In its latest Fact Finding 30 report, FMC Commissioner Sola indicates that Florida has lost $3.2 billion in economic activity and 49,500 local jobs paying approximately $2.3 billion in wages as a result of the suspension of cruising following the COVID-19 coronavirus pandemic and the U.S. Centers for Disease Control and Prevention’s No-Sail Order, in effect through September 30.
In an ephemeral world, few things survive. I am not talking about species or human beings whose existence on earth is also transitory. Instead I am referring to social and financial systems which are now coming to an end.
In July 2009 I wrote an article called The Dark Years Are Here. It was reprinted again in September 2018.
Here is an extract from my original article:
“The Dark Years will be extremely severe for most countries both financially and socially. In many countries in the Western world there will be a severe depression and it will be the end of the welfare state. Most private and state pension schemes are also likely to collapse. It will be a worldwide depression but some countries may only have a deep recession. There will be famine, homelessness and misery resulting in social as well as political unrest. Different type of government leaders and regimes are likely to result from this.
How long will the Dark Years last? There is a book called ”The Fourth Turning” written by Neil Howe.
Re-Blogged From Headline USA
Research is increasingly pointing to a retreat of working mothers from the U.S. labor force as the government shutdowns leave parents with few child care options and the added burden of navigating computer instruction.
Thousands of school districts are starting the school year with remote instruction, including most of the largest ones.
At least half the country’s child care providers are closed and may not survive the crisis without financial help to cope with implementing safety standards and reduced enrollment.
Negotiations for a bailout of the industry have stalled in Congress.
Retail sales growth has slowed down. What does it mean for the U.S. economy and the gold market? Retail sales increased 1.2 percent in July. The growth was worse than expected, which hit the U.S. stock market. As the chart below shows, the number was also much weaker than in the two previous months (8.4 percent gain in June and 18.3 percent jump in May), when it seemed that the economy started to rebound.
The monthly U.S. budget deficit for June 2020 was a heart-stopping record $864 billion. For reference, last year’s deficit for all of fiscal 2019 was just under $1 trillion. In other words, the June deficit was almost as much as the entire amount of red ink spilled one year ago. This year will see the worst annual amount of fiscal hemorrhaging ever—and by a whole lot. The figure will be at least $4 trillion in total, which is $2.6 trillion more than the peak suffered under the Great Recession. One has to imagine that with the Department of Labor reporting, there are now 32 million people collecting unemployment insurance as of June 27th–the amount of additional debt continues to pile up fast.
We can all be very confident that there will be no change to monetary policy for a very, very long time. But there is a fiscal cliff coming—and indeed has already begun.
It is clear that Mr. Powell is all-in on his unlimited QE and ZIRP. And, that he is “not even thinking about thinking about raising interest rates.” Therefore, the stock market does not have to worry about a contraction in the rate of money printing any time soon. However, equities could soon plunge due to the crash in the amount of fiscal support offered to the economy.
- Last month, the auto-loan and credit-card forbearance period ended
- On July 1, state and local government budget cuts kicked into high gear, as the $330 billion in aid already dispensed has been wasted
What happens when politicians decide they are in a better position than business owners to know how much workers should be paid? We don’t have to guess. Cities like Seattle and New York have already done so with their $15/hour minimum wage mandates. Simone Barron, a lifelong restaurant worker, recounts how “helping” her impacted her wallet, her career, and her life.
Please watch the VIDEO
The coronavirus pandemic inflicted a “swift and massive shock” that has caused the broadest collapse of the global economy since 1870 despite unprecedented government support, the World Bank said.…
“This is a deeply sobering outlook, with the crisis likely to leave long-lasting scars and pose major global challenges,” said World Bank Group Vice President for Equitable Growth, Finance and Institutions Ceyla Pazarbasioglu….
The depth of the crisis will drive 70 to 100 million people into extreme poverty.
By Eric Worrall – Re-Blogged From WUWT
h/t JoNova – as Aussie greens panic about expiring climate policy targets, an effort by Australia’s opposition politicians to appease angry coal union supporters by offering to include a place for coal in a future bipartisan climate deal has upset radical greens.
Labor offers to deal with terrorists in climate wars
In offering bipartisanship on energy, Labor is offering to do a deal with the ‘terrorists’ who have thwarted all forms of climate action for years.
Jobless claims paint a much grimmer picture than other pieces of economic data. So, the Fed (and other central banks) will remain dovish for years, which should support gold prices.
