Friday, March 8, 2019

Well here we go - Today's economic report from the circling drain

With today's abysmal jobs number coming in at 20,000 new jobs, a tenth of what was projected, we find ourselves caught in the whirlpool of The Orange Moron's incompetence meeting the confluence of economic down trends. The straw that the administration is trying to cling to is a significant jump in hourly wages but there is absolutely nothing to maintain a trend of 'rising wages' in a labor union free economy. Wages are so low that offering slightly higher pay to attract people to change jobs is not going to calm the raging river of economic collapse. The average hourly wage today is roughly equal to the minimum wage paid in 1968 and those weren't great wages back then.

The next biggest problem that this country has is its trade deficit and Trump has managed to drive that to an all time record high. Nobody is going to invest in making things in the US because they know Trump's tariffs are not permanent and will only last until he gets what he wants. With China, Trump wants their cash in Trump's pocket, he's already gotten $500 million funneled into Trump development in Malaysia but it's not clear if China is willing to make him into a real billionaire or if they'll simply wait him out. It's not that they can't bribe him, they don't have that pesky 'rule of law' problem that our other major trading partners must deal with. But destroying the US is their ultimate goal and they may just let Trump do it for them.

At a joint White House photo op with the Chinese Vice President announcing progress in trade talks, Trump embarrassed himself by saying that the memorandums of understanding (MOU) that they were showcasing were not to his liking "because a MOU didn't mean anything". The US trade negotiator couldn't help himself and interrupted to correct Trump by pointing out that the MOU was very detailed, legally binding like any contract and that they are what trade deals are based on. Trump doesn't actually know anything about the Art of the Deal, his book on the subject was ghost written. Not accepting any correction from an underling he gave the hapless trade expert a tongue lashing repeating his earlier nonsense. The stoic Chinese responded by laughing out loud in Trump's face. He doubtless took it as a compliment.  

We are living in those interesting times the Chinese curse refers to.

Wednesday, July 4, 2018

Independence from the Corporation Day - Learn from history or be doomed to undo it.

On July 4th we celebrate our Declaration of Independence from the British Crown. More accurately we celebrate our defiance of the corporation that the King of England held a lot of shares in, The British East India Company.

The Boston Tea Party, contrary to what conservatives will tell you, was not about the colonists being upset over paying taxes but rather they were furious that the Parliament made the British East India Company exempt from all taxes and refunded 2 million pounds silver previously paid in. That's actual pounds of silver which represented far more wealth than the mountain of silver like that would be worth today. 

The East India Company was also granted monopolies on basically anything of value and not just tea, everything from steel shovels to fine men's suits were unavailable without going to the Royal Big Box Store. Yankee traders were treated as smugglers and harassed by the British Navy. American trading ships also brought back stories from the Far East on how colonists were treated by Walmart (I mean the East India Co) in colonies where they were the only game in town. Export quotas were met ahead of feeding the locals and moral was maintained by regular floggings. 

Despite all of these grievances, not all Americans were united in opposition. The Tories, we'd call them conservatives, were loyal to their God's chosen King, his Peers and their corporate representatives. After all their own God All Mighty had not only chosen them to rule but the proof was in their wealth or God's blessings bestowed upon them. Anyone who was poor was lazy or cursed by God. And slaves were given black skin to denote their poor standing with God. Native Americans were a bit more complicated, they just didn't make good slaves, but were an excellent source of game and furs. Until White men needed their lands of course.  

Modern conservatives lay claim to patriotism by taking credit for a revolution their forefathers actively opposed on the same basis they oppose a liberal values today. What conservatives really did during the Revolutionary War was harass the families of liberals who were off fighting, they jailed them, burned their houses and drove them into the forest to die. Ten percent of the American population died during the war and most were from things that conservatives did.

Of course few conservatives actually put on British uniforms, there wasn't any draft so no need to get your barber to write a parchment saying that you had bone spurs. While you celebrate Independence Day keep in mind that it's not something conservatives gave us, it's something that they're actively taking away. 

Wednesday, August 9, 2017

Attention all commands this is not a drill, we are at DEF CON ONE - Commanders are free to launch weapons in accordance with their targeting instructions. 

