discussion comment
2 years ago
If the federal government confiscated every dollar from every billionaire, it would fund the government for a few days. The spending insanity goes much too deep to solve by taxing the rich.
discussion comment
2 years ago
In the midst of record inflation, a border disaster, and a supply chain crisis - the Democrats thought today would be a good day to have Congress vote on….
Mandating the Federal Reserve to *solve racism.*
discussion comment
2 years ago
Dark Angel ( with a young Jessica Alba )
Dark Matter
Life ( the Zen Detective series )
discussion comment
2 years ago
“I'm still not convinced about how fast or deep the next recession might be.”
The final shoe to drop will be layoffs. Those will result from businesses reacting to higher capital costs, squeezed margins, and reduced demand. If/when that happens, things will spiral down. We are already seeing some of this in tech. Construction should react soon with the rise in mortgages. Other industries will follow.
discussion comment
2 years ago
Prostitution also thrived during the Great Depression. Chains of brothels, known as ringer houses, were everywhere. Prostitutes typically charged two dollars for fifteen minutes. There were regular health checks and the houses were a safe place for the women, providing room and board.
Much like the speakeasy’s, ringer houses were run by organized crime. The police were paid off. It was an open secret.
discussion comment
2 years ago
The clubs with the biggest overhead costs, the big party clubs, are most at risk. The smaller niche clubs might survive by focusing on the hardcore PLs.
discussion comment
2 years ago
Firefly
discussion comment
2 years ago
Here in Arizona, there are dozens of new home communities being built with prices in the $500,000 to $800,000 range. These were all planned when mortgages were 3%. As these homes come on line, mortgages are 6%. If we are going to beat inflation, mortgages will need to rise to 12%.
Who is going to buy all those $800,000 homes when the annual mortgage payment exceeds $100,000 ?
Just one example of the disruption that is coming.
discussion comment
2 years ago
By the way, when the economy really hits bottom, the government will no longer be able to spend trillions on stimulus or enhanced unemployment. We’ll be on our own. All the more reason to address inflation aggressively and get through it as quickly as possible.
discussion comment
2 years ago
The real revolution will begin in November when the politicians responsible for this ( both Democrats and Republicans ) are thrown out of office.
discussion comment
2 years ago
If you don’t think the federal government will find the resolve to beat inflation, it follows that:
1. High inflation will become permanent
2. The only hedge against inflation will be owning hard assets such as farmland and stock in companies providing necessities such as food and energy
3. Except for the very wealthy, life will be a struggle.
discussion comment
2 years ago
Here’s a summary of the bind we are in:
1) The U.S. has $31 trillion in debt.
2) The U.S. is already spending $305 billion in interest payments every year with rates at ZERO.
3) Every 1% increase in rates by the Fed means U.S. debt payments rising another $300 billion.
4) The Fed wants to raise rates to 3%... which would mean the U.S. spending nearly $1 trillion in interest payments… without reducing its debt by a CENT!
5) This would mean the U.S. spending 25% of its current budget on interest payments alone… while its debt pile continues to rise by trillions per year.
6) Interest rates need to exceed the rate of inflation for a period of time in order to break the inflationary cycle. That means interest rates of 8%, with $3 Trillion in debt payment.
So, to bring inflation under control is going to be very painful and very costly. Does the federal reserve, and the federal government, have the resolve needed to accomplish this ?
discussion comment
2 years ago
If the Fed gradually, slowly raises rates, and the President keeps spending while blocking drilling, it might be a decade or more before we get out of this hole.
If the Fed aggressively raised rates, while the President allowed oil, gas, and refineries to expand production, we could put the worst of this behind us in 1-2 years.
discussion comment
2 years ago
Like a Ponzi scheme, thousands of early investors in crypto got wealthy ( assuming they sold ) but millions are going lose their investment when the “ emperor has no clothes” moment arrives. Unlike stock, Crypto only has value as long as it is perceived as having value. There is no there, there.
discussion comment
2 years ago
The Producer Price Index is a good predictor of consumer inflation a few months in the future since PPI reflects the cost of materials being used to produce goods.
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2 years ago
“You're the ones saying everyone is getting so much money for free”
If you knew the first thing about economics, you’d understand what I meant when I said there was too much money in circulation. The money supply. It has nothing to do with how much money an individual has in their pocket.
discussion comment
2 years ago
From America’s paper of record ( the Babylon Bee ):
WASHINGTON, D.C.—Biden attempted to calm fears of a crashing economy and coming recession today assuring Americans the economy is every bit as vibrant and healthy as he is.
"You people have nothing to worry about. Best economic recovery ever! The economy is just as fit and healthy as Old Joe!" said Biden to a 12-year-old girl in the junior's clothing section of JCPenny he mistook for an MSNBC reporter. "If I wasn't the picture of health, do you think I could do this?" Biden then got in the push-up position but quickly forgot why he was down there and decided to go to sleep.
The White House's gay-black Press Secretary Karine Jean-Pierre confirmed Biden's assertions after flipping through her notebook for 30 minutes to find the correct response. "Yes, the economy is very healthy," she said, "just like the president. I am gay and black."
discussion comment
2 years ago
A Ponzi scheme is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. A Ponzi scheme can maintain the illusion of a sustainable business as long as new investors contribute new funds, and as long as most of the investors do not demand full repayment and still believe in the non-existent assets they are purported to own.
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2 years ago
ICEE, your lack of reading comprehension, and ignorance of economics, is staggering.
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2 years ago
There are two primary causes for the mess we are in.
First, we have record government debt, paid for by printing money. The debt will continue to rise and the printing press will continue to run. In fact, as interest rates rise, servicing this debt will become nearly impossible. Inflation is always caused by too much money chasing too few goods.
Second, we have regulated the US energy industry almost out of business. That causes high energy prices and a reliance on expensive foreign oil. High energy prices raise the price of everything. Importing oil raises debt.
Until someone ( like Biden ) addresses these two issues, we are stuck with high inflation and the resulting recession.
So, unless Biden has a road to Damascus epiphany, the peak is not around the corner.
discussion comment
2 years ago
Then, there is the bizarre situation in Europe where they are effectively at war with Russia while funding Russia’s army through energy purchases.
discussion comment
2 years ago
Many people refinanced their mortgage to something like 3%. As a practical matter, they cannot move because that would mean taking on a mortgage at more than double the interest. Just one example of the way inflation upends our lives.
discussion comment
2 years ago
For much of the last 10 years, companies could easily borrow money at close to 0%. One byproduct of that was they could afford to overstaff. As a result, productivity has been relatively poor.
Now that borrowing is more expensive, companies are reconsidering staffing levels and unprofitable components of their business. Layoffs are definitely coming.
discussion comment
2 years ago
Mortgage rates jumped half a percent in the last TWO DAYS.
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2 years ago
One of the differences between now and the late 1970s is, back then, companies reacted to higher prices by making more goods, which resulted in more supply and lower prices.
This time, energy is the core problem. The government won’t allow increased drilling. So, the supply won’t go up and prices won’t go down. And, high energy prices cause everything to be inflated. For example, fertilizer requires natural gas for production.