Washington Times: Fed Policy Powerless to Influence Inflation…

In 2015 we discussed candidate Trump’s economic positions and how they would impact the economy.  CTH anticipated that MAGAnomics would be reversing three decades of federal reserve fiscal policy. After about a year of analysis and discussion, in 2016 CTH presented a theory: “A new Dimension in Modern Economics“.

CTH shared a possibility of what could happen if Trump Economic Policy was shifted to favor Main Street over Wall Street.  One aspect we presented was how Federal Reserve monetary policy would be oddly disconnected from its ability to influence inflation.

Washington Times today:

(Article Link)

While the issues inherent within economic influences can be riddled with complexity, we remain optimistic that MAGAnomics will be very very successful.

2016 […]  Understanding the distance between the real Main Street economic engine and the false Wall Street economic engine will help all of us to understand the scope of an upcoming economic lag; which, rather remarkably I would add, is a very interesting dynamic.

Think about these engines doing a turn about and beginning a rapid reverse.  GDP can, and in my opinion, will, expand quickly.  However, any interest rate hikes (fiscal policy) intended to cool down that expansion -fearful of inflation- will take a long time to traverse the divide.

Additionally, inflation on durable goods will be insignificant – even as international trade agreements are renegotiated.  Why?  Simply because the originating nations of those products are going to go through the same type of economic detachment described above.

Those global manufacturing economies will first respond to any increases in export costs (tariffs etc.), by driving their own productivity higher as an initial offset, in the same manner American workers went through in the past two decades.  The manufacturing enterprise and the financial sector remain focused on the pricing.

♦ Inflation on imported durable goods sold in America, while necessary, will ultimately be minimal during this initial period; and expand more significantly as time progresses and off-shored manufacturing finds less and less ways to be productive.   Over time, durable good prices will increase – but it will come much later.

♦ Inflation on domestic consumable goods ‘may‘ indeed rise at a faster pace. However, it can be expected that U.S. wage rates will respond faster, naturally faster, than any fiscal policy influence because inflation on fast-turn consumable goods becomes re-coupled to the ability of wage rates to afford them.

The fiscal policy impact lag, caused by the distance between federal fiscal action and the domestic Main Street economy, will now work in our favor.  That is, in favor of the middle-class. (full outline)

♦The Modern Third Dimension in American Economics – HERE

♦The “Fed” Can’t Figure out the New Economics – HERE

♦Proof “America-First” has disconnected Main Street from Wall Street – HERE

♦Treasury Secretary Mnuchin begins creating a Parallel Banking System – HERE

♦How Trump Economic Policy is Interacting With The Stock Market – HERE

♦How Multinationals have Exported U.S. Wealth – HERE

 

Advertisements
This entry was posted in Big Government, Budget, Donald Trump, Economy, Legislation, media bias, NAFTA, President Trump, Trade Deal, Uncategorized, US dept of agriculture, US Treasury, USA. Bookmark the permalink.

90 Responses to Washington Times: Fed Policy Powerless to Influence Inflation…

  1. indiamaria2020 says:

    Yo’ street cred be DOWN, Sundance !! (In kid talk that means “up”).

    Liked by 15 people

  2. daughnworks247 says:

    That’s what happens when you print money to prop up Obama, instead of letting the market TANK and then rebound naturally.

    Liked by 11 people

  3. Cetera says:

    What affect will this have on home prices and the housing market over the next two years? It seems to me we’re back in bubble territory, but I’m not an expert, and only have a very limited picture I’m looking at locally.

    Liked by 2 people

    • The Boss says:

      Cetera – There are more buyers of homes than homes for sale (new or used). That is what’s driving prices now. Builders are ramping up after taking many years off from crrazy levels of new construction. However, I don’t see us doing stupid bidding up of prices for homes since lending standards are much tighter.

      If there’s a bubble ready to burst, look no farther than autos. Loads of sub-prime leases and loans during the obama years are ready to crap out. Should be good deals on used cars this fall.

