Repost from June by Request – Several people have written to CTH for an economic review of our current status. Below this post are two primary precursor articles [Primary One and Primary Two] which outline the economic dynamic in play, and how we can look forward with accuracy to what is likely to happen. Despite the deflective talking points by the professional financial pundits, this massive spike in inflation is entirely predictable due to Biden economic policy and Biden monetary policy.
Keep in mind, the FED already said in April they would “support inflation”, that’s because – while they will not say it openly, they know there’s no way to stop it. The massive inflation is a direct result of the multinational agenda of the Biden administration; it’s a feature not a flaw, and it has nothing whatsoever to do with COVID. Also keep in mind the first group to admit what is to come are banks, specifically Bank of America, because the monetary policy is the cause.
There’s no way around this. Despite the pundit and financial class selling a counter-narrative, home prices will crash and unemployment will go up. I know this is directly against the current talking points, but the statistical reality is clear. CTH was the first place that said months ago that new home sales will plummet, that is starting to happen right now. There’s no way for it not to happen, the big picture tells us why.
You might remember, when President Trump initiated tariffs against China (steel, aluminum and more), Southeast Asia (product specific), Europe (steel, aluminum and direct products), Canada (steel, aluminum, lumber and dairy specifics), the financial pundits screamed at the top of their lungs that consumer prices were going to skyrocket. They didn’t. CTH knew they wouldn’t because essentially those trading partners responded in the exact same way the U.S. did decades ago when the import/export dynamic was reversed.
Trump’s massive, and in some instances targeted, import tariffs against China, SE Asia, Canada and the EU not only did not increase prices, the prices of the goods in the U.S. actually dropped. Trump’s policies led the largest deflation in consumer prices in decades. At the same time, Trump’s domestic economic policies drove employment and wages higher than any time in the past forty years. With Trump’s policies we were in an era where job growth was strong, wages were rising and consumer prices were falling. The net result was more disposable income for the middle class, more demand for stuff, and ultimately that’s why the U.S. economy was so strong.
♦Going Deep – To retain their position, China and the EU responded to U.S. tariffs by devaluing their currency as an offset to higher prices. It started with China, because their economy is so dependent on exports to the U.S.
China first started subsidizing the targeted sectors hit by tariffs. However, as the Chinese economy was under pressure, they stopped purchasing industrial products from the EU, that slowed the EU economy and made the impact of U.S. tariffs, later targeted in the EU direction, more impactful.
When China (total communist control over their banking system) devalued their currency to avoid Tariff price increase, it had an unusual effect. The cost of all Chinese imports dropped, not just on the tariff goods. Imported stuff from China dropped in price at the same time the U.S. dollar was strong. This meant it took less dollars to import the same amount of Chinese goods; and those goods were at a lower price. As a result, we were importing deflation…. the exact opposite of what the financial pundits claimed would happen.
In response to a lessening of overall economic activity, the EU then followed the same approach as China. The EU was already facing pressure from the exit of the U.K. from the EU system; so when the EU central banks started pumping money into their economy and offsetting with subsidies, they essentially devalued the euro. The outcome for U.S. importers was the same as the outcome for U.S-China importers. We began importing deflation from the EU side.
In the middle of this there was a downside for U.S. exporters. With China and the EU devaluing their currency the value of the dollar increased. This made purchases from the U.S. more expensive. U.S. companies who relied on exports (lots of agricultural industries and raw materials) took a hit from higher export prices. However, and this part is really interesting, it only made those companies more dependent on domestic sales for income. With less being exported, there was more product available in the U.S for domestic purchase…. this dynamic led to another predictable outcome, even lower prices for U.S. consumers.
From 2017 through early 2020 U.S. consumer prices were dropping. We were in a rare place where deflation was happening. Combine lower prices with higher wages, and you can easily see the strength within the U.S. economy. For the rest of the world this seemed unfair, and indeed they cried foul – especially Canada.
However, this was America First in action. Middle-class Americans were benefiting from a Trump reversal of 40 years of economic policies like those that created the rust belt.
Industries were investing in the U.S., and that provided leverage for Trump’s trade policies to have stronger influence. If you wanted access to this expanding market, those foreign companies needed to put their investment money into the U.S. and create even more U.S. jobs. This was an expanding economic spiral where Trump was creating more and more economic pies. Every sector of the U.S. economy was benefiting more, but the blue-collar working class was gaining the most benefit of all.
♦ REVERSE THIS… and you now understand where we are with inflation. The Joebama economic policies are exactly the reverse. The monetary policy that pumps money into into the U.S. economy via COVID bailouts and ever-increasing federal spending drops the value of the dollar and makes the dependency state worse.
With the FED pumping money into the U.S. system, the dollar value plummets. At the same time, JoeBama dropped tariff enforcement to please the Wall Street multinational corporations and banks that funded his campaign. Now the value of the Chinese and EU currency increases. This means it costs more to import products, and that is the primary driver of price increases in consumer goods.
Simultaneously, a lower dollar means cheaper exports for the multinationals (Big AG and raw materials). China, SE Asia and even the EU purchase U.S. raw materials at a lower price. That means less raw material in the U.S. which drives up prices for U.S. consumers. It is a perfect storm. Higher costs for imported goods and higher costs for domestic goods (food). Combine this dynamic with massive increases in energy costs from ideological policy, and that’s fuel on a fire of inflation.
Annualized inflation is now estimated to be around 8 percent, and it will likely keep increasing. This is terrible for wage earners in the U.S. who are now seeing no wage growth and higher prices. Real wages are decreasing by the fastest rate in decades. We are now in a downward spiral where your paycheck buys less. As a result, consumer middle-class spending contracts. Eventually, this means housing prices drop because people cannot afford higher mortgage payments.
Gasoline costs more (+50%), food costs more (+10% at a minimum) and as a result, real wages drop; disposable income is lost. Ultimately this is the cause of Stagflation. A stagnant economy and inflation. None of this is caused by COVID-19. All of this is caused by economic policy and monetary policy sold under the guise of COVID-19.
