Recently in Economics Category

His observation cuts through the media bullshit - from Zero Hedge:

"This Is A F**king War": Jamie Dimon Slams Biden Begging Saudis For Oil, Says Investors "Don't Give A Shit" About ESG
Three days after Jamie Dimon sparked a marketwide selloff which sent stocks to fresh 2022 lows after he predicted a US recession in 6 to 9 months citing drivers including rising interest rates, persistent inflation and Russia’s invasion of Ukraine, and warned stocks could drop another 20%, the JPMorgan CEO who is expected to report earnings tomorrow (and hopefully clarify why his bank refuses to move its deposit rate above 0.01% in the process keeping $2.2 trillion in liquidity locked inside the overnight funding facility), doubled down today saying the Fed can’t cool the red-hot economy without bringing on a recession.

“I don’t know if it could be a soft landing -- I don’t think so, but it might,” the JPMorgan chief executive officer said at an industry conference in Washington Thursday, adding that the alternatives would be a mild or a severe recession. “In a tough recession, you could expect the market to go down another 20% to 30%”, adding an additional 10% to the number he first floated on Monday.

It got worse: besides predicting a hard-landing and a 30% crash, the CEO of the largest US bank also said his “gut” tells him that the Fed funds rate will probably have to rise higher than the 4% to 4.5% level many economists are predicting, as inflation persists.

Much more at the site - his thoughts on ESG are spot on:

And he did say when it comes to ESG “investors don’t give a shit” warning not to "cede governance to do-gooder kids on a committee”.

Yep...  Kids.  Spoken like a true adult in the room.

A point of order - economic difficulties

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Thanks Brandon - exchange rates

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Used to be quite the other way around - even earlier this month:

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From 90 Miles:

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For more background, this video is excellent.

Interesting times - a story from Finland

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By way of Legal Insurrection:

Finnish economist: “I am telling you people that the situation in Europe is much worse than many understand”
So I saw this tweet from Murtaza Hussain of The Intercept:

If you turned the electricity off for a few months in any developed Western society 500 years of supposed philosophical progress about human rights and individualism would quickly evaporate like they never happened.

It reminded me of my post on January 25, 2022, “There are only nine meals between mankind and anarchy, in which I tracked down the source of the phrase:

A bit of background and then this:

It might be worse. I saw this tweet thread by Finnish economist and professor Tuomas Malinen:

I am telling you people that the situation in #Europe is much worse than many understand. We are essentially on the brink of another banking crisis, a collapse of our industrial base and households, and thus on the brink of the collapse of our economies. Short thread. 1/4

We are also totally at the mercy of the authorities, and we have very little knowledge what they have planned. Will they be able to stop the onset of the banking crisis, yet again? I don’t know, but I am doubtful. 2/4

In any case the speed of deterioration is massive now, and it’s only a matter of time, when markets catch up. I am betting that we still have few weeks (months at max.) before “mayhem” truly begins. Take precautionary measures. Stock: 3/4

1. Cash.

2. Food.

3. Water.

4. Wood (if you have a stove).

5. Other necessities.

No harm will come from preparation, if somehow miraculously we can avoid the onset of an outright economic collapse. You just have more cash (no meaningful interest in banks), food, water and wood. 4/4

Wise words - Europe has been through hard times before.  This time, it is of its own making.  Post modernism and socialism is a failed philosophy.  Time for them to learn their lesson good and hard.  And I wonder if we in the USA will be able to ride to their rescue.

From the National Broadcasting Corporation:

Bank of America announces zero down payment, zero closing cost mortgages for first-time homebuyers in Black and Hispanic communities nationwide
Bank of America said it is now offering first-time homebuyers in a select group of cities zero down payment, zero closing cost mortgages to help grow homeownership among Black and Hispanic/Latino communities.

The option will first become available in certain neighborhoods in Charlotte, Dallas, Detroit, Los Angeles and Miami. The new mortgage, called the Community Affordable Loan Solution, aims to help eligible individuals and families obtain an affordable loan to purchase a home, the bank said.

Applicants do not have to be Black or Hispanic to qualify for the product, a bank representative said.

“Homeownership strengthens our communities and can help individuals and families to build wealth over time,” AJ Barkley, head of neighborhood and community lending for Bank of America, said in a release. “Our Community Affordable Loan Solution will help make the dream of sustained homeownership attainable for more Black and Hispanic families, and it is part of our broader commitment to the communities that we serve.”

