Economic pressures

[Danny B]

Stupidity squared,,,price inflation,,,public debt

First, Europe.
Macron, "Patriotism is the exact opposite of nationalism. Nationalism is a betrayal of patriotism."
There have been 4,000 serious injuries at the yellow vests marches.
"We call for the continuation of the occupation of the roundabouts and the blockage of the economy, to engage in a massive unlimited general strike starting on February 5th 2019. "
https://www.theautomaticearth.com/20...nd-a-backstop/
This is STUPIDITY in action. After the Spanish prime minister crushed the Catalan demonstrations, he was kicked out.
Macron is doing the same thing.
Poland is having NONE of this BS. THEY have solidarity, https://www.rt.com/news/443697-far-r...-march-poland/

Salvini, the head of Italy faces charges, "“I confess,” Salvini said in a video posted to his Facebook page, “there is no need for a trial. It’s true, I did it and I’d do it again.”
“I risk 3 to 15 years in prison for blocking illegal landings in Italy. I have no words,”
A court in Sicily has ruled that Interior Minister, leader of The League and all-around Euroskeptic bad-ass Matteo Salvini should stand trial for kidnapping migrants held in abeyance off Italy’s shores."
https://tomluongo.me/2019/01/31/salv...the-eu-scared/
The boneheads in Brussels seem to believe that they can somehow win these types of confrontations.
Lega Nord and 5 Star will have the last laugh when they default on Italian debt.

The Bank of England is playing fast & loose with the gold it is holding for Venezuela.
https://www.bullionstar.com/blogs/ro...-central-bank/
This will greatly reduce trust in London bankers, https://www.rt.com/business/450144-v...old-boe-wolff/
Here is a great article about the reasons that Pox Americana is in the process of destroying Venezuela.
http://www.johndayblog.com/2019/01/d...te-empire.html

The FED claims that we need 2% inflation to maintain price stability. Wages haven't gone up since about 1971.
U.S. Inflation Rate, $15,000 in 1971 to 2018

According to the Bureau of Labor Statistics consumer price index, prices in 2018 are 520.02% higher than prices in 1971. The dollar experienced an average inflation rate of 3.96% per year during this period.

In other words, $15,000 in 1971 is equivalent in purchasing power to $93,002.59 in 2018, a difference of $78,002.59 over 47 years.
This number depends on statistics that are blatant lies. At a minimum, we have double the price inflation that the FED claims.
If you took $100 and let it grow at 2% for 50 years, you would end up with $269. All of this price inflation was engineered by the FED and, pumped in through the bond market. When the middle class and the lower loop could no longer keep all the money-renters in business, the CBs stepped in with QE. none dare call it money printing. Ostensibly, the free money is given to the banks so that they can stimulate the economy. This never happened because consumption is winding down. Even energy use is falling.
Americans' Electricity Use Just Keeps Falling - Bloomberg

Here is an excellent article about all the damage done by QE.
https://economyandmarkets.com/economy/qe-perversion/
2/01 Payrolls surge by 304,000, smashing estimates despite government shutdown – CNBC
EVERYBODY and their dog is selling U.S. public debt (Treasuries). U,S, GOV claims that hedge funds, et al are buying the $1.5 trillion in new debt that it has sold.
https://wolfstreet.com/2019/01/31/wh...ast-12-months/
Remember that Armstrong said that nobody will touch public debt
World Debt Burden has Exceeded $230 Trillion | Armstrong Economics
Sovereign Debt Crisis | Armstrong Economics
Why National Debts Eventually Default | Armstrong Economics
The Coming Public Debt Crisis | Armstrong Economics
FED GOV claims that everybody is slurping up U.S. debt. Call me dubious.

[Danny B]

Big bumps in the road

MMT says that GOV should just print the money that it needs.
2/02 Nobody buys US Treasury’s but “other investors(?)” & mutual funds – Economica
"This means the domestic public has been left to purchase an unprecedented $3.2 trillion, or 84% of all issuance since QE ended. The chart below details which domestic sources have been adding to their holdings; "other investors"
https://econimica.blogspot.com/2019/...y-buys-us.html
Call me suspicious but, I believe that QE has morphed into MMT.
2/01 An obituary: Fred Credibility – NorthmanTrader


Armstrong, "This new year for Japan is going to be a really crazy and chaotic year. There will be nationwide local elections held in mid-April, which Socrates is already picking up on the horizon. This will then be followed by Emperor Akihito’s historic abdication also at the end of April. Traditionally, this will begin a new “era” in Japanese custom.

Then arrives June, when Japan will host the drinking party known as the Group of 20 Summit in Osaka. This will be a first time ever event for Japan. The event will be followed by political tensions that will really soar during late summer when the Upper House political election is held. After the elections, the Japanese will then be hit with the tax increase in the consumption tax hike, scheduled for October, when it will jump from 8% to 10%. We are approaching the tipping point in Japan "
2/02 FIT cuts and lower revenue may cause more bankruptcies in Japan – PV Magazine

Armstrong, "ANSWER: Unfortunately, socialistic governments pretend that they are taking your money for your own benefit. The excuses are endless. Nevertheless, they constantly oppress the people by taking an ever increasing portion of their net disposable income, crushing them into the dust. The motives seem to change, but the end is always the same. This is why the Founding Fathers forbid direct taxation. That was such a critical deterrent to prevent revolution. The governments followed Marx at the beginning of the 20th century, and then convinced themselves that they were doing it to care for the people. In the process, they paid themselves pensions that no one else could possibly attain. Forbidding direct taxation was the only possible way to prevent the recurrence of revolution."
https://www.armstrongeconomics.com/w...ys-inevitable/

The Eurozone is a perfect example of the government taking enormous amounts of money to "help" everybody out. The result;
2/02 Italy heads for 2nd lost decade, entire eurozone contracting – Mish
2/02 EU charges eight banks over alleged government bond cartel – GATA
I suspect that the major crime of these 8 banks was; they refused to buy government bonds.
2/01 Payrolls surge by 304,000, smashing estimates despite government shutdown – CNBC
2/02 Jobs rose by 304k although employment fell by 251k – Mish
2/01 Almost 26 pct of Greeks cannot afford to heat their homes – Ekathimerini Austerity has NEVER worked and the poor Greeks have been screwed by the German banks.

