How Can Productivity Soar When "That" Is Out Of Stock?

Recently a person that gets about shared with me a story about how coffee shop employees spent much of their day telling customers, we can't make that. The problem, of course, was they were unable to get the ingredients. Not only did it reduce sales but it left customers a bit peeved. While understanding it is not the fault of the barista, somewhere in the back of their mind they probably blamed someone in management for not making sure enough inventory was on site.

We should wonder how productivity can soar when so many items are out of stock and companies don't have "that." This is a problem caused by supply chain disruptions. The ramifications loom large as shortages continue adding to the cost of doing business. Much of this is due to shipping issues. Adding to the problem is due to the cost of carrying inventory many companies over the years have moved towards a just-in-time system. This means not stocking huge quantities of goods but bringing them in just before they are needed has left shelves empty.

Outsourcing the manufacturing of products to distant lands has come back to bite us. Once considered the way to lower cost and increase profits now means we have become far more dependent on logistics. Hopefully, the latest supply chain failures and increased animation will be enough to cause companies to rethink returning much of their production closer to home. For now, all this is driving prices higher and adding to inflation.

Yes, supply chain shortages are real and yes, they are destroying productivity. A couple of months ago Shelly Fagin wrote a piece titled; List Of Supply Chain Shortages. In the article, she delves into the bottlenecks in the chain explaining why this is occurring. The list of items having a difficult time getting to consumers is both broad and long. It includes everything from different kinds of foodstuff, to water pumps, and semiconductor chips. This has created a domino effect slowing the production and availability of even more products.

It Is Hard To Sell From Empty Shelves

Returning to the story about the coffee shop, the problem is that employees are being paid not to produce but to disappoint. This is not a successful formula for any business owner. Sadly, it is occurring every day across America and hurts small businesses the most because they often do not have the resources to ride out the storm. Imagine being the business owner that has seasonal items arriving at their door too late to be sold. How do they sell that new shipment of Christmas tree lights that arrive in February?

Another issue acting as a double-edged sword on productivity is the "Amazon business model." The inefficiency of shipping products directly to consumers is a subject raised here on AdvancingTime in a recent post. This inefficiency was hammered home on December 26th and 27th on NBC news. While the news did not blame Amazon directly it attacked the wasteful process of selling online. NBC looked at how new products purchased online were often returned and the cost to a business for taking these items back. It reported it cost $33 to take back an item sold for $50 and how this is crushing profit margins. NBC went on to detail how many of these items end up in landfills were never used.

As a side note, it should be mentioned that many of these items ending up in landfills unused were manufactured in China. How ironic, the fact we buy so much from China rather than making more goods at home is one of the reasons for the current supply chain debacle. There is a slang expression we sometimes hear people say, "you can't make this shit up." This idiom is used to describe a situation, event, or action that is or seems especially bizarre, surreal, or hard to believe. To put this in context, Americans send their wealth overseas to buy the goods our system is designed to throw away. 

When all is said and done the combination of sorry we don't have that and paying employees to take back items previously sold online so you can send them to a landfill decimates profits. In the latter case, it is also an environmental disaster. The only place the second matter can be cheered is that in some sick way it adds to the GDP. Yes, one of the dirty little secrets of our political leaders is, waste adds to the GDP.

Footnote; Information from the following articles fed into this post.

1.  https://medium.com/age-of-awareness/list-of-supply-chain-shortages-f9adc4e41967
2.  https://brucewilds.blogspot.com/2021/12/amazon-predatory-monster-unleashed-upon.html
3. https://brucewilds.blogspot.com/2021/02/the-dreadful-c-word-conserve.html
   

 (Republishing of this article welcomed with reference to Bruce Wilds/AdvancingTime Blog)

Less Gifts and Far More Christmas Would Be A Blessing

Even The Grinch Knows This

Each year, I hope we will see fewer consumers gone mad. Unfortunately, while we constantly have the notion of climate change and going green jammed down our throat people seem to buy just to be buying. Yes, Christmas is the time of year when we buy and give in an act we have all come to know as gift giving. 