This inflationary period will not stall out until the U.S. economy can recover from the massive amount of federal spending. If the spending continues, the dollar continues to be weak, as a result the inflationary period continues. It is a spiral that can only be stopped if the policies are reversed…. and the only way to stop these insane policies is to get rid of the Wall Street democrats and republicans who are constructing them.
Hope that makes sense, and love to all.
~ Sundance
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YES, thank you SD.
Let’s go back to America First.
But first we should audit 2020 vote theft-
because of course, that’s what the USA voted to continue:
America First.
Because it works. MAGA
Yep! When Republicans send out opinion surveys on topics—use a Sharpie and write on the survey form, “It’s the fraud, stupid” and send it back. When they ask for donations, tell’em to prove the fraud and you’ll donate.
We’re fighting for truth here. This is the hill to die on.
the rnc no longer includes postage paid envelope or i would send them a brick
Send it postage due.
“Because it works. MAGA”
Yea it sure does. This is why we can’t do it anymore. Not only does it work it is also contagious. Other countries start behaving this too way and it really screws up the powers of centralized authority. Since the founding of our country we have fought back and forth about a centralized and decentralized power structure. It seems the people who prefer the unified method have an upper hand. They tend to not fear God or Karma let alone concern themselves with truth. It seems in the last 20 years they have proven that reality can be whatever they intend. Look at this madness that has set in over a virus.
Can I offer some hope? I don’t believe in any organized God or religion. My brother and I have often pondered that if we were ever to discover such a being he would be explained by a mathematical equation or perhaps the finest symphonic composition. God, Natural Law, Absolute Truth, Light Mother Nature are all in the same league of which I write about. Neither of them will be tricked by alternate truths or ginned up realities in the end. Yet we are at that point I suppose.
All of the people’s nations (particularly the West) are being turned upside down by dark forces. In my 40+ years I have never thought these things exist but yet I can sense them. Whatever happens to us ultimately God/Light/Mother Nature will have their say. I pray that what happens is just.
“ My brother and I have often pondered that if we were ever to discover such a being he would be explained by a mathematical equation…”
You realize that this makes your brother and you Reductionists, right?
Then are you aware of yourself as a fortuitous combination of random particles? And if all is flux or chance, you are a man of water, in the water, trying to climb out of the water on a rope made of water.
Reductionist logic is a reductio ad absurdum.
When push comes to shove, who will fight to save our freedoms and to defeat tyranny, that is my question. We need to be able to stand together against what is happening to our country. We may not agree but we must agree to resist Marxist EVIL with whatever might we possess. The Father, the Son and the Holy Spirit never give up on saving souls.
God is the author of liberty. He is not a math formula or musical score.
God wants us free so that we may serve him. Tyrants demand that we serve them.
No man can serve two masters.
A fine example of why this country may never be ‘United’ again. Is it not enough that someone be on our side … with our goals … ready to fight for them? You speak of freedom but what you mean is only ‘think like me’. Do you not understand that organized religions have a history of tyranny because they are a creation of imperfect men? No one including you know what God wants for us. I welcome all to this movement without demands for dogma or name calling.
40% of US dollars in existence were printed in the last 12 months: Is America repeating the same mistake of 1921 Weimar Germany?
https://techstartups.com/2021/05/22/40-us-dollars-existence-printed-last-12-months-america-repeating-mistake-1921-weimar-germany/
In the 2008/2009 financial crisis Congress learned 2 things. They could print free money and they did not have to listen to the American people. The downhill accelerated from that point forward.
The economy only has so many segments. If you kill manufacturing, it has to be replaced with something else. That left housing and deficit spending to fill the gap. Housing will of course peak and crash again. The Fed won’t raise because they don’t want to be stabbed with the blame.
Cheap money forces assets higher because everybody wants a return on their money. This is the interest rate/asset value seesaw.
Covid rules allow government to choke the neck of the people while deficit spending allows them to get away with it. When government is not reliant on the people for funding, they can have their way with them.
“Cheap money forces assets higher….” This is a point that I don’t understand: Why wouldn’t this cause housing prices to rise along with everything else?
It’s basically a ripple effect. As money flees from the artificially low returns on savings, it has to go somewhere. The inflationary pressure pushes the price of alternatives (such as assets and equities) higher and higher.
Recall how when the housing market collapsed in 2008, gasoline prices went through the roof, in some cases doubling within a few weeks. That’s largely because the money fleeing the collapsing mortgage backed securities was invested in energy futures, driving the price of gasoline and petroleum up sharply for a time.
you are misremembering history…higher fuel prices CAUSED the housing market collapse….people were moving further out from their jobs looking for affordable housing as the CRA was causing home prices to steadily increase….it came to the point after fuel price increases to pay for the commute of mortgage or transportation
Nope – not misremembering at all. In fact, I distinctly remember how we got the “stimulus check” AFTER the crash, and everyone was griping about how it all went into the gas tank.
The housing bubble was years in the making, and when it burst it happened pretty quickly. But it was nothing to do with gas prices, it was everything to do with the leveraging and securitizing of sub-prime mortgages.
It does, to a point. That’s precisely why home prices have risen and will continue to rise. Until they don’t and then comes the crash. Ultimately you need someone willing to buy your inflated house and at some point inflation eats away buying power because wages can’t keep up w prices and no one will buy your overpriced house. Then la deluge.
I understand little of macro economics but local real estate is a hobby of mine.
Asian just bought the house
directly across the street from me for around 2,400,000 ( (Can) it was 14 years old and 5,600 sqft the have been gutting it for a week, R.E. In my opinion is now an international asset class, and foreign cash is largely what drives it. Of course along with cheap interest rates.
The previous owners would be stunned.
The lady sold the house that was on that lot 15 years ago for $400,000.
House was demolished the day after the sale…and the monster built.
Crazy stuff.