2/02 House Democrat says Green New Deal “smash and grab” is over – Intercept
Well, that didn't last very long. The election is quite near considering that they must groom a viable candidate.
2/02 America’s withdrawal from Syria must be total – American Conservative
It WILL be, once all the oil is gone.
2/01 63 of America’s largest 75 cities are broke – SHTFPlan I won't tell if you won't.
The job market, Why Do So Many Modern Jobs Seem Pointless? - Reason.com

[Danny B]

MMT, Germany, Norway

Currently, the FED mucks around with interest rates to accomplish speeding up or slowing down the economy. ALL new money is channelled through the bond market and the banks. With MMT, interest rates would be held very low,,, the Treasury would directly inject money into the economy. If price inflation were to occur, the treasury would raise taxes, NOT interest rates. Definitely an interesting idea.
https://dailyreckoning.com/the-next-...ry-experiment/

Treasury, "The U.S. Treasury Department indicated that the government’s borrowing needs are rising faster than previous estimates as the Trump administration finances a widening budget deficit. The department expects to issue $365 billion in net marketable debt from January through March, up $8 billion from its estimate in October…"
Credit Bubble Bulletin : Weekly Commentary: No Mystery

Shale, "With the big Wall Street players now questioning the value of their existing investments in shale oil, the industry is finding it hard to raise money. Not a single bond sale has come off since November in an industry which must continuously raise capital to survive.

If the needed capital is not forthcoming, it means that companies will be faced with declining revenues from declining production. With lower operating cash flow and little access to additional capital, these companies will be unable to drill enough wells to offset declining ones. That means even lower revenues in the future which will mean even lower investment in new wells. That's what a death spiral looks like."
"Either the economy descends into recession, resulting in widespread job losses and a deflationary correction of today's ridiculously-inflated financial markets. Or the central banks go "all in" and launch QE4ever, leading to runaway inflation (runaway stagflation, more likely) and possibly hyperinflation."
https://www.peakprosperity.com/blog/...val-guide-2019

The Germans have had quite enough of being an occupied country. They want Russian oil via Nordstream. They want out of the EU before they get screwed for their 1 trillion account surplus.
2/03 It’s not Brexit but “Deutsche-it” you want to worry about – Golem XIV
The Germans are also looking to break with NATO. They aren't stupid. They know that they will never be attacked by Russia.
https://www.zerohedge.com/news/2019-...adiness-crisis


Taxes in Norway, https://www.theguardian.com/money/bl...eads-the-field
Don't forget, every Norwegian is a millionaire.
https://www.bloomberg.com/news/featu...a-and-big-tech
2/03 Exhumed remains of Karl Marx to run for US president – Sovereign Man

WHAT do they expect? The poverty brought by Crony capitalism makes socialism attractive.
2/03 Chinese accelerate their exodus from US real estate – Zero Hedge
2/02 Melbourne housing prices plummet at fastest quarterly pace ever recorded – Zero Hedge
2/02 Australia home prices falling at fastest rate in 36 years – ND
Evidently, the Chinese have checked out of OZ also.
Tax avoidance years ago, https://www.bloomberg.com/opinion/ar...ated-loopholes
https://www.paragonpride.com/forum/d...f88f251e48.jpg

[Danny B]

Inescapable pension problems

The steady price inflation over the years engineered by the bankers was not offset by wage inflation. The differential was handed out as stock dividends to people who rented out their money. This deflation of purchasing power necessitated that women entered the workplace if a couple hoped to live above the poverty rate. Having children became a very expensive scenario. The combination of price inflation and, the destruction of the family meant that the traditional arrangement of caring for elders by family members was lost.
The State stepped in with a public pension system. This worked well for buying votes but, has become prohibitively expensive.

"The Public Employees Retirement System, like investors everywhere, had a tough 2018. U.S. stocks’ worst year in a decade was capped by a fourth-quarter plunge that wiped out trillions in wealth and most gains for the year. The pension fund’s full-year return was 0.48 percent, preliminary results show, falling well short of its assumed earnings rate of 7.2 percent.

As a result, system actuary Milliman Inc. estimated, PERS’ unfunded liability grew to $26.6 billion – a $4.3 billion increase"
"That’s obviously not good news, but Milliman suggested the situation may actually be worse than it appears. That’s because the system’s 0.48 percent return does not reflect fourth-quarter results for its investments in private equity partnerships, which comprise about 20 percent of the portfolio."
"PERS officials also note that last year’s poor investment returns will force them to transfer $255 million in reserves to fund the guaranteed earnings crediting for Tier One members’ pension accounts"
https://www.oregonlive.com/politics/...s-in-2021.html

Calpers, "The new method, called “projected benefit obligation,” aligns pension assets and liabilities with new governmental accounting standards and how the federal government values its own employee pension program.

Using that methodology, CalPERS’ current unfunded liabilities, officially $179 billion, could be more like $360 billion, completely overwhelming the fund’s current assets and making it, on paper at least, hopelessly insolvent."
https://www.desertsun.com/story/opin...ry/2732926002/

"In my previous post I demonstrated a grim reality: using official government figures that under current accounting conventions, we would need a wealth tax approaching 100% in order to fully finance the enormous unfunded liabilities for Medicare and Social Security.

These unfunded liabilities represent promises made by U.S. policymakers that exceed the dedicated funding set aside to guarantee them. This means that to pay for said promises, we either have to be willing to raise taxes higher than they have ever been, borrow amounts than ever before have been possible or substantially cut back on what has been promised. There is no magic way to square the circle."
"For those brave enough to dive deeper into this rabbit hole, I will use today's post to explain the two most important reasons the challenge of funding our two biggest entitlements is far bigger than advertised: the chasm to fill is much larger than the $97.8 trillion problem described in my last post:"

"The Medicare trustees soberly summarized this bleak future in their most recent report "By 2040, simulations suggest that approximately half of hospitals, roughly two-thirds of skilled nursing facilities, and over 80 percent of home health agencies would have negative total facility margins, "
An obtuse way of saying that they would be broke and closed.
https://www.forbes.com/sites/theapot.../#e2b26505d062

Martin Armstrong Warns on Pension Crisis, Confiscation of 401k Plans ...
https://www.armstrongeconomics.com/tag/pension-crisis/

[Danny B]

Back door MMT,,,inflation,,, Italian fireworks

Crony capitalism has screwed everybody except the top 10% of "earners". They were close enough to the money spigot that price inflation did not hurt them. Their incomes were inflating faster. Wage stagnation wouldn't have hurt the actual producers near so much if there wasn't so much price inflation. The money-renters made out fine and, they like it that way. As we go down the drain because of crony capitalism, socialism looks to be our only relief. The champagne socialists are taking a hard look at modern monetary theory
Armstrong on MMT. "This economic theory is the same old incantation — how to prosper with other people’s money. Rome had no national debt and no central bank. It created money to fund itself. In hard times, they used the law to confiscate the property of people as they are doing today with their civil asset forfeitures.