      Another bubble is college student loans and the attendant rise in tuition costs. That little scam will not end well.

      A final bubble – subprime or “junk” bonds which people bought for yield. I’d get the hell out of those now and not look back.

      Liked by 8 people

      • The student housing condo construction phase is crashing BIG time.

        Liked by 3 people

      • In the people’s republic of NY, my area of the Hudson Valley has had an uptick in forclosures and the uptick was enough to make the front page of the local yellow journalism rag.

        Liked by 2 people

        • lokiscout says:

          Anyone in the market should pay attention to the foreclosure market. Banks are in the mortgage business not the real estate business. Empty houses don’t do them any good. My son picked up a 5 year old house foreclosure in 2011 It is now worth almost double what he paid for it 6 years ago. At the time he bought there was something of a glut of foreclosures and the banks wanted rid of them so they could start getting paid again. Three years later 2014 things had pretty well settled out and the inventory had pretty well dried up and and I sold the home we had lived in for 30 years at top dollar. Not bragging but glad I dodged a bullet.

          Don’t know what to expect going forward but it seems if wages do increase a lot of folks who have been holding off buying will be entering the market along with folks looking at moving up. Both I would expect to push prices up.

          Liked by 2 people

        • DHarvey says:

          Hey..a conservative in NY ! WOw. So there are two of us :). Conservative in the Adirondacks. Have a nice day!

          Liked by 3 people

      • TPR says:

        The student loan debt bubble is unfortunately only getting bigger. It’s the greatest economic tragedy in American history, IMO. The longer it takes to find a solution, the bigger the problem will get until it consumes our entire nation and leads to a unprecedented catastrophe.

        This whole problem was created like most others: big government & free handouts.

        Lending fortunes (funded with tax dollars) to teenagers was never a good idea for anyone who cares about America’s future and wellbeing. Democrats and RINOs saw federally funded student loans as an easy and quick way to gain political points and appeal to the unwise & ignorant masses. A true shame.

        The result was what anyone with a brain would have said if asked about the idea/policy: a never-ending supply of federal student loans means a never-ending increase in college tuition, costs, and higher-ed expenses. We now have too many colleges with too many professors, administrators, and staff members that are evolving into 4-year all inclusive resorts for every single high school graduate. The colleges are no longer teaching students, and when they do, most of the students don’t care enough or respect the educational opportunity enough to learn anything. It’s a 4-year Spring Break where America’s youth learn the most degrading and debasing skills a human can learn. It’s an institution of liberal propaganda that brainwashes America’s youth with unrealistic ideologies and delusions that fuel a mindset and way of life dependent on the federal government. It rewards victimhood and conformity. And it does a host of other horrible things. For all of this our country’s youth gets loaded with an amount of debt they can’t even comprehend and that they won’t be able to repay in the future without living like paupers or otherwise digging themselves into more debt, with credit cards, to maintain a lifestyle they were deluded into thinking they were entitled to. The more problems these debt-saddled college graduates face as a result of their wasted years in that institution of higher learning that so many people told them was so necessary to get a decent job, the more they come to depend on the government, just as scared and uncertain children depend on their daddies and mommies.

        We are only in the beginning. The solution won’t come for years, and I’m talking decades, because the problem isn’t yet bad enough for politicians to do the right thing. It will have to get bad before politicians realize the only real solution to this problem is to eliminate “free” and unlimited federal student loans. But, what’s more likely is that Congress will respond with more regulation. They will try and control the costs and expenses of colleges. But what they won’t do is face reality. They won’t tell Americans that they’re not entitled to an education. They won’t tell Americans that if they can’t afford college then they can’t go. No, we’re far too deep into the depths of a socialized state to face reality. Things will get worse. Band-aids will ease the pain now and then, but the problem will get worse and worse until our economy crashes. Anyone who disagrees likely doesn’t understand how big this problem is or how detrimental it will be for the economy when the majority of Americans are spending sizable chunks of their income on repaying student loans instead of houses, cars, clothes, etc.