Cheers to all and God bless PDJT
Dekester, what “bugs” me is seeing all these “new Canadians” driving around London ON with all these expensive Foreign Cars like Mercedes, BMW, Lexus at all hours of the day, when they should be working (to pay for the car)! Hell, even their women & children drive around in these expensive cars.
THIS is the problem with “Multiculturalism” (Justin Trudeau’s father started this in the early 70’s)… in that multiculturalism is just another way to ruin a Country, in that the (legal or illegal immigrants) are not required to “assimilate” into Society & are actually encouraged NOT to learn English, adopt Canadian customs, Canadian job values, or traditional Canadian Business Practices! AND most of them will NOT vote Conservative!
I do understand that most of the new Canadians, have to be of a certain position in life to come here, BUT seems to me that “some of them are rubbing it in our faces”… if you know what I mean.
Are you old enough to remember “Hong-couver”?
They did. Everything is interest rate and energy price driven. You are at the end of the cycle of “how low can they go”.
30-Year Mortgage Rates Chart | Historical And Current Rates (themortgagereports.com)
Lenders will begin to demand an inflationary premium to protect their income stream. This will force up interest rates, making loans more expensive. There will be fewer mortgages assumed.
The home loan market will contract, forcing prices lower.
The bio-weapon and the mortgage melt down were identical in purpose.
Crush the Middle class of America.
There is one glaring difference.
President Trump’s economy, is still here, where I live in NC, and it is white hot.
When I lost my Cabinet business, in 08′, I became an electrician’s helper, to keep from being homeless.
Someone asked me, when my business started coming back, 2016, that’s when.
Brrrr goes the money machine….
Yes, absolutely. Printing money is never a good idea, unless your intention is to devalue the currency and destroy your economy.
Is it a mistake if that’s the intended outcome?
Meanwhile, the banks are sitting on too much cash and they are DESPERATE to create more loan activity. The banksters have shot themselves in the foot. As I’ve posted before, the Fed has a tiger by the tail – they can’t hold on and they can’t let go. Their whole fiat system will collapse.
The only reason the US has not crashed yet is only because the worlds trading currency is still the dollar.
This is the reason why both the Chinese Communist Party and Russia made attempts to make the Yen or the Ruble the currency 0f world commerce, a couple years ago. They only failed because no one is that dumb, yet.
I personally believe that crypto-currency is seen as the solution to replace the US $ with something else. Anything else.
IMO, It will be the quickest way to destroy our economy.
Well, considering the Treasury has been suspended from issuing new bond sales, the CBO has stated that the government is behind on the 28.5 Trillion loan payments and concerned the government may default for failing to raise the debt ceiling, and the treasury is doing an emergency conversation because of this, Fed is the only buyer of bonds and now has to much on reserve, investors are buying up properties like mad, I’d say, we are doing great as a country on the brink of collapse.
lemonade out of lemons folks, lemonade out of lemons.
I noticed in the last few days that many of the high end homes in Duluth, Minnesota have sold, even some that were on the market for years (on and off again).
Who are the investors buying million dollar homes? Are they doing that because dollars will be worthless but property will always have value?
The Blacrock and Vanguard companies et al, no, they are not buying government bonds because there’s no money in it. hence, cash of the Feds balance sheets is excessive. When ever a government loses confidence from the investing community, they move into equities (stocks) private assess, homes, paintings, metals, collectibles etc.
then, you have Capital Flows, meaning investors are pouring money into our markets from around the globe which is what has been happening out of Europe because their Central Banks are screwing them too.
This is very similar to the Great Depression as the same thing occurred but… it happens in every country, when they see profits to be made, the invest in that country.
“…dollars will be worthless but property will always have value?”
Have you taken a look at Detroit property values lately? That city had the world’s highest per capital income in the 1950s.
It now looks like it was carpet bombed by the Luftwaffe.
The local economy in Detroit collapsed and the neighborhoods that housed the workers have been abandoned. There is no housing boom because there is no market at all for a lot of these houses. HOWEVER – if the United States as a whole collapses then your point is valid.
A buying opportunity, no?
Sure. Who wouldn’t want to live in the Motor City. ?
I once saw an ad for free housing in Detroit of you went to teach. My thought was “not for ten free houses would i move to Detroit!” And that as was several years ago.
Bingo. Back in the 1970’s when Mexico was experiencing hyperinflation it was common for people with money to spend it as quickly as they could on assets whose prices would rise with inflation, or even consumer goods. Nobody wanted to hold cash, because it was quickly becoming worthless. That’s at least part of the reasoning driving the current frenzy in the housing market.
Black rock.
Blackrock
I say let the FED monetize all the debt then abolish them…it is an unconstitutional act for congress to delegate their monetary responsibilities in the US Constitution w/o an Amendment
The Fed is the only “buyer” of bonds = a two step process of printing money. The Fed creates a bond, and then buys the bond from itself using money it magicked into existence with the push of a button.
Wouldn’t shock me if Blackrock and other Foreign entities buy up US real estate on the cheap if/when prices begin to fall.
If Blackrock thought they would fall they wouldn’t be buying up everythibng right now.
Larry Fink of BlackRock is connected to Klaus Schwab and the WEF (World Economic Forum) you know… The “Great Reset”.
I’m almost positive his on the Board.
His is connected to the WEF but not on their board.
https://www.weforum.org/agenda/authors/larry-fink
It isn’t about whether it falls or not for them, it’s about holding the most cards.
Black rock is acting as a vacuum cleaner and taking properties out of the hands of potential property owners.
When you rent, you are essentially a serf. That is what they want and they don’t care how much it costs because the money is coming from their friends inside the WH.
Unless they are in the echo chamber with the financial pundits and believe the narrative. Sweet schadenfreud if so
Black rock is buying whole subdivisions at a time to rent and drive home ownership to the sewer
I read an article about that very subject 2 weeks ago. Blackrock is buying way above asking price in many areas to ensure they’re the only property owners in each area. Ultimately the plan is to force everyone into Urban zones, and choice of where you want to live won’t come I to the conversation anymore. That’s part of The Great Reset land conservation caveat in the Agenda.