In a mind-numbing barrage, stuff peddlers rush to fill any need that can be imagined. We are even asked to reach out and consider, and speculate, on the needs and desires that others might have. Over the years our lives have become so crammed with material goods, our drawers and closets are now chucked full of the trendy apparel of last season, exercise equipment, knick-knacks, and electronic equipment. For some people, the place where they live is about to explode unless they move to a larger house or rent a storage unit.

Many garages across America are so full of this stuff cars can no longer be parked inside. Neurotic people with overactive pack-rat syndrome destroy their quality of life with clutter and junk. This stuff will often sit in one place for years while they can’t find a chair to sit in or a clean tabletop on which to eat. Ads like - "get it all" or "have it all," live on the cutting edge, buy all of these high-powered models, and "put your life in the zone." fill our lives. This new-fangled electronic gizmo does it all and more, look at the artwork, let it wash over you, surround you, and cover you up. Check out that perfect car, driving it would make life a zen-like experience. Buy it now with no payment for 90 days.

Consumers often get caught up in the game of finding the perfect patio furniture and buying it only to use it twice. It then sits on a patio deck to fade in the sun. Never before has man had so much, but it's far from enough. The idea things will be “swell" and life downright peachy only after you fill it with the right kind of stuff is a slippery slope. The fact is for some people they will never be able to get enough. The one thing we can count on is that tomorrow the new models arrive, better and sleeker with even more options!

During Christmas, the overwhelming efforts we make to fill our needs with material objects in an effort to achieve happiness are almost laughable. We rush around creating video and digital images in a desire to preserve those precious moments but most are never downloaded, viewed, or printed. We may have the ability to collect and store vast quantities of information and data but much of it is never processed or utilized. It is all akin to poor quality or obsolete data entered into a system which results in "garbage in - garbage out."    

It seems the ads filling our Sunday paper and mailboxes weigh ten pounds, the ads, the ads, the ads. Many are from stores we have never heard of and will never visit. They are all the same, junk, junk, junk, buy me some happiness! It is only natural to be drawn to nice things but new is merely a point in time and not a reflection on quality or utility value. We have so much junk we can’t find the item we need or want, so we are forced to buy a replacement until we find where it was placed. You know it’s true – yes, you are guilty, so are we all.

The fact there is a lot more to life than stuffing your face with too much food and running around trying to find things to buy. This is made clear by the picture appearing to the right. Life is about more than buying and spending. So many people are not as fortunate as we that have been born in America and we should count our blessings and good fortune. When all is said and done it is more likely the most precious moments in our lives will center around people rather than things. We should never forget that trying to do the right thing for our fellow man is an important part of being alive.

We have even been convinced that we should not leave our house or office without a bottle of water, if it were not for bottled water, we would all be dead. Bottled water was a three hundred billion dollar industry last year. Oh, how our needs have grown. Well, all I really need is a lamp, an ashtray, and well maybe a yogurt maker. That’s all I need! Using a line by the songwriter-singer Jimmy Buffet, I want to go where the women and water are free. All this means that for many of us it is time to take a deep breath and forget about material things. This might make a lot more room for us to remember what is really important, people and family.

Merry Christmas to All!!

 Republishing of this article is welcomed with reference to Bruce Wilds/AdvancingTime Blog

 

Inflation In 2021 Far Different From What We Had In 1979

The inflation of today is a starkly different creature than what we faced in 1979. The world is massively different and presenting us with a strain of inflation that will most likely be stronger and more difficult to combat without major disruptions to our economy. This article is an attempt to highlight the differences and why today the position we find ourselves in is much more precarious.

