Deflation and Monkeypox are coming.
The middle-class' two worst fears - a lower cost of living, and Monkeypox.
“Everyone's bearish but they haven't sold.” - Julian Brigden
“There are times in the market where the best thing to do is nothing.” - Rick Rule
Sounds like the CPI number tomorrow will be even more awful.
The consensus is 8.8%. Maybe sell some more SPR oil to China.
Meanwhile…
“We can never recapture the purchasing power of the dollar that has been lost.”
- William McChesney Martin, the longest-serving Fed chairman, August 1955
I like to call price deflation an untaxed increase in your real income, which of course governments cannot allow.
fyi I marked in RED on the below chart all of the periods of deflation that have destroyed the American middle-class over the last 60 years. And this is using their b.s. numbers.
Never forget the words of the great failed regulator and hedge fund advisor, Ben Bernanke, in 2002:
"...the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation."
Also…
"The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists." - Ernest Hemingway, Esquire 1935 (my pinned tweet in a nutshell)
Today’s CNBC drinking phrase was “fortress balance sheet.”
Then again…
“…don’t kid yourself. If Goldman and Morgan Stanley collapsed, you could forget about JP Morgan’s “fortress balance sheet”.”
You will have vaccine passports, and own nothing.
…what is the point of creating a global vaccine passport regime when, as we have seen over the past year, said passports offer zero hope of controlling the spread of the COVID-19 virus, because the vaccines themselves are non-sterilizing? In fact, there is growing evidence that vaccine passports may actually be exacerbating rather than reducing transmission of the virus, by propagating a false sense of security among vaccinated people leading many of them to let down their guard.
(Note that the above is from the not-conservative NakedCapitalism.com website.)
Oh, by the way: “CBDC research and experimentation appears to be showing is that it will be nigh on impossible to issue such currencies outside of a comprehensive national digital ID management system.”
Would you like to comment on this, Agustin Carstens?
Anyway…
…these vaccines, whatever their efficacy in other areas, do not prevent transmission of the virus. This single fact - which has long been known but is barely ever mentioned - blows apart the case for vaccine passports, segregation, lockdowns of the 'unvaxxed' and all such similar measures. Even if you believe (or pretend to) that this virus is dangerous enough to justify the radical new forms of authoritarianism which have emerged around it - and I certainly don’t - those forms will fail anyway if both vaccinated and unvaccinated people can spread it; which we know they can.
…under a vaccine passport system, an unvaccinated person without COVID-19 would be barred from an establishment, while a vaccinated person could enter even if they had a symptomatic breakthrough case. How logical is that?
It’s not logical at all. That’s not the point. This isn’t about health, it’s about power and control.
Public-health officials ruined many lives by insisting that workers with natural immunity to Covid-19 be fired if they weren’t fully vaccinated. But after two years of accruing data, the superiority of natural immunity over vaccinated immunity is clear. By firing staff with natural immunity, employers got rid of those least likely to infect others. It’s time to reinstate those employees with an apology.
Investors bought 28% of single-family homes sold in the first quarter of 2022, up from 19% a year earlier and 16% averaged in 2017–2019. “These aren't mom and pops who have one or two "extra" properties they're renting out. This is on another level.” This is part of what a decade of ZIRP hath wrought. Reach for yield.
FT Alphaville is dying to ask: Did central bank balance sheets really need to get so big? I’ll save you a click…
“Wisdom Tree and Ritholtz Wealth Management, when they partnered to create a crypto index late last year, may have top-ticked the entire market.”
Home-Sale Cancellations Jumped in June as Buyers Backed Away “Across the country, nearly 60,000 home sales fell through, according to an analysis by Redfin Corp. That was equal to 15% of transactions that went into contract that month, the highest share of cancellations since April 2020, when early Covid lockdowns froze the housing market.”
I was reminded of another recent Canadian story.
“A lot of the sellers in the market today are effectively distressed sellers,” said John Pasalis, who runs Toronto-based brokerage Realosophy Realty Inc. “This is putting a lot of downward pressure on prices.”
Higher rates are for the serfs, not central bank employees…(in Hebrew, but I speak fluent Google translate.)
The Bank of Israel Employees' Committee demands that the Bank's employees not be harmed by the Bank of Israel's interest rate hikes, and that they be able to pay low interest on the loans taken by the state guarantee, Calcalist has learned
h/t BuyTheDipOrElse
If you’re curious, the Bank of Israel policy rate is 1.25%, and the Israeli 10-year is around 2.7%.
So by nuking my twitter account, we lost nine years of dumb jokes, but also a lot of actual investigative reporting, with links, and threads tying things all together. I wish they’d just ban me from new posts but leave my archive up. I don’t think the Stasi running Twitter want my archive up though.
Anyway, I had a long thread called “Random Movie Suggestions for Young People,” which was just that. It wasn’t a “Top 10” list - just movies that randomly came to mind, usually because I had just (re)watched them. A process, not a list. A lot of people seemed to like that thread. Now that’s all gone (without archive.org).
So last night it was “The Deer Hunter,” which every American should see at least once. It’s a sad movie, much more about friendship and loyalty and community than another horrific, stupid war.
It reminded me of Martin Luther King’s comment:
“If America's soul becomes totally poisoned, part of the autopsy must read: Vietnam.”
No one man nor group of men incapable of fighting or exempt from fighting should in any way be given the power, no matter how gradually it is given them, to put this country or any country into war. - Ernest Hemingway
I'm sad your Twitter is gone too, but I could never follow as I would never keep up with my timeline. Your substack is a great substitute for me!
Regarding inflation, I have noticed that some articles in the WSJ have recently cited the PCE rather than the CPI. The PCE is running about two percentage points lower and is the Fed’s “preferred” measure of inflation. Also, there is an article preparing us for a horrid CPI number tomorrow blaming the situation on housing costs finally impacting the number, even though it has been exploding for well over a year.