        Liked by 3 people

      • Construction standards are higher now, and in many places not only are land prices higher, but municipal codes and zoning requirements are now such, that new housing literally can’t be produced cheaply. (I speak as a builder with 20+yrs of experience).

        If wages continue to go up (and every indication I see says they will for middle level Americans), and if new homes continue to be brought to market slower than demand (again, this is what I see), this would indicate demand staying strong, with supply limited…and housing prices should stay stable, if not rise slightly.

        Obviously, in areas dominated by Wall Street personal, I’d expect to see a hit in the upper-level housing and related services.
        In areas with more easily rebuilt industrial capacity, you may see demand far outstrip supply, and a heavy push for reconstruction of urban properties for modern residential use.

        IMHO.
        -Matt

        Liked by 6 people

    • WSB says:

      People will look to move where manufacturing will make a comeback. Not so much around large cities, thus housing should follow local situations.

      Liked by 1 person

    • TheLastDemocrat says:

      If anybody and their dog can borrow the money to “buy” a house, then two things happen: more people “buy” a house as an investment, and more unqualified people start buying houses.

      When the money is easy to get, and many people are taking advantage of the easy-money opportunity, then dollars are chasing houses and prices go up.

      The problem there is that unqualified buyers will eventually begin to fail to pay their notes.
      And, the speculation buying will go beyond the natural customer base – and so speculators will start failing to pay their notes.

      Lending works until too many borrowers fail to pay their note at the same time.

      If housing prices are rising because qualified buyers are buying their own homes, due to strong economy, they will pay their notes and all will be fine. In that case, housing prices go up gradually and indefinitely. <–This is why they say real estate is a great investment. (Which is why amateur speculators try and be real estate tycoons when money-borrowing gets easier.)

      Liked by 2 people

  4. Plato says:

    Deflation is the kryptonite they fear above all things. Inflation is the goal of of govt and that is not happening. Ask the Japanese who seem financially unable to learn a thing.
    The exception is the helicopter money and very low rates in the US are guaranteed to produce tag team asset bubbles.

    Liked by 4 people

    • Alligator Gar says:

      And bankrupt retired savers who had factored in at least 4% on their investments to live on. Now they are eating their principal and have been for over 8 years. My folks saved and lived frugally. They started off in 2005 when dad retired at age 70 with a nice nest egg. It is all but gone. They do not travel, have a pool, RV, or go out. They simply live as close as ever. The upkeep of their home (which they are trying to sell as they live with me now), and INSURANCE are killing them. Enough! Stop abusing our elders with this fake 0% money. This hurts SAVERS, not SPENDTHRIFTS!

      Liked by 1 person

  5. Pushing on the string? The markets are just a big Ponzi scheme anyways. Something’s gotta give. Holding on and praying that MAGAnomics got this. I trust POTUS, but he is only a man. He cannot stop natures laws.

    Liked by 4 people

    • fleporeblog says:

      MAGAnomics absolutely got this!

      SD you hit it out of the park! You said that GDP would expand quickly.

      First quarter with Barry from Kenya 🇰🇪 still President for 20 days and our Lion 🦁 implementing the reversal in regulations and putting the plan in place for our Energy Revolution with Secretary Perry, Zinke and Pruitt. The final GDP number after adjustment was a miserable 1.2%.

      Second quarter and our President begins to cut deals for our coal to be shipped to France 🇫🇷, Germany 🇩🇪, UK 🇬🇧 as well as LNG shipped to China 🇨🇳. GDP comes in at 2.6% and will absolutely be raised up to possibly 3.0%.

      We are currently in the third quarter and the Atlanta Fed is projecting a HUGE number of 4% for our GDP. LNG is now being shipped to Poland 🇵🇱, Lithuania 🇱🇹, South Korea 🇰🇷 and China 🇨🇳. Ukraine 🇺🇦 has purchased large amounts of our coal while coal is continuing to be shipped to France 🇫🇷, Germany 🇩🇪 and the UK 🇬🇧. Ireland 🇮🇪 also signs a deal for our LNG. We are also exporting beef to China 🇨🇳.

