Monday, November 30, 2020

World Currency Included In The "Endgame" Reset

Many Countries Endorse A Single World Currency

The idea the world would be better served with a single "World Currency" has been growing and looms as a real possibility in the near future. Many people see this as a major part of the "endgame" or something that will constitute a needed reset to a global economy and financial system that has gone off track. Throughout history, before an economic collapse, the masses and society tend to believe things are financially stable. Only after the economy goes over the edge of an abyss and is in free-fall does reality set in. It is not by accident that blinders have been placed upon us but it is the result of distractions being thrown in our path by those wishing to hold onto their power over us. It is wise to remember that when things do become critical, those in power will not be kind to us but that we will be thrown under the bus without a thought.

Over the last one hundred years, equity markets have been a primary tool used by the public to measure the economy. In some ways, the stock markets have become a kind of switch the elites can push at any given time to energize the masses distracting them from the dangers lurking in their economic future. When markets rise despite warnings from negative fiscal indicators, the masses become optimistic. During every upswing of stocks the elites claim they see the "green shoots" of prosperity, however, these shoots seem to always turn brown and die. We have been leaping from one recession to another even though central banks claim they now hold the key to generating true and honest growth. The truth is the current stock market bolstered by easy money and stock buybacks is a poor reflection of the real economy and what is happening in many areas across a broad swath of the world.

History indicates that establishment economists trained and educated in the ivory towers of academia are perhaps the most useless of all analysts and perpetually wrong. Only independent analysts have ever been able to predict anything of value when it comes to our economic future and that is because they have the advantage of not being blinded by the propaganda and brainwashed by lies flowing from those in control. Time and time again it has been proven the appearance of prosperity means nothing if the fundamentals do not support the optimism. A bullish stock market, a high dollar index, and low unemployment mean nothing and are unsustainable if generated by false methods and fiat money. We have seen time and time again throughout history that fundamentals matter. 

The markets cannot hide from true price discovery forever. The stock market with its boom and bust cycles has proven to be a false indicator of what is really unfolding. Manipulation by the central banks has rendered this indicator of economic health useless. The problem we face is the horrible options in fiat money, massive debt, and the growth of international businesses have all come together in an explosive way. The banking elites are positioning themselves to avoid blame for this disaster while the rest of us are being sold on the most elaborate recovery con-game ever conceived and perpetuated by those with the most to gain.

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Magazine Cover Touting World Currency

Those in charge of our financial machinery have indicated to the public their desire for more power. This means creating a truly global centralized economic system and a highly controlled world currency framework dominated by a select cult of banking oligarchs. This would, in effect makes the rest of the human race their slaves.

Over the years, many articles have  referred to a 1988 write-up in the financial magazine 'The Economist' titled “Get ready for a world currency by 2018.” It outlined the framework for a global currency system administered by the International Monetary Fund. This new system was and is floated on the premise that only by erasing all national economic sovereignty can true stability be obtained. It requires governments to borrow from the world central banking authority, rather than printing currency to finance their infrastructure programs. 

 This dovetails with efforts to create such a system under the total control of the IMF which should raise the concern of every American. We are hearing more warnings and witnessing a push to destabilize the dollar as the reserve currency by China and several other countries. It is also occurring as Orwellian governments float the idea of going cashless as a way to gain further control over our lives.

For years the IMF has been openly discussing the ascension of the SDR to replace the dollar as the world reserve currency. Many developing nations that are deep in debt are already asking for help from the IMF due to volatility across the world and the BRICS are pushing hard to remove the dollar as the world reserve. This makes it a question of when such a currency reset will occur and in its wake bury the majority of the middle-class and poor throughout America. There is no way around it, the elites are positioned and merely waiting for a geopolitical disaster or catastrophe so overwhelming that when the time arrives they can portray themselves as our saviors during the chaos.

American Dollar Constitutes Bulk Of Reserves

The demise of the dollar harkens back to when President Nixon severed its tie to gold. First, it’s crucial to understand that at the very core of our global economy is a financial system dominated by the U.S. dollar which has been deemed the reserve currency.  The USD is unique in that it grants the U.S. the privilege of having a national currency which at the same time serves as the global reserve currency. This was solidified toward the end of World War II with the Bretton Woods agreement, which was accepted because the U.S. agreed to offer sovereign nations holding dollars a right to exchange these dollars for gold at a fixed price, however, with Nixon's action in 1971, the USD became a fiat currency backed by nothing, the supply of which can be arbitrarily altered and manipulated by a group of unelected bureaucrats in charge of the Federal Reserve. This money system represents the most powerful tool on the planet. 