Check your HOA if you have one. If there is not a no renting clause work to add one. It may hurt a few individuals but it will screw these corporations that are trying to kill home ownership. Keep throwing sand.
Ultimately the plan is to federalize zoning and planning functions now mainly performed by county/city/townships at the local level. Then, the “single family residential” zoning can be abolished and McMansions in the burbs can be subdivided into rental units.
Obama’s administration was already looking into spreading Section 8 housing across the land, rather than concentrated in urban centers. Mom & Pop landlords often didn’t want to opt in, however – corporate landlords might be more pliable, if offered incentives.
you will own nothing and be happy. sound familiar?
I say let us ensure that THEY own nothing and are miserable. They’ve never broken a sweat in their lives. They’ve never gotten blisters on blisters or ended the workday hardly able to motivate for the aches and pains. Let’s put these jerks to hard labor under a lash and see how long they last.
Great Reset: Housing Shortage EXPOSED (2021)
By Man in America
Published June 10, 2021
https://rumble.com/vicur3-great-reset-housing-shortage-exposed-2021.html
Wouldn’t a housing shortage cause housing prices to rise?
Only as long as buyers can pay for them.
Well someone is buying these homes and at insane prices. 6 just sold here for prices that make me cringe. In the same week a moving company said that more people are moving out of Oregon than anywhere else (understandable) But 6 houses in a week? At huge prices?
I agree that this can’t stay at this level but someone is paying the prices.
Not if it’s a manufactured crisis.
New strains will begin each time we attempt to crawl out of the economic hole the uniparty has dug. Good article on Gateway Pundit on delta variant. How do we know it actually exists. There no test for delta.perhaps the vaccine is the variant making people positive for COVID. Followed by omega and down the line. Never ending and always requiring more cash dumps into the population.
Actually there is a test for the Delta variant or as I prefer to call it the Biden/CCP Indian variant.
waiting for the teenage double mutant ninja variant
They are able to determine that variant by its “genome” in the strand or molecular material.
Back atcha’ big guy! 😉
And “Thank You” for all you do here!!! BD
Be patient, be respectful, be kind and caring toward all. Don’t look for trouble. However, when the time comes to get in the fight, drop the rules and fight for your family with insane ferocity. Fight like you are the third monkey on the ramp to Noah’s Ark…. and damned if it ain’t starting to rain.
Holding a sign waving rally this Saturday, letting everyone who passes by our small town that they are encouraged to attend the county school board meeting on Tuesday.
Last month the school board was directly questioned about what their stand was on children wearing masks in school. They said during the meeting that they had not yet discussed the subject. We had people at that meeting who were there when it started and there when it was over, and the school board never talked about mandating masks.
Two weeks later — last week — the local socialist paper reports that children will be required to wear masks at school, that the decision was made at the last school board meeting.
Nope, it was not.
So now we are calling everyone to attend the school board meeting to lambast the liars whose darkened hearts are supposed to work for the betterment of our children.
And we’re looking to get a lawyer to go after the school board for making decisions behind closed doors and without parents in attendance.d
We were not looking for trouble, but we will be fighting.
There are people in the conservative camp telling us not to get “too emotional” or “too worked up.” They say if anyone gets too passionate during the meeting that our side will automatically lose. Our side is already losing! What is wrong with these people?!
We are the third monkey on the ramp to Noah’s Ark! The rain is becoming torrential! Monkey two is gonna find me running over his back and monkey one is gonna be pushed off the ramp.
Not get emotional?
They are trying to force children to wear masks, and by doing so forcing fear into the tender hearts of people who must be protected.
They are trying to force all of us to have poison injected into our bodies, including all children.
They want to teach white children that they are bad because of their skin color, they want boys to believe they may be girls and girls to believe they may be boys, they want to teach children that abortion is OK in kindergarten, and they want us to believe that it is OK for a mentally ill man who dresses like a woman to teach kids cross-dressing is a fun thing to do.
I hope those people who caution against taking a fierce stand are monkey 1 and monkey 2.
Maybe the kids can wear masks that read… “the school board sucks!”
If not them, then parents can without trouble.
They are also teaching the children to fear abd obey big brother government.
Raven it is people like you who help Change this country for the better . Thank you and prayers for you and yours God Bless R.D.
Your prayers are greatly appreciated.
The sign wave will be 10am to 7pm. It will be at a bottleneck in the road where people cannot miss seeing us, in the arrowhead of Minnesota, the part that juts out over Lake Superior, where socialism is strong.
Your prayers are truly appreciated.
aside from the obvious psychological damage from masks resulting in us raising a generation of “school shooters” since children need to see faces for proper emotional expression and reactions, the masks are causing an increase in pneumonia among children due to rebreathing through a dirty mask. i think the masks may also eventually cause a mesothelioma type of lung illness from breathing in all those small particles of the mask (many of which are made in CHINA!).
One of the parents who is scheduled to speak during the Tuesday school board meeting has a daughter who is currently on suicide watch.
These are soulless creatures forcing evil on our children.
“ There are people in the conservative camp telling us not to get “too emotional” or “too worked up.”
These people are not in the “camp”. They are in their own comfort zone and have no wish to contend for the cause.
Never let the REMFs dictate your battle plan. They will stab your back if it looks like you are about to win a fight.
What state are you in? If in Florida, the board is in clear and open defiance of the Open Meetings law. Call on local legiscritters, local news, local talk radio, and your State Ethics Commission to do their jobs. Expose, out, lambast, and jump on that board with both feet until they scream “Uncle! Calf rope!”
I wish everyone had your patriotic presence of mind and your fighting spirit. I love it!! God Bless you!!
Hope some data helps your cause:
https://statsiq.co1.qualtrics.com/public-dashboard/v0/dashboard/5f78e5d4de521a001036f78e#/dashboard/5f78e5d4de521a001036f78e?pageId=Page_ffb4dc52-5543-46b2-8126-2b7229fd1b17
One in ten poor kids are at math standards? Biden says they are as bright as white kids.