"This has to be a drill, we were at DEF CON FIVE."

"No sir, the codes match."

"Fuck me..."

How close are we to this situation? Probably not as close as Donald Trump wants to be. Trump started by sending out a couple of tweets congratulating himself on totally rebuilding our nuclear weapons system. He of course has done no such thing. He's probably only vaguely aware that Obama initiated an overhaul of weapons systems dating from the 1970s. 

Trump must of thought he'd scare the fermented cabbage out of the North Koreans with his "fire and fury" threat that White House insiders are saying was totally improvised. The talking point sheet on the table in front of him was for the opiates crisis. 

Instead of responding to Trump with the usual crazy rhetoric North Korea named a specific target. An isolated strategic US military base on an island called Guam. This is a definite calculated escalation on the part of the Chinese, errr, I mean North Korea. You need to ask yourself who is really in charge and what are they playing at?

When he was giving his ultimatum Trump himself seemed to be acting totally out of frustration. Body language experts say that the way he had his arms wrapped tightly around himself indicated that he feels really boxed in and unable to act. Did he try to order some sort of military action and his Joint Chiefs simply tell him no? Is the Vice President threatening to remove him from office for incompetence? The other people in the room including his wife all reacted with what is called 'dog face', a totally frozen look intended to not betray any emotion. Don't look him in the eye, he could bite. 

The People's Republic of China or some part of it, is up to their eye balls in what's happening in North Korea. These new missiles are way beyond the technical capability of the Hermit Kingdom. The missiles look exactly like China's. The mobile launchers are of a modern design straight out of China and not an old Soviet livestock truck the North Koreans got for free back in the 1960s. They can't even build the trucks and they sure aren't building 21st century missiles. 

One thing you need to understand about China's military is that they don't take orders from their Comrade President. He's not really a President in any real sense of the word but the chairman of a committee that represents the various factions that share power. This doesn't mean they've gone rogue either. What we know for sure about China is that we don't know much for sure. 

If China can provoke Trump into doing something truly stupid in Korea it's not likely that China will rain nukes down on us in return. More likely the container ships will simply stop coming. In a couple of weeks the US won't have an economy anymore and the rest of the world won't care, we'll be the Hermit Kingdom. The US will have no choice but to accept the end of its empire with a whimper. How many yuan for a can of beans?

Thursday, March 16, 2017

The End of the World (or something more important)

In case you missed it today, Senators of the Intelligence Committee Chairman Chuck Grassley and Ranking Member Diane Feinstein emerged late after a TOP SECRET briefing from the Director of Your FBI

to face reporters. Chairman Grassley let the Ranking Member speak for him as he appeared about to lose his lunch. They steadfastly refused to make any comment on the briefing with Democrat Feinstein

repeating that the briefing was highly classified. Remember that the reporter gaggle was scheduled ahead of time & Feinstein apologized for keeping them waiting for a considerable time. She and Grassley  

had nothing to say, but both their faces had an ashen appearance you might expect if they had just heard that aliens has taken over the planet. The briefing was supposed to cover Trump, his minions and

their involvement with Russia. Unless the Senate cafeteria gave them both food poisoning at breakfast, I'd say things are as bad as they can get. Do you have your bunker stocked with canned goods? 

Friday, March 4, 2016

Riding Crops and Jack Boots aren't just for Sex Dungeons anymore

Ho hum, another month, another quarter million new jobs. Obama's job creation streak is a new record by what, a year? You don't hear that on the news, and if it's talked about at all the Conservatives always say, 'but they're low paying jobs'. No actually they're replacing the same jobs lost by Bush, most pay pretty good. Of course the definition of 'pretty good' has been changing. 

The median wage of hourly workers is a little over $22/hour, meaning half of Americans make less than that. The problem is that by 1968 standards $22/hour should be the minimum wage, you know like the kid slinging burgers was making at the Golden Arches while the latest Beatles hit played on the AM radio. 

