Tuesday, October 19, 2021

BALTIMORE, MARYLAND – What a marvelous time to be alive… with a front-row seat to watch a great empire stumble and fall!

It only happens once every hundred years or so… So pull up a chair and enjoy the show.

Here’s the big news, from Bloomberg:

U.S. Factory Output Falls in Fresh Supply-Chain Warning

Production at U.S. factories fell by the most in seven months in September, in part reflecting a sharp pullback in the manufacturing of motor vehicles as well as broader backlogged supply chains and materials shortages.

Supply chain? What’s happening is much more than just a weak link. Adjusted for inflation, real industrial production has been going down for half a century and now is only a third of its 1968 level.

Falling Apart

The U.S. enjoyed a fake prosperity for the last 30 years – but only because China picked up the burden of manufacturing and sold goods to Americans at discount prices, keeping inflation in check.

And now, the U.S. no longer has the good jobs, the infrastructure, or the know-how to make things Americans want.

Instead, appliances and geegaws are shipped across the Pacific Ocean – at enormous cost – while the discounts disappear.

China’s raw materials costs – metals, fuel, etc. – are going up. So are its wages. It can no longer offset America’s money-printing with cheap products.

Yes, here in the U.S., “inflation” is now out in the open… and the whole scam is coming apart. CBS News reports:

A perfect storm of high demand and low supply is sending fuel prices through the roof. Driving your car is costing a lot more – and heating your home this winter could, too.

The national average for a gallon of regular unleaded gas this week is $3.27 – a seven-year high. According to GasBuddy, a price tracking service, the price of a gallon nationwide has gone up more than five cents in a week.

Meanwhile, benchmark crude oil prices have risen above $80 a barrel for the first time since 2014. As a result, Chicago-area utilities are projecting that heating bills will be up to 50% higher this winter. The New York Department of Public Service warned residents last week that their home heating bills could jump 21% compared to last winter.

On the Case

But don’t worry. The Biden team is on the case. Spotted on Bloomberg last week:

Biden Seeks to Spearhead New Attack on Supply-Chain

President Joe Biden will turn his focus to supply-chain transportation bottlenecks on Wednesday, as the congested Port of Los Angeles will announce a 24 hours a day, seven days a week effort to confront the squeeze on goods.

But is the president really doing Americans a service by making it easier for them to buy Chinese products?

Both the Trump and Biden administrations share the same COVID-19-fighting strategy – close up U.S. businesses, but give Americans money so they can shop for Made-in-China goods. Here’s the Asia Times:

Gobbling China’s exports, US sinks into dependency

China’s exports rose 28% in September from the year-earlier level, more than the analyst consensus had forecast. More important is that China’s exports to the United States have risen by 31% since January 2018, when President Trump imposed tariffs on a wide range of US imports from China. At a seasonally adjusted annual rate, the US is buying $635 billion of Chinese goods, equal to a staggering 27% of US manufacturing Gross Domestic Product.

Fraudfest

As we’ve been saying… the whole thing is a fraudfest. From the most basic premises – that wise guys in Washington can make decisions better than consumers, producers, and investors…

…that American “democracy” follows the “will of the people”… and adapts to its needs…

…that elected officials know how to run a shipyard better than people who’ve been doing it all their lives… people with skin in the game and real brains in their heads…

…that you can spend more than you earn, year after year, and cover the deficits with “printing press” money…

…and that this fake money actually “stimulates” the economy – it’s a “bezzle.” From start to finish. Dishonest. Corrupt. Incompetent.

Fake Prosperity

You can’t “print” prosperity. You can’t make an economy work with five-year plans. And “democracy” does not mean that the majority always gets what it wants.

Nope. It gets whatever bone the elites toss its way.

But while tossing out scraps was easy when the economy was growing, of late, it’s become much more difficult.

The U.S. squandered trillions on its misbegotten wars and social programs. Now, it’s got a $3 trillion deficit – even without a recession.

And this week, Republicans and Democrats consider the next trillion-dollar-plus programs… while the printing presses run hot to pay for them.

More to come…

Regards,