ECONOMICS: FT Opinion ignores that there is no way to pay the debt that has been created

Friday, July 22, 2022

https://www.ft.com/content/db0a2535-7292-4c84-9015-0d9c4af67713?segmentId=b385c2ad-87ed-d8ff-aaec-0f8435cd42d9

Opinion The FT View
US recession is a smaller danger than long-term inflation
The Fed needs to hold its nerve on tightening further
The editorial board

*** begin quote ***

Investors have spent much of this week puzzling over what this all means — edging up predictions for the future path of interest rates and for the chances of recession. But there is good news in some of it — it is hard to read the markets’ responses as indicating that investors think this ultra-high inflation is now a permanent feature of American life. The Fed has credibility. But it still needs to tighten further to justify that faith.

*** end quote ***

I respectfully disagree.

The current 30T$+ national debt and the guesstimated 226T+ in unfunded liabilities that our posterity will have to deal with is inescapable.

The Russian “sanctions” over Ukraine have put the USA on a collision course to crush the U$D.  (The fact that it’s the cleanest dirty shirt in the laundry is little comfort.)

For decades, responsible people have been pointing out that empires fall when their currency is debased.  Why should the USA be any different?

We have kicked the can down the road and we can see the end of the road.

End the FED and return to sound money.

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ECONOMICS: If my leased car’s value is understated, ain’t I paying from more “leave value” than I am getting?

Tuesday, June 28, 2022

Ford eliminates end-of-lease purchase option for EVs

https://www.autoblog.com/2022/06/24/ford-ends-purchase-option-on-leased-vehicles/

# – # – # – # – #

The “game” may be having a “rules” change because used cars are more valuable than the lease’s return price.​

So that means you the leaser (i.e., sucker) paid more for the value of the lease than calculated and you can’t recapture that at the end of the lease by selling the “pig” privately.

Seems like something akin to theft by fraud.

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ECONOMICS: There is no such thing as “price gouging”

Wednesday, May 25, 2022

https://patch.com/new-jersey/southbrunswick/s/i9a9w/baby-formula-shortage-prompts-nj-state-of-emergency-murphy?utm_source=nearby-news&utm_medium=email&utm_campaign=alert

Baby Formula Shortage Prompts NJ State Of Emergency: Murphy
Those looking to make a profit by increasing baby formula prices will face severe penalties in New Jersey, officials said.
Nicole Rosenthal, Patch Staff
Posted Wed, May 18, 2022 at 8:40 am ET

*** begin quote ***

NEW JERSEY – Gov. Phil Murphy declared a state of emergency in New Jersey on Tuesday amid an ongoing shortage of baby formula due to inflation, supply chain issues and recalls in the state and around the country.

The declaration was signed in order to activate New Jersey price gouging laws consistent with efforts at the federal level, according to Murphy.

“We firmly believe that New Jersey is the best place in the nation to raise a family, and during this challenging time, we want to support our
families with all of the resources at our disposal,” Murphy said in a statement.

“To any retailer who may try to take advantage of vulnerable families during this shortage, let me be clear that this reprehensible action will not be tolerated. And to any New Jerseyan affected by this shortage, rest assured that my administration will do everything in our power to ensure families have access to the formula they need.”

*** end quote ***

Once again, this is just Gooferment stupidity. There’s no such thing as “price gouging”. Higher prices are the signals from the market that makes TWO things happen — conservation of a scarce resource and an incentive to entrepreneurs to provide resources or alternatives. Baby formula is no different that any other commodity. Argh!

Like the hotels taking in refugees from a natural disaster MUST raise their prices to encourage “conservation”.  If the price is “too high”, then a family will squeeze into one room rather than spread out into two.  Then this will leave that other room free for some other family.  The market place “rations” scarce resources by higher priced.  

Also, entrepreneurs may open a spare bedroom during an emergency to make a few bucks because of those high prices.

Argh!

Real economists like Walter Williams have made much stronger arguments than I ever can. But it’s clear that politicians and bureaucrats never studied any economics or enjoy posturing for the publicity.

Argh!

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ECONOMICS: Anti-trust? Let Musk buy Twitter. It’d would be a hoot!

Saturday, April 16, 2022

https://www.spiked-online.com/2022/04/15/why-elon-musk-has-rattled-them/

Why Elon Musk has rattled them

  • His attempted takeover of Twitter has revealed just how terrified the liberal elites are of freedom of speech.

Tom Slater Editor 15th April 2022

*** begin quote ***

We stand here on the edge of tyranny… Elon Musk wants to buy Twitter. That, roughly speaking, has been the commentariat reaction in recent days as the world’s richest man has launched a takeover attempt of the social-media giant, citing his concerns about its censorious policies as his main motivation.