New data released by the Bureau of Labor Statistics showed price inflation in November rose to the highest in forty years. Allianz Chief Economic Advisor Mohamed El-Erian warned the Federal Reserve is losing credibility by not tapering its balance sheet to rein in inflation. Appearing on CBS' "Face the Nation" he stated the most significant miscalculation in decades is the Fed's inability to characterize inflation correctly. It was only on November 30th that Fed Chair Jerome Powell finally retired the term "transitory" and opted to label inflation as persistent. 

President Biden responded to rising inflation has been to call upon Congress to pass his Build Back Better plan. Biden claims this will lower how much families pay for health care, prescription drugs, child care, and more.” In reality, of course, the passage of BBB would increase inflationary pressure throughout the economy and only transfer these soaring costs from the individual to the government.

The idea the economy of 2021 is strong enough to allow a rapid and huge surge in interest rates such as those imposed upon America in 1981 is false. During America's prior bout with inflation 40 years ago the economy was able to withstand the shock. Yes, we did have a recession, but it was short-lived because the foundation of our economy was much stronger. America was not bleeding from huge trade deficits and people had real jobs.

Debt And The Money Supply Are Rising Much Faster Than The GDP

Today, after years of trade deficits, America's economic foundation has grown much weaker. We have created the illusion of economic growth by blowing the lid off government spending. This has created a false economy and should not be confused with real growth. The chart above has been circulated in many forms. It reveals the GDP lagging the growth in the money supply and debt. We are living in a completely different era and facing a far more serious problem.

The cause of inflation during the 1970s is blamed on several events specific to that time in our history. Part of it was due to rising oil prices (oil prices tripled in the 1970s). There was also inflation due to rising wages. Unions were relatively powerful and their bargaining for higher wages to keep up with the rising cost of living created a wage-inflationary spiral. Yous should also throw in spending on the Vietnam War and Nixon cutting the tie of the dollar to gold. The result was an inflationary mindset that exploded as investors and waves of people started investing in ways that would protect them from being ravished by a falling dollar.

Fast forward to the end of 2021. Today, many people are busy blaming the recent inflation on supply chain disruptions resulting from the global pandemic. In truth, much more focus should be turned to the surge in money supply, government spending, and Fed policies. The result from the combination of these toxic paths forward has created a slew of new problems. Surging inequality, more reliance on government. 

Lock-downs initiated by governments to halt the spread of what turned out to be a "not so deadly" virus also have added to our woes. This is evident as small and mid-size businesses struggle to stay afloat in a world where huge companies have access to cash and many options not afforded to their smaller competitors. Today the "Amazon effect" is continuing to ravage America while its full impact has yet to be felt in most communities. It seems that only after Amazon has wrecked communities leaving many Americans jobless and retail stores sitting as giant empty shells might short-sighted consumers finally realize Amazon is bad for America and its distribution system an affront to the environment.

The idea anyone can predict how creating trillions, upon trillions, upon trillions of dollars worth of demand and debt over just a few years will tilt inflation is a reach. Now that inflation has taken hold how to stop it will be the real test. This calls for a bunch of clumsy idiots to thread an economic needle. A great deal of the problem we currently face is rooted in the lack of faith many people have come to hold in those that direct the policies that affect us. 

This extends to how Central Banks and politicians want to bend and manipulate the economy to rapidly address what they call climate change and a rash of other issues. We are even being told while the planet is about to undergo food and energy shortages the answer is to have more children because we need more workers. Ironically, this is being touted as an answer at the same time we are giving people less incentive to work and rapidly moving to erase millions of jobs through automation.

As for the Fed, it has become "the great enabler" by allowing this to go on for so long. Many economic watchers have come to the conclusion the Fed has totally lost control of the situation. The big question is whether it will taper and risk a major recession or keep pumping out money. Continuing down its current path is viewed as a recipe that will allow inflation to run rampant. 