And of course, those cities are all democrat-controlled shitholes.  Surprised Seattle and Portland are not in that list.

Someone is getting paid off and here we go with another mortgage crash.

Used to bank with BofA - quit them back in 2007.  Pulled all of my accounts out - investments, etc...  Chase is much better managed.  Use local credit unions for day-to-day and deal direct for investments (moved out of stocks and into bonds these days)

Voting with your feet - Chicago

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Another one leaves - from The Western Journal:

Chicago's Wealthiest Man Pulls His $22 Billion Company from the City Following Crime Complaints, Will Relocate to DeSantis' Florida
Chicago’s wealthiest man is saying farewell to the Democrat-governed state of Illinois.

Hedge fund billionaire Ken Griffin is moving his company to the state of Florida.

Griffin, whose net worth is almost $29 billion, announced that he had personally moved his residence from Illinois to the Republican-governed Sunshine State in a Thursday letter to his employees.

Griffin said that Florida would become the new primary home of his company, Citadel Securities. The investor touted Florida’s business environment.

While he didn’t reference crime in his letter to employees, Citadel officials said that it was a factor in the move.

They do not say which city in Florida but just for the hell of it, let's use Miami. 
Time for another UHaul Index - Chicago to Miami and back again:

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Yep - $903 more to rent a 10' box truck. More of them are leaving Chicago than Miami. And do not forget that this only looks at the subset of people who do their own moving in a rented truck. It ignores those who hire it out and those who move in a personal vehicle.

I have been seeing rumblings about this - Sensing Online lays it out in living color:

Get ready for the catastrophic DEF shortage
DEF is the acronym for Diesel Exhaust Fluid. Every diesel truck that has been made since 2010 is required to use it. It's a product made of 32.5% urea (made from natural gas) and 37.5% de-ionized water. DEF is kept in a separate tank in the truck and the trucks using it will not start unless the DEF system is working properly. There are regulators inside the engine that mix DEF with the diesel exhaust to reduce diesel emissions. That's the purpose of DEF.

A bit more:

Urea is also an essential ingredient in fertilizer. Yet despite these production numbers, the United States is the world's third-largest importer of urea

Yeah - the Biden administration has screwed us over yet again. The people in DC are running a clusterfuck of epic proportions and they will only listen to those "experts" who have the proper credentials and who promote the same narrative.
Facts not allowed - don't even try.

Much much more at the site - trucking is going to get a lot more expensive.  A lot more.  The keystone of my plans for moving have been the two Connex boxes I purchased.  Fill them up and have them trucked to North Carolina.  I am budgeting about $3-5K for that.  Looks like I might need to budget as much as $20K.

Cash is king - the market

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Sure, holding cash will net you a 15% "haircut" but this is a pittance compared with stocks these days.
From CNBC:

Dow slumps 600 points to start the week, S&P 500 falls back into bear market territory
Stocks sold off Monday, pushing the S&P 500 to a fresh 2022 low and back into bear market territory, as recession fears grew ahead of a key Federal Reserve meeting this week.

The Dow Jones Industrial Average dropped 760 points, or about 2.1%, the S&P 500 fell 3% and the Nasdaq Composite tumbled 3.7%.

Those percentages are just for the one day.  Add these to the dismal last week and you are seeing some serious losses.

Lagniappe? A small gift given to a customer by a merchant at the time of a purchase (such as a 13th doughnut when buying a dozen), or more broadly, "something given or obtained gratuitously or by way of good measure (a curious etymology as well).

There is a fee-based stock trading website called Unusual Whales 

If you click on the "building" glyph in the top menu bar (between Options Profit Calculator and Alerts) you will be brought to this wonderful set of pages: I am the Senate    What follows is an in-depth tracking of the trading records of our Senators and Representatives. Most of them are doing a lot better than the various indicies.  Helps to have an inside line on what legislation is going to be passed and when.

Worth checking out.  I'll be looking into this once I am done with the move.
Got a bunch parked in some index funds now but getting nervous...