More and more economic reports show the beginning of the economic recovery in the U.S. Following the retail sales earlier last week, the Philly Fed Manufacturing Index turned from negative 43.1 in May to positive 27.5 in June, the first positive reading since February. And the Leading Economic Index rose 2.8 percent in May, after a record plunge in the two prior months.
By John Williams – Re-Blogged From Shadow Stats
The seasonally-adjusted SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994. That estimate is added to the BLS estimate of U-6 unemployment, which includes short-term discouraged workers.
The U-3 unemployment rate is the monthly headline number. The U-6 unemployment rate is the Bureau of Labor Statistics’ (BLS) broadest unemployment measure, including short-term discouraged and other marginally-attached workers as well as those forced to work part-time because they cannot find full-time employment.
May 2020 ShadowStats Alternate Unemployment is 34.0%, 36.5% net of BLS errors (Flash Nos. 1435 and 1439).
The stock market promoting mainstream media this morning reported “U.S. Retail Sales Rose Record 18% in May” (e.g. the Wall St Journal). The S&P futures jumped from up 45 points to up 90 points.
But, as usual, the details are in the fine print of the report itself, and it’s apparent that nobody in the financial media bothered to look beyond the headlines.
In fact, the 18% rise is measured from April’s report, which was heavily depressed due to the shelter-in-place restrictions and the closure of many retail businesses. Funny thing about using the percentage change as the metric of measurement. If April had one dollar of retail sales and May had two dollars, the percentage gain would have been 100%.
Flippy the robot flips cooks burgers to perfection.
Dining out looks pretty different these days. It’s natural to pine for the past, but many quick service restauranteurs are also looking ahead to a future where automation will be the key to drastically increasing their notoriously thin margins and allowing their workers to shine in the tasks no machine can do.
Robots in the workplace can get a bad rap—most people aren’t trying to get replaced by one. But the smartest and most innovative robotic companies aren’t designing teams of droids that send people packing. Instead, they’re crafting intelligent machines that work alongside workers, increasing efficiency and profits in the process.
April job report shows a terrible US labor market. Coronavirus destroyed 20.5 million jobs, pushing the unemployment rate to almost 15 percent. How far does the number reflect reality – and what does it actually mean for the gold market?
Apocalypse in the US Labor Market
14.7 percent. Remember this value well, as it will go down in history. This is the official US unemployment rate for April calculated by the Bureau of Labor Statistics. The unemployment rate soared from 3.5 percent in February and 4.4 percent in March. As the chart below shows, the spike is really historic, as such high level has not been seen in modern history.
By Lisa Bellfuss – Re-Blogged From Barrons
The coronavirus pandemic claimed 20.5 million jobs in April as companies across America were forced to close and consumers stayed home to cap the disease’s spread.
The Labor Department said Friday that the job losses in April followed a downwardly-revised loss of 870,000 in March . So far, about one in five workers are unemployed.
Investors knew this would be one of the worst jobs reports in history . The decline in nonfarm payrolls for April is about three times as bad as the jobs lost over the entire Great Recession, with the depth of the losses not seen since the Great Depression. But the headline number was about in line with the 21 million job losses economists predicted, and the unemployment rate—at least on the surface—looks not as bad as feared. Stocks rose following the report, with the S&P 500 up about 1.1% and the Dow Jones Industrial Average higher by 1.2% in afternoon trading.
The question that remains is how quickly these laid off workers can be rehired and start spending again to restart the U.S. economy.
My friend Larry Kudlow always says that Profits are the mother’s milk of stocks. That used to be true when we had a real economy. But sadly, that is no longer factual because we now have a global equity market that is totally controlled by central banks. To prove this point, let’s look at the last few years of earnings. During the year 2018, the EPS growth for the S&P 500 was 20%; yet the S&P 500 Index was down 7% over that same time-frame.
Conversely, during 2019, the S&P 500 EPS growth was a dismal 1%; yet the Index surged by nearly 30%. What could possibly account for such a huge divergence between EPS growth and market performance? We need only to view Fed actions for the simple answer: it was the degree to which our central bank was willing to falsify asset prices.
It was the best of times, it was the worst of times. April closed as the best month for the US stock market since the V-shaped recovery that followed the Black Monday stock market crash of 1987. April also delivered the deepest, broadest economic collapse of any month in history.
The economic collapse was simultaneously global. What is written here about the US can pretty well be said for all nations in the world. The collapse crushed jobs, personal income, consumer spending, consumer sentiment, car sales, and general economic activity more than any month in the history of the nation. Some of those sharpest declines happened in March, but April relentlessly drove to to greater depths. But stocks rose.