The new world order and globalization pushed by many world leaders and the rich elite that tout "larger, more cooperative governments under one financial unit will benefit us all” feeds into the world currency scenario. Many Americans are oblivious to the fact we gain a great deal by our status of the dollar being the reserve currency by which all others tend to be measured. This means we have a great deal to lose if it is dethroned and stand to suffer the most if the dollar declines in value. Those who will be crucified are the middle-class Americans whose wealth is locked into or are holding long-term USD bonds thinking they are a safe investment.

Currently, a huge mismatch exists between the use of the dollar in the global financial system and the U.S. share of the world economy. This is why China, Russia, and several other countries that are acutely aware of this have been taking major steps to transition to a more multi-polar currency world. This is also why we should prepare and expect that in coming years the world will adopt a completely different global financial system from the one chaotically birthed in the 1970s and when this occurs the USD will lose its total dominance on the world stage, resulting in major implications for America. While many people see this coming, several opinions exist as to how it will unfold and while we engage in speculation, nobody really knows what the world financial system will look like ten or twenty years down the road.

Few of us who continue to cherish freedom can get excited about transitioning away from the USD and being placed under the thumb of the IMF or an oppressive nation-state currency controlled by a country like China. That is why many of us think the dollar will be ripped from us during a time of crisis when Americans are open to accepting any solution offered to them as a way to ease their woes. While people point to cryptocurrencies as an option we should remember politics plays a massive role in how this all unfolds. To Americans, the fate of dollar-dominated assets and their value when the dust finally settles should be a huge concern but most Americans fail to grasp the implications. 

It is my contention the transition to a world currency will take a far greater toll on paper assets than tangible goods. While recognizing the flaws of the dollar and our current system I have come to believe the other fiat currencies such as the euro and yen hold even less merit. This includes cryptocurrencies such as bitcoin. Regardless, in the end, we should expect to be told and not given an option as to what is coming. If events unfold in the way those promoting a one-world currency have planned it will be a dagger in the heart of freedom.

Tuesday, November 24, 2020

The Shocking Growth In America's National Deficit

Government Spending Gone Wild!

To say the national deficit is out of control may be an understatement. Our surging deficit is a sign of "spending has gone wild."  The important point is that covid-19 has again given us a reason to divert our eyes away from the over the top spending taking place. It appears everyone in Washington has come together and simply agreed on, "I will support your spending if you support mine!" The fact remains that while both the Republicans and the Democrats mumble about being dissatisfied over the deficit, pork packed bills continued to be signed into law.  

Calling these spending packages "bipartisan" helps spread the blame around and masks just how dysfunctional Washington has become. Sadly, it allows all the players involved to take their victory laps and claim democracy works. When criticism does arise, those we have sent to Washington fall back on the stand that it was all done in order to avert problems down the road that would further damage the economy. 

A person would have to be delusional to think this explosion in national deficits is not occurring across the world. It is a reality no matter how much effort is made to mask the truth.  It is logical that if Biden does step into the Presidential office and nominate financial uber-dove and former Federal Reserve Chair, Janet Yellen, as the next Treasury Secretary the deficit growth will explode. Those of us appalled by how the Trump Mnuchin team has handled spending should be prepared for further disappointment. It has even been suggested and rumored that Yellen would leap into buying stocks if they were to decline as little as 20%.

A close look at the economy reveals it is only this massive and unsustainable deficit spending that continues driving our economy forward. The 2017 tax cuts have not panned out the way Republicans promised when they slashed corporate and income taxes. While we were told tax reform would mark a major shift in companies causing them to bring jobs back to America not enough of this has occurred. The structural issues that haunt America's competitiveness far outweigh the benefits brought forth from Trump's tax bill and lower taxes. The ugly truth is American companies still have little reason to bring jobs home and the budget deficit is set to widen significantly in the next few years even with healthy economic growth.

It would be wise not to accept America's recent GDP as verification the economy is hitting on all cylinders. In 1962 Kuznets, the father of the GDP formula emphasized that we must keep in mind the difference between quantity and the quality of growth. While economic growth appears robust and a solid GDP number can result in a feel-good moment building consumer confidence it can also mask growing weakness in various parts of the economy. Quantity simply does not make up for poor quality, we are talking about two different animals. The false narrative that simply growing the size of an economy by adding more people into the mix or using deficit spending undercuts the importance of a solid economy and the long-term stability of the financial system.

We Are Now Off The Chart click to enlarge

The national debt which entered 2020 at over $23 trillion now tops $27 trillion. Each trillion added to our deficit represents or translates into America spending $3,333 more than it takes in for every man, woman, and child in the country. To clarify, this fails to include State and local deficits as well as a slew of "off-book" promises and spending that are also being made. Adding $13,332 of new debt for every person in the country in just one year spells big problems going forward. If we do not begin to face up to reality and get in front of our problems we will soon find ourselves solidly behind the eight-ball.