Years ago we saw more of a balancing act with Central Banks concerned that bond vigilantes would descend upon them if they stepped out of line. Before the days of Modern Monetary Theory, investors voted on government budget deficits and debt management each day by buying or selling bonds. This is no longer seems the case due to massive Central Bank intervention. With each "crisis" has come excuse after excuse which has allowed the Central Banks to rewrite the rule governing the global financial system. 

Going forward other calamities and crises await society, these will also affect inflation. Whether they come in the form of energy shortages, food shortages, or devastation caused by war, each will leave its mark. While creating the illusion this time is different has allowed those in charge to postpone facing serious questions only time will tell. It is clear the currency is being debased, the big questions now are where it will be most prevalent and how we as individuals can protect ourselves from its fury.

(Republishing of this article welcomed with reference to Bruce Wilds/AdvancingTime Blog)

Will America's New Nuke Deter War, Or Bring It On?

In a bit of irony, a Twitter comment by Jill Hruby Administrator of the National Nuclear Security Administration (NNSA) pointed to a new nuclear bomb as proof America is committed to nuclear deterrence. This is where it is important to remember that deterrence means, the action of discouraging an action or event through instilling doubt or fear of the consequences. See her Twitter post below;

NNSA Administrator

@NNSAHruby

Last week, #NNSA successfully completed the B61-12 First Production Unit @PantexPlant. This is a huge milestone for stockpile modernization and demonstrates our Nation’s commitment to #nuclear deterrence.

 

The B61-12 Is Light And Accurate  

It could be argued that reworking a nuclear bomb to make it easier to justify using it and widening out the opportunities for its use is nothing to brag about. This all falls under the category of, "once it's out of the bottle it will be hard to put back in"  

 

An article in The National Interest on October 9th, 2018 by Zachary Keck indicates this bomb may be the most dangerous nuclear weapon in America's arsenal. The combination of accuracy and low-yield make the B61-12 the most usable nuclear bomb in America’s arsenal. It also makes using nuclear weapons thinkable for the first time since the 1940s. 

 

To be clear, the reason it is such a monster is not because of its power. The bomb has a maximum yield of just 50-kilotons, the equivalent of 50,000 tons of TNT. By contrast, the B83 nuclear bomb has a maximum yield of 1.2 megatons which is 24 times greater. The B61-12 may only be able to carry low-yield nukes but is guided by an advanced Boeing tail kit. 

 

Can Anyone Win A Nuclear War?

To put the issue of power into perspective; On August 6, 1945, the United States dropped an atomic bomb on the city of Hiroshima. The bomb was known as "Little Boy", a uranium gun-type bomb that exploded with about thirteen kilotons of force. At the time of the bombing, Hiroshima was home to 280,000-290,000 civilians as well as 43,000 soldiers. It is estimated that around 140,000 people were killed in the bombing.

 

In our extensive nuclear arsenal, the United States maintains 7,200 nuclear bombs. America also maintains a plethora of expensive delivery options for its nuclear bombs. Our so-called nuclear triad includes 94 nuclear-capable bombers (B-2s and B-52s), over 400 Minuteman III ICBMs, and 12 Ohio-class ballistic missile nuclear submarines. The submarines are equipped with modern Trident II submarine-launched ballistic missiles.

The key to the effectiveness of any weapon is its accuracy.  It has been reported that in 1985, a single U.S. ICBM warhead had less than a 60 percent chance of destroying a typical silo. Today, a multiple-warhead attack on a single silo using a Trident II missile is said to have a roughly 99 percent chance of destroying it.”

A Baby Nuke With Great Accuracy

To be clear, the B61-12 is America’s first nuclear-guided bomb, it is a new weapon. According to Hans Kristensen, from the Federation of American Scientists, existing U.S. nuclear bombs have circular error probabilities (CEP) of between 110-170 meters. The B61-12’s CEP is just 30 meters. Also, with a maximum yield of 50 kilotons, the yield can be lowered as needed for any particular mission. An amazing fact is, the bomb’s explosive force can be reduced electronically through a dial-a-yield system. 