In 1968 we still ran a Trade Surplus, you know like China does now to the tune of $700 billion/year. We still had tariffs then like China does now, we'd had them from 1790. It was no secret in 1968 that the US oil shortage was a problem, in five years it would be a huge problem. Solar technology had been developed 50 years before, but no one that could understand the math was listened to. Jimmy Carter would make some inroads into people's thinking but Reagan would erase that. 

Today China adds more solar production each year than the US has built to this point in history. China pretty much does more of everything in a year than the US ever has.  It's to be expected, the US is a third world country. Okay the US is really populated by 300 million temporarily embarrassed millionaires. Or do you subtract the 47% who don't pay income taxes from that number because they're just lazy? Yeah, that guy is back and bashing Trump. 

You have to wonder why Trump scares the crap out of the Republicans? It's not the fascism, they're all cool with that, they could bring the Jack Boots and riding crops out from their Sex Dungeons.

Trump keeps saying Populist things like 35% tariffs, that's what scares them. He might turnout to be some sort of class traitor like FDR. Too bad Trump is so fucking crazy. Oh wait, we could all just vote for Bernie, he scares them even more.  

Twitter @BruceEnberg - Scaring the crap out of Conservatives is the Order of the Day.

Friday, February 19, 2016

Conservative Liberals and their love of Reaganomics

Those of us of certain age remember well the Reagan Democrats, mostly white guys with union cards who thought Reagan would be better at running the economy in their best interest. He'd cut their taxes, crack down on Welfare Queens, bring back the good old days, all that.   

Today we've got the liberal establishment that want the good old days of the Clinton Administration back and would prefer that those pesky Progressives stop rocking the boat. There are Republicans circling in the water after all. (be afraid, be very afraid) 

It's hard for them to actually criticize Progressive goals, it's always what they say they want for everyone, but like Reagan Democrats they seem to only want these things for themselves and just choose to believe that things can't be changed. They keep trying to knock down the standard bearer but that turned out to be harder than they thought, so mostly they've been concentrating on disparaging his supporters for refusing to listen to them and saying mean things. 

For the past week or so the big push has been to discredit Progressive economics as simply pie in the sky nonsense. An independent economist reviewed the Sanders plan & calculates that it would produce better than 5% growth in GDP. This has made certain so-called liberal economists gnash their teeth & pull out their hair. At least this is the story the NY Times is pushing and their resident economist Paul Krugman is dutifully agreeing with their editorial assessment. I always wondered about somethings Krugman would say, now I know.

Not that any of these so-called liberal economists have made any actual analysis Bernie's plan themselves. The gist of the ridicule they heap on Bernie revolves around the fact that they've been saying since the early 90s that this level of growth is impossible. With Reaganomics in full effect it has been. They compare it to Jeb Bush's ridiculous claims that he could guarantee 4% annual growth based solely on more tax cuts for the rich & because he had 4% growth as Governor of Florida during his brother's housing bubble. 

I would think liberals could see the difference between the Republican's schemes to capture more of our wealth by funneling money to themselves and a comprehensive plan to actually do again the things that built this country. I guess it's hard to tell the difference if you're being paid not to see it. 

Twitter @BruceEnberg - Where we see things as they are for free. 

Friday, November 6, 2015

Keystone is dead and the economy is off and running.

There were 271,000 new jobs created in October and the unemployment rate remains at 5%. Low gasoline prices have been driving up consumer spending and creating jobs. Obama has driven a stake through the heart of Keystone XL pipeline ensuring that oil from the northern tier states will continue to stay in the US instead being exported and that will keep the price down.

Right wing pundits have be saying that low gas prices don't translate into increased consumer spending, but an extensive study by JP Morgan Chase shows that the average consumer is spending 80% of what they save on gas. This translates into billions of dollars that actually goes into an increase in demand for goods and services which is where jobs actually come from. Conservatives continue to sputter about Supply Side job creation, those are what they call the job creators, even though this economic theory was first debunked nearly a century ago.

The death rate of middle aged Americans is up significantly, this is of course directly caused by the GOP war on the Middle Class. Russia experienced the exact same thing after the Soviet Union collapsed leaving the Oligarchs in charge. The numbers aren't anywhere near as bad here, but only because Obama has been able to hold the US oligarchs at bay for now.