History shows government spending is a poor substitute for the free market when it comes to allocating capital to where it is most effective instead it creates a false economy by borrowing from the future. Deficit spending is not a silver bullet without consequences. The fixation on the stock market and not the real economy represented by Main Street does a great disservice to Americans. While Trump may have been correct in pinpointing many of America's economic ills his prescriptions for a cure, like those before him, leaves much to be desired. 

Corporate investment decisions are based upon the cost of capital and the prospective equity returns that new investment can generate, not how much capital is available and in our current cheap and easy money, environment capital is basically free. The problem is not funding new investments, but finding endeavors in which to deploy this capital. The economists who largely control the major central banks in the industrialized nations may be able to manipulate markets and cancel excessive debt through open market operations, but they cannot manufacture attractive investments. This is why stock buybacks have become a corporate priority joining other investments that are not productive.

Click Here To Visit The Active Debt Clock

The deficit spending propping up our economy has gone far past anything we might have envisioned just a decade ago. Nowhere is this more evident than when we visit the active US Debt Clock shown on the right. Many people don't realize it but indirectly this deficit spending by our government also fuels our trade deficit. This contributes to our massive trade deficit with Asia and even our huge trade deficit with Mexico which becomes even more disturbing when you begin to understand that money quickly passes through Mexico and flows to Asia. It could be argued that when all is said and done the money flowing into Mexico still ends in the far east only it takes  the scenic route. 

The idea we will reach a quick fix to the trade problems facing America is a myth and oversimplifies the problems before us in achieving a sustainable trade balance. Reaching a reasonable solution posses a major difficulty in that China is so entrenched in its ideology it most likely will refuse any change that will throttle back its plans of domination. The bottom-line is that Washington has become a hostile and unfriendly environment for those interested in good governance. The crux of this post is to point out deficit spending is not a silver bullet, it has real consequences and with each step forward we get closer to the end of the road. While those embracing Modern Monetary Theory may argue otherwise, Econ 101 teaches that such actions always lead to a very bad place.  

Saturday, November 21, 2020

Amazon's Deceitful "Feel Good Ads" Mislead Consumers

Going into the holidays a slew of "feel-good ads" from Amazon now hitting the airways is intended to mask the miserable truth about this company. Amazon has many critics on both the political left and right. While praised and pushed forward by politicians such as former President Obama as a job creator it has drawn ire from progressive heavyweights like Bernie Sanders for how it treats its workers. Now that stores are closing all across America and jobs are being lost much of the myth of Amazon being a positive force has vanished. Also debatable is the claim Amazon is not harmful to the environment, not only does it's delivery system and cloud use a great deal of energy but it has been documented that a huge percentage of products sold online get returned and end up in landfills.

Amazon Is Not Your Friend!
In early October an article published on Viable Opposition took a strong look at the findings of the national non-profit organization Public Citizen. It delved into how Amazon benefited from the COVID-19 pandemic by gouging customers on what it sold. The fact that more shutdowns now appear in our future as tests show increasing numbers of cases makes this extremely important. Amazon's pathetic effort to distance itself from its sins with a PR campaign does not erase them.

The key findings of the Citizen Prime Gouging report are

  •  Amazon set prices of products during the COVID-19 pandemic to levels that would be considered violations of price gouging laws in many states.
  •  Amazon has misled the public, law enforcement, and policymakers about price increases during the pandemic.
  •  Numerous examples of price increases were found on essential products on Amazon.com, some as much as 1,000% over the expected price.
  •  Amazon publicly blamed so-called third-party sellers for price increases while continuing to allow third-party sellers to increase their prices.

This took place at a time when many bricks and mortar stores throughout the United States had been ordered shuttered as a result of the pandemic. With stay-at-home orders issued by state-level governments, many American consumers turned to shopping online for goods they needed during the pandemic. Below are some examples of price gouging by third-party sellers on items that were considered necessities for consumers:

 


The chart below gives examples of price gouging on products sold directly by Amazon. Many of these items are considered to be essential components of PPE while other food products were in higher demand as households turned to home-cooked meals because they were ordered to shelter-in-place:


 

Of course, Amazon's response was to distance itself from price gouging in March 2020:


 
Longtime readers of AdvancingTime blog know this is not the first time Amazon abused its relationship with Americans while they were suffering. In an article titled, "Walmart Gave, Target Gave, Amazon Gouged!" in 2017, I detailed how Amazon.com increased prices on basic supplies ahead of Hurricane Irma’s landfall in Florida. At the time, Kate Taylor of Business Insider reported that customers took to Twitter to share screenshots of water from various brands — for example, Aquafina and NestlĂ© — priced roughly between $20 and $25 per case. Usually, the same cases of water sell for between $4 and $8, this means that the screenshots demonstrate Amazon was gouging customers for about 500 to 625 percent.