What is missing in this theory is the question of debt. They assume they can borrow without end and never have to account for what they have done. They fail to understand that concept and try to regulate pension funds, which requires them to obtain government debt that they never pay off.

Yes, you can just create money to fund the government and it is confined by inflation. That is a true statement if taken by itself. However, you cannot then borrow with no intention of paying down the debt because the accumulative interest payments will end up representing 100% of the debt. This theory fails for it ignores dealing with the debt."

OK, now for the lies and sins of omission. Rome was on a precious metals standard. They did NOT have a flexible currency for hard times.
"They assume they can borrow without end" MMT is NOT about borrowing. It is about the Treasury creating money out of thin air. This has been done by the banks alone and, they like it that way. We have had a minimum of 4% price inflation every year. The treasury can just print the money and will have a BETTER control over price inflation.

Demand-Pull Inflation
1.Aggregate Demand in the economy rises
2.The rising Demand causes shortages to occur in some markets
3.Shortages lead to price rises in those markets
4. People/businesses respond to those price increases by raising prices throughout the economy
Cost-Push Inflation
1.Key resource cases rise (oil,food,labor)
2.Aggregate supply in the economy shrinks
3.Decreasing supply causes shortages to offer in some markets.
4.Shortages lead to price rises in those markets
5.People/Businesses respond to those price increases by raising the prices throughout the economy

"They" claim that there are 9 types of inflation. BS... The banks take our savings AND free money from the State. They buy up everything on speculation and then, resell it to us. If the Treasury originated the money supply and did NOT channel it through the banks first, this would cut out most of the speculation.
"rise (oil,food,labor)" Pretty funny that they group oil along with labor. The West has reached peak-cheap-oil. Automation has assured that labor shortages have little effect on productivity.
https://www.nytimes.com/2019/02/04/b...ity-wages.html

The demand for labor is shrinking in many fields.
The forward supply of labor is shrinking (birthrate) in most of the West.
https://econimica.blogspot.com/2019/...ated-peak.html
FED inflation has jacked up prices in America so high that we are not globally competitive in many areas. At the same time, 50% (average) of the cost of everything that you buy is for upstream financing.
Starting with the war years, FED GOV forced the FED to buy State debt. Presently, many types of funds are mandated to hold U.S. debt. SS holds $3trillion. The FED holds just over $4 trillion.
Several years ago, Treasury claimed that the BLICs bought up the debt,,, even though they didn't have any dollars to buy with. Then, we were told that "households" were buying up a couple $ trillion. Now, were told that it is "other'. Previous to this, we sent boatloads of pixels to London, Brussels and Zurich to buy U.S. debt. They bought equities also.
We've had back-door MMT for years.

2/06 Italy’s debt crisis will “rock EU to its foundations” – Goldcore ROCK ON!
Italy needs MMT, https://www.zerohedge.com/news/2019-...d-take-down-eu

2/06 The threat of a US government debt trap – Mises Institute What threat? They have a printing press.
2/05 Big tech is no longer carrying the stock market – NY Times
2/05 Loan demand falls among U.S. businesses, households – Reuters
2/05 World’s biggest pension fund suffers record collapse in Q4 – Zero Hedge
2/05 Motor vehicles sales dive in January, light trucks down 7.8% – Mish

2/06 German factory orders slide in December, undercut forecasts – AP
2/06 Age UK: 50,000 elderly have died waiting for social care package – Guardian
2/06 After abysmal Jan sales, car dealers are overflowing with unsold cars – ZH
2/05 US services stumble to 13-month lows as new orders plunge – Zero Hedge
The liquidity injected into the upper loop didn't help the lower loop very much. Consumption and profits go down.
It appears that you Canadians smoke 77,000 kilos of pot every month. https://www.thestar.com/news/cannabi...arket-yet.html

[Danny B]

China --U.S. liquidity flows,,,life is unfair,,,debt exhaustion

Here is a Zero Hedge article that makes 2 points. I have claimed that Powell is trying to do a controlled demolition of U.S. markets to avoid an uncontrolled collapse.
"And while stocks continue to levitate on hopes of a tide of liquidity washing up as soon as 2020 once the Fed starting cutting rates again (perhaps going all the way to negative"
I wouldn't bet the farm that Powell will cut the rates. The high rates attract capital from low-rate economies. The article goes on to prove that Chinese capital is what is holding up U.S. markets.
"And just to demonstrate how critical to US stocks is "China-sponsored" liquidity to global market, look no further than the below stunning chart of PBoC open market operations (on a cumulative 30 day moving average basis) relative to the key Value/Growth ratio for US stocks. If there was ever any doubt that the relative performance of US stocks - and especially FAANGs/growth names - is a function of Chinese liquidity, it can quietly be put to rest."
https://zh-prod-1cc738ca-7d3b-4a72-b...?itok=lXv6rV0L
Powell can hold off pumping in FED liquidity as long as Chinese liquidity is sucked out of China and, into U.S. markets. I'm sure that the Chinese don't like this development. They have to keep printing to support Chinese markets but, the money runs away.

This is a good article from Armstrong. He finally shows some awareness of failing job markets.
https://www.armstrongeconomics.com/w...-to-socialism/
Re: the job market. The lefties are all screaming that life isn't fair.
"Society judges people by what they can do for others.":
We judge ourselves by our thoughts.
“I’m a good person”. “I’m ambitious”. “I’m better than this.” These idle impulses may comfort us at night, but they’re not how the world sees us."
https://oliveremberton.com/2014/the-...a-of-fairness/

Armstrong, "Will Russia’s economy eventually exceed that of Germany? The answer is yes, just as China will surpass the United States. The West is collapsing. World GDP has been in a bear market since the late 1970s. The economy is moving into a recession as we spiral toward 2020. We will then enter STAGFLATION — rising prices with declining economic growth — between 2020 into 2024 with another hard decline thereafter into 2028.