Re-Blogged From RightWingAmericans.Com
President Donald Trump caused outrage among Democrats on Monday when he announced that his administration would protect American workers by suspending immigration into the United States while the country battles an economic crisis.
According to a New York Times report, published on Tuesday morning, the president’s plan could come into effect in the next few days when he is expected to sign an executive order. Sources familiar with the plan, according to the Times, say that the executive order would stop the United States approving any new applications from foreigners intending to live and worked in the United States. It would shut down the illegal immigration system completely for as long as the president deems the executive order to be necessary.
By Willis Eschenbach – Re-Blogged From WUWT
I’ve read claims on the web that the job losses in the US were due to the virus itself, and to the fear of the virus making people cut back on activities. The claims are that the job loss is more from that, and not so much a result of the American Lockdown. So I thought I’d take a look at the weekly new claims for unemployment insurance. Of course, the different states have been hit differently by the changes. Here’s the graph of weekly new unemployment claims for one of the least affected states, Oregon.
Figure 1. Weekly new unemployment claims, Oregon, since 1999. “Usual” refers to the one-year period preceding the record rise.
One of the many bothering issues about the coronavirus crisis, is whether it will turn out to be inflationary or deflationary. What do both of these scenarios mean for gold ahead?
US Inflation Rate Declines in March
Many people are afraid that the coronavirus crisis will spur inflation. After all, the increased demand for food and hygiene products raised the prices of these goods. Moreover, the supply-side disruptions can reduce the availability of many goods, contributing to their increasing prices.
On the other hand, the current crisis results not only from a negative supply shock, but also from a negative demand shock. As a result of uncertainty, people cling to cash and forego unnecessary expenses. In addition, social distancing means reduced household spending on many goods and services, which exerts deflationary pressure. The most prominent example is crude oil, whose price has temporarily dropped to just $20 a barrel (although this was partly due to the lack of agreement between OPEC and Russia). Lower fuel prices will translate into lower CPI inflation rate. Entrepreneurs, especially those with large stocks of goods, will probably lower prices to encourage shopping. Moreover, the appreciation of the US dollar means lower prices of imported goods.
We are all praying for the Wuhan virus to die. But there is something the virus can actually “cure” itself: deflation. I put the word cure in quotes because it’s not an actual issue in reality. Low inflation and disinflation are actually great conditions to enjoy and help an economy thrive. Increasing the purchasing power of consumers is something that should be cherished and targeted goal. Increases in productivity, along with a strong currency, raises your standard of living. In sharp contrast, Central Banks think any rate of inflation that is less than 2% is a deadly economic disease that must be vanquished faster than the Wuhan virus.
Many Austrian economists believed the money printing that occurred during the Great Recession of 2008 would engender massive inflation. That indeed turned out to be the case; but only with asset price inflation. The Fed’s balance sheet expansion left Consumer Price Inflation (CPI) far behind. This is because the Fed bailed out banks, not consumers. Mr. Bernanke printed trillions of new dollars to purchase bad assets from banks’ balance sheets. Thus, it gave banks credit in exchange for those assets; and that base money was primarily parked back at the Federal Reserve. In other words, there was a huge increase in Fed credit but not in loans that would have led to an increase in the broader monetary aggregates—the kind of money supply increase that leads to rising CPI. What money that was lent out arrived directly to Wall Street by the process of banks selling MBS, ABS and other troubles assets and then using that credit to buy more bonds and stocks. The rich got richer and the lower classes were, for the most part, left out in a big way.
By Associated Press – Re-Blogged From Headline Wealth
The outbreak of the coronavirus has dealt a shock to the global economy with unprecedented speed. Following are developments Friday related to the global economy, the work place and the spread of the virus.
UNDER REVIEW: This week, the U.S. reported that a staggering 3.3 million Americans applied for unemployment benefits last week, a five-fold increase over the last high sent in 1982. On Friday, President Donald Trump signed a $2.2 trillion aid package into law. Few believe it will be the last in the aftermath of this viral outbreak. Credit ratings agencies are taking note of the financial standing of the U.S., and other nations.
By Associated Press – Re-Blogged From Headline Wealth
Nearly 3.3 million Americans applied for unemployment benefits last week — almost five times the previous record set in 1982 — amid a widespread economic shutdown caused by the coronavirus.
The surge in weekly applications was a stunning reflection of the damage the viral outbreak is inflicting on the economy. Filings for unemployment aid generally reflect the pace of layoffs.