Amazon is a self-promoting hype machine that is far from transparent and while many politicians fall over themselves to be in its shadow it is not our friend. Because of its massive advertising budget and other ties to Amazon, we find the media often seems to be in bed with Amazon and continually portrays the company as both the flavor of the day and the future of commerce.  This means you seldom hear anything bad about the retail behemoth turning the articles put before us into nothing more than free advertising. These so-called "news articles" are often spun to place Amazon in the most flattering light. This explains why the issue of price gouging remains an under-reported story. 

Technosexuals Can Be Created By Loneliness
On a lighter note, or shall we say, in a rather strange reflection of how some people are reacting to technological changes, the term "technosexuals" has been coined. A new study commissioned by WeVibe, a sex toy company, found loneliness and anxiety during the virus-induced lockdowns has likely resulted in some people becoming sexually attracted to machinery, robots, and even smart-speakers. As bizarre as it might seem, WeVibe surveyed 1,000 men and discovered 14% of respondents confessed their Amazon smart-speaker sexually aroused them. 

To these people, Amazon's smart-speaker, also known as "Alexa," has extended its role from just fulfilling questions about the daily weather or telling jokes but the Chinese-made device is fueling their sexual fantasies. Lucy Beresford, a U.K.-based psychologist, wrote in The Telegraph that the number of technosexuals is increasing and that society is sleepwalking into an epidemic due to loneliness and a growing fear of intimacy. All this has left me wondering if this is another part, or arrow, in Amazon's plan to shape the future and our opinions by extending its hold over individuals. 

Due to its strong ties to America's government, Amazon has been allowed to create a persona or facade that far outshines reality. Amazon has adopted a full-on engulf and devour strategy to weasel its way into our lives. It is difficult to quantify all the damage Amazon has done to America as it has burrowed its way into the fabric of society. Amazon is the destroyer of the stores that provide valuable jobs and has exploited communities by continually telling consumers it is the answer to a "better America" while feeding at the government teat.

No federal price-gouging law exists in the United States but it is illegal in about 35 states. This means the free market is often considered the final arbitrator on pricing. Americans can shop online from any state which makes state laws against price gouging ineffective. This does not mean steps to prevent such actions by companies could not be put in place or that consumers cannot retaliate by taking their business elsewhere if they are aware they are being abused. Sadly, "feel-good ads" intended to create the illusion a company cares about its customers tend to massage away the truth.

This brings us to one last point. There is no denying that one person who has benefited from all the misery flowing from Covid-19 is Jeff Bezos. Thanks in large part to the significant increase in sales volumes and the price gouging noted above as a result of the government-imposed lockdowns Amazon has benefited greatly. According to Inequality.org, this has boosted the personal wealth of Jeff Bezos. It rose from $133 billion on March 18, 2020, to $206.4 billion on September 4, 2020, an increase of 55.2 percent. Maybe a hefty massive fine by the federal government over "price gouging" would take the snicker off his face.

Wednesday, November 18, 2020

China Has A Plan And We are Not In It

The news that on Sunday China signed a massive free trade deal with fifteen Asia Pacific Nations confirms China is busy cutting a path forward even as much of the world is in economic turmoil due to covid-19. This is a major victory in that it encompasses almost one-third of all global economic activity. It also gives the impression the United States is being left out in the cold. The Regional Comprehensive Economic Partnership, or RCEP, establishes the world's largest trading block. It was signed virtually during the annual summit of the 10-nation Association of Southeast Asian Nations (ASEAN).

One Belt One Road Is China's Path Forward
This underlines the fact that despite economic problems popping up in countries across the world, China is hellbent on pursuing its goal of galvanizing itself as the leading global power. Not waiting to resolve trade issues with America, China is busy turning economic lemons into lemonade. One example of China reaching out can be seen in its courting of Europe. Last year the European Union and China, after a series of meetings, came up with an important joint statement. It outlined agreement on three quite sensitive fronts and paved the way for a complex, wide-ranging EU-China investment deal. 
 
To put this in context, this came at a time when the German government had just cut its GDP forecast and the Euro-zone economy was slowing. The statement was signed by Chinese Premier Li Keqiang, European Commission President Jean-Claude Juncker, and head of the European Council, Donald Tusk.
This has been described as "the real deal" and is viewed as a departure from antics such as the endless Brexit saga. The agreement was free of any accusations of “unfair” trade hurled at Beijing. It appears that Brussels and Beijing seem to be finally engaging in building some sort of synergy between the One Belt One Road (OBOR) Initiative. this is outlined in the EU Connecting Europe and Asia project report.
 