      Fourth quarter expectations remain at 4% with new deals on the horizon with India 🇮🇳 and the Three Seas Countries (11 total) for our LNG.

      Unemployment will fall again at the end of the month to either 4.2% or 4.1%. Labor Participation continues to rise. All of this is setting up the next explosion 💥 in MAGAnomics which is the sudden increase in wages since companies have a smaller pool and must offer greater incentives to hire folks.

      This is winning I couldn’t imagine happening in year one of our Lion’s Presidency.

      Liked by 15 people

      • nyc0009 says:

        The big elephant in the room is not inflation it is actually the decline of the value of the US dollar. Everything looks good, except I think Trump is going to have to break up the monopolies of beef production and distribution in the US. Prices are way too high, if we are goinna export, then the American consumer should experience much lower prices here at home. The only way to fix that problem is to start dealing with the farmers and cattle ranchers directly again. It will take time, but I hope someone reads this and starts their own cattle ranch somewhere in the US. I think we need more local cattle ranchers. As it stands now, the packaging of beef occurs in Mexico/Canada not the USA. Not sure about that story but if its true we have SERIOUS problems.
        The dollar gets lower on purpose, then people start to leave the dollar, then we put pressure on countries to buy the dollar, but in the meantime USA consumers buy less imported (Chinese) good because they are more expensive. That creates closing of factories in China, that creates a serious problem for their social “order”.

        And one more thing, is it just me but is Trump really going to allow the Chinese to buy the Chicago Exchange? Let’s flip it and think to ourselves, would the Chinese allow us to buy the Shanghai Exchange? Ehem, no. Just an aside, this deal just can’t go through.

        Liked by 1 person

        • sledhead406 says:

          The packing does not necessarily happen IN CA or Mexico (there could be some, but not a large percentage), but it is very much effected by CA and Mexico live beef supply being imported to keep domestic prices (paid to ranchers) low.

          They have fought COOL (country of origin labeling) since it was dreamed up decades ago. Simply because if people know the meat they buy is from USA or Mexico or Brazil, etc., There is a good likelihood that the consumer will buy US Beef. By making sure that import beef is readily available they can keep the commodity price paid to US producers down. This among many other things keeps their basic input cost down. All while depriving the consumer of choice.

          They then also can keep the prices high on the grocery store shelves via supply management, regulations limiting straight from farm sales, etc.. and then usually blame producers input costs or something silly like that.

          Chinese approve US Beef imports a few months ago. The market size increases by a few billion people and the price paid to guys like me is continuing to decline.

          Like

        • fleporeblog says:

          Great write-up! The President has said numerous times as a candidate that he prefers a weaker dollar versus a stronger dollar because it allows for much more exports to take place which in turn lowers the gap between imports versus exports which allows our GDP to take off.

          Like

        • G. Combs says:

          I buy my beef direct from the farmer and raise my own sheep and goats. However good luck finding a butcher for your home grown meat.

          The biggest problem is regulations on SLAUGHTER HOUSES.

          The new HACCP regulations DECREASED food safety and INCREASED the paperwork, simultaneously protecting the big meat packers while driving the small slaughter houses and butchers out of business.

          Jolley: Five Minutes With John Munsell & A Trip To The Woodshed With The USDA

          One day, a long, long time ago, Big John noticed something amiss. Contaminated meat was coming in the back door of his very small plant. “That’s not right,” he thought and called the authorities.

          They arrived ready to right a wrong; after all, that was what they are paid to do, an earnest and dedicated group of men and women charged with safeguarding much of America’s food supply.

          An inspector, armed with many official looking pieces of paper, looked Big John in the eye and said, “Assume the position!”

          John was frisked. The authorities stopped just short of a full body cavity search. It was a very thorough exam.

