With rapt attention from all across the nation, the High Priest of Finance at the Federal Reserve took his position behind his presser pulpit. Biting his quivering lip again and again, he uttered his benediction over the US economy. He made sure to carefully speak the words I hear repeated across the nation like a mantra: “The Economy is Strong.”
It seems that, wherever I wander on my own through the concrete canyons, I keep hearing all the stock market evangelizers on Wall Street say, “The economy is strong.” I hear Goldman’s Fed acolytes say it surrounded by their Sachs of gold, but also I hear the merry band of Robinhood retail investors, who want to believe they are immortal, proclaim it out in the streets. I especially hear the televangelist economic gurus of our time who worship at the door of the Fed’s ecclesiastical temple — the Eccles Building — say it ALL THE TIME.
These are the words that keep up the spirits of mammon worshippers everywhere. They shore up the faith that maintains market sentiment into the rising fervor of a pentecostal crowd. They are calming words, reassuring words, even strengthening words — the Wall-Street equivalent of “A Mighty Fortress is Our Fed.”
Unlike the worshipping crowd, I feel nauseated every time I hear people singing that tune from a sidewalk cafe as I walk by, from a radio program playing in my car, or from High Priest Powell, himself. The cognitive dissonance between what I hear all these people saying and what I see for myself about the economy around me on Main Street causes my brain to churn like it has some kind of mental version of the stomach flu. I am sure those around me can hear and see as easily as I can what is happening in our world, so the disconnect between what they all claim to see and my own sense of reality makes me dizzy.
On what basis can anyone possibly think this is a strong economy? Look aground you, and let me point out a few ghosts, goblins and zombies that I see scattered like shadows throughout the scenery. I do it not to haunt you with woe-begotten tales fear but to reinforce what your sense of what are seeing, lest you waver in your own sense of reality and doubt your eyes as their lids start to droop under the opiate words of puppet master Powell. (All that I present is not much different for other nations right now either, so everyone can probably apply it wherever they live and maybe even multiply it to reinforce their sense of reality and their belief that they are not going insane IF they prefer reality over the hyped sentiment that pervades the wound-up world of finance.)
I’ll put it in simple bullet points to help it penetrate the fog.
Here is reality as I see it
GDP growth is shriveling rapidly and is probably lower than the Fed is letting on, and retreating GDP growth is never a sign of a strong economy.
The job market is not strong as Powell claimed it was due to a strong, healthy economy. It is tight because a huge part of the labor force quit for good in total disgust, leaving us incapacitated in production. Many of those retired for good (even Powell admits that) because their companies were destroyed by our various COVID lockdowns over the past two years. They were close enough to retirement that retraining or relocating made no sense to them. The job market has been made even tighter by the unconstitutional Biden vaccine mandates and then again by Omicron sending many out on temporary sick leave. All of those mean the market is NOT strong and healthy because of a growing, vibrant economy, as Powell claimed, but is tight because of economic ruination!
Headline unemployment is actually starting to rise again. That is never part of a strong economic picture.
The businesses that closed because of the COVIDcrisis stand out like enduring economic ruins on the landscape. They do not just represent a permanent loss of jobs, leaving more people taking from the government via social security than giving into it. They are also permanent waste of productivity littered around the nation. Those particular businesses are never coming back, and in the present plague-ridden environment, new production or service businesses will be slow to get going. (I mean who really wants to open a restaurant or hotel at a time like this when many establishments are still forced to run at partial occupancy or to turn patrons away who are not vaccinated because of local vaccine mandates?)
Inflation is a roaring inferno and not primarily because of demand due to a strong economy, as the parrots of the priesthood keep screeching, but due to shortages in the face of the greatest money printing since Zimbabwe bought new printers when the old ones smoked out.
We were told shortages were going away soon many months ago, but we can readily see they are slowly building. (Even Powell acknowledged they had not gone away, saying there were a few hints that some supply-lines were improving, but they were marginal hints at best in his view, and he was content to leave it with they are not abating for now.) There are more ships waiting to get into port, not fewer; they are just waiting out at sea, and it would take a couple months to clear out the present mess if everything else improved immediately.
China has shut down entire cities, businesses and ports in its zero-COVID policy, leaving it unable to keep up with our supply needs for both consumers and industry, and we have let ourselves become deeply dependent on China for those needs. So, that part of the supply-side shortage isn’t going away anytime soon.
Various other nations are facing similar shutdowns with lasting wreckage to some of their companies, leaving them unable to send sufficient resources and components to producers in the US.
We’re two years into a global plague, and we were told at the start of the plague we’d be heading out of it within a year. The end may be near, but we’ve seen a rise in deaths reportedly due to COVID many times. I have no idea who is right about how fake or true those reports are, but I do know that Omicron has sent a lot of people home sick. Regardless of what is real and what its the fog of delusions on both sides of the COVID argument, the plague or our perception of plague (however you want to call it) is destroying our economies.
We have a quivering mass of zombie corporations leaning out over us like some sort of shadowy collective of ghouls. These are the skeletal companies that have been sustaining themselves for years on a phantom diet of debt because their investors are running, and they have no profits. They threaten to collapse like empty sheets in a world of rapidly rising debt costs.
Those are economic realities that do not look like a strong, vibrant economy. It doesn’t matter what people say the metrics are, which are so easily massaged and rigged, but I’ll give you a real look at the most economically descriptive metrics, too.
When you look around and see the wreckage, this economy looks more like a knee-capped old man who was knocked into a casket by COVID and is trying to crawl back out against a strong wind, and that doesn’t even consider the financial meltdown many nations have with bond funds and their stock markets right now, especially the US with which I’m most familiar. If you add all that is happening there at present, the skies darken considerably around you.
No, I’m just talking in this article about the condition of the Main-Street economy where most of us work and take our leisure if we’re allowed. I’m talking about the fractures in its structures — the economy’s fundamentals, not the stock market’s fundamentals — which are why those financial markets are crashing, though the walking blind refuse to see that, too.
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