China is pushing forward and financing OBOR with its economy having a huge debt/GDP ratio already well above 300% according to the Institute of International Finance.  https://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/27/China%20debt%20GDP.jpg


The president of the World Bank, David Malpass has claimed there is too much debt floating around the world and China is a big reason why. While his view could be written off as totally political, this is not the first indication that China has gone, shall we say, over the top in creating new credit. Last year the IMF has warned China of the risk having to do with increasing China's debt by agreeing to loans which could prove economically explosive. More and more of the debt over the last year has been related to and intricately interwoven into China's far-reaching and encompassing OBOR initiative. Malpass said, “There are challenges facing the world in terms of how do you have transparent projects that are high quality, where the debt is transparent. China moved so fast that in some part of the world there is just too much debt.” 
 
While at the IMF, Christine Lagarde the current head of the ECB raised these concerns and has made it clear that Beijing was fully “aware” of the potential potholes associated with such a massive undertaking as OBOR and underwriting its funding. The cost of the planned network to connect China with 68 countries and 4.4 billion people across Asia, Africa, the Middle East, and Europe in a labyrinth of multi-trillion-dollar transportation, energy, and telecommunications infrastructure projects may total as much as 8 trillion U.S. dollars.
Now Airborn The C919 Will Be A Major Player
Articles have appeared on this site over the years arguing that China is not our friend and its economy is predatory by nature. One such article explored how China was ramping up its fledgling aviation industry and how when it hits its stride we can expect cutthroat competition. The article warns that COMAC (Commercial Aircraft Corp. of China) claims its new twin-engine, narrow-body design of the C919 is superior to the Boeing 737  the best-selling jetliner in the world. COMAC also says it can bring the C919 in at a price lower than the $50 million range that Boeing and Airbus charge for each of their planes. If history is any indication, this industry will not grow organically but to be driven forward by an aggressive government with a mission. When China's aviation industry takes flight over the next few years America and Europe should expect to say goodbye to a huge chunk of exports in this field.

Chinese-Bullet-Trains On Display
Another issue addressed in past blogs is the merger of China’s two largest companies involved in the production of railway locomotives, bullet trains, passenger trains, and metro vehicles. It pointed out that no effort was made to deny the impetus for the merger of China CNR Corp and CSR Corp in 2015 was the quest for a deeper push into overseas markets. Since the merger, China has been able to win by a wide margin nine-figure contracts, such as the supply of metro cars to Boston and LA. It should also be noted that CRRC formed a consortium with Bombardier which allowed it to compete for the renewal of the New York subways a huge contract that should amount to around 1.5 billion dollars.

Another article focused on America's trade deficit with Mexico. When following the money it becomes clear that money from the United States huge trade deficit with Mexico eventually ends up in China.  When you start thinking about all the money and jobs we shift into Mexico each year you would think by now Mexico would be rolling in cash, however, a bit of research quickly confirms that the money Mexico receives by way of trading with America quickly passes through its lands and flows to Asia. It could be argued that when all is said and done we are still transferring our wealth to the far east only by the scenic route and each year the numbers are huge. North Americans have been sending over half a trillion dollars a year to Asia each year.

Emboldened by this influx of wealth China has played fast and loose with creating and loaning out new funds. As debt service rises, this can create serious balance of payment challenges. OBOR to move forward has to provide the financing for infrastructure that many countries desperately want and need but will they be able to repay the loans in coming years? The Center for Global Development, a Washington-based think tank, has highlighted in a report entitled Examining the Debt Implications of the Belt and Road Initiative from a Policy Perspective, the underlined the problems of extending credit to poor or unstable countries. It has pointed out that as many as 23 countries could be prone to “debt distress.” This group includes Pakistan, Djibouti, the Maldives, Laos, Mongolia, Montenegro, Tajikistan, and Kyrgyzstan which were rated in the “high risk” category. This brings us to the question of whether OBOR will become a massive expensive bridge to nowhere?

While China has lent trillions of dollars to countries the motivation behind these loans must be questioned. Circling back to Malpass, it should be noted he has also criticized China for taking low-cost loans from the World Bank despite being the second largest economy in the world, China even surpassed the bank’s income threshold for low-cost loans in 2016. Malpass has also been critical of China’s lending in conjunction with funding its OBOR infrastructure initiative claiming these loans can saddle weaker countries with “excessive debt and low-quality projects.” 
 
The bottom-line is, China is our rival. China's state-run economy is based on a business model that is geared to expand by crushing the competition. China has no intention of being locked into producing low-end manufacturing of basic goods but is determined to move into high-tech products. China's plan centers around both state-owned and private firms investing in and acquiring foreign companies to steal their technological innovations. Subsidizing those companies working within its system in a multitude of ways helps China achieve this goal. Countries that export goods at slightly below cost in exchange for manufacturing jobs are not stupid they are predatory and America and the rest of the world are their prey. 