The best and the brightest - inflation

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I could have told them - from July 2020 - a scant two years ago:

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But that's what you get when you play with Keynesian Economics.
Me? Old school Austrian. Hayek worked then and still works now:

So true - April 1st

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Unintended consequences - Russia

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Looks like Russia is in for a bit of a hard time.  It is already a very poor nation.  Now?
From Market Watch:

Russian central bank lifts interest rates to 20% as ruble plunges over Western sanctions
The Russian central bank more than doubled interest rates to 20% on Monday, as the ruble plunged following further sanctions by Western powers to over the country’s invasion of Ukraine.

The ruble USDRUB, +17.34% hit an all-time low of 119.25 per dollar on Monday, according to FactSet. In volatile, sporadic trade, it was last down 18% to 98.94. The interest-rate hike, meanwhile, ratcheted up the key lending rate from the already high level of 9.5%.

“External conditions for the Russian economy have changed dramatically. An increase in the key rate will make it possible to ensure an increase in deposit rates to the levels necessary to compensate for the increased devaluation and inflation risks. This will help maintain financial and price stability and protect citizens’ savings from depreciation,” said the central bank in a statement.

“The Bank of Russia will make further decisions on the key rate based on an assessment of risks from external and internal conditions and the reaction of financial markets to them, and taking into account the actual and expected inflation dynamics relative to the target, economic development over the forecast horizon,” it added.

And Biden will be taking credit for this in 3... 2... 1...

It must suck to be a legitimate small business owner in Russia.  Not connected?  Don't even try.

Some numbers - USA Oil Imports

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We get most of our imports from Canada but Russia is #2.
Data from the US Energy Information Administration (last complete year is 2020):
(units are in 1,000's barrels per day)

For 2020:
Canada - 3,193
Russia - 540
Saudi Arabia - 514
Colombia - 185
Iraq - 176

A great quote

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Sums it up in a few words:

Economics and politics confront the same fundamental problem:
What everyone wants adds up to more than there is.
—Thomas Sowell

Right up there with Margaret Thatcher's epigram on socialism:

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From the London Daily Mail:

'Honestly, I would just can this whole bill': Elon Musk rips Biden's 'Build Back Better' Plan despite its massive subsidies for electric cars

    • Biden's plan includes big subsidies for purchasers and manufacturers of electric cars
    • Musk blasted the legislation despite its subsidies for electric vehicles
    • Purchasers get up to $12,500; manufacturers can get $4,500, but only union shops in the U.S.
    • Musk called to 'get rid of all the subsidies'
    • He also blasted giving 'capital allocation' to the government
    • He has been unloading shares and assets while facing a massive tax bill

Tesla founder Elon Musk tore into President Joe Biden's 'Build Back Better' plan over its tax hit on millionaires and its regulatory framework – even as the plan prepares to provide big subsidies for electric cars.

Musk, who has gone after Democratic tax policies in the past, slammed the proposal in an interview with the Wall Street Journal.

'Rules and regulations are immortal,' he said. 'They don't die. The vast majority of rules and regulations live forever ... there's not really an effective garbage collection system for removing rules and regulations, so this hardens the arteries of civilization where you are able to do less and less over time.

Love that last paragraph - so true.  President Trump was very careful about sunsetting two regulations whenever a new one was introduced.  Cuts down the red-tape. And, to be clear:

'I'm literally saying get rid of all subsidies,' he said.

The government actually makes very little money of its own — land and mineral leases and a few other sources.  All monies for subsidies come from our wallets - our tax dollars. So much money is wasted on subsidies that our economy has grown bloated and inefficient. Time to tighten the belt - let the well run businesses thrive and let poorly thought out and poorly run businesses fail.

I fail to understand why the guy won the 2008 Nobel Prize.  He is clueless.

From his twitter account:

No shit Sherlock - anyone and their brothers were saying that inflation would happen.
What numbers were you looking at, Paul?

As things get interesting - Evergrande

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From Gateway Pundit:

China’s Evergrande, the World’s Most Indebted Corporation, Officially Goes Insolvent Today
We’ve reported about the challenges that Evergrande is in while facing insolvency.  Today the company officially went bankrupt. 

This morning it was reported out of Germany:

China Evergrande Group today again defaulted on interest payments to international investors. DMSA itself is invested in these bonds and has not received any interest payments until today’s end of the grace period. Now DMSA is preparing bankruptcy proceedings against Evergrande and calls on all bond investors to join it.