          “Wait,” protested Big John. “The meat came in with bad stuff already on it. I didn’t put it there. Go after the people who sent it to me!”

          “Obviously you don’t understand the way we do things around here,” chuckled the inspector who was amused by Big John’s apparent naivety. “We found the bad stuff in your possession; therefore you have to be the bad guy.”

          John was frisked again. This time, the authorities included a full body cavity search. It was VERY thorough exam.[…]

          A few months later, (deleted), now known as Conagra, recalled 19 million pounds of beef that was potentially contaminated with E. coli 0157:H7.

          Such is the sad tale of a small Montana beef processor and its owner who thought he could tilt at very large windmills.

          John Munsell didn’t quit, though. He dusted himself off and started a new whistle blowing career. His target? Anything that seemed out of place at FSIS. As far as he’s concerned, the most out of place thing is HACCP; a good idea, perhaps, but completely misapplied he thinks.[…]

          John’s critique of HACCP detailing what is wrong.
          HACCP’S Disconnect From Public Health Concerns – John Munsell

          HACCP: The Case For Dismissal

          More on John’s fight against Big Brother:
          (wwwDOT)foodsafetynews.com/2012/05/the-meatpacking-maverick-and-usdas-new-tracback-policy/

          (wwwDOT)marlerblog.com/lawyer-oped/one-e-coli-o157h7-outbreak-i-think-i-could-have-prevented/

          Like

      • KittyKat says:

        Another way that the stars are aligned for prosperity is that the American banks have finally worked themselves out of the sub prime mess, therefore will be making more credit available to businesses to start or grow,

        Liked by 1 person

  6. Bouchart says:

    The only thing a central bank knows how to do is create inflation.

    Liked by 2 people

    • WVPatriot says:

      That is what makes that business model — “central bank” — so dangerous.

      Like

      • Daniel says:

        There seems to be a lose correlation between presidents (and world leaders) who thwart or fight the central banks and their subsequent (attempted) assassination. JFK was issuing silver certificates. Lincoln created the debt free greenback. Garfield also opposed central banking as did McKinley.

        Not saying these aren’t mere coincidences… but there is that lose correlation.

        Like

  7. The Boss says:

    I haven’t been overly impressed with the Fed for years. If they can’t do anything, maybe it’s time to wind down their operations. THAT would make lots of heads go splodey!

    Liked by 12 people

  8. Bob says:

    The Fair Tax would elevate our Country’s income tax problems….the whole problem is the politicians don’t like it. It’s simple, justice like Obamacare, they don’t want the repeal, or tax reform or anything that keep them into anything to keep the population under their control. The Fair Tax would take away the politician toy, along with getting more rid of the IRS.

    Liked by 3 people

    • skipper1961 says:

      Bob,
      Boy would I be overjoyed to hear that Wilburine, Mr. Mnuchin, and President Trump were intrinsically involved in an HONEST and PUBLIC analysis of FairTax! It would take astronomical pressure to “persuade” the swamp creatures to pull the drain plug on themselves, but if not OUR LION, then who? Remember, it would require the repeal of a Constitutional Amendment! One of Mr. Trump’s “flow charts” would be a GREAT start!! MAGA!!

      Liked by 1 person

  9. Plato says:

    There might be another country on the earth where Private Banks run a nation’s Central Bank,
    I just haven’t heard about it, the concept is beyond bizarre.

    Liked by 3 people

    • hypnotique59 says:

      It is my understanding that the central banks control just about every country’s banking system. The exceptions are North Korea, Iran and Ice Land( just a few years ago, arrested some of the bankers and closed the banks. )

      Liked by 5 people

    • svenwg says:

      The Bank of England, the EU Central Bank and every Central Bank in the 20 individual countries are all private banks, where the government of the day gets to ‘elect’, more like appoint, the head of each individual Central Bank. The rest of the world, besides NK, Sudan, Ethiopia and other communist controlled African dictatorships have exactly the same system, Keynesian Economics on steroids!!!

