Wilson’s Folly, the Washington Hegemon and Why There Is Still No Peace on Earth

Wilson’s Folly, the Washington Hegemon and Why There Is Still No Peace on Earth

Another Christmas and there is still no peace on earth. And the proximate cause of that vexing reality is the $1.3 trillion warfare state planted on the banks of the Potomac—along with its web of war-making capabilities, bases, alliances and vassals stretching to the four corners of the planet. So positioned, it stands in stark mockery of John Quincy Adam’s sage advice to his new nation 200-years ago: Wherever the standard of freedom and Independence has been or shall be unfurled, there will her heart, her benedictions and her prayers be. But she goes not abroad, in search of monsters to...

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Cheap Money Didn’t Fix the Economy (Shocker!)

Cheap Money Didn’t Fix the Economy (Shocker!)

Some big, round-numbered interest rate thresholds have been passed in recent days including 4.0% on the 10-year UST, 5.0% on the 2-year UST and 7.0% on the 30-year mortgage. These all come at the end of extended round trips, of course, so the question at hand is how long did these trips take and what has been accomplished by all of the Fed’s interest rate pegging and repression during the interim. As to the duration of the round trips, the elapsed time between this week and when rates originally broke lower from current levels are as follows: Elapsed Time Of Round Trip: 10-Year UST: 5,600...

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Bubbles R-Us

Bubbles R-Us

The Wall Street Journal today brings word that a professor Efraim Benmelech of the finance department at Northwestern University thinks the Fed is hurting housing and the consumer too much. Opined he, ...those higher interest rates are making mortgages more expensive and leading to fewer home sales. That leads to less spending on appliances, paint and other home goods, because people commonly buy those items ahead of a sale and after moving. “The actions of the Fed are leading to lower consumption,” he said. You don’t say! Then again, has it occurred to the good professor that the years and...

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David Stockman’s Explainer to the 2023 Economy

David Stockman’s Explainer to the 2023 Economy

You can count on the knuckleheads at Bloomberg to start off the year with still another dead-wrong proposition. That is, more nonsense about the “strong” labor market—-one so strong that it is purportedly even defying the mighty Fed. The latest US employment report is anticipated to highlight the resilience of the nation’s labor market through 2022, despite the most aggressive pace of monetary tightening in decades. Really? The chart below is supposed to a show a booming +392,000 new jobs per month during the first 11 months of 2022, but it neglects to mention the starting point: Namely,...

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Mainstreet Hunkers Down as Home Sales Drop Drastically

Mainstreet Hunkers Down as Home Sales Drop Drastically

The crash landing of the housing market continued in November. Existing home sales of just 4.09 million units at an annualized rate represented at staggering 37% drop from the 6.49 million rate posted in January. There has never been a drop this severe within a single calendar year in the history of the series. Needless to say, existing home sales are not merely a secondary economic indicator. To the contrary, they arise from ground zero of household economics. That is to say, the doubling of mortgage rates to nearly 7%, the soaring inflationary bite out of paychecks and the growing public...

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Turning Down the Noise in the CPI Numbers

Turning Down the Noise in the CPI Numbers

So the talking heads of bubblevision think inflation is abating, but what about this: Federal revenues in November posted at $252 billion—10.3% below last November—while spending came in at $501 billion. And the latter included an ominous +53% rise in Federal debt service costs compared to a year ago. That’s right. After two-and-one-half years of so-called “recovery” from the Lockdown Recession of Q2 2020 and unprecedented monetary and fiscal stimulus, Uncle Sam’s November receipts barely amounted to 50% of Washington’s half trillion dollar eruption of Federal largesse, free stuff, pork and...

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No, the Labor Market Ain’t ‘Strong’

No, the Labor Market Ain’t ‘Strong’

Last Friday the Wall Street gamblers made another run at “bad news is good news”, taking the averages up modestly after a frenetic chase around the barn and back. But at the end of the day, it’s high time to forget about the games played by Wall Street day-traders and recognize that bad economic news is just that—bad news. The apparent negative in the October jobs report was the slight increase in the unemployment rate to 3.7% from 3.5% in September. That was supposed to mean that the economy was cooling and that the Fed could ease up on its tightening campaign. But, as we have often said,...

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Lock Out Below! Lockdown Economy Plunging

Lock Out Below! Lockdown Economy Plunging

Mike Shedlock crystallized the Lockdown Nation catastrophe at hand by focusing on the unemployment claims numbers for Michigan Wednesday morning. And it doesn’t get any more transparent than a staggering 25% of the state’s work force already having filed unemployment insurance claims under the existing Federal/State UI program—only to have its computers crash and burn when the normally uninsured gig workers and self-employed tried to file this week for the new Federal $600 per week Covid benefit: More than 1 million people — over a quarter of Michigan’s workforce — have filed for...

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Israel Winner of the 2003 Iraq Oil War

Israel Winner of the 2003 Iraq Oil War

From the Foreword by Lawrence B. Wilkerson: “[T]he debate over whether oil was a principal reason for the 2003 invasion has waxed and waned, with one camp arguing that it absolutely was, while the other argues the precise opposite.” “Mr. Vogler, himself a former...

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