The problem with this "friendly" nuclear bomb is that those controlling its use will most likely be more inclined to use it. This muddies the boundary and red line that mankind has up until now feared to cross. As noted earlier in this article, "once the nuclear genie is out of the bottle it will be hard to put back in." 

Remember the 1983 movie WarGames? In it, a young computer whiz kid accidentally connects to a top-secret super-computer. The computer which has complete control over the U.S. nuclear arsenal innocently starts the countdown to World War 3. We may be moving back into such a scenario. This bodes poorly for us poor saps living in harm's way if shit hits the fan. 

(Republishing of this article welcomed with reference to Bruce Wilds/AdvancingTime Blog)

Does Russia Threatens Us All By Simply Existing?

This article is focused on giving readers a better understanding of the Russian threat. Few of us have had the pleasure of visiting Russia so what we do know about it has generally been filtered through a national security apparatus so entrenched in a cold war mindset they have lost all appearance of objectivity. Those with this bias are always pounding on the drums of fear and demonizing Russia as a major threat to America and our way of life.

Note Russia's Failure To Appear On List!

Getting away from what shapes American opinion here are some real facts about Russia. For over half a century economic policy was shaped by the Communist Party and like the rest of the USSR, was centrally planned. The state controlled virtually all investment, production, and consumption across the country. The transition towards a market economy in the 1990s was painful. The chart on the right shows even today Russia fails to place in the world's top ten largest economies.

• Russia is the 9th most populated country in the world with 144.50 million people in 2017.
• In terms of land area, Russia is spread across 9 time zones and is the largest country in the world. Russia shares borders with many countries, including China, Ukraine, North Korea, and Norway. 
• The official language is Russian but there are 27 other languages co-official in various regions of the country. It is located in Eurasia (the combined continental landmass of Europe and Asia).
• Some sources estimate that Russia contains over 30 percent of the world's natural resources. 

Modest Skyline Downtown Moscow

If a picture tells a thousand words then people need only compare a picture of downtown Moscow's modest skyline with a picture of Beijing China which is rather overpowering. The overwhelming mass, density, and the number of sophisticated buildings in Beijing dwarf those in Russia's capital. Simply put, Russia is not the massive global power American media portrays it to be. Elevating countries like Iraq, Russia, Iran, and North Korea, to "major threat" status has allowed money to pour into what President Eisenhower years ago aptly named the Military-Industrial-Complex. This has flowed into the pockets of Washington politicians and their cronies for decades.

Not being an economic powerhouse brings with it certain limitations.

The fact is with all the bravado aside a person might call the military situation in Russia a bit dire. Forgotten with all the talk about new supersonic weapons and more is the fact Russia has delayed the production of a new generation of tanks because it lacks the money. This means it has been forced to rely on older equipment much of it dating back to the cold war. The Russian Army planned to acquire 2,300 T-14 Armata main battle tanks between 2015 and 2020. Production and fiscal shortfalls delayed this to 2025 and resulted in the cancellation of the main production run. The new tank together with a new heavy infantry fighting vehicle using the same chassis is slated to replace older T-72 tanks and its 1980s-vintage BMP-2s, infantry fighting vehicles.

Russia Spends Little On Weapons (Click To Expand)

Once a person has established Russia is not an economic powerhouse it is time to examine the real "bug-a-boo" and that is its military might. Those of us that have had the awesome experience of going deep beneath a Russian city to ride the subway will testify that it is indeed worthy of being declared as a shelter during a nuclear attack. The fact is most of our apprehension of Russia stems from its massive nuclear arsenal dating back to the cold-war. Today nine countries have a total of over 15,000 nuclear weapons the U.S. and Russia together have over 14,700 of them. Like many people, I do not find what is known as the concept of Mutual Assured Destruction, or MAD to be reassuring. 