      Liked by 3 people

  10. jeans2nd says:

    Waiting for the day when it says the real truth – “The Fed has reached a dead end in its ability.” If the Fed ever had any ability at all, that is.

    Liked by 4 people

  11. Jlwary says:

    I will repost on the Monday’s Open Thread, however, I did just post about helping a family in need, if anyone can take the time to go see it.

    As for this great news within SD’s post: I love winning alongside our winning President who always wins!!! Winning, winning, winning–all day, everyday!

    Liked by 2 people

  12. dustahl says:

    Buy everything durable goods that you can get your hands on, prices will be going up next year.
    my opinion, as the economy expands money will chase goods.

    Liked by 4 people

  13. greenvalleygal says:

    Prescient. Sundance. Thank you.

    Liked by 1 person

  14. trialbytruth says:

    SD
    I understood your theory of two trains.

    I understood your proclamation that the fed would be confused and powerless

    I thought both theories made sense and I was hopeful you were correct.

    To see it all fleshing out is remarkable. Congratulations Sundance you are a Svengali.

    Liked by 8 people

    • sundance says:

      No, not all that. Just practical review based on main street economics.

      However, if my theory is correct, the two economies will gain parity at approximately the time when the total U.S. GDP level grows by the sum total of all Obama’s various fiscal stimulus.

      It’s around $20 trillion now. So it needs to get to about $25 (ish) trillion in total before the two economies will re-merge. Approximately 3 to 5 years of Trumpian GDP growth.

      Once the U.S. economy reaches $25 Trillion in total Gross Domestic Product, output, we will only have one economic engine again. That’s my general theory. Hold me to it.

      MAGA 😀

      Liked by 21 people

      • lokiscout says:

        More than happy to hold your feet to that fire Sundance, More than happy! Winning is such a sweet feeling! If we can achieve that in 3 to 5 years I may be able to look at my 4 Grandkids again without feeling like I need to apologize for the mess my generation is leaving them.

        Liked by 5 people

  15. Ono says:

    Home run Sundance!

    Liked by 3 people

  16. Donna in Oregon says:

    Corporate and Company bonds which hold debt and are held by hedge funds and big banks. These debt derivatives are tied to companies & corps all over the world. It is a scam, in legitimate businesses and it is too big not to effect the American economy.

    That is not accounted for in any financial assessments.

    Liked by 1 person

  17. Redhotsnowman says:

    My bank practically “forced” a $14K credit card on me the other day, didn’t ask for it. Next time I went to the bank on an unrelated issue the guy I was dealing with said “did you receive the card? Make sure you activate it, even if you don’t use it”. Wtf? It’s weird no?

    Liked by 6 people

    • They arbitrarily just tripled the available credit on my credit card. I would never even imagine charging the new available balance. Crazy!

      Liked by 2 people

    • lokiscout says:

      I suspect they expect inflation to takeoff with an increase in the prime. All credit cards are variable interest rates so expect rates to increase. Also the consumer confidence is picking up and they know a lot of us have been pushing things down the road. They want folks to feel good and run up their plastic again.

      Best advice is if you don’t need the card they send you call up and cancel it. Too many open accounts count against your credit score even if they are dormant.

      Liked by 2 people

    • I just bought two new cars this year (Honda).
      First one I bought cash. For second one, I told them cash. Whereupon, the sales manager cut $600 off the sales price if I financed it. Which I did. If I pay it off in 5 payments, I will pocket $450 (after interest charges)

      All credit people are under pressure to move the credit money (velocity)

      Like

    • PreNanny says:

      If you use credit cards, keep the credit line as low as possible it discourages thieves.
      Should you ever need a higher line of credit you can call and obtain one. Some folks oddly consider a high credit line is a badge of honor…
      Also, might want to look into credit unions in lieu of banks.
      Next time hang up the phone if they won’t take no for an answer.

      Liked by 1 person

    • TwoLaine says:

      Report them to your State Attorney General.