The school AYP reports I referred to above, also showed that the poorest schools received the most money. It never made a difference. Only about 20% of poor
students tested at grade level in math and English. The big city schools received thousands more per pupil than the rural schools. Nonetheless, the rural schools consistently outperformed the poor, inner city schools. Rural students had graduation rates between 80-90%. There’s no reason the inner city kids can’t succeed but money is not the answer.
I love stats like this! The schools keep excellent records and make all sorts of pretty charts. I used to use this type of info to fight illegal immigration. There were towns whose schools were excelling and were A+ rated until illegals and their children moved in for the factory jobs. The Annual Yearly Reports tracked all of this including the addition of ESL (English as a Second Language) classes and the increase in free lunch programs. Very helpful.
Thunderous applause.
i dearly hope this causes home schooling co-ops to rise exponentially.
the “state” may be leery of interfering because home schooled students will almost assuredly test at or above (and likely far above) public school students on the precious grade level standardized testing metric.
very embarrassing for the teacher’s union, administrators, and school boards to have that made public….
Home schooling is not the answer!
If a child is home schooled in Minnesota, the money a local school would get if that child was attending school there still goes to that school.
In Minnesota local schools still get the per student payout, even when a child is home schooled!
It is insanity!
What people have to do in order to stop the insanity is to find Accredited schools your children can go to online and “send” them there.
Your children will still be at home, you make the choice of what type of school and what type of curriculum you want for your children, and the per pupil money will be yanked away from the local school trying to force evil on your kids.
When school boards hear that a parent is going to home school they just snicker. They know that means they will have less work to do while still getting the per pupil cash.
When school boards hear that a parent has found an accredited online school they no longer snicker.
We need to completely dry-up the cash cow.
Or the exchange rate could have little to do with it – https://www.macrotrends.net/2548/euro-dollar-exchange-rate-historical-chart
https://www.macrotrends.net/2575/us-dollar-yuan-exchange-rate-historical-chart
Housing prices could go up 10 times+ if buying with a US currency that becomes worthless…(1930’s)
The lock downs (covid) obviously caused suply shortages that contributed to the current inflation as did printing to may dollars.
It is just a matter of time before a 1930’s like crash…expect a digital currency by the globalists
Watch Harry Dent videos.
Lot of fun for a perpetual stock market crash fan like me!
The Markets will go up forever and everrrrrrrrr.
I say that in a higher pitched tone when I trade the futures markets, lol.
When everyone was thinking that the other day I shorted the hell out of Avis car rental at 90 per share.
Nice…
Currency is already digital, has been for years. Nobody is going around with wheelbarrows of cash except drug money.
most of it seems to be. i fear digital/electronic control of currency because my social credit score is probably negative and i would not likely be allowed any access to my money.
Cash is still king in Oklahoma. Our average income is so low much of our economy is off-the-books cash. It’s the same all over the south.
3.50 for a large coke I served myself from a soda fountain.
fast food?…the carbonated syrup is one of the biggest in profit margins…it costs about 5-10 cents for a 32oz cup of soda including the cup and straw…rest is profit
Coronavirus will undermine trust in government, ‘scarring body and mind’ for decades, research finds
Two new studies find that people exposed to pandemics in their formative years carry psychological scars for the rest of their lives
By Christopher Ingraham
5 Jul 2020
https://www.washingtonpost.com/business/2020/07/05/coronavirus-pandemic-trust-government
Excerpt:
The first, led by Julian Kozlowski of the Federal Reserve Bank of St. Louis, finds that the experience of the coronavirus and ensuing recession could make people and businesses less likely to resume their previous spending and investment patterns, which would have an extended stunting effect on economic growth.
we are raising a generation of “school shooters”
You would of course need several FBI agents though to recruit and train each one, provide the weapons, and drive them to the school.
This administration is spending “wasting”money like it grows on trees. Never mind the inflation issue, that’s why there are money printing machines. And after all, the politicians have to reward themselves, their cronies and the world’s climate change problems. Lastly, they have to keep the lazy, well, lazy by giving them money so that they don’t have to apply for any of those countless jobs that are out there. Oh, and there are also an abundance of illegals that have to be taken care of. To this administration, the economy being in the toilet, isn’t really an issue.
PDJT deprived the corruptocrats of 4 years of cash flow…they are making up for it and how now
Most, if not all, of them remained on the gubt dole while they sat at home doing little to nothing (EXCEPT STEALING ELECTIONS).
They even voted to give themselves raises and new perks/bennies while they were shutting everyone else’s businesses and livelihoods and schools down, repeatedly.
All I know is that bacon has gone up to $7.00 a pound. That peeves me more than I can say.
they say CA’s new provision will increase the price again…pork has to have 24 sq ft each before slaughter to be sold in the state since 1 Jul and they purchase 15% of all pork in the country…next statement made no economic sense…they said the price would go UP if that market was lost….that goes AGAINST what I learned in economics class…supply goes UP = price goes UP…huh?
let them eat cake
This is how bad the governments around the world are doing, the Bank of International Settlements (BIS) has called on all Central Banks to ready themselves for CBDC’s (Central Bank Digital Currencies), no more cash, no more runs on banks, if you owe the government anything, they just take it first and then you fight after. This leads to a whole world of other totalitarian tactics no matter what they try and convince the people.
thats why Bitcoin became popular, even Ben Bernanke (Former Fed chairman) knew this. Look around, look what the younger generation is doing, digital wallets, credit cards for kids so parents can monitor their spending habits.
you tell me where we are headed?
Headed? IDK but barter and the underground economy have been around for a long time, long before the Fed and long before the U.S., and we’ve had civil war before too. And assassinations. Currently, comparatively, things have been quite peaceful and civil.
Nationwide strikes. Truckers of the world unite! Do not deliver to any city or state that imposes vaxports or lockdowns.
People had better be filling their pantry and collecting items because you can almost feel another store issue coming
Vote for President Trump for a third time. This is exactly why we need him. Quick talking about other options. Only he can turn this around as quickly the second time as he did the first time.