Layoffs are sure to accelerate as the U.S. economy sinks into a recession. Revenue has collapsed at restaurants, hotels, movie theaters, gyms and airlines. Auto sales are plummeting, and car makers have closed factories. Most such employers face loan payments and other fixed costs, so they’re cutting jobs to save money.
The Week That Was: February 22, 2020, Brought to You by www.SEPP.org
By Ken Haapala, President, Science and Environmental Policy Project
Quote of the Week: “I never guess. It is a capital mistake to theorize before one has data. Insensibly one begins to twist facts to suit theories, instead of theories to suit facts.” – Sir Arthur Conan Doyle. [H/t Eric Wagner]
The Scientific Method: There appears to be no clear, widely accepted definition of science or the scientific method. Professor of Applied Mathematics and philosopher Christopher Essex considers science to be an adventure. A long game of generations and part of the ascent of Man. Not just a fad invented in the 17th century. In an unpublished paper, “The Scientific Adventure,” he wrote for the 100th anniversary of Einstein’s 1905 discoveries, he stated:
“Others try to embrace it as a recipe. They say, to be scientific, do this, then do that, but not the other way around. They talk of the scientific method as if there is just one; as if scientific discovery were clean, orderly and uncontroversial, supervised by grizzled elders of authority. But the search for scientific discovery is anything but. It is messy, contentious, factional, but also wondrous, inspired, and above all serendipitous. It is human.”
By David Middleton – Re-Blogged From WUWT
Note: This is a politically charged post. If you don’t like such posts, don’t bother reading it.
What would happen if frac’ing was banned?
The 2016 report was intended to lay out the implications of reckless, if not treasonous, energy policy demands of politicians and activists.
By Associated Press – Re-Blogged From Headline Wealth
Macy’s said Tuesday it is closing 125 of its least productive stores and cutting 2,000 corporate jobs as the struggling department store tries to reinvent itself in the age of online shopping.
The store closures represent about one fifth of Macy’s current total. They include about 30 that are in the process of closing and account for $1.4 billion in annual sales.
Macy’s didn’t specify how many jobs would be lost at the shuttered stores.
The corporate jobs will be shed as Macy’s closes its offices in Cincinnati and San Francisco, leaving New York as its sole corporate headquarters. Macy’s said that the 2,000 jobs to be lost account for about 9% of its corporate workforce.
Having predicted last year that a recession would begin in the summer of 2019 and that it would likely start with a major repo crisis, I am now proven wrong by 2019’s fourth-quarter GDP. If the repo crisis that started in the final week of summer had actually been the start of a recession, we would have seen fourth-quarter GDP go negative. Instead, it came in at 2.1% growth.
With a recession become increasingly certain and the end of the expansionary phase of the credit cycle in sight, we can expect a periodic systemic crisis to be upon us soon. The question arises as to how serious it will be, given that despite the massive injections of extra base money since the Lehman crisis, signs of liquidity shortages are already re-emerging in financial markets.
We don’t know what will trigger the crisis, but a likely candidate is foreign selling of US dollars combining with a collapse in the US government’s finances. Perhaps the coronavirus will turn out to be a black swan event, but the underlying conditions for an economic and monetary crisis already exist.
This article looks at alternative outcomes. It concludes that the current situation bears a worrying resemblance to the collapse of John Law’s Mississippi scheme exactly 300 years ago. The key to understanding why this is so is because of the link forged between asset prices and fiat currencies. One fails, and they both fail, more rapidly than the most bearish bear might expect.
The Week That Was: January 11, 2020, Brought to You by www.SEPP.org
By Ken Haapala, President, Science and Environmental Policy Project
Green Arrogance: Regardless of the political system, or ideology, arrogance can lead to destructive actions contrary to the interests of the public. History produces many examples, including major wars. We are seeing examples of arrogance in so called “green” laws and regulations which are actually contrary to nature. Humans can modify and use nature for their benefit but cannot regulate it. Unfortunately, politicians frequently ignore limits of power when passing sweeping laws and regulations. This week, three examples of arrogance, or hubris, are evident: 1) bushfires in Australia; 2) closing the Crescent Dunes power plant in Nevada; and 3) the continuation of a 2.5 gigawatt (GW) off-shore wind project off the coast of Virginia Beach ordered by the governor of Virginia.
The U.S. created 145,000 jobs in December, following an increase of 256,000 in November (after a downward revision), as the chart below shows. The nonfarm payrolls came below expectations, as the analysts forecasted 165,000 new jobs. The gains were widespread, but with a leading role of retail trade (+41,200), leisure and hospitality (+40,000), and education and health services (+36,000). Manufacturing again cut jobs (-12,000), which means that industrial recession has not ended. Mining and transportation and warehousing also dismissed workers.