Still, the truth is the nuclear deterrent we hold is a hundred times larger than needed to stop anyone sane or rational from attacking America, and for anyone else, an arsenal of any size will be insufficient. Logic dictates Russia would be insane to launch an attack on America and would have little to gain considering its military spending and the weapons Russia stands ready to deploy, America has little to fear and most of the noise is from those wanting more money to enrich those producing weapons.  

As for what drives the "Russia is a threat narrative," it is clear that America's "Deep State" continues to consider Russia a major threat. If rational people were asked to speculate why, many would say they are held hostage by the money and power of those gaining from producing weapons of war. To be clear it was not just neoconservative Republicans like Marco Rubio and Lindsey Graham but Democrats and liberals were so upset about the meeting in Helsinki between Donald Trump and Vladimir Putin. This resulted in a full-court press to sabotage what they viewed as "peace talks." 

A lot of peace-hating beltway stalwarts wasted little time before painting Trump as wrong and misguided when it comes to our policy towards Russia. Fox News, NBC, and The Washington Post all continue promoting the same hard-line against any notion of normalizing relations with Putin and Russia. After all, Putin is guilty of halting Russia from and being carved up by a group stealing its resources in collusion with America. 

The fact is many Russians credit Putin with saving Russia. He took Russia after its collapse in 1991 and resurrected the crumbling empire once again into a nation-state with coherence and purpose. Putin is credited with stopping the theft of his country’s wealth by the plutocracy and restoring Russia's military strength. Putin's biggest sin may be that with blunt rhetoric he refused to accept for Russia a subservient role in an American-run world under a system drawn up by foreign politicians and business leaders.

The current dust-up in Ukraine is strongly linked to the fact that NATO has slowly been expanding towards Russia since Putin took power in late 1999 is not acceptable to Russia. President Eisenhower warned us of the power of the Military-Industrial Complex and history has proven him correct. As he left office in 1961, Eisenhower was deeply concerned about those that financially gain from producing weapons of war bending power for their gain were hijacking our government. He thought the cost of modern weapons took food from the hungry and shelter from the homeless. 

 

One of the things we often forget is that many Americans don't know very much about Russia or the Russian people. Also, much of the narrative we are being fed is being controlled by those with an agenda. It is clear the warmongering faction residing within Washington has declared Russia a major threat and sparked massive media coverage to convince us it is true. An example of what we are facing was revealed in an article published by The Intercept a couple of years ago. 

 

It told of how a prominent national security reporter for the Los Angeles Times routinely submitted drafts and detailed summaries of his stories to CIA press handlers before publication. Apparently, Ken Dilanian enjoyed a close collaborative relationship with the agency, explicitly promising positive news coverage and sometimes sending entire drafts for review prior to publication. In at least one instance, significant changes were made before the story was published. Documents show reporters for the Associated Press, Washington Post, New York Times, Wall Street Journal, and other outlets also interacted with the agency.

The myth of Russia's strength has been amplified by journalists seeking to routinely curry favor with government sources and others by falsely hyping the official point of view. A read of The Intercept article generates a reason for concern. Another article is even bolder when it states, "The US intelligence community’s job to lie to you." It goes on to detail how two big Russian stories blasted onto the front pages loudly promoted Russia hysteria just days before the Trump-Putin summit were in effect an attempt to sabotage the meeting. 

 

The first was that Robert Mueller had issued an indictment of 12 Russians. This was rapidly followed by America’s top intelligence officer Dan Coats who replaced Russophobic James Clapper declaring that the warning signs of future Russian cyber-attacks are akin to the warnings received prior to the September 11 attacks. The Washington Post bolstered this narrative with an article titled, “Trump hopes he and Putin will get along. Russia experts worry they will”.

 

In a nutshell, much of the blame for the current mess in Ukraine falls squarely on the shoulders of Barack Obama and his inability to accept Putin. With all the above in mind, one of the most idiotic and stupid blunders ever concocted by those in control of foreign policy was to drive Russia into the open arms of China. The reason America initially adopted its policy to work with communist China way back in the 70s was to drive a wedge between it and Russia. China is by far more of a threat and rival in America's struggle to remain the most powerful nation on earth.