It does appear that the economic decline will be much more severe with respect to Germany than Russia. "
https://www.armstrongeconomics.com/i...-anytime-soon/

2/07 Public pensions are the Trojan horses of US entitlements – The Hill
The growing problem is; we continue to live on long after we are unable to work.
2/06 UN warns of currency wars and widespread protectionism – CNBC Everybody is trying to export deflation & unemployment.
2/07 The “retail apocalypse” isn’t over: It is only just getting started – Zero Hedge
2/06 U.S. mortgage applications fall despite lower borrowing costs – Reuters
No kidding !!. The lower loop ran out of money.
It's called "debt exhaustion"
https://seekingalpha.com/article/423...ebt-exhaustion

[Danny B]

Debt and wars

Most everything is in a state of flux because of developments in Venezuela and Iran. Chavez took over the oil fields from the oil majors and now, pox Americana is trying to privatise them again.
Meanwhile, the debt is still growing.
"According to the U.S. Treasury, the federal government is currently $21,933,491,166,604.77 in debt. In just a few days, that figure will cross the 22 trillion dollar mark. Over the last 10 years, we have added more than 11 trillion dollars to the national debt"
The Most Depressing Stat Of The Month: The U.S. National Debt Is About To Pass The $22 Trillion Mark | The Daily Sheeple


" According to TBAC calculations, America will need to sell an eye-popping $12tn of bonds in the coming decade"
Credit Bubble Bulletin : Weekly Commentary: Delusional
Bummer
Obviously, QE has morphed into MMT with money being fed into all markets. Without constant transfusions, markets immediately freeze up. The FEDS plan to make MMT official policy of the FED. The FED has no army and no guns.
https://www.zerohedge.com/news/2019-...more-regularly
35 facts;
#1 Approximately one-fourth of the entire global prison population is in the United States.
#5 According to the American Road and Transportation Builders Association, nearly 56,000 bridges in the United States are currently “structurally deficient”. What makes that number even more chilling is the fact that vehicles cross those bridges a total of 185 million times a day.
Maybe so BUT, we have great war machines.
#17 More than 2 million Americans work for Wal-Mart.

#18 Half of all American workers make less than $30,533 a year.
#24 If the U.S. health care system was a country, it would have the fifth largest GDP on the entire planet.

#26 Today, a million Americans are living in their RVS, and that number is rising with each passing year.
#33 Congestion on our highways costs Americans approximately 101 billion dollars a year in wasted fuel and time.
Yes, BUT, we have great war machines
#34 According to Bloomberg, it is being projected “that by 2025, shortfalls in infrastructure investment will subtract as much as $3.9 trillion from U.S. gross domestic product.”
Yes, but, we have great war machines.
https://www.zerohedge.com/news/2019-...-have-believed
List of tent cities in the United States - Wikipedia
https://en.wikipedia.org/wiki/List_o..._United_States

2/10 Next recession: bearish signals show crisis is fast approaching – Business Insider
Michael Hudson has a very interesting article on Trump and dollar hegemony.
http://www.unz.com/mhudson/trumps-br...llar-hegemony/
Through asset forfeiture, GOV has stolen over $ 2 billion of cash that people were carrying,,,, calling it profit from illegal operations. They are trying to drive us to a cashless society. The problem comes in that; if we aren't carrying cash, they can't charge our cash with a crime.
"The Oklahoma Department of Public Safety (aka extortionists) and other agencies have portable card readers mounted on vehicles that can confiscate or freeze suspected drug-trafficking proceeds loaded onto prepaid cards."
"Of course, under civil asset forfeiture, they need not prove that anything is connected to drugs. They can claim you looked suspicious and take everything you have under the PRESUMPTION of guilt. "
"The Electronic Recovery and Access to Data devices on Oklahoma Highway Patrol cars are being used by a joint law enforcement drug interdiction team under the Oklahoma County District Attorney’s Office. The elimination of cash means that police can’t seize money, so they are adapting and grabbing your debit cards to download your funds."
https://www.armstrongeconomics.com/w...-through-ever/

[Danny B]

China, BIG rise,,, BIG fall

Decades ago, Japan was pouring more cement than the rest of the world combined. They still haven't escaped the doldrums.
Bill Gates , "According to his blog, between 2011 and 2013, China consumed 6.6 gigatons of concrete - that's more than the U.S. used in the entire 20th century. Look at what the U.S. built between 1901 and 2000: all those skyscrapers, the Interstate, the Hoover Dam, the list goes on and on but all that concrete only amounted to 4.5 gigatons."
China's workforce declines by 1 million a year. The moved all the self-sufficient peasants to the cities and put them to work. They had an export economy that depended on good wages in the West. They undermined those wages and now, the export economy doesn't work anymore. The main problem comes in that; They didn't sell to make a profit,,, they sold to lock-up markets and perpetuate growth.

"China's total systemic debt has soared from $7 trillion in 2008 to $40 trillion in 2018.
China has embraced the narrative of "growing our way out of stagnation by quintupling debt," but the banquet of consequences of this speculative orgy is finally being served: China's dramatic slowdown in 2018 is just the appetizer course of the banquet of consequences.
This excerpt of a recent (and immediately censored) talk given by a Chinese economist illuminates the result of debt-fueled mal-investment and speculation on a grand scale:

Look at our profit structure. To put it plainly, China’s listed companies don’t really make money. Then who has taken the few profits made by China’s more than 3,000 listed companies? Two-thirds have been taken by the banking sector and real estate. The profits earned by 1,444 listed companies on the SME board and growth enterprise board are not even equal to one and half times the profit of the Industrial and Commercial Bank of China. How can this kind of stock market become a bull market?

When we buy stocks, we are buying the profits of the company, not hype and rumors. I recently read a report comparing the profits of China’s listed companies with those in the U.S. There are many U.S. public companies with tens of billions dollars in profits. How many Chinese tech and manufacturing companies are there that have accomplished this? There is only one, but it’s not listed, and you all know which one that is. [Xiang is referring to Huawei, the Chinese tech company.]"
So, Trump attacked their only profitable company.

In the West; Look no further than Brexit in Britain, the yellow vests in France and the Deplorables in the U.S. for manifestations of a broken social contract and decaying social order. The politically invisible / financially vulnerable have declared we're still here to their globalized elite aristocrats, and this rebellion against elite domination and profiteering is being demonized by the corporate-state media as populism rather than what it really is: a full-blown revolt of the working class.
In response, the ruling elites have instituted social controls via ramped up official propaganda, Social Credit Scoring in China and private-sector Surveillance Capitalism in the U.S.

"All these forms of social control seek to marginalize, suppress and censor dissent, alternative sources of information, alternative narratives and financial independence:
oftwominds-Charles Hugh Smith: 2019: The Three Trends That Matter

SOMEBODY sent a U.S. warship into the South China Sea,,,,, to pi$$ off China and scuttle a trade agreement?
From comments;
China was the engine of growth for the global economy.