Saturday, November 14, 2020

Election Distraction Has Taken Eyes Off Our Economic Ills

See the source image 

Lately it has been difficult to write about the economy because of all the noise flowing from the election and covid-19 hype. There is a growing reluctance to opine by many economic skeptics because it appears we have been wrong on recent predictions. Only time will tell if this is true due to the huge distortions now evident in the markets. Still, all this tends to diminish confidence in the ability to see what is ahead. This has forced not only me, but other economic watchers to go back and question all we hold true.

Unfortunately, other than moving a few pieces around the board, the recent actions by the Fed only continues to move back the day of reckoning. The "extend and pretend illusion" our economy remains on a sound footing is alive and well. One place this is evident is in the area corporate bond market where many bonds now hold an investment-grade BBB rating. If a company or bond is rated BB or lower it is known as junk grade, this means the probability the company will be able to repay its issued debt is seen as speculative. 

In this troubling time of covid-19 where companies are being stressed and tested, we have watched the high yield option-adjusted spreads fall back towards pre-covid levels. The fact we have not seen yields rise as lending standers have tightened indicates the Fed has removed the liquidity problem. This has temporarily masked but has not solved the solvency problem. As the "lag time effect" kicks into gear expect a growing number of defaults and bankruptcies to take place.

This will become more visible especially now that we are encountering a resurgence of the virus pandemic. The tightening of lending standards generally leads to a huge increase in interest rates but not so much today and with companies floating new bonds they are leveraging up their balance sheets as a way to stay in business. This doesn't mean they are viable or will be in the future. It also brings about the question of whether they will be able to repay this debt especially if rates rise which at some point is very likely.

Without a doubt, certain areas of the economy have been impacted far worse than others. Airlines, hotels, cruise-lines, and a few other sectors have been decimated. The World Travel & Tourism Council (WTTC) published a report recently predicting that over nine million jobs could be lost in the US Travel & Tourism sector this year if barriers to global travel remain in place. The WTTC's warning is just another latest reminder of the deep economic damage occurring due to the virus pandemic that continues to batter the economy. 

WTTC's research outlines between 10.8 million and 13.8 million jobs within travel and tourism remain at serious risk. According to the WTTC report, 7.2 million jobs in the US have already been impacted. If restrictions on international travel aren't lifted, and further stimulus isn't seen, 9.2 million jobs, more than half of all jobs in the sector, could be lost. Stimulus in this case is generally seen as government bailouts. Travel and tourism accounted for at least $1.84 trillion to the US economy and was responsible for 10.7% of all US jobs. 

This is just one example of how much the economy has been affected. We should have no expectations that international travel or tourism will resume or return to normal in the near future. As this is being written, increased social distancing restrictions are being reimposed in Europe and the US. Companies adding to their debt load in order to survive while seeing their business erode are digging a deep hole from which they may never emerge. The ripple effect as this works its way through the economy makes this even more daunting.

When we couple the underlying ramifications flowing from the trends above with the fact that automation and the use of robots to perform tasks that in the past have been done by humans we should be very concerned about the loss of jobs. This gives credence to the idea the Government and the Fed are holding all this mess together with simply a promise and a prayer. This creates a rather poor quality hook for which investors to hang their hats.

 

Footnote; If you go to this YouTube video, https://www.youtube.com/watch?v=zuUnZFrR3K0&feature=emb_logo by Jeffrey Gundlach to CIEBA Financial Professionals titled "Hey Kids, Want Some Candy." 10-20-20, around 32 minutes into his presentation he hits an area that really brings home the issue we face huge problems ahead. 

Sunday, November 8, 2020

CoVid-19 Not As Deadly As We Thought But Now What?

In some ways, much of the election became about the handling of Covid-19. One thing we have learned since this monster out of China has spread across the world is that Covid-19 is not nearly as deadly as we once thought. Because of how things were handled in China fear exploded. This resulted in many people getting the image of Covid-19 hitting on the level of the black plague. We were presented with the idea trucks might roll down our streets with loudspeakers blaring, "Bring out your Dead!".

On March first of this year, I published my fifth article on Covid-19. It seems I was early to the table claiming it had the potential to be a big deal. At the time some of those reading my articles criticized me for writing about a disease that didn't exist. Like many people, I never would have predicted much of what has unfolded since. Whether it is because Covid-19 has become so politicized or because those in the scientific and medical community simply cannot agree as to the answers, so far many questions about Covid-19 have not been fully addressed. 

Back in March, I put forth the following questions stating," What we really need to know about the corona-virus is how it will affect us as individuals. At the time, the picture presented by governments was sketchy at best. Driven by agendas such as preventing panic and spinning the ramifications to lessen their toll on financial markets made what we were told unreliable. The big issue facing those interested at the time was what to expect and how to prepare. Below is a list of what I saw as the five most five crucial issues before us.

