Settling Wreckage from the Past

Posted on May 6, 2022 by MN Gordon

Settling wreckage from the past with realities of the present can be difficult and painful.  If you do the crime.  You must do the time.

When it comes to financial markets and the economy, this can take many forms.  Some of the most common include bankruptcy, shuttered businesses, and collapsing share prices.

This week Federal Reserve Chair Jay Powell and his cohorts at the Federal Open Market Committee Meeting (FOMC) raised the federal funds rate 50 basis points.  This marked the first 50 basis point rate hike since 2000.  It is part of the Fed’s initial efforts to settle up on wreckage from the past.

The world has changed markedly over the last 22 years.  Certainly, the economy and financial markets have become twisted and warped.  Without the proper perspective everything from the price of a gallon of gas to the price of a house is muddled and confused. Continue reading →

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The Ugly Transformation of Netflix

Posted on April 29, 2022 by MN Gordon

Human progress and upset, both real and imagined, is a wide ranging subject.  It can logically weave from discussions of indoor plumbing, agronomy and penicillin to thermonuclear weapons, corporate welfare and the ever present consequences of artificially low interest rates.

One of the great advancements of the early 21st century was the dawn of digital streaming.  Humans, with nothing better to do, could now scroll through a library of digital media and instantly stream it to a television or handheld tablet.  The sport of binge watching was born.

Cable TV was now an expensive dinosaur.  Many budget-conscious consumers cut the cord.  Maybe you did too.  The rationale was simple enough…

Consumers were granted a mobile, handheld idiot box.  For a fraction of the cost, you could watch programs whenever and wherever you wanted.

The ability to stream a movie to your phone while riding the train to work was simultaneously a mind blower and a life changer.  Surly a zenith of civilization had been reached. Continue reading →

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Feeding LA’s Homeless Industrial Complex

Posted on April 22, 2022 by MN Gordon

Election season 2022 is in full bloom.  Activists, with clipboards and ballot initiatives, are abundantly flowering outside supermarkets.  They want signatures – your signature – in support of new legislation that would increase funding for various whacky and zany ideas.

In California, and particularly in Los Angeles, initiatives that would fire off more dollars to combat the abundance of shanty favelas blighting urban areas are flourishing.  The rationale is compelling…

As of 2020, there were over 161,000 homeless people in California.  In Los Angeles County alone, the homeless population, as of 2020, was precisely 66,463.  Both those counts are now likely much higher.

Who doesn’t want to do something about the profusion of tented bivouacs, barrel fires, medieval disease, human excrement, public drug use, crime, and mental illness that is running rampant across the southland?

Surely something must be done.  But what? Continue reading →

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Is It Game Over For Washington Checkers Players?

Posted on April 15, 2022 by MN Gordon

The United States and Western Europe are playing checkers.  Russia and China are playing chess.

This mismatch is grossly evidenced by the recent salvos in the financial warfare being waged between NATO allies and the burgeoning Sino-Russian alliance.

The initial centerpieces of the massive sanctions against Russia included cutting Russian financial institutions off from SWIFT and preventing the Russian Central Bank (Bank of Russia) from using its foreign currency reserves.  Orders to ‘freeze and seize’ the assets of Russian oligarchs soon followed.

At the time, NPR breathlessly reported on the excellence of this monumental cooperative action.  The genius of the allied elites was celebrated before the effectiveness of the sanctions was known.  Failure of such a shrewd and unified move was out of the question.

But Putin had his own countermeasures ready.  To stabilize the ruble, the Bank of Russia offered to buy gold from Russian banks at a fixed price of 5,000 rubles per gram, thus linking the ruble to gold.  This quickly limited the ruble’s devaluation in terms of U.S. dollars because gold trades in dollars. Continue reading →

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