China Evergrande Group, the second largest real estate developer in China, defaulted on interest payments on two bonds back in September, with the 30-day grace period still ending in October. However, shortly before the end of the grace period, the public was misled by rumors about alleged interest payments. The international media also took the rumors for granted. Only the DMSA – Deutsche Marktscreening Agentur (German Market Screening Agency) already recognized the default at that time and proved in a study that the bankruptcy of Evergrande, the world’s most indebted corporation, could ultimately lead to a “Great Reset”, i.e. the final meltdown of the global financial system.

Time to hunker down.  Gonna be a long and difficult ride.

Let's go Brandon:

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An interesting website - WTF 1971

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A lot of things changed that year and the repercussions are still being felt today.

The website is a compilation of graphs and it raises a very good question.

Go and visit - well worth your time... More here: wtf1971

1971 was the year that the United States officially went off the Gold Standard. We debased our currency - one dollar is no longer backed up by $1.00 worth of gold held in the Federal Mint. This action (as well as others) is known as The Nixon Shock

Eaton Rapids Joe is a daily read for me.
Here, he talks about China's energy problems as a metaphor for the worlds financial status:

Another thought on the Chinese energy crisis
If you have been following the news then you are aware that hundreds of millions of people in China have been under rolling electrical black-outs and brown-outs. The crisis came out of nowhere. One week there was plenty of electricity. Then next week multiple provinces in northeast China had shortages.

I want to offer one way that could have happened.

The upshot:

Physical possession is 99.9% of ownership.

The financial and derivatives "economy" dwarfs the real, nuts-and-bolts economy. Everybody is getting rich laundering each others' bytes.

So true. Only way to go...

First The Speech - Biden

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Gave a thundering speech yesterday and today? Commissar Biden is singlehandedly raising everybody's prices.
Is there nothing that our Great and Fearless Leader can not do?  From Breitbart:

Producer Prices Soar a Record 8.3% as Bidenflation Runs Hotter Than Expected
Prices charged by U.S. businesses jumped higher than expected in August, data from the Department of Labor said Friday.

The Bureau of Labor Statistics’ Producer Price Index rose 0.7 percent compared with July. Compared with a year ago, the index is up 8.3 percent, the fastest pace of price increases in data going back to 2010.

Economists had forecast PPI to rise by 0.6 percent on a monthly basis, down from the one percent rise reported for July and June. On an annual basis, prices were expected to be up 8.3 percent.

Prices for “final demand” services—those used for personal consumption or exports—rose 0.7 percent. The index for final demand goods moved up 1.0 percent.

And of course, take these numbers and multiply them by three for something approximating the real numbers.

Expecting nothing less from this regime.

Interesting times - China bond market

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From Zero Hedge:

Evergrande Bonds Halted Amid Liquidation Panic As Contagion Spreads To Other Chinese Junk
With algos busy chasing upward momentum in futures and global stocks, the biggest - if largely ignored story - remain the ongoing collapse of "China's Lehman", the $300+ billion China Evergrande, where following our earlier reports (see below) that a bank run emerged among creditors of the biggest and most indebted Chinese developer as its bonds were no longer eligible collateral in the repo market after a ratings downgrade, on Monday the rout went from bad to catastrophic as various Evergrande bonds crashed amid a liquidation frenzy, prompting China's stock exchanges to halt trade.

The Shanghai Stock Exchange said in a statement that it had temporarily suspended trading in China Evergrande Group's 6.98% July 2022 corporate bond following "abnormal fluctuations." The exchange had also suspended trading in the bond on Friday.

More at the site - they seek to emulate Western things but they do not learn from Western mistakes.
Should be fun - make a bowl of popcorn and see how bad this is...

Dodged a bullet? Maybe. From Fabio Vighi writing at The Philosophical Salon:

A SELF-FULFILLING PROPHECY: SYSTEMIC COLLAPSE AND PANDEMIC SIMULATION
A year and a half after the arrival of Virus, some may have started wondering why the usually unscrupulous ruling elites decided to freeze the global profit-making machine in the face of a pathogen that targets almost exclusively the unproductive (over 80s). Why all the humanitarian zeal? Cui bono? Only those who are unfamiliar with the wondrous adventures of GloboCap can delude themselves into thinking that the system chose to shut down out of compassion. Let us be clear from the start: the big predators of oil, arms, and vaccines could not care less about humanity.

Follow the money
In pre-Covid times, the world economy was on the verge of another colossal meltdown.