      Liked by 1 person

    • dayallaxeded says:

      The bank officer involved probably gets “points” or a commission on opening new accounts/credit lines. Similar sounding activities resulted in a major scandal and class action against Wells Fargo. You might want to talk to that banker again and ask if they can make a better deal for you on a lower interest rate or whatever other “incentives” they might have to offer, b/c otherwise it’s not that good a deal and since you did not authorize it, it should probably be reported to law enforcement and regulators.

      Like

  18. Although food prices are going through the roof, inflation is very stubborn.
    That’s probably because inflation is defined as “too much money chasing too few goods”.
    Yes, there is tons of money, but the available goods are also booming, due to record high productivity. We have machines making machines. The machines never get tired, or take a sick day.
    As with all governments, this FED is fighting the last war. They have no playbook for robots churning out goods and services.

    Liked by 1 person

    • PreNanny says:

      Meat prices are going down here in PA of late and I have not noticed ( yes I pay attention )
      other foods going through roof can you be more specific please?

      Liked by 1 person

      • linda7780 says:

        Prices are not going down here in the south. I can barely live due to the highest prices for just necessities each month. I live alone and it is cheaper to go pick up pre-prepped food than it is to cook. Just a few years ago, you could get crops grown locally and they were cheap. Now, you rarely see produce grown and no produce roadside stands anywhere around here. If things don’t improve quickly,I am going to have to move in with my mom, who is in her 80s. I don’t see it changing anytime soon either. The days of small farming are gone in this part of the country. All you see being grown now are things like corn, wheat, cotton, etc.

        Like

  19. Craig from Scotland says:

    Thanks for the opportunity to comment.
    Respect to Sir Sundance and folks on this website.

    Discussing GDP, FED RES inflation levers +/- without providing declaration of debt is in my view slightly misleading.
    The US, like the UK and other mature economies have an ongoing issue with monstrous levels of debt [ratio] to either productivity or GDP or however one would care to phrase the issue.
    Totally agree with Trump commercial / economic policy which hopefully is to power up US economy, provide stability and reduce the tax burden.
    Power right through.

    However, China financed a whole lot of US debt and I think the ongoing negotiations are around play by my rules and you might get marginal return or you [china] can completely feck off and whistle in the wind for your money.

    Individuals from the FED RES and Bank of England et al try to make these things overly complicated when they are not. All the jargon about markets etc is complete nonsense.

    The amusing thing is none of these ‘experts’ have ever operated or run a company, ‘period’ as you folks say. Ask any of them to read a balance sheet and you’ll get blank stares.

    All the best,
    Craig

    Liked by 4 people

  20. Plato says:

    US Consumer inflation is lusted after by the Fed, it is kept ‘under control’ at a lowish levels because China is the supplier of last resort.
    Other than domestically produced food and services, China can always be the “cheap” supplier for reasons to do with it’s massive oversupply of labour and because ALL its businesses, when push comes to shove, are slaves to Party directions or owned by the P LA.
    The Military as massive corporate owners is China’s cross to bear.

    The Fed is as dumb as 9 chickens, if it wants inflation in the US CPI wack tariffs on the price killer, China.

    Like

    • Craig from Scotland says:

      @Plato

      I agree with the first part of your comment about the FED but then you went way off field about slaves n 5hit.

      And, who the feck is the P LA ?

      Like

      • Plato says:

        Ok, China is a politically controlled economy, the bright lights of Shanghai don’t equal market forces. Any corporation in China can be directed by the govt to do anything, that’s by the CPA, Communist Party of China. it doesn’t matter whether it’s good business or for some other reason.
        The PLA is the People’s Liberation Army, It owns or controls or has a stake in the largest Institutions in China, banks, utilities, manufacturing etc. PLA owned companies operate freely in much of the Western world.

        Like

        • Craig from Scotland says:

          @Plato

          Don’t agree with several names etc and to suggest the Chinese economy is ‘controlled’ is a little bit silly.
          Controlled by whom ?