Based on the 'runaway' growth of the US economy the Federal Reserve is hinting that they may start raising interest rates. Contrary to the Right Wing crazies bloviations, Obama doesn't control the Fed, he dis appoint the Chair, but she doesn't have any real say about interest rates. Those are set by a board of made up of bankers, and they're just been itching to raise rates from the first month with a increase in jobs. The only thing slowing them down is a practice of transparency started by Ben Bernanke and continued by his protege Janet Yellen. The weasels aren't willing to eat the chickens if everyone knows who exactly is doing it.

China has run out of storage space for oil and they're still buying oil to build up reserves, so the sea of oil we're swimming in is going to suddenly get much deeper when they let up on purchases and that will drive the oil price even lower.

The Rightwing crazies thought the economic Armageddon they've been jonesing for on Obama's watch had come because China has been "dumping" US debt and surprise, no one cares. There is plenty of demand for US debt and as economy improves that demand will only increase while the need for debt will continue to decline.

Predictions that China's economy is collapsing need to be contrasted with the fact China has just launched a yuan based worldwide payment system. Anyone doing business with China can simply use yuans and avoid the Money Changers down at the Temple that prefer make you convert back and forth to USD or Euros or whatever.  

Walmart has been forced to remove "Made in USA" logos from its websites, it seems China isn't a US state, who knew?

Twitter @BruceEnberg - I checked the map, there really isn't a US state called China. I guess that explains all the boarded up factories.

Friday, September 25, 2015

Is the GOP Clown Car a Volkswagen? It should be.

China marked its President's visit to the US by announcing a cap and trade program on the burning of carbon starting in 2017. Now the Right Wing Nut Jobs really can call Obama's Cap and Trade proposal a Commie Plot with some small measure of truth.

China's economic problems are likely to get somewhat worse, but it's hardly the global disaster the short sellers would like you to bet on. Literally bet on, Wall Street has instruments to sell you that will cover you against China's collapse for a small fee. Check out their Brooklyn Bridge penny stocks while you're at it.

It appears China's problem revolves around moving to a consumer driven economy, they have 600 million middle class to serve and are planning for 400 million more over the next 15 years.

A number of past officials in China have become absurdly rich 'investing' in the stock market and are facing long prison terms for corruption. They were also resisting the move to consumerism but that is rapidly coming to an end. So it's unclear what exactly they're being prosecuted for, corruption which is usually tolerated or for resisting the new Five Year Plan from Comrade Chairman. That's the real title of China's 'President', he's really just the Chairman of the 205 member Central Committee and they represent every major power base in China.

Speaking of dodgy investments, I hope you weren't too heavy into German car companies. It's not just Volkswagen that's coming under scrutiny, it seems you really can't build a small cheap diesel engine that violates the laws of physics. It's not difficult to clean the sulfur out of diesel exhaust, but it's too expensive for a small engine, VW and other companies claimed they had a magic way to do it involving computer control, except the computer was lying and cheating like a Conservative politician.

The scheme was simple, the factory designed test of exhaust output involved taking control of the onboard computer from the testing equipment, but that actually triggered the computer to run a secret program that leaned out the engine so it ran clean. Conveniently, no provision was made for also testing horsepower output as that went to zero. You can have clean car that goes slow or a dirty car that goes fast, VW was pretending you could have both at a cheap price. The fallout from this could kill the company.

VW only got caught because a small US environmental group was trying to collect data to promote clean diesel, not to prove it's not clean. They borrowed a exhaust gas tailpipe probe and not having a shop dynamo to run the car on, they loaded it in the trunk and went down the road. The onboard computer not being hooked to a dynamo had no idea it was time to cheat. Germans just don't understand that Americans don't always follow orders without question.

The final numbers for 2nd quarter GDP were a robust 3.9% growth. This is like we had before Reagan. Low gasoline prices are boosting consumer spending for housing and big ticket items. Factory numbers suggest there should be another small uptick for the 3rd quarter. Since Conservatives have run out of ways to drive up gas prices we could roll into the election year with what for these days passes for a truly booming economy.

Twitter @BruceEnberg - My new German computer says that I now have seven gazillion followers.