Musk revealed last week that he had become Twitter’s largest shareholder, with a 9.2 per cent stake. Now he’s offered to buy the whole company for a cool $43 billion, a nice premium on its current worth. As it stands, Twitter’s board is resisting and America’s great and good have gone berserk.

The Washington Post’s Max Boot was swift out of the blocks. ‘I am frightened by the impact on society and politics if Elon Musk acquires Twitter’, Boot tweeted. ‘He seems to believe that on social media anything goes. For democracy to survive, we need more content moderation, not less.’

*** end quote ***

What better way to break up Big Tech than to have some “wild card” break in?

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ECONOMICS: The economy has yet to recover from covid, but the stock market is being inflated

Tuesday, March 29, 2022

https://www.zerohedge.com/markets/nothing-has-changed-except-everything

Nothing Has Changed, Except For Everything
BY TYLER DURDEN
MONDAY, MAR 28, 2022 – 09:30 AM

*** begin quote ***

The signs and symptoms I’m paying attention to are as follows (read this list slowly, and take it all in):

  • We have a market that saw the NASDAQ (an index) rise about 120% in less than 2 years off its March 2020 lows, despite the fact that our economy never materially recovered during the same period of time.
  • Our money supply (M2) rose between 21.7% and 26.92% year over year, between April 2020 and February 2021. Its long term YOY average rise, including this data, is just 7.16%. Prior to 2020, most YOY growth was between 3% and 5%.
  • Our inflation rate is at its highest point in about 30 years, and that is using a totally different method for measuring inflation than we used to. If we used the standards for measuring CPI in the 1980s, inflation would likely be at all time record highs for our nation.
  • We have the most material hot war in Europe since World War II taking place, with little visibility on how it will end. At the same time, relations with Russia and China have not been this contentious in decades. Russia and China also look to be posing a serious, calculated challenge to the U.S. dollar’s reserve status.
  • As I pointed out days ago, stocks relative to GDP are also in uncharted territory, where reversion to the mean would mean a minimum of a 40% drop from here.

But hey, Jim Cramer says he thinks “the bear market is over”. He’s on CNBC. I’m not.

*** end quote ***

Hard to imagine what will happen when the politicians and bureaucrats have “managed” the US into a horrific depression.

Sigh!

It’s not going to be pretty for the non-rich.

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ECONOMICS: There should NOT be any taxes on “Virtual Currencies”

Thursday, March 3, 2022

https://www.irs.gov/businesses/small-businesses-self-employed/virtual-currencies

*** begin quote ***

Virtual Currencies
 
Virtual currency transactions are taxable by law just like transactions in any other property. Taxpayers transacting in virtual currency may have to report those transactions on their tax returns.

What is Virtual Currency?

Virtual currency is a digital representation of value that functions as a medium of exchange, a unit of account, and/or a store of value. In some environments, it operates like “real” currency (i.e., the coin and paper money of the United States or of any other country that is designated as legal tender, circulates, and is customarily used and accepted as a medium of exchange in the country of issuance), but it does not have legal tender status in  the U.S. Cryptocurrency is a type of virtual currency that utilizes cryptography to validate and secure transactions that are digitally recorded on a distributed ledger, such as a blockchain.

Virtual currency that has an equivalent value in real currency, or that acts as a substitute for real currency, is referred to as “convertible” virtual currency. Bitcoin is one example of a convertible virtual currency. Bitcoin can be digitally traded between users and can be purchased for, or exchanged into, U.S. dollars, Euros, and other real or virtual currencies.

*** end quote **

Sounds like they are defining “money”!

We don’t tax when “dollars” (i.e., Federal Reserve Note fiat greenbacks) are converted to Euros or visa versa.  So why are we taxed on “Virtual Currencies”?  For that matter, why are we taxed when buying gold or silver?  Doesn’t the Constitution define a “dollar” as an amount of gold or silver?

Argh!

Guess the IRS is going have a hard time finding all the non-custodial crypto wallets!!!

#endthefed 

If they can keep drugs out their prisons, how will the keep crypto out of a free society?

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ECONOMICS: Inflation reduces real wages

Thursday, February 10, 2022

https://www.theguardian.com/commentisfree/2022/feb/05/fed-raise-interest-rates-shaft-american-workers-robert-reich

The FED is about to raise interest rates and shaft American workers – again
Robert Reich — Sun 6 Feb 2022 01.00 EST

  • Policymakers fear a labor shortage is pushing up wages and prices. Wrong. Real wages are down and workers are struggling

*** begin quote ***

Fed policymakers are poised to raise interest rates at their March meeting and then continue raising them, in order to slow the economy. They fear that a labor shortage is pushing up wages, which in turn are pushing up prices – and that this wage-price spiral could get out of control.