Some history, some current events and some abject stupidity by the financial wizards and we wind up with this:

As claimed by economist Ellen Brown, it was “another bailout”, but this time “under cover of a virus.” Similarly, John Titus and Catherine Austin Fitts noted that the Covid-19 “magic wand” allowed the Fed to execute BlackRock’s “going direct” plan, literally: it carried out an unprecedented purchase of government bonds, while, on an infinitesimally smaller scale, also issuing government backed ‘COVID loans’ to businesses. In brief, only an induced economic coma would provide the Fed with the room to defuse the time-bomb ticking away in the financial sector. Screened by mass-hysteria, the US central bank plugged the holes in the interbank lending market, dodging hyperinflation as well as the ‘Financial Stability Oversight Council’ (the federal agency for monitoring financial risk created after the 2008 collapse), as discussed here. However, the “going direct” blueprint should also be framed as a desperate measure, for it can only prolong the agony of a global economy increasingly hostage to money printing and the artificial inflation of financial assets.

Quite the read.  A bit long but well worth your time. The elite think that they are so smart but in reality, they are just as error-prone as the rest of us.  Painting oneself into a corner is not a unique event. I may be naieve and not as "nuanced" as these people but I can certainly see that what they are trying to do is stupid and prone to failure. They got themselves into this and they are using us as pawns to avoid paying their butcher's bill.

Unreal - WOKE comes to the FED?

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These people are screwing around with their little kiddie word games and they have zero clue what they are doing. From Politico:

AOC, Tlaib, Pressley call on Biden to dump Powell as Fed chair
Reps. Alexandria Ocasio-Cortez, Rashida Tlaib and Ayanna Pressley on Monday called for Federal Reserve Chair Jerome Powell to be replaced, stepping up the pressure on President Joe Biden as he draws closer to a decision on the government’s most important economic post.

And what they want (raising their little fists into the air and waving them about)

They acknowledged that the Fed under Powell “has made positive changes” by steering the central bank toward a greater emphasis on reaching full employment. But they said they want to see someone at the helm who is more aggressive on financial regulation and climate change.

Climate change? The FED? These idiots have no clue what they are messing with.
It is all word games with them with no thought given to any consequences of their actions.

My surprised face again - from the London Daily Mail:

Biden asks Saudi Arabia and OPEC to produce MORE oil as inflation sends gas prices soaring - after HE shut down America's Keystone pipeline

    • Prices at the pump are about $1 higher, 42%, than they were one year ago
    • OPEC+ cut production by 10 million barrels per day at the height of the pandemic, and has only slowly started to increase production again
    • 'This is simply not enough,' National Security Adviser Jake Sullivan said
    • Republicans have blamed Biden’s shift toward green energy, which includes nixing the Keystone pipeline permit and pausing new federal oil and gas leases

The Biden administration is sounding the alarm about fast-rising energy prices and demanding that Saudi Arabia and OPEC produce more oil - after the president paused all federal oil and gas leases.

Prices at the pump are on average about $1.00 higher, 42%, than they were one year ago.

'Higher gasoline costs, if left unchecked, risk harming the ongoing global recovery,' National Security Adviser Jake Sullivan said in a statement Wednesday.

He called on the world's largest oil producers, including OPEC nations and Saudi Arabia, to up their production.

Heh - they own this.  Lock stock and barrel.  The Democrats shut down the pipeline on day one and now they are having to deal with the unforeseen (yeah riigghhhttt) consequences.  Why did they shut down the pipeline?  Because their bagmen make so much money shipping the oil by railroad.  Warren Buffet and others. Rail is a lot more expensive for shipping so the energy prices necessarily skyrocket.

The Democrats understanding of capitalism and basic economics is about at a 6-year old level.
Fits their personalities.

Paging Messrs Dunning and Kruger

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Messrs Dunning and Kruger to the white courtesy telephone please:

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And that shopping list is just beginning.  How much for the leather backpack.  Those boots are a couple hundred.

Who knows, maybe this is just a phase and she will wise up.