The engine has stalled and they can't get it started again.

When you know what they’ve done, you’ll know why.

The sequence of events:

Debt fuelled boom
Minsky moment
Balance sheet recession
Japan was the canary in the mine.

Then the UK, US and Euro-zone in 2008, and finally China.
2008, 90% of China's global trade surplus is the result of trade with the US:
Taps Coogan: The US Accounts for over 90% of China's Global Trade Surplus - The Sounding Line
Trump pulled out the rug and now, globalism is collapsing.
https://www.zerohedge.com/news/2019-...its-brick-wall

2/11 China upbeat on U.S. trade talks, but South China Sea tensions weigh – Yahoo Yeah, I'll bet they do.
2/11 Get over it: Asia rules – Asia Times
15% of China's GDP is eaten up by pollution. Who knows how much is eaten up by corruption? They change an area the size of Rhode Island into desert every year. Climate change is going to be very hard on them.

2/11 Blain: “The current iteration of ‘capitalism’ is a disaster – ZH
Douglas MacArthur," history shows no example of a nation that underwent moral collapse and did not also undego financial collapse."
So, moral collapse opened the door for regulatory capture where the rich bought all the laws that they wanted. Crony capitalism is a disaster. The consumer has been squeezed out and the middle class is broke. This works up the line and the stock markets have no earnings. The debt-trap takes everything down.

2/11 IMF cuts 2019 global growth forecasts: “we have no idea,” says Lagarde – FX
2/11 All the ways Gen X is financially wrecked – MarketWatch
Bummer.
2/11 Talks collapse on border deal as U.S. government shutdown looms – Reuters
Just wait til this happens. Buy MORE popcorn AND supplies.

[Danny B]

background reading

If you can take the time to read these 3 articles, I'll try to write a coherent picture later on.

https://www.theautomaticearth.com/20...at-discontent/

https://dailyreckoning.com/youve-been-bamboozled/

https://www.financialsense.com/blog/...-continue-rise

[Danny B]

Savibgs,,Can't pay bills, China, Hormesis & sinecure

Hmmm, my very short post this morning has disappeared. At least it was short. I want to write about the big picture but, I try not to include too many things at once.
Traditionally, an economy expanded and grew by carefully using savings for investment / growth. Savings were at risk and money was loaned carefully.
Samuel Untermeyer: "Is not commercial credit based primarily upon money or property?"
J. P. Morgan: "No, sir; the first thing is character."
Untermeyer: "Before money or property?"
Morgan: "Before money or anything else. Money cannot buy it."
Well, the bankers didn't much like this arrangement. Regulatory capture allowed them to expand credit without any practical limit. Moral hazard was out the window. The corporate structure ensured that legal hazard was close to non-existent.
Douglas MacArthur, " History fails to record a single precedent in which nations subject to moral decay have not passed into political and economic decline. There has been either a spiritual reawakening to overcome the moral lapse or a progressive deterioration leading to ultimate national disaster."

When credit creation became untethered from savings,,,, when the State was no longer limited by a gold standard, the world bankers went on a great binge. If a little bit of credit is good then, obviously, a LOT of credit is better.
" Hormesis is a term used by toxicologists to refer to a biphasic dose response to an environmental agent characterized by a low dose stimulation or beneficial effect and a high dose inhibitory or toxic effect."

"Self-liquidating debt adds to the total debt in the economy, but rather than heighten the economy’s debt burden it usually reduces the burden by increasing the wealth or productive capacity created by the project by more than the cost of the project"
"Debt that is not self-liquidating increases the total debt in the economy and, because it doesn’t improve debt-servicing capacity, usually adds to the economy’s debt burden
Debt that isn’t self-liquidating is necessarily serviced only through implicit or explicit transfers from one economic sector to another. I
"John Stuart Mill explained in an 1867 paper for the Manchester Statistical Society, “Panics do not destroy capital; they merely reveal the extent to which it has been previously destroyed by its betrayal into hopelessly unproductive works.”
https://www.financialsense.com/blog/...-continue-rise

Yesterday we alerted you to the latest assault upon savings — negative interest rates.

During economic stress, negative interest rates would crack open the piggy bank… and spill its contents into the productive economy. But in dark times saving locks needed capital out of the productive economy.
Investment, meantime, answers a higher calling. It is publicly minded. It pitches in… and expands the economy.
"Explained the late economist Murray Rothbard:
Savings and investment are indissolubly linked. It is impossible to encourage one and discourage the other. Aside from bank credit, investments can come from no other source than savings… About that bank credit,,,
https://dailyreckoning.com/youve-been-bamboozled/

Kunstler, "The self-proclaimed socialists are actually seeing the world through a rear-view mirror. What they are really talking about is divvying up the previously-accumulated wealth, soon to be bygone. Entropy is having its wicked way with that wealth, first by transmogrifying it into ever more abstract forms, and then by dissipating it as waste all over the planet. In short, the next time socialism is enlisted as a tool for redistributing wealth, we will make the unhappy discovery that most of that wealth is gone.
We have a new kind of mass squalor in America: a great many people who have nothing to do, no means of support, and the flimsiest notions of purpose in life. The socialists have no answers for them. "
Mistaken Futures - Kunstler

" People may not see liberalism as their problem, or even know, let alone understand the term, but what they do understand is they can’t pay their bills anymore.
it’s not some ideological question or fight, it’s about people not being able to pay their bills, and about politicians leaving them hanging all alone in a freezing wind.
But if anything, Brexit is not a cause but a mere symptom of the British variety of the Great Discontent. The cause is that in Britain, too, people can’t pay their bills anymore. One country gets Trump, the next one Yellow Vests, and the third gets Brexit.
The main upcoming event in media and politics won’t be the Great Political Discontent, it will be the economic one. Those who can’t pay their bills today will be the first victims of the massaged economic numbers finding themselves subject to gravity once again. Central banks won’t be able to prop up the zombies anymore, or the facade."
https://www.theautomaticearth.com/20...at-discontent/

EVERYBODY is trying to lock in a salary and/ or a pension. As automation wipes out more and more job niches. more and more people try to access the public food trough. The European Union is a perfect example. The overlay of the EU bureaucracy on top of the existing bureaucracy reduced GDP by 20%. Full employment for bureaucrats. they specialize in writing stupid laws and collecting golden pensions.
https://getbritainout.org/rules-rule...lous-eu-rules/
It's the same around the developed world. As automation wipes out job niches, everybody wants to work for the State.
"Debt that is not self-liquidating increases the total debt in the economy"
Society created the State to order things to b ring more security and prosperity. That idea is long gone and the bureaucracy is self-perpetuating.