  • Just how deadly is this thing and what are the odds you will get it?
  • Are we looking at citywide lock-downs such as those that have been instituted in other countries?
  • Is it expected to return time and time again and how long before we know? 
  • If I or someone I know appears to start showing symptoms, what is the best course forward?
  • What are the long and short-term economic consequences of this outbreak?

Covid-19 Is Not As Deadly As Thought
In the minds of the public several concerns and issues remain unresolved. Whether it is because Covid-19 has become so politicized or because those in the scientific and medical community simply cannot agree on the answers the fact is many of these questions have not been fully addressed. Today, with it clear Covid-19 is not the "get it you die" killer we thought, the questions above have been replaced with several others. Most of us are not panicked but slowly becoming resolved to the fact we are living in a world that will never be the same. Our lifestyles have undergone some rapid social adjustments as the concerns of being stalked by such a virus have unsettled in.  

The public has good reason to be skeptical of what we are being told when the so-called experts can't agree on how long a person should be quarantined and continue changing how long the virus can live on different surfaces. In truth, we have no idea how far this virus has spread. Remember, not everyone that has been infected has been tested. Many countries have few health care facilities and still suffer from a shortage of test kits. While this virus is particularly dangerous because many carriers of the infection show no symptoms the big question is whether it merits such stringent measures as to locking down the movement of people in large areas to stop its spread.

Other issues revolve around when and how a vaccine will be received.  Most vaccines have very long study periods that most likely won’t be done before a vaccine is hastily rushed through development. This has led to growing questions and fear about whether it will be safe or how it effective it will be mean many Americans are not enthusiastically ready to be vaccinated. Talk about it being required or mandated does not sit well with a large part of the population. Of course, the bill for all of this will be massive and we the taxpayers will get stuck with all of it. All of this is truly an incoherent mess in which both social media and a bias media with an agenda have worked extremely hard to spin and politicize.  

The mainstream narrative is that  Covid-19 remains a quite deadly and novel disease and there are no effective treatments. This means that society must do all it can to help the brave health authorities that care about saving lives including surrendering our liberties and shutting down the economy. with a second and possibly third wave ramping up across the U.S. and Europe and there’s nothing we can do to limit it except shut down businesses and halt the ability to travel and gather. Much of this narrative and hype is based on the idea every life is precious and equal. It discounts the fact quality of life matters. Keeping a ninety-five-year-old person with Covid-19 alive could be seen as not saving a life but merely extending it at great cost.

Deaths Did Meet Predictions 
Some covid skeptics might go as far as to argue this has become just as much about money as health, and we are talking trillions of dollars. Slow-moving incompetent overpaid bureaucrats within governments with strong agendas generate and control both the data and the narrative. Whether the goal of a government is to limit panic, deflect criticism from its failings, or simply generate the impression they have control of the situation we pay the price. When we step back and look at what has so far occurred we find that perhaps locking down societies doesn’t do much to combat the disease while it does do a lot to ruin people’s lives and livelihoods? 

The alternative narrative is very different. it is based on the idea that while covid-19 is a dangerous disease, it is not novel. Some people argue a combination of mostly OTC supplements could reasonably be expected to drop the severity of illness and the already low mortality rate by 90% or more. Common sense an assortment of very effective, inexpensive widely-available methods of preventatives exist that lessening its impact. Still, we are told health authorities have shown either zero interest in the results of such studies mainly conducted in poorer nations or they have actively run studies indicating these cheap, effective therapies could be dismissed.

It appears someone is bending the truth when we hear or are told that in Sweden, where virtually nobody outside hospital settings uses masks, the 7-days rolling deaths per capita has been lower than in the U.S. for months. It is also lower than in the U.K. which is in a mask-wielding and lockdown craze. Even Germany is said to have more people dying with Covid-19 than Sweden does. Infection rates and spread trends since the height of summer now are beginning to look similar if you’re a massively mask-wearing country or not. In many ways, the ramifications of the media, big tech, and Orwellian governments using this virus to increase their control over a docile populace is even more threatening than the pandemic itself. 

Today, just like months ago the long and short-term economic consequences of Covid-19 remain uncertain. Certain sectors of the economy are destined to continue taking it squarely on the chin. Businesses involved in things where people gather or move about remains in peril. The disruption of production and deliveries will continue to have a massive effect on business. Many small businesses without the financial resources to absorb losses and weather this storm have already failed and as this rolls on jobs will be lost and inequality will grow. Expect companies to continue shortening and reducing the weakest links in their supply chains. It is impossible to deny these long-term consequences will stay with as the threat of Covid-20 and 21 linger in the shadows just out of sight.