Chart 1: U.S. nonfarm payrolls (green bars, left axis, change in thousands of persons) and the unemployment rate (red line, right axis, %) from January 2015 to December 2019.
By Associated Press – Re-Blogged From Headline Wealth
A California law that makes it harder for companies to treat workers as independent contractors takes effect next week, forcing small businesses in and outside the state to rethink their staffing.
The law puts tough restrictions on who can be independent contractors or freelancers rather than employees.
Supporters say it addresses inequities created by the growth of the gig economy, including the employment practices of ride-sharing companies like Uber and Lyft that use contractors.
But the union-backed legislation went far beyond demanding that drivers be treated like employees. In theory, it could extend to everything from hospice and home healthcare workers to babysitters to newspaper employees and even (depending on the laws) workers in the sex trade..
Government-mandated employee perks might sound like a good way to help out working women, but, in reality, these programs do more harm than good. European women are already paying the price, and American women might be next. Carrie Lukas, President of Independent Women’s Forum, explains how keeping the government out of the workplace goes a long way toward keeping women in it.
Please watch the VIDEO.
By David Middleton – Re-Blogged From WUWT
This post is extremely political. If you are offended by hardball politics, stop reading here. Comments to the effect that you don’t like political posts or are offended political incorrectness and moderately insensitive language will be mercilessly ridiculed.
Fauxcahontas is truly a “stupid and futile gesture”…
A climate denier-in-chief sits in the White House today. But not for long
The next president must rejoin the Paris agreement and show the world that the United States is ready to lead on the international stage again
President Trump has now fulfilled his disastrous promise to pull the United States out of the Paris Climate Agreement. The agreement represents decades of work by both Democratic and Republican administrations to achieve a common goal: bringing every country of the world together to tackle the climate crisis, the existential threat of our time.
By Reuters – Re-Blogged From IJR
U.S. job openings fell to a 1-1/2-year low in August and hiring slipped, suggesting employment growth was slowing mostly because of ebbing demand for labor.
Job openings, a measure of labor demand, dropped by 123,000 to a seasonally adjusted 7.05 million in August, the lowest level since March 2018, the Labor Department said in its monthly Job Openings and Labor Turnover Survey, or JOLTS, on Wednesday.
It was the third straight monthly drop in job openings, which have been trending lower this year since scaling an all-time high of 7.6 million in late 2018. The job openings rate fell to 4.4% in August from 4.5% in July.
Hiring decreased by 199,000 jobs to 5.8 million in August, led by declines in the private sector. The hiring rate slipped to 3.8% from 3.9% in July.
Nonfarm payrolls rose by 136,000 jobs in September, down from 168,000 in August, the government reported last Friday. The three-month average gain in private employment fell to 119,000, the smallest since July 2012, from 135,000 in August.
Job growth has averaged 161,000 per month this year, compared to a monthly gain of 223,000 in 2018. Job gains remain above the roughly 100,000 per month needed to keep up with growth in the working-age population. The unemployment rate fell to near a 50-year low of 3.5% in September from 3.7% in August.
This month the economic expansion brought to you by your Federal Reserve and by US government largess becomes the longest expansion in the history of the United States! That’s something, right? Something? Let’s take an honest look at what we now call great.
By “the longest expansion” we mean the longest period in which US GDP has been growing without a recession. Now, that’s something to crow about, right?
Not so fast for many reasons. It’s also been the most anemic expansion on the books, and it’s not too hard to see why it’s been the longest, having nothing at all to do with a great economy. It has cost us far more than any expansion (by an order of magnitude) because we’ve piled up ten times the national debt over any amount we accumulated during previous expansions. (I’ve said before, it’s easy to let the “good times” roll when you are buying it all on the company credit card.) We also quadrupled the size of the Fed’s balance sheet. That didn’t cost anything, but we sure didn’t get much bang for the buck! We actually got less bang than in any previous expansion!
By Thomson Reuters – Re-Blogged From Newsmax
Deutsche Bank laid off staff in Asia on Monday as it began cutting 18,000 jobs as part of a 7.4 billion euro ($8.3 billion) “reinvention” set to tip Germany’s largest lender into yet another annual loss.
In a retreat from a long-held ambition to make its struggling investment bank, which employs 38,000 people, a force on Wall Street, Deutsche Bank said on Sunday it would scrap its global equities operations and cut some in fixed income.