The Attack on Workers, Phase II

It’s been a long row to hoe for most workers during the first 17 years of the new millennium.  The soil’s been hard and rocky.  The rewards for one’s toils have been bleak.

For many, laboriously dragging a push plow’s dull blade across the land has hardly scratched enough of a rut in the ground to plant a pitiful row of string beans.  What’s more, any bean sprouts that broke through the stony earth were quickly strangled out by seasonal weeds.  Those ‘green shoots’ that persisted bore pods that dried out on the vine before maturity.

This has been the common experience of the typical 21st century American worker, thus far. Countless, stories of labors with no fruits have been shared at bowling alleys across the Bible Belt.  There are also hard numbers that backup these woeful tales.

Just this week, for example, Sentier Research released a new report showing that after scratching and clawing the earth day after day, median household income has finally surpassed a level last seen in January 2000.  In other words, living standards for the typical family are now a smidge higher than they were at the turn of the century. Continue reading

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Warnings from Mount Vesuvius

“Injustice, swift, erect, and unconfin’d,
Sweeps the wide earth, and tramples o’er mankind” – Homer, The Iliad

When Mount Vesuvius Blew

Everything was just the way it was supposed to be in Pompeii on August 24, 79 A.D.  The gods had bestowed wealth and abundance upon the inhabitants of this Roman trading town.  Things were near perfect.

The lucky residents of Pompeii lived in large homes with elegant courtyard gardens and all the modern conveniences.  Rooms were heated by hot air flowing through cavity walls and spaces under the floors.  Running water was provided to the city from a great reservoir and conveyed through underground pipelines to houses and public buildings.

Fresh fish from the Bay of Naples were readily available in the Macellum (great food market) and countless cauponae (small restaurants).  Entertainment was on hand at the large amphitheatre.  Life was agreeable, affable, and idyllic for all – and it was only getting better.  Everyone just knew it.  They could feel it.  They believed it. Continue reading

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How to Stick It to Your Banker, the Federal Reserve, and the Whole Doggone Fiat Money System

Somehow, former Federal Reserve Chairman Ben Bernanke found time from his busy hedge fund advisory duties last week to tell his ex-employer how to do its job.  Namely, he recommended to his former cohorts at the Fed how much they should reduce the Fed’s balance sheet by.  In other words, he told them how to go about cleaning up his mess.

We couldn’t recall the last time we’d seen or heard from Bernanke.  But soon it all came back to us.  There he was, in the flesh, babbling on Bloomberg and Squawk Box, pushing the new paperback version of his mistitled memoir “The Courage to Act.”  Incidentally, the last time we’d heard much out of the guy was when the hard copy was released in late 2015.

With respect to the Fed’s balance sheet, Bernanke remarked that the Fed should cut it from $4.5 trillion to “something in the vicinity of $2.3 to $2.8 trillion.”  What exactly this would achieve Bernanke didn’t say.  As far as we can tell, a balance sheet of $2.8 trillion would still be about 300 percent higher than it was prior to the 2008 financial crisis. Continue reading

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The Coming Debt Reckoning

American workers, as a whole, are facing a disagreeable disorder.  Their debt burdens are increasing.  Their incomes are stagnating.

There are many reasons why.  In truth, it would take several large volumes to chronicle all of them.  But when you get down to the ‘lick log’ of it all, the disorder stems from decades of technocratic intervention that have stripped away any semblance of a free functioning, self-correcting economy.

The financial system circa 2017, and the economy that supports it, has been stretched to the breaking point.  Shortsighted fiscal and monetary policies have propagated it.  The result is a failing financial order that has become near intolerable for all but the gravy supping political class and their cronies.

Take consumer spending.  This is the primary driver of the U.S. economy.  Yet it requires vast amounts of credit.  In fact, American consumers presently hold $1 trillion in revolving credit.  At the same time, they have nowhere near the income needed to finance these debts, let alone pay them off. Continue reading

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