 

This is the link to that March first article; https://brucewilds.blogspot.com/2020/03/coronavirus-five-things-we-need-to-know.html

Tuesday, November 3, 2020

Coming Together Post Election Will Be A Huge Task

Biden Voters Make The Same Claim!
To say this election has been divisive is an understatement. A great number of people are angry and pissed off over various issues. Most Americans are hanging on to the hope their candidate in the Presidential election will be victorious. Expect a huge spike in emotions when the reality hits those that are wrong. Few voters are prepared for the reality that their man has gone down in flames and facing their interpretation of what that will mean in the next few years. The very personal and raw emotions of many Americans will only become apparent when the winner is finally announced.

All this may be made worse by the fact results as to who will be sworn into office come inauguration day may not come in immediately. This may drag on for weeks even months. On January 20th this does not end, for many voters, it will only be starting. The thrilling feeling your man will be victorious will turn into growing apprehension and fear for those disappointed by the results of this election. These feelings will not fade gracefully into the night.

Voters Showing Strong Feelings
Families have been divided and friendships ended because of differing views of whether to support Donald Trump or Joe Biden. Not only do many voters strongly dislike or "hate" one or the other of these men but this extends to what they stand for. To many voters, Trump and his Make America Great Again agenda is void of compassion. Adding to this is the fact he has been branded a liar because he tends to stretch the truth. Biden on the other hand has been demonized as an old school politician that sells out America and panders to the socialist left.

Much of this feeds into how we as Americans will be treated and the path our country will take going forward. The economy, taxes, and the budget are all concerns. Growing inequality must be addressed going forward but much of what we have seen occurring has been because of Fed policies. Raising taxes is another difficult issue because it is difficult for the working middle-class to think they will not be hit when efforts to redistribute wealth take place, part of this is because taxing the rich will simply not generate enough money to pay for even a fraction of the social programs that have been proposed.

This has been a polarizing time signified by a take no prisoner attitude. The idea America will not survive four years of this or that guy has been put out there and accepted by many Americans and claims that the results will be rigged are also rampant. The balance of political power will also be  decided by whether the Senate also falls in line with the same party that wins the White House. It may be the best many Americans can hope for if their man fails is political gridlock.


Sunday, November 1, 2020

It Is Important To Always Be Learning

The embarrassment of being one of those people that could be described as a "know it all" around the age of twenty should haunt me but I have learned from it. Thinking you have it all figured out at an early age will most likely leave you surprised as you move forward in life. Time will probably teach you that you still have a lot to learn. Life is a learning experience and one that is generally full of humbling surprises. As the ground continually shifts below us we often find ourselves on unexpected paths that become our life.

Smartphones Don't Make People Smart

Sadly, many people do not understand the importance of continually learning and staying engaged in life. This explains why some people seldom or never pick up a book, stay current with news events, or read. A mind that is not exercised becomes weak and feeble. Such a mind slowly loses the ability to question what it is told creating a situation where it can be manipulated by propaganda.

Society has not placed continued learning as a priority on its list of values. The philosophical question of why we are here has been pushed away and replaced with what could be considered superficial concerns. An example of this can be seen as people go through life solidly attached to their cell phones, or rather smartphones which links them to everything and then some.

I'm constantly appalled by how much I learn each day and how this knowledge sheds light on all I don't know. These new lessons tend to lead me to ask even more questions. Each sheds more light upon what we still have to learn. Because of the type of work I do, rather than assuming the person I'm talking to knows about what is involved in fixing this or that I often ask if they know much about a certain subject, usually the answer is no.

Decades ago I read a book by Anthony Robbins, a well-known self-improvement guru, In the book Robbins promoted an idea he called CANI. This stands for Constant And Never-ending Improvement. This is a concept that I have adopted and strongly recommend. It is rooted in committing to seeking small incremental improvements in your life each day that will allow you to grow in all areas of your life. The part of  moving forward that is based on the importance of knowledge and experience can not be underestimated.

Something Here Is Not Right

Today we are blessed with many sources from which we can get information. The internet, while often frustrating because of its tendency to drop us into a "same info loop," is a wellspring of knowledge. A great number of videos on how to do repairs as well as charts and figures are readily available. While they don't always answer the questions we seek, the information can still point us in the right direction.

As to the importance of knowledge and experience, it saddens me greatly that it is so difficult to pass on and that each day as people die it is simply lost. It is also ironic that we as a society seem in such a hurry to pass off the responsibility of making decisions to the young inexperienced and unproven simply because they have a degree from some institution of learning. 

Another problem we face is that with so many experts specializing in a certain field of their profession is that many lack valuable cross-training. This leaves large gaps in what they know and how it fits into the larger picture of the world around them The ability to look back at all the things we have done wrong and our failures is often one of the best ways to learn. One last thought, to quote a Guinean proverb, "Knowledge without wisdom is like water in the sand." For now, that is all I have to say about that.