The root cause of all this drama is that NATO and Kiev simply refuse to respect the February 2015 Minsk Agreement. According to the agreement, Kiev is supposed to grant autonomy to Donbass via a constitutional amendment referred to as “special status.” This includes a general amnesty and starting a dialogue with the people’s republics of Donetsk and Lugansk. Over the years, Kiev has not honored its commitment. The asinine idea of going to war with Russia has disaster written all over it. Even if we have a lot of strong advantages Russia has both the will and the home advantage to make it a very bloody affair. 

 

Footnote; The following link is to "Russia Today" the country's propaganda news channel which you may find interesting.    https://www.rt.com/news/     

Another interesting link is this one that takes you to a YouTube video of President Eisenhower's very important warning about the danger of the Military-Industrial Complex    

https://www.bing.com/videos/search?q=President+Eisenhower+warning+about+the+Military+Industrial+Complex&&view=detail&mid=F3BD6B71EDD94F79CC41F3BD6B71EDD94F79CC41&rvsmid=9D891E045120807989A89D891E045120807989A8&FORM=VDQVAP

 

 (Republishing of this article welcomed with reference to Bruce Wilds/AdvancingTime Blog)

Amazon, A Predatory Monster Unleashed Upon America

The news that Amazon is on track to become the largest U.S. delivery service by early 2022, should be troubling to the American people. The company's worldwide consumer business CEO, Dave Clark recently said, “I think we’ll probably be the largest package delivery carrier in the U.S. by the time we get to the end of the year, if not in early "22." Clark added that because of its size, the company has been able to secure ships and send goods through lesser-used ports to avoid blockages that will give the retailing giant another major advantage during this holiday season. 

Far From Environmentally Prudent

This underlines the fact that Amazon is a predatory monster. With the help of our government, it has grown rapidly to exploit America and continues to engulf and devour its competitors. Thursday night NBC news did a fluff piece on what they called Amazon's state-of-the-art delivery system. The NBC report showed an Amazon building was full of robots then a slew of planes with Prime painted on them that are used to rush items to consumers. 

By calling its disruption facilities "fulfillment centers" Amazon tries to give customers the impression they are fulfilling their needs rather than just pushing merchandise. Even its logo resembling an upturned penis resembles a smile letting people know it is their friend. Those putting a friendly face on Amazon spin in a positive way the damage it does calling it, "creative destruction." Someday we may look back at how it has altered the fabric of America with huge regret. Americans are trading both their future and freedom in exchange for the baubles Amazon dangles in front of them each day. Make no mistake, there is no free lunch and every item people purchase from Amazon carries with it a large hidden cost.

Bezos Is Not A Man Of The People

The narrative that Jeff Bezos pursued the American tradition and his company grew great by simply offering a better product at less cost is obliterated by several facts. Amazon is not a great company with huge profits, it is an exploiter that has linked itself to the deep-state and feeds at the government teat. Is it a coincidence that Bezos suddenly leaped into the news about  the time he cemented his ties with the CIA in 2013? An indication of this tie occurred only six days before Bezos contracted to buy WaPo when due to widespread labor-activist criticism of Amazon, then-President Obama went to an Amazon warehouse in Tennessee to show his support for Amazon. Obama claimed the jobs being created were part of the new high-tech economy rather than merely shifted from companies Amazon was putting out of business. 

While touting Amazon as a model of efficiency what people often forget is that its overall business model is far from efficient. Little attention is being paid to the environmental damage being done as it quickly places goods in the hands of spoiled customers that are in no real hurry for them or decide to return them. What happens to returns or items people decide they do not want is a huge problem. The Amazon model tries to ignore the large number of goods that are returned, discarded, or underused. When people handle and view a product before buying it they are far more likely to use and enjoy it.
 