It’s a huge mistake. Higher interest rates will harm millions of workers who will be involuntarily drafted into the inflation fight by losing jobs or long-overdue pay raises. There’s no “labor shortage” pushing up wages. There’s a shortage of good jobs paying adequate wages to support working families. Raising interest rates will worsen this shortage.

There’s no “wage-price spiral” either, even though Fed chief Jerome Powell has expressed concern about wage hikes pushing up prices. To the contrary, workers’ real wages have dropped because of inflation. Even though overall wages have climbed, they’ve failed to keep up with price increases – making most workers worse off in terms of the purchasing power of their dollars.

*** end quote ***

It’s a fact of life the at the FED’s 2% inflation target is a joke.  The FED has debased the currency of 99% of its value with its “2% target”!  But over and above that, the inflation has been robbing poor people, working slobs, and senior citizens on fixed income.

So maybe a good liberal like Reich might be enlisted into the “End The Fed” movement.

IMHO we need to go back to “real money” aka gold and silver.

Under hard money, prices go down and real wages go up naturally.

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ECONOMICS: ‘The Great Reject’?

Saturday, May 22, 2021

http://feedproxy.google.com/~r/zerohedge/feed/~3/0jJpXtjZ4no/atlas-shrugging-forget-great-reset-here-comes-great-reject

Atlas Is Shrugging: Forget ‘The Great Reset’, Here Comes ‘The Great Reject’
Zero Hedge by Tyler Durden

*** begin quote ***

It won’t work, and it brings to mind a particularly vivid example I once heard about a balloon disaster that still makes me cringe when I think of it:

A group of people were embarking on a balloon ride and as they were just a foot or two off the ground, the burner erupted into flames. The balloon pilot realized immediately what this meant and he leapt from the gondola which was still only a few feet off the ground.

One or two of the passengers were quick witted enough to realize what this meant and followed him. This set off a feedback loop: as the fire expanded, its hot air forcing the balloon higher, combined with the weight reductions as the first few people bailed out, the situation very quickly escalated past a point of no return.

The balloon had accelerated very rapidly to heights from which it was no longer possible to leap safely. The unfortunates who had hesitated and were trapped in a gondola being propelled higher by a fireball, to their inevitable doom.

That’s what our entire situation feels like today. The balloon is still hanging a foot or so above the ground, the canopy is on fire, and the people who have figured out what this means are bailing out while they can and in doing so they are accelerating the ultimate burn-then-crash of the entire system.

*** end quote ***

Economics is called the “dismal science” for a very good reason.

It’s based on the idea that ALL resources are scarce and there are “laws” that describe how resources are used

It’s “dismal” because rarely are there enough resources to satisfy everyone’s “wants”.  (Notice I didn’t say “needs” because that’s a much lower standard. (Think what passes for a “good life” in a Third World country and you’ll have my idea of “needs” versus “wants”.)

In today’s economic climate, the “wants” have outstripped our Gooferment’s ability to supply the resources need to satisfy them. (Note the tax  & borrow to spend  on “wants”.)

So like the balloon example above, get off before the disaster.

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ECONOMICS: A “wealth tax” is tax on unrealized gains; not “income”

Saturday, March 27, 2021

https://www.americanthinker.com/articles/2021/03/the_government_is_considering_a_financial_weapon_of_mass_destruction.html

March 25, 2021
The Government Is Considering a Financial Weapon of Mass Destruction
By John Klar

*** begin quote ***

In seeking to tax unrealized income from hyper-inflated capital assets, AOC, et al. are launching an aggressive, unconstitutional plan to destroy the national economy while growing government limitlessly.  Given her past pronouncements, she likely understands this travesty even less than she comprehends cow farts.

What is terrifying is not that AOC is calling for insane monetary policy and whole new means of tax takings.  What is terrifying is that almost no one is raising the fiscal alarm.

*** end quote ***

And, like the income tax, that started by impacting the top per cent, it quickly came down on everybody.

There’s no way that such a tax doesn’t destroy the economy’s “seed corn”.

The rich don’t have a basement full of bucks like Scrooge McDuck in their basement.  It’s spent or invested and EVERYONE benefits.

Argh!

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ECONOMICS: The Gooferment is to blame for Texas’

Friday, February 19, 2021

https://www.washingtonpost.com/opinions/2021/02/18/texans-grid-outage-deregulation/

*** begin quote ***

Why Texans are cold and in the dark Texas’s predicament stems from a decision that state lawmakers made about 20 years ago to abandon the traditional model of fully regulated electricity utilities. Still used across many areas of the nation, these electric companies — described as vertically integrated utilities — do not compete for customers and are allowed to earn a rate of return on investment. They can raise rates only with the permission of state regulators. (Washington Post)

*** end quote ***

All the Gooferment’s fingerprints are all over this crisis.

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