What You Will Find When You Follow the Money

Posted on August 14, 2020 by MN Gordon

It has been a rough go for California Governor Gavin Newsom.  Late last week it was revealed that the state Department of Public Health had tickled the poodle on its COVID-19 record keeping.  Somehow the bureaucrats in Sacramento undercounted new coronavirus cases by as many as 300,000.

Perhaps this oversight prompted Newsom to imbibe in a little meditation and reflection.  At his Wednesday coronavirus news conference, shortly after quoting Voltaire, Newsom offered the following epiphany:

“Businesses can’t thrive in a world that’s failing.”

Often the simplest insights into reality are the most essential.  We’ll give Newsom that.  Yet, this is hardly an insight.  Rather, it’s readily obvious…even to a numskull.

The world that’s failing, where businesses can’t thrive, is a direct consequence of government lockdown orders.  And Newsom, more than any other public official, has his fingerprints all over the offense.  If you recall, California, under Newsom’s command, was the first state to order lockdowns.  It’s a shame he didn’t pause for meditation before committing the state to ruin. Continue reading →

Posted in Inflation, MN Gordon | Tagged , , , , | 23 Comments

The Dollar Is Dying

Posted on August 7, 2020 by MN Gordon

This week, while perusing the Federal Reserve’s balance sheet figures, we came across a rather curious note.  We don’t know how long the Fed’s had this note posted to its website.  But we can’t recall ever seeing it.  The note reads as follows:

“The Federal Reserve’s balance sheet has expanded and contracted over time.  During the 2007-08 financial crisis and subsequent recession, total assets increased significantly from $870 billion in August 2007 to $4.5 trillion in early 2015.  Then, reflecting the FOMC’s balance sheet normalization program that took place between October 2017 and August 2019, total assets declined to under $3.8 trillion.  Beginning in September 2019, total assets started to increase.”

Directly below this note is the following chart: Continue reading →

Posted in Inflation, MN Gordon | Tagged , , , , | 17 Comments

Black Lives Matter: An Immodest Suggestion

Posted on July 31, 2020 by MN Gordon

We don’t like it.  But we won’t deny it.  America’s buried itself under an immense pile of public debt over the last 40 years.

Time to grab a shovel and some gloves.  There’s plenty of digging out to do.  There’s also plenty of opportunity in doing it.  We’ll have more on this in a moment.  First, the grim facts…

The national debt in 1980 was $908 billion.  Today it’s over $26 trillion.  New debt racked up in June alone – $863 billion – was more than the country added in its first 200 years of existence.

But as the national debt’s been piled on with ever increasing heaps over this time.  Economic growth has diminished to near subsistence levels.  The progression was gradual at first.  Yet over the last two decades the growing burden has become inescapable.

In the 1950s and 1960s, for example, the average GDP growth rate was above 4 percent.  Then in the 1970s and 1980s GDP growth declined to around 3 percent, where it held through the 1990s.  The 21st century, however, has been characterized by decreasing growth rates.  In fact, over the last decade, the average GDP growth rate has been below 2 percent.  That’s no joke. Continue reading →

Posted in Government Debt, MN Gordon | Tagged , , , , | 18 Comments

Best Laid Schemes

Posted on July 24, 2020 by MN Gordon

But, Mousie, thou art no thy-lane,
In proving foresight may be vain;
The best-laid schemes o’ mice an’ men
Gang aft agley,
An’ lea’e us nought but grief an’ pain,
For promis’d joy!

– Robert Burns, To a Mouse, on Turning Her Up in Her Nest With the Plough (in extract), 1785

A Really Neat Bridge

The grand plans of our local officials in Long Beach have been foiled by the coronavirus bug.  After seven years of construction, at a cost of $1.5 billion, they can’t even hold a proper ribbon-cutting.

The special occasion is the grand opening of the new, yet to be named, Gerald Desmond Bridge replacement.  To prevent the spread of COVID-19, a virtual ceremony is planned for the Friday leading into the Labor Day weekend. Continue reading →

Posted in Economy, MN Gordon | Tagged , , , , , , | 13 Comments