Agree BUT…we can “vote” all we want but until we are successful in reforming the voting system and stopping the “mail-in” ballots, voting is practically a moot point!
Your faith in the current electoral system is touching.
Didn’t reference the electoral system. Reference needing PT again.
Sundance some how I always feel like I never say thank you enough. Prayers for you you’re family ad rem and the cth team . it’s a beautiful ? you have planted . We are all the wiser for having climbed on it’s branches God Bless and keep you safe R.D.
Thank you for the kind words RED DOG….a very nice late night surprise. ?
DITTO!
Yep! It’s been quite the ride! Thank the Big Man Above for the Treehouse and other Fine sites…..couldn’t have got this far without ya!!
A strong US economy is a mortal threat to the Democrats’ quest to create universal dependency. Of course they need things to be bad and spiralling downwards – that’s who they are. What’s unforgivable is all the aid and abet they get from the GOP in this unholy quest.
The Left’s worst nightmare is a financially independent electorate. They will stop at nothing to prevent it.
“ China and the EU responded to U.S. tariffs by devaluing their currency…
This made US Treasuries comparatively more expensive which would have pushed up interest rates. Higher interest rates would have drawn money out of stocks and into bonds.
If the stock market collapsed from the interest rate hike, as it did during Reagan’s term of office, it would have trashed the value of retirement funds.
Those IRA funds are held by voters It would be evident even to a Democrat that Trump had a better economic performance and Biden would lose office.
Enter the FED’s Open Market Committee to shore up the bond market by adding bonds to the FED’s balance sheet.
Brrrrr goes the money machine. Consumers respond to the influx of newly deposited funds by borrowing fresh money and bidding up consumer goods.
Inflation is always and everywhere a monetary phenomenon and this closes today’s lesson on bad monetary policy. ?
Outstanding analogy of what’s is and has taken place. None of the talking head propagandists currently employed by the globalist owned corporate media complex will ever admit to this. Now more than ever I believe that the downfall of the United States as an economic power is a top priority of the global masters. Since the creation of the Wuhan China flu the advancement of the global agenda has taken off at break neck speed. The fact that nothing on the world stage wants to investigate the origins of covid and how it was deployed and how the globalist agenda has suddenly taken off makes me ponder that there could be some truth to the so called “Plandemic” conspiracy theory.
Trump’s economic policies are a key reason why the establishment is so opposed to him. When working and middle class wages began rising, after decades of being flat, the establishment unleashed covid. Globalist economic policies are basically a transfer of wealth from the working and middle classes to the ultra wealthy. Despite its public pronouncements, the Fed is quietly tightening because it sees inflation isn’t transitory. You can already see the effects-growth isn’t picking up nearly as much as predicted but prices keep rising. A recipe for 70s style stagflation.
Treepers we need to support the TREEHOUSE
MONEY BOMB TODAY
LETS DO THIS
Couldn’t agree more!!! Already did! Who’s going to join us!! This is the first place I roost in the morning. Thank God for CTH.
Huh, imagine that! Printing trillions (yes, TRILLIONS) of dollars out of thin air for “COVID relief” packages one after the other after the other is driving inflation. Add to that taking a wrecking ball to the economy with the forced lockdowns, and then JoeBama undermining the strength of the US economy in service to China and you get what we have now.
Who woulda thunk it?
Thank you for the explanation. It makes a lot of sense, but it is still not CLEAR (to me, anyway) that inflation is on the way. I read denials by the White House and the Fed, media agreement (of course) with the WH, varying analyses by investment and brokerage houses and widely different observations by individual financial managers. Is there ANY agreement out there?
6-8% inflation is a Value added tax. The bright spot of 15 dollar min wage is more SS withholding. The negative is inflation which punishes seniors drawing SS benefits.
Think of the other counter inflation stunt. All the owners of rentals can’t sell apartments because they have tenants who don’t need to pay rent.
In early 80’s there were nearly empty office buildings in houston. Oil bust. Many oil companies defaulted on rent. Most spaces were empty and if they could sign a tenant, they offered 18 months free rent on 60 month lease.
I work for distributor servicing industrial, commercial and construction markets.
I call on industrial accounts that either make the machines that make the stuff you buy (OEMs) OR make the stuff you buy (end users).
We ARE taking orders hand over fist.
We CAN NOT deliver products.
The supply chains of the manufacturers we represent are completely broken.
We started seeing this early this year…..and it’s getting worse NOT better.
Stated ship dates for normally stocked products have slipped to 45, 90, 150 days. (And those stated dates most often turn out incorrect)
Some manufacturers of higher tech products are IDLING their manufacturing not increasing production.
We take orders, immediately begin expedite process, and manufacturer doles out products based on “critical business case”. This is taking a tole on the smaller manufacturers.
IOW Who get’s the product? XYZ Press Manufacturer or Amazon.
By years end, the effects of this will start becoming apparent to the masses.
Stinky, same thing in commercial construction. Orders taken today on foam roof insulation may ship in March of 2022, glues, steel fasteners, commercial roofing material all pushed out 3 months. It’s a giant Biden shit show out there.
Bought…ordered actually…a US made sofa and loveseat set in March and given an end-of July, early August date for delivery.
Latest we heard, delivery is pushed to October reason being the foam plant in TX had to essentially be rebuilt after the big freeze earlier in the year.
Take a step back. People say to sue China for what they did to the world economy. BUT but but in America China did not do that. Politicians did. Supply chain disruptions that are caused by that action and disruptions in international trade are at the front of these rising prices. Now politicians want to double down on these policies. Nonsense and insanity OR Evil pick your cause. We now know that cov has a recovery rate of 99.972%. 18 months ago it can be said we did not know that. Delta is 99%. Another way to say that is that both are 99% harmless yet politicians are dead set on crushing the economy and I might add the constitution. So for my money today and forward when looking for a cure get government out of the way first before anything else is applied to this mess.