          PRC – People’s Republic of China [oxymoron].

          Like

          • Plato says:

            ‘Don’t agree with several names’
            Err, what’s confusing you?
            ‘to suggest the Chinese economy is ‘controlled’ is a little bit silly.’
            You misunderstand, the economy goes on as it can, IF the govt (CPA) want to direct any Chinese company to comply with its wishes, it can. This not to be confused with micro management of Chinese commerce.

            Like

            • Craig from Scotland says:

              Hi @Plato

              Having worked in China and around Asia, I don’t misunderstand.
              Your viewpoint has merits but it’s out dated.

              You stated – “Ok, China is a politically controlled economy”

              That is completely different from your latest statement of ‘controlling one company’ which was the basis of my original point.

              Like

              • Delilah says:

                He has a point. I was involved in some litigation where the Chinese did just that. The Chinese govt. was going on a buying splurge, giving money away to Chinese investors to buy any American business. From outward appearances, it didn’t look as though the Chinese govt. was too worried about how solvent those companies were either, just as long as they were American.
                Strange, huh?

                I remember a news podcast by that news jockey in NY — I can never remember his name, but he calls himself a Republican, think he’s a Jewish guy, he’s like Levine — anyway, he was talking about how Obama allowed Chinese operatives to come into the US and shake down all the Chinese-owned businesses in the US for money when China’s stock market tanked. It was like their own little piggy banks.

                Like

  21. Frank says:

    If the price of wheat has gone down 50% since 1988, why has the price of a loaf of bread gone up by over 300%?

    Liked by 1 person

  22. Bendix says:

    Disappointingly, Betsy McCaughey the other day repeated the fallacy that “most shoppers” prefer cheaper imports over American products.
    We are going to have to get past years and years of erroneous assumptions, propaganda, deliberate lies, and mistakes by people who believe they are too smart to make mistakes. It will be tough.
    Even now, we still see this ‘blame the victim’ stance being taken.
    This is the real nitty gritty, right here, people. Don’t get distracted. This is Donald J. Trump, taking on the world, for America.
    Also disappointingly, I see know-it-alls who have even held elective office working hard against him, or if not actively working against him, standing on the sidelines, Monday morning quarterbacking America’s president as he tries to stop our losing streak. What is wrong with them?
    Since no one except maybe Ron Paul foresaw what was going to happen to us, what makes these people believe in their own expertise at this point?

    Liked by 1 person

  23. Delilah says:

    Okay, Sundance, I’ve gone back and restudied most of your stuff on this issue…

    Phew, lot to process, but one light-bulb moment, shadow banking……

    BWHAHAHAHAHA, omg, it just dawned on me what that’s all about…the sheer simplistic brilliance of it.

    You don’t control the big banks….you just create competition for them.

    SMH, why didn’t some econ genius think of that before? Too big to fail, pfffft.

    Liked by 1 person

    • Delilah says:

      But the one question that keeps reverberating in my mind is, if WS no longer controls inflation, what does? Obviously, the feds don’t know the answer to that, or they’d be doing it now. Or is it even a problem?

      I think if GDP made inflation irrelevant that you wouldn’t have even mentioned inflation…I don’t know. That’s where I get lost in the weeds is right there.

      Like

  24. Bruce says:

    In 1970 gold was $35 per ounce. Today gold is $1303 per once. The dollar today is worth 2.7 cents as compared to the dollar in 1970. In 1970 I paid 35 cents per gallon for gas. Gasoline today should cost $12.95 according to gold.
    I paid much more for gasoline and everything else in 1970, but I had no trouble affording what I needed if I watched my budget. I doubt today many people even know what the definition of budget is, let alone try to maintain one.

    This is to be expected because we murder unborn children, destroyed traditional marriage/family, and we spend way more than we earn. There is no reason to think of ourselves as a moral culture with our basic rights in tact.

    Like

  25. MIKE says:

    I’m clueless about that Washington Times commodities chart.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s