamic, the decapitalization of the middle class and the decay of the ladder of social mobility which enabled tens of millions of workers to transform their wages into productive capital via saving and investment in their own human capital, their own enterprises and assets that earn income. "The Top 10% Is Doing Just Fine, The Middle Class Is Dying on the Vine" (2/4/21)

The second primary dynamic is the substitution of debt and speculation for earned income and productive capital. As the purchasing power of the bottom 90%'s wages declines, the status quo has substituted debt for income and speculation for investing in productive capital. "Debt and the Demise of the Middle Class" (2/9/21)
This dynamic incentivizes debt, speculation and consumption rather than producing, savings and investments in human and productive capital. The source of this incentive structure is the maximization of corporate profits earned by banks loaning money to the middle class and by selling the middle class on superfluous consumption being the signifier of "success" rather than production being the signifier of "success".

In reality, what counts is agency (control of one's life, having a voice in governance) and ownership of productive capital. Becoming a debt-serf to buy more stuff and grab a few chips in the speculative casino sacrifices both agency and the acquisition of productive capital. But this sacrifice is oh-so profitable to the financier purveyors of debt and speculative gambles in the casino.

The third dynamic is globalization, and specifically the tyranny of global markets. Global banks and corporations are ideally placed to profit from the arbitrage of labor, environmental regulations, currencies, corruption (dear in some places, cheap in others) and the price of debt and risk. Wage earners have no such leverage. In effect, all the risks of competition are eliminated for corporate monopolies and cartels while the risks are transferred to workers who face a global race to the bottom in wages, opportunity and income security.

The fourth dynamic is speculative bubbles put many assets out of reach of the bottom 90% who have only their wages and savings. The winners in speculative bubbles are those fortunate enough to have bought homes, bonds, rental properties, land, etc. decades ago when a house could be had for three times median income and bonds paid solid, above-inflation returns.

The bottom 90% attempting to find productive assets at affordable prices now are out of luck. Consider a 900 square foot home built in 1916 in the desirable San Francisco Bay Area community of Albany, CA. The house sold for $135,000 in 1996, 3.8 times the national median household income. Then Housing Bubble #1 boosted the value to $542,000 in 2004, 12.2 times the national median household income. Housing Bubble #2 has pushed the value to slightly over $1 million, 14.5 times the national median household income. Only those inheriting wealth (or who chose wealthy parents), those earning over $250,000 annually or speculators who just scored big gains in bitcoin or GameStop could afford this very small, modest house.

That's what speculative bubbles do to the middle class: they leave them behind forever. Those who bought 25 years ago entered the top 10% in wealth due to the bubblicious increase in the value of their home. A few winners in the casino who sold at the top might have edged into the top 10%, but the vast majority of gamblers in the casino cannot compete with the insiders, manipulators and pros, so they lose ground. This is why the bottom 90% collect an insignificant 3% of all income from capital. "Jay Taylor and I discuss The Upcoming Revolt of the Middle Class" (22 min)

These four primary dynamics manifest in the following ways. Each one helps generate a two-tier Neofeudal Economy of a Financial Aristocracy and its top 9.9% technocrat class who own virtually all the productive capital and the bottom 90%, a disenfranchized ALICE (assets limited, income constrained, employed) workforce.

1. The shifting of pension and healthcare costs and risks from the state and employers to employees. (see chart below)

2. The decline of safe, secure high-yielding investments as central banks have driven savers into risky, crash-prone speculative assets such as stocks and junk bonds.

3. The decline of scarcity value in college diplomas that were once the ticket to middle class security. "How Many Slots Are Open in the Upper Middle Class? Not As Many As You Might Think" (March 30, 2015).

4. The inexorable rise in big-ticket costs: higher education, healthcare and housing. Even as wages stagnate, these costs continue rising, claiming an ever-larger share of household incomes, leaving less to save/invest.

5. The transition from a stable economy with predictable returns to a financialized boom-and-bust economy that wipes out middle class wealth in the inevitable busts but does not rebuild it in the booms.

6. The regulatory and administrative barriers to self-employment, forcing most of the workforce into wage-slavery and/or dependence on the state. "Endangered Species: The Self-Employed Middle Class" (May 2015).

7. The rising exposure of the U.S. workforce to highly educated, lower-cost competing workforces in a globalized economy.

8. The decline of labor's share of the U.S. economy: the slice of the pie distributed to earned income has been declining for decades.

9. The share of the earned-income slice going to the top 5% is rising.

10. The wealth of the middle class is tied up in the family home, a non-income producing asset prone to the wild swings of housing bubbles and busts. "Stagnation Nation: Middle Class Wealth Is Locked Up in Housing and Retirement Funds" (October 25, 2017).
The middle class has already collapsed, but thanks to debt and bubbles, this reality has been temporarily cloaked. All bubbles pop and all excessive debt ends in default. When these inevitably occur, the reality can no longer be hidden."

Gerald Celente, "Trends Journal: The New Normal Valentine, Masked, Tested, Vaccinated, Sanitized, Afraid"

Gerald Celente, "Trends Journal: 
The New Normal Valentine, Masked, Tested, Vaccinated, Sanitized, Afraid"
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