Not mentioned in the article is the infrastructure bill that will raise taxes on middle class America leaving even less disposable income. So inflation + stagnant economy + lower wages + higher income taxes. 40% of America knowingly voted for this because the media told them Trump was the worst person in the world everyday all day and that he colluded with Russia to win in 2016. The cherry on top was the stolen election and the democrat collusion with China to release the bioweapon.
My favorite US$ indicator is UUP, a bullish etf. It’s a convenient tracking tool. Indeed, UUP has been in a down trend since c-XIX started.
However, do not ignore that the Fed is a central planning and control agency owned by its member institutions. Whether you are an individual trader, or a bank borrowing from the Fed at 1% and loaning out at 24% on credit cards, you make exponentially more as interest rates rise.
Thanks for the explanation in a way even a laywoman like myself can understand.
An entire generation has grown up that has not experienced inflation.
I recall it well, growing up in the ’70s and early ’80s.
To properly understand it, go watch any movie or police tv show from that time period and pay special attention to the actual background and equipment. It is well represented.
So true, I remember powdered milk, meat was hamburger and that was only once a week, tuna casseroles, home haircuts. Gas lines. Home loans at 13% to over 20%. and more.
PDJT made some questionable Administration staffing decisions but three he hit of the park were Ross, Navarro and Lighthizer. Hopefully they’ll be back.
Great story.
They were/are the Greatest economic team we have had in DC.
I wish Wilbur would start an investment newsletter. That’s one smart man.
Excellent analysis but without discussing the effects of USA quantitative easing there is a serious gap in the discussion that challenges the thesis of the discussion. I would love CTH to address this.
Thanks to my Word Press imposed hiatus, I missed these original articles.. I appreciate your rerunning them.
Thus, where we go from here is crucial .. And since it was 32 years between the elections of US Presidents who perceived this dilemma, I’d suggest we redouble our efforts to reelect Mr Trump.
Jeremiah 45 – Baroch moaned when the Lord said he was about to take down all the nations around Israel and destroy their leaders and all their peoples. But the Lord told Baroch he would spare the life of Baroch and the lives of Israel, that they should not look for great things, that they should expect to be corrected with measure.
It’s seems so for us now and our children. A storm is coming and their is no escape. Good Christians will stand through it only with our modest lives, and that only because of the grace and mercy of the Lord of hosts.
All honor and praise belongs to Lord God of hosts, and to His Son Jesus Christ who has come and will come again in His name.
I fully agree that inflation is going to happen, and it’s going to be bad. And I agree that it’s going to be a repeat of stagflation.
However, home prices did not fall in nominal terms during that era, they rose. Aggressively. Now, corrected for inflation, there was some ups and downs.
https://fred.stlouisfed.org/series/ASPUS
The volume of home sales had some ups and downs as well, but that wasn’t all bad news either.
https://tradingeconomics.com/united-states/new-home-sales
https://tradingeconomics.com/united-states/existing-home-sales
Now maybe we’re in a new era with all the millenials wanting to rent instead of own, and that’s a possibility. Or maybe something else is different.
But if I am mis-reading the historic data, I would very much like to be corrected.
Joe B as usual lying and corrupt , he must be hold accountable for and porpaganda pelosi’s Groups also,
the porpaganda Democrat Agenda is exactly gettling worst that everything are expensive
everyday of our life i seeing our country are Real going wrong way and failing again ,
in fact we paid a lot more for smaller Quarter now Than what they were usually Quarter was,
were, we the people are nothing But screwed again and again from corrupt Governments,
Great Reset. One global currency. One world government. An economy destroyed is a prerequisite.
Thank you. You put into a clear and concise explanation what I felt but couldn’t figure out how to explain to others.
In spite of having a financial background, and actually reading about monetary policy recently, I find it difficult to untangle all the strings so I can clearly see what is going on. It is much more complicated and controlled than I realized but there is one thing that I know instinctively. The Federal Reserve has too much power and actually very little transparency. Why should interest rates and the money supply be controlled by the Fed? Why not let a free market do that? Yes, I am a Dr. Ron Paul supporter and think the Fed should be ended.
As an example of the Fed’s control over the economy, the WSJ published an article by Phil Gramm and Thomas Saving this week, pointing out that the Fed now owns 33.6% of all publicly held federal debt and 35% of all federally insured mortgage backed securities. In the same article, the authors reveal that while the Fed is publicly saying they will let inflation run its course because it is just temporary, behind the scenes, they have dramatically increased their reverse repo borrowing which has pulled almost a trillion dollars of liquidity out of the financial system. I didn’t even know that there was such a thing as reverse repo borrowing and that the Fed has added that to their toolbox. Let’s face it, the normal person cannot be an expert in this area. It is difficult enough to have even a basic understanding of monetary policy and its implications for the economy. We are supposed to trust that the government knows what it is doing and that they will do what is right. Not sure I will rest easier tonight. Without a working knowledge of how the Fed is controlling the economy, how are we supposed to make informed investment decisions? I’m beginning to think that depositing my money in the Mattress Bank and Trust is the safest bet.
By the way, one other thing to factor into monetary policy is that since 2008, the Fed has been allowed to pay interest on reserve balances that banks are required to keep on hand. That apparently has helped to control inflation because even if the Fed is increasing the money supply, banks are not as likely to circulate it through loans because they can make as much interest on the reserves without the risk. Does any of this make sense?
Trying to understand monetary policy is like trying to understand the rules of Fizzbin and is by design
The Federal Reserve really cannot raise interest rates to stop inflation.
Think about it. We have a national debt of ~$30T on which we pay interest at a rate of ~1% at this time. If the Federal reserve increased interest rates to, say 3%, the Treasury would have to follow and our debt service would go from $300B to $900B. Keep in mind the interest rates of 15% were in place in 1980 (10 year Treasury rate). At 15% interest, we would be paying $4.5T in interest: more than all tax receipts you could ever imagine.
If you say the Treasury would not raise rates to match the Federal Reserve, then you don’t realize the US Treasury auctions would have no takers if they could get more $ elsewhere.