On to China. It looks like they will meltdown before Europe or Japan.

2/12 Europeans must get rid of the failing EU one way or another – MarketWatch
2/12 Today is the 20 year anniversary of the Bank of Japan cutting rates to 0% – ZH
It's been non-stop printing ever since.
Please consider £11 Trillion Debt Wave as Governments Borrow More Than Ever Before. But more than £2 trillion is new borrowing as nations continue to add to their national debts, Amidst all this nonsensical talk of austerity, government debt keeps expanding, and expanding, and expanding. "
https://moneymaven.io/mishtalk/econo...EiuBFMro7hltw/
NO mention that over 22 million Americans work for the GOV. They borrow to keep bureaucrats and lawyers from learning what their actual value to society really is.

2/13 Fed to finalize plans to end balance sheet runoff ‘at coming meetings’ – Reuters
The FED was holing about $4.1 trillion and, sold about 10%. NOW, they are stuck with it.
2/13 A record number of Americans are 90 days behind on their car payments – CNBC
2/13 Household debt up 18 consecutive quarters to a new record – Mish
Living on plastic.
2/13 Red flags emerge as Americans’ debt load hits another record – Reuters Living o plastic.
2/12 Wealth concentration near ‘levels last seen during the roaring twenties’ – Seattle Times
2/12 US job openings soar to all time high: 800k more than unemployed workers – ZH That's amazing. 96.2 million Americans are not in the labor force.

2/12 China’s private firms hit by default contagion – Reuters The banks took all the money, the corporations are broke.
2/12 China: harbinger of global economic decline – Claudio Grass
2/12 China’s problems hit it all at once – Bloomberg
Much as they would like to, China can't shut off the money spigot. The profitless companies would close an lay off millions. That Chines liquidity is flowing into American stock markets.
https://www.youtube.com/watch?v=bKHyqO72oAo&t=61s

[Danny B]

Private debt saturation and default

The stock market eventually depends on earnings. The earnings just aren't there so, they do buy-backs to look more profitable. That works to a point.

Stock Market Is Even Worse Than You Think It Is - Bloomberg
https://www.bloomberg.com/...11.../s...ou-think-it-is
2/12 Latest warning sign for markets: a possible ‘earnings recession’ – NY Times
OK, so stocks eventually depend on consumption. Absent good wages, consumption depends on credit.
In the United States, total nonfinancial private debt is $27 trillion and public debt is $19 trillion. More telling, since 1950, U.S. private debt has almost tripled from 55 percent of GDP to 150 percent of GDP, and most other major economies have shown a similar trend.
2/13 A record number of Americans are 90 days behind on their car payments – CNBC
2/13 Household debt up 18 consecutive quarters to a new record – Mish
2/13 Red flags emerge as Americans’ debt load hits another record – Reuters

Debt saturation / exhaustion is creeping up on everybody.
https://www.youtube.com/watch?v=vAStZJCKmbU
It has become painfully obvious that everything financial depends 99.99% on fresh money printing from the FED. The lower loop fell flat and the PTB tried to save the upper loop from doing the same. The resulting price inflation only made it worse because it drove down consumption. The consumer doesn't have a printing press OR a job.
It remains to be seen what will happen when the lower loop defaults even more.
"Twenty-two percent of student loan borrowers fall into default"
"Nearly 40 percent of borrowers are expected to default on their student loans by 2023"
"the Fed's balance sheet had expanded in size—from about $870 billion in August 2007 to $4.5 trillion in September 2017"
The FED will stop reducing it's balance sheet which means that this money is orphaned and will act like MMT.... money that is printed but, never repaid.

Gen X seems to be not worried about all of this.
"They’ve got the most credit card debt of anyone — yet still spend more than anyone on non-essentials. Members of Gen X have higher levels of credit card debt — which tends to carry a higher interest rate than most other debt — than other generations."
https://www.marketwatch.com/story/al...ked-2019-02-08

Armstrong writes about farmers going bankrupt. To him, this signals a boom in food commodities. The more likely result is that people downshift from meat-to-chicken OR, chicken-to-vegetables. Leave it to Armstrong to see a silver lining when people can no longer afford food.
https://www.armstrongeconomics.com/m...ude-to-a-boom/

[Danny B]

Just how big can a bubble get?

Here is an excellent article on the "dimensions" of the bubble. I don't need to excerpt it. Every paragraph has astounding numbers.
Credit Bubble Bulletin : Weekly Commentary: No Holds Barred
An excellent article on the genesis of the income tax.
https://www.zerohedge.com/news/2019-...can-income-tax
Peak credit and debt exhaustion are dragging down spending in the lower loop.
https://www.zerohedge.com/news/2019-...predicted-here

2/16 If socialism is so good, why are people moving away? – Miller
https://www.forbes.com/sites/ebauer/.../#224cbdab7a90
They DO have a plan, https://moneymaven.io/mishtalk/econo...0-lhjPFfKaIsQ/
This is a crosspost from Kunstler.
http://kunstler.com/cluster****-nation/worms-turning/

Armstrong has his own perspective that is very much at odds with a non-investor.
China, "Aggregate Financing up $685 billion in a month. China’s banks made the most new loans on record in January - totaling 3.23 trillion yuan ($477bn)
Bank Loans expanded an imprudent $821 billion over the past three months alone, a full 20% above the comparable period from one year ago. Total Bank Loans expanded 13.4% over the past year; 28% in two years; 45% in three years; 91% in five years; and an incredible 323% during the past decade." Credit bubble bulletin You get the idea.

Here's what Armstrong has to say. " The Shanghai declined 1.37% today. The KOSPI and Hang Seng lost 1.38% and 2.03%, "
OK, Aggregate Financing up $685 billion in a month... 91% in five years
No mention that money creation is rising like crazy but, the markets are falling.
2/15 China’s loans hit all-time high as banks open floodgates in January – SCMP

Armstrong, "The states are broke. Their pensions are consuming everything. It is no longer about servicing the people, it is all about exploiting the people to fund themselves. "With every new tax, they simply reduce disposable net income, which in turn lowers living standards. This process is not sustainable."