Why people hate capitalism

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In a society based on caste and status, the individual can ascribe adverse fate to conditions beyond his own control. He is a slave because the superhuman powers that determine all becoming had assigned him this rank. It is not his doing, and there is no reason for him to be ashamed of his humbleness. His wife cannot find fault with his station. If she were to tell him: “Why are you not a duke? If you were a duke, I would be a duchess,” he would reply: “If I had been born the son of a duke, I would not have married you, a slave girl, but the daughter of another duke; that you are not a duchess is exclusively your own fault; why were you not more clever in the choice of your parents?”

It is quite another thing under capitalism. Here everybody’s station in life depends on his own doing. Everybody whose ambitions have not been fully gratified knows very well that he has missed chances, that he has been tried and found wanting by his fellow man. If his wife upbraids him: “Why do you make only eighty dollars a week? If you were as smart as your former pal, Paul, you would be a foreman and I would enjoy a better life,” he becomes conscious of his own inferiority and feels humiliated.

The much talked about sternness of capitalism consists in the fact that it handles everybody according to his contribution to the well-being of his fellow men.
--Ludwig von Mises The Anti-Capitalistic Mentality

Much more at the site and yes, intellectuals are just that shallow in their understanding of capitalism.
The reason Marx is so popular is that his ideas sound good to people who are not that bright.

From Vox Day:

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Reminds me of this wonderful video from 11 years ago:

Me? 100% Austrian school. Anything else is ephemera. Do the numbers for yourself.

An excellent mental excercise:

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Spending - four possibilities

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From The Silicon Graybeard:

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The rest of their post is well worth reading.

Good news from the G7 meeting

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From America's Newspaper of Record:

World's Economy Saved As Giant Crack In Earth Swallows Up All G7 Conference Attendees
A time of peace and prosperity has broken out across the earth after a sudden earthquake opened up a crack in the earth's crust and swallowed up all G7 world leaders in mere seconds.

Witnesses reported feeling a low rumble beneath their feet as Joe Biden, Justin Trudeau, Angela Merkel, and others gathered on the green grass for a photo op. The rumble grew to a roar as the ground below them opened up and dragged every G7 leader into the depths of the earth. The ground then closed up over them and they were never heard from again.

"Hey guys, please remember to use my preferred pronouns," Trudeau had begun to say. "We need to be sensitive to-- AAAHHHHHHHHHHhhhhhhhhhhhh!"

Experts are unsure who will be taking over the important work of running the planet, issuing random lockdown orders, and fighting climate change in the absence of such brilliant and courageous leaders.

"This is such a disaster. What will we ever do without them?" said 1 or 2 people around the world.

World governments have assured their citizens they will continue the important work of building back better for everyone. American citizens will be mourning the terrible loss this weekend with backyard barbecues.

News like this just warms my heart.  The best thing these people could do is just get back and stand out of the way.  They are not elite, they are just credentialed and know nothing about the real world.

I am not surprised - lumber prices

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Recently moved all my money out of stocks (Vanguard index funds) and back into Bonds.
Good timing - from Russia Today:

Global banks bracing for losses amid US hedge fund collapse
World banks may lose over $6 billion from the downfall of the US investment firm Archegos Capital, sources told Reuters. Regulators are closely monitoring the situation as panic spreads about the possible scale of the fallout.

The sudden liquidation of the New York-based billionaire Bill Hwang’s Archegos Capital Management ignited a fire sale of more than $20 billion in assets that has left some of the world’s biggest investment banks bearing billions of dollars of losses.

According to billionaire investor Mike Novogratz, the collapse of Hwang’s Archegos fund could turn out to be “the most spectacular personal loss of wealth in history.”

The problems started last week when a disappointing stock sale by media giant ViacomCBS triggered devastating bank margin calls for Archegos, three people familiar with the matter said. Shares in ViacomCBS plummeted 23% last Wednesday after the media company sold shares at a price that diluted its value. The shares continued to decline, setting off alarm bells at Archegos’ prime brokers and prompting them to offload stock in all of Archegos’ investments.

Just love love LOVE that last paragraph. ViacomCBS owns Paramount Pictures, CBS, Nickelodeon, Miramax, BET, MTV, Showtime. Looks like people are not into "big media" very much these days.  Maybe, just maybe if they produced something that we wanted to watch... Not watching WOKE TV - that is for sure.

In other words - job numbers? Shut Up. From Breitbart:

Joe Biden: It Will Take Ten Years to Get Full Employment at Current Job Growth Rate
President Joe Biden sounded a dark note on the future of the economy Friday, after a bleak jobs report came out.