The game is over. Nobody seems to want to realize it, yet.
Most currency is actually held within the system as some form of an IOU with an interest rate and term. As such, should interest rates be allowed to find their true free market value, vs just issuing more IOUs like now, will create strong deflationary pulse as it destroys the cash value of long term fixed rate IOUs.
Let’s say you have 30 year UST at 3%. A couple years later the interest of a ‘new’ 30 year UST is at 30%. In order to sell your UST you’ll have to discount it so that has the same interest payments as the new IOUs. Now layer on to this an inflation rate of 20% with no signs it will be letting up soon.
Now think about the about who you are selling this IOU to for cash today. They must hold on to this thing for 30 years with inflation running at 20%. Now what do you think the cash value is; answer worthless. Again very deflationary as most purchasing power in the system vanishes even as cash is ‘also’ becoming increasingly worthless through inflation. Basically the nexus point that joins both inflation and deflation.
The image of supernova comes to mind. Basically the outward push of energy (the real economy) can longer push against the gravity (the growing level of parasites) which causes a great collapse (deflation) followed by great explosion (inflation).
The solution is to put your purchasing power in real things of value, while you still have time.
Sundance,
I have tried to find some semblence of a copy of some sort of economic bill, document or information relating to such–about the Clinton and Papa Bush years…that relate to deals with China, for cheap junk foisted on the American shopper. I either don’t know the right search words or title of said documents….
My thoughts align with the fact that surely, some of these deals/policies must be expiring or sun-setting? I mean, we are talking about a time frame of almost 30 years or addicting shoppers to acquiring lots of cheap junk.
Would that not account for the empty shelves we are seeing in Wally World? In the clothing sections, wracks have been strategically aligned to give the impression of lots of ‘stuff’ but the reality is not lots of ‘stuff’.
A strategic tactic for the new admin to engage in pricey deals and later on fill the store with more junk?
I am praying for God to show Himself strong in the face of tyranny all across the world.
I pray that God would bring His fiercest wrath upon and against all ungodliness over the entire world.
May His will be done on earth as it is in Heaven.
May God be Blessed!
May He quickly execute His salvation on the earth and burn with fire that which remains.
I humbly pray in the name of the man Christ Jesus.
Who is our representative man in glory.
He is the appointed means for without Him no man can come to God.
Amen amen
I closed out a lot of equity positions yesterday. I can see the storms clouds forming. May initiate a position in TIPS and short the overall market.
To add to Sundance’s remarks, jobs came in lower than expected the other day as demands slows and companies are paying higher prices for inputs.
The market is irrational right now.
Great article Sundance.
We have been rolled back to Comrade Obama’s 2015 in 7 Short Months, of Sock Puppet Joe’s administration and complicit Congress.
I would add, follow the US Market Sector Reports and one can follow the crushing of Domestic GDP and Skilled Labor (Middle Class) creating Industries across the US via regulation and purposely created raw material shortages.
Domestic IPO’s are on a downward trend again as US cash moves off shore to restart the 2015 business model.
Large Multi-Nationals and Major Financial Institutions able to act on both sides of as well as across the US Border are the ones driving the market up. Plus, they can whipsaw the market on-demand as needed.
It is the elites objective to continue full on until all the wealth is totally drained from the US. The vaccine passports will be tied to the Chinese financial matrix. If you fail to be vax’d… they will take or decide what you will have. Sound far fetched? It’s the same as everyone screaming conspiracy… we’d all better seriously pray as Christians, God will continue to show favor to a nation who once placed all trust in God. This Evil runs so deep and wide spread. It’s going to take a real miracle to stop it. It isn’t just politics anymore.
If you haven’t seen this, watch in segments. Explains a ton.
Francis R. Connolly: “From JFK To 911 Everything is a Rich Man’s Trick”
The last 8 months prove that the dems know what they are doing. For decades they sold us on things that were unpredictable as the cause of so many economic woes. Trump and his wolverines know how to create wealth and they did it despite the sabotage from every nook and cranny. But Joebama policy is not about money or they would support Trumpian policy and go where there was money to be made. This is about power and control over everyone and everything.
Exactly…think of Global Puppet Master actions in terms of a functioning, live and on-going business model.
ALL business models crave CONSISTENCY and maximized control over all the variables.
The Global Puppet Masters are arranging for that consistency and the ability to rearrange the parts of the model to either satisfy a business objective or assert control over an actor (an actual moving part) within the model.
The crash predictors never consider that the Global Puppet Masters have more at stake than anybody if they crash the system. It is about control and compliance to ensure consistency.
President Trump’s policies were crashing the models by encouraging actors to become more like near random, independent variables within the model…shattering consistency.
Thank You Sundance… even I understand this!
This falsely installed regime needs to go. There’s not even a democrat that voted for this fumbling feeble fool think he won the presidency. So essentially it is the cabal that is trying to destroy the middle class. So some big guns need to put their big boy pants on and do something!! SOON.
Love SD and this site. Make 3 or 4 comments a week. Like to come back a few times during the day and see if I’ve had comments or upvotes. I find it really difficult to find my comment. The comments are broken down into most reacted comment and hottest comment thread. Hmmm, how about doing what every other site does and have comments listed by newest and best? The search would be shorter and make more sense. Cheers
Sundance…Where can I get one of those Gas/Bank Account Monitors??? I want to install one in my 12 mpg. Ambulance Camper! Sort of a take-off on Engine Vacuum/Mileage Monitors from the 60’s.
With all the modern WiFi equipped vehicles nowadays, something like this could be reality… & probably sell like “hotcakes” to “PO’D Gearheads” all over the World!
Coincidently, I just finished reading an article on the Fed causing the current inflation in the USA by printing lots of US Dollars by Wolf Richter & I thought that you were going to expand on it… AND you did a BETTER JOB!
https://wolfstreet.com/2021/08/04/dollars-purchasing-power-gets-zapped-its-permanent/
THANK YOU!