Armstrong on gold, "Now with respect to why they have gold reserves, it is simply leftover and they would love to sell it but politically can’t right now. Because of the coming crisis in the euro, which they ALL see behind the curtain but will not speak about publicly, they are at a crossroad. The only currency they can respectfully hold remains the dollar. Both Europe and Japan have destroyed their bond markets. Central banks have been buying equities and gold BECAUSE they have little options but to diversify. "
So, gold is barbaric relic but, the CBs are buying the most they ever have. China just bought 11.2 tons.
https://www.armstrongeconomics.com/m...ill-have-gold/
The people who have lots of credit hate gold. The people who have no credit love gold. When the great reset hits, nobody will have credit. MOST of the world will have gold.
"They" are making moves to limit the phony gold markets.
https://www.zerohedge.com/news/2019-...56jtgeahU2JNBI

Armstrong, "The FX market DAILY trading volume is about $5.3 trillion,which dwarfs the equities and futures markets no less oil and gold. Just look at the numbers."
He is arguing that gold and oil are of little importance in financial markets.
I give you dollars and, you give me Yen. Supposedly, THAT little bit of currency arbitrage is worth many billions every day.
https://www.armstrongeconomics.com/w...s-petrodollar/

2/16 What happens when more QE fails to reverse the recession? – CHS ZH
The suspicion is that "they" will go to negative interest rates.
2/16 Gundlach: corporate debt blowup will unleash “turmoil” in next recession – ZH I believe it.
LA Times - CA to sue Trump administration over national emergency declaration
2/15 Trump demands CA return $3.5 billion in funds for ‘disaster’ bullet train – CNBC

[Danny B]

The CBs pump it in, the banks suck it out

Benjamin Franklin and Adolph Hitler injected money directly into the lower loop for work done Both got a war. Nope, the money must be injected into the upper loop. Finance has gone from being about 7% of the economy to about 40% of the economy. Real productivity has been severely reduced. Wages have been static for about 40--45 years. Production & consumption are floating on a sea of debt money. This bubble of debt money has taken on a life of it's own. It is not inflated by commerce. It is inflated by the pressure of more debt flowing in. There is no particular source of legitimate money coming in so, it depends on illegitimate money. The new money hasn't really done any good.

"In other words, whereas in the US the Fed was responsible for roughly half the upside in the market in the past decade (assuming low rates did not also benefit earnings, which they did) in Europe if it weren't for central banks, there would have been no market appreciation at all since the March 2009 lows. "
https://www.zerohedge.com/news/2019-...past-ten-years
The overlay of the EU bureaucracy on top of existing European bureaucracy sucked out 20% of their GDP. Remember this is pure consumption, NOT investment. The EU States (ex Germany) have a 1 trillion account deficit.
50% of the rise in U.S. equities is due to FED pumping. 100% of the rise in European equities is due to ECB printing. The ECB pumps in money so that the legions of bureaucrats won't lose their jobs and pensions.. NOBODY needs that many bureaucrats. Like most government employees, there is no demand for their"skills" in the private sector.

2/17 China accounts for 60% of past decade’s new global credit – ZH
China is printing to keeping the masses employed
When it come to public employees, NO price is too high to keep them employed and comfortably retired.
Illinois Governor Seeks to Sell State Buildings and other Assets to Pay Pensions
Governor Prtizker released details of his plan to save Illinois. He made three of three of the worst possible choices.

No matter how much the private sector suffers, the public sector is untouchable. BUT, that takes a lot of money.
Fed Launches Stealth QE “New Normal” | Miles Franklin
Op-Ed: The Fed's stealthy QE — $267 billion of fresh liquidity injected ...
So you thought quantitative easing was over? Think again | PBS ...
The End Of QE Isn't Really The End Of QE - Forbes

When wages crashed, the CBs jumped in to rescue the banks. Organic commerce couldn't save them so, the CBs did. They never thought that saving banks would be a open-ended job commitment.
https://www.dollarcollapse.com/nolan...arket-bubbles/

Bill Gates said. "But we can be more progressive without really threatening income generation — what you have left to decide how to spread around."
Yep, don't tax me, just spend it more carefully.
https://www.benzinga.com/short-selle...paign=benzinga
The Scrooges, https://www.benzinga.com/media/18/10...c-billionaires

2/17 Accounting change will raise corporate liabilities by $3 trillion – CNBC
So, how does that affect earnings?

[Danny B]

Continued QE for the upper loop but, none for the lower loop

During Great Depression I the farms and factories were still there but, nobody could buy their products. All the money flowed into the speculative loop and, was stuck there. The Glass-Stegal act pried the money lose from the bankers. Currently, the economy is shrinking but, the banks report their most profitable year yet.
Capitalism is the only production system. Socialism is a consumption system. When morality leaves the scene, this opens the door for regulatory capture and crony capitalism. Amazon paid no income taxes. Warren Buffet reported that his secretary paid more taxes than he did.
So, the money is all stuck in the upper loop. Keep in mind that interest charges are a deflator. The more that interest and taxes suck out of the economy, the less that is left over for consumptive spending.
EVERYBODY in the upper loop is rolling their money over into more instruments. The TARP bill was supposed to free up money for loans to consumers. Outsourcing meant that consumers didn't qualify for loans. So, money was loaned to people who did not qualify. Total personal debt has reached $ 19.5 trillion (debt clock)

The TARP money and $trillions more to follow it were injected into the upper loop Obviously, this didn't bring back consumption at the consumer level. The idea behind MMT is that it would allow the government to inject money into the economy that was NOT debt money.
Taxes and interest charges are a deflator in that they take money out of consumption. If the government used taxes for something other than wars, it wouldn't be so much of a deflator. We ned to spend $trillions on failing infrastructure but, we spent it on wars.
The idea of MMT is to replace the money in the lower loop that was sucked out by the upper loop.
The U.S. treasury bond market is valued at about $ 15.5 trillion of marketable debt. Just imagine what would happen to the marketable interest-bearing debt if the government could issue debt-free money.

"Modern Monetary Theory: If you read only one post all year, this is the one

Lorimer Wilson February 12, 2019
"If you read only one…post all year, this is the one I want you to read. I think it’s that important [so please]…take some time to learn about Modern Monetary Theory.

…Modern Monetary Theory (MMT) is a macroeconomic theory that contends that:

a country that operates with a sovereign currency has a degree of freedom in their fiscal and monetary policy which means government spending is never revenue constrained, but rather only limited by inflation.

…MMT’ers believe that government’s red ink is someone else’s black ink. Sure, the government owes dollars, but they have a monopoly of creating those dollars, and not only that, the creation of more and more dollars is essential to the functioning of the economy.