The United States economy added 49,000 jobs in December with only 6,000 jobs in the private sector, according to the latest report released Friday morning.

“At that rate, it’s going to take ten years to get back to full employment,” Biden said. “That’s not hyperbole, that’s a fact.”

Gee - the previous guy did pretty well.  What's up with the Democrats? Pretty lackluster performance given all their hype and rhetoric.

Wonder how much is coming in these days - another sure way to crash the economy and create a crisis.
From the U.S. Customs and Border Protection:

Two Packages, $136K of Counterfeit Currency CBP Officers in Chicago Seize Shipments Containing Funny Money
At Chicago’s International Mail Facility (IMF) U.S. Customs and Border Protection (CBP) officers recently seized two parcel arriving from China that held different denominations of counterfeit currency totaling more than $136,000.Bogus Money

On January 28, officers at the IMF held two parcels for inspection that were arriving from the same shipper in China. The officers inspected the shipments to determine the admissibility of the parcels and its contents. The first shipment contained 957 counterfeit $100 dollar bills and 44 counterfeit $50 dollar bills totaling $97,900. In the second shipment were 384 counterfeit $100 dollar bills. In total, $136,300 of counterfeit currency was seized under Counterfeit U.S. Currency, Coins or Government Securities.

Like I said - is this the tip of the iceberg? Flooding the nation with counterfeit currency would be a sure way to force us to use digital currency for any and all payments.  Which is exactly what they want as cash payments can not be traced. Cards can.

And another one bails - California

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California is losing tax revenue hand over fist. From CNBC:

Tesla CEO Elon Musk has told friends and associates he plans to move to Texas
Tesla CEO Elon Musk put his California houses on the market this year while he was sparring with state lawmakers over Covid-19 restrictions. He’s simultaneously been expanding operations in Texas and cozying up to Republican Gov. Greg Abbott.

Now, several of his close friends and associates say that Musk has told them he’s planning to move to the Lone Star State. The people with knowledge of his plans asked not to be named because their conversations were private.

California has the highest state income tax in the nation.  Texas has no income tax at all. Tesla is not the first.
From FOX Business:

Hewlett Packard leaves California for Texas in headquarters jump
Hewlett Packard Enterprise is kissing California goodbye as it prepares to move its headquarters to Houston, Texas.

And this report from Business Journals:

Bay Area exodus accelerates at year-end as some seek to avoid tax hikes in 2021
The Bay Area exodus, which accelerated amid Covid, appears to be gaining more steam in the final months of 2020. Moving out of the state by year-end could help those leaving avoid being hit by a California income tax increase next year that might be retroactive to the start of 2021.

“I’m seeing an acceleration of clients — not to mention friends and neighbors — leaving California,” Paul Bleeg, a partner with accounting firm EisnerAmper in San Francisco, told me Tuesday. “The destinations vary: Montana, Nevada, Tennessee, Florida, Texas, Utah and elsewhere.”

The ruling class is unaware of the basic facts - raising taxes results in less revenue.  Art Laffer had this down to a science 46 years ago. Basic economic fact.

China and Taiwan

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We are getting friendlier with Taiwan - this is a good thing. China is not happy.
From the South China Morning Post:

China tells US to stop building relationship with Taiwan after economic dialogue announcement
Beijing on Tuesday asked the US to stop upgrading its unofficial diplomatic relations with Taiwan, after Washington’s announcement of a new economic dialogue with Taiwan.

“We called on the US to ... stop official interaction with Taiwan in all forms,” said Hua Chunying, spokeswoman of China’s Ministry of Foreign Affairs on Tuesday.

Hua described the US Taiwan Relations Act, which allows for de facto diplomatic relations, as “illegal” and “invalid”, adding that it violates the one-China principle.

On Monday, US assistant secretary of state David Stilwell said that the United States and Taiwan would establish a new economic dialogue focused on semiconductors, health care, energy and other technology sectors.

I like Taiwan - got the chance to visit there once and really enjoyed myself. My favorite tool store (Grizzly) imports machine tools from China and from Taiwan (also India) and the quality of the Taiwanese and Indian tools is significantly better than the best from China. Fit and finish, precision, quality of materials. All around better.

Good that we are establishing better ties with them - they are a bastion of freedom in a section of the world that needs it. China not happy? Boo hoo. So sad, too bad.

So so true

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