Here are the policy implications of accepting MMT:

Governments cannot go bankrupt as long as it doesn’t borrow in another currency.
Governments can issue more dollars through a simple keystroke in the ledger (much like the Fed did in the Great Financial Crisis).
Governments can always make all payments.
Governments can always afford to buy anything for sale.
Government can always afford to get people jobs and pay wages.
Government only faces two different kinds of limitations; political restraint and full employment (which causes inflation).
Government can keep spending until they begin to crowd out the private sector and compete for resources.

[Indeed, according to] Professor Stephanie Kelton from Stony Brook University, it is immoral not to utilize this power to fix problems in our society.

…[The above] sure sounds like socialism…but MMT is not socialism – not by a long shot. MMT’ers don’t necessarily believe in taxing the wealthy and redistributing it to the poor…[although] they do believe the way conventional economics and politicians think about money is wrong.

I know it seems insane to think about the government as not having to worry about deficits and debts. It doesn’t seem to make sense…but here is another way to think about it. If you have an economy with underused capacity, having the government spend on infrastructure or other societal useful endeavors is actually raising the total GDP of the country…MMT’ers argue that by not spending now, we will be harming our productive capacity in the future. Ultimately it makes no sense to have economic capacity sitting fallow because of a self-imposed worry about paying back a debt that is denominated in an asset that only the government can create. But, but, but… won’t that create inflation? Yup! Darn right it will, and that’s the point. MMT’ers believe that inflation is the only true constraint a government faces…

Let’s step back and think about what’s happened in our economy since the Great Financial Crisis and then think about how MMT changes the equation…

In 2007 it looked like we had hit the Minsky moment when no more debt could be balanced on the teetering edifice, and when the final piece of the Jenga puzzle was removed, it started to come tumbling down.
At this point, private credit had entered into a deflationary self-reinforcing credit destruction loop which would have resulted in a cleansing reset of the entire system…[that] would have been extremely painful…
It soon became clear that the government didn’t have the stomach to live through this sort of reset so they flooded the system with money through quantitative easing – much to the howls of protest from the economic and Wall Street elite who insisted this would cause inflation.
Much to almost everyone’s surprise, [however,] there was almost no inflation…There was plenty of financial asset inflation as all that new money pushed down interest rates and caused asset prices to lift, but the average worker saw little benefit from the Fed’s largess…

You might think these sorts of tax-cutting pro-business policies are the best thing for our economy…but the tide is shifting away from this belief… Society’s mood has changed and Stephanie Kelton’s concepts will continue to gain supporters…

The public has woken up to the fact that supply-side-trickle-down economics is not helping them anywhere near as much as promised [and that, in fact,] monetary stimulus with fiscal austerity doesn’t do anything except make the rich richer…MMT is a novel, ambitious, and a little bit scary, I get it, but young people aren’t afraid of trying something new. They know the system isn’t working and are desperately looking for an alternative. I think they found it in MMT…

What does this mean for your portfolio?

…I have lots of worries that under MMT inflation would quickly rise and before too long, the government would be forced to cut back it’s spending…Therefore:

I would expect fixed-income to be a terrible investment under MMT. Even if the government pegs rates low, inflation will be the real risk. It would make little sense to sit in an asset that pays fixed.
To me, MMT would scream that the best course would be to buy real productive assets hand over fist.
Modern Monetary Theory: If you read only one post all year, this is the one - munKNEE.com
The FED has now come out and said that they will need to do QE on a regular basis.
ALL of the gains in the European stock markets have come from QE at the ECB. 50% of the gains in U.S. markets are due to FED printing.
The speculators will fight tooth & nail to keep QE for the upper loop. It can be expected that they will fight equally hard to prevent QE for the lower loop.

[Danny B]

Claimed problems with MMT

You're going to hear a lot about MMT in the future. Bankers have long had the privilege of creating credit-money out of thin air,,, ex nihilo. Actually, it is your signature that creates the loan amount. The bankers want to keep it that way. Actually, anybody who is close to the money spigot wants to keep it that way. The money-renters claim that MMT could never work because there is no discipline regarding limitations of issuance.

MMT And Its Fictional Discipline
This theory is crucially important for investors and citizens to understand as its popularity is spreading like wildfire. The theory promises to be a strong force in the coming election and a challenge to the popular Keynesian policies that are widely adhered to by most governments and central banks.
That right there should make you suspicious.
Given the importance of this new thinking, we will analyse various bits and pieces of the theory in the coming months. In this article, we discuss a crucial aspect of the theory, inflation. MMT theory essentially believes the government spending can be funded by printing money. Currently, government spending is funded by debt and not the Fed’s printing press. MMT disciples tell us that when the shackles of debt and deficits are removed, government spending can promote economic growth, full employment and public handouts galore.

The point that inflation is impossible to calculate cannot be overstated.
Pure BS but, go ahead.
The bottom line is that inflation varies widely by demographic, region and individual needs and desires and a host of other differences that cannot possibly be accounted for in one number.
He is so sloppy that he just says inflation without even differentiating whether it is price inflation or currency inflation. As to his claim, that is pure obfuscation. Harvard is tracking ALL prices.
The Billion Prices Project

Inflation Manipulation

There is a bigger and more nefarious problem with inflation measurements and how they can be manipulated. To reiterate, MMT states that government spending and money printing can occur as long as inflation is limited.

If inflation regulates government spending and by default the health of the economy, then won’t leaders, who will do anything to retain their power, suppress inflation readings to allow greater spending?
That would certainly be nothing new. We already have complete BS statistics from the State.
https://realinvestmentadvice.com/mmt...-theory-but-2/

Price inflation as it was calculated in 1990 is running at about 6%
http://www.shadowstats.com/imgs/char...d&t=1550066990
Alternate Inflation Charts

The FED claims that we must have 2% price inflation to maintain stable prices. Even GOV figures show twice that much.
The price of gold in 1970 was $38.90.
The price of oil in 1970 was $3.60 a Bbl.
The Nixon shock cut out the stability of gold from currency inflation. So, the money renters love to see price inflation in the upper loop. They hate the idea of losing the catbird seat when it comes to creating liquidity. One thing that they have purposely forgotten to state; Liquidity injections for speculation are very inflationary. Money injections for consumption are only minimally inflationary.
Here is U.S. debt growth, https://empwaynek.files.wordpress.co...pg?w=450&h=838
If MMT is inflationary, it couldn't be worse than the current situation.

Meanwhile population and consumption are falling.
https://econimica.blogspot.com/2019/...opulation.html