Polluting planes flying packages across the country and putting a small item in a box to be driven miles to a customer's doorstep is far from environmentally prudent. The amount of waste generated from such a promotional online distribution model boggles the mind. Especially concerning is that companies using such a model often find it easier to tell a customer to throw away certain types of items rather than return them. This is because often the hoops they must jump through to get the product back means it is more economical to simply write the transaction off. Another problem is the item can no longer be considered "unspoiled" and fresh. How to handle such goods is a major problem in retail. The ugly reality is many of them end up in a landfill having never been used.

When looking at the policies flowing out of Washington it is clear many politicians seem to have no idea that all consumer spending and purchases are not created equal. What and where consumers buy a product matters a great deal. The fact is, consumers should take a long look at how their purchases will impact the economy over time. If more consumers viewed their spending in this light, Amazon's sales would fall like a stone. Where money flows and who it enriches is a key component of economics, the failure to consider this is a blind spot many people have. 

 

Today I found out that on Saturday morning during the busy Christmas shopping season the largest mall here in northern Indiana now opens at 11 A.M. Consider this another example of the self-feeding loop of brick and mortar stores cutting their hours as labor shortages and cost-cutting continues. This drives more shoppers online, which again, forces more cutting of hours. Years ago when Amazon was being hammered for paying low wages, its CEO, Jeff Bezos, a master reframer of issues endorsed raising the minimum wage. This translates into "while Amazon moves towards automation and utilizing more robots we will raise labor cost for our smaller competitors so we can put them out of business."

Looking back, higher minimum wages combined with Covid-19 have worked out splendidly for Amazon. Remember, Amazon gained greatly from the tax dollars showered upon people forced to sit at home during the shutdown. Sadly, the average person fails to internalize online sales result in retail store closures that contain a hidden cost to communities and society. Retail closings have a trickle-down effect that results in other small businesses closing their doors. Not only do the retail employees lose their jobs but these closings hurt other local businesses. 
 

The ugly reality is that store closures act like a cancer eating away at communities. The Bezos empire has been built on the foundation of businesses destroyed. When stores close, mortgages go unpaid, commercial real estate values fall, and the local tax base shrinks away. Only after Amazon has wrecked communities leaving many Americans jobless and retail stores sitting as giant empty shells, will short-sighted consumers finally see the air of their way.
 

Protesting Amazon Workers 

As it weasels its way into every part of our lives, Amazon's size and its power combined with a powerful public relations scheme allows it to shape a message masking its true nature. Amazon tells us it cares about its employees, this is in conflict with many articles documenting its treatment of workers. This scheme tells us how the company has a nourishing relationship with third-party sellers, the fact is Amazon has a history of exploiting these so-called partners. Amazon claims it cares about the environment and is striving to become carbon neutral while everything about the company screams otherwise. Amazon is expanding its fleet of airplanes, delivery trucks, promises of fast deliveries, and its ever-expanding use of power-hungry technology. 

 

What consumers buy and from who they buy matters a great deal. When looking at the policies flowing out of Washington it is clear many politicians seem to have no idea that all consumer spending and purchases are not created equal. The fact is, consumers should take a long look at how their purchases will impact the economy and their community over time. When money flows into an area and stays there its people prosper. Where money flows and who it enriches is a key component of economics, the failure to consider this is a blind spot many people have. 

 

The Amazon issue is made up of many parts, it is complex with huge ramifications. It spills over into things such as the war on cash and how moving people towards a cashless society eliminates privacy, freedom, and many options we now enjoy. It spills over into the fairness and efficiency of America's food stamp program known as SNAP. It entails how Amazon's former CEO Jeff Bezos also owns America's most influential newspaper, the Washington Post, and how it is used to quietly grab more power and shape public opinion. It includes how it exploits workers and masks the huge amount of income it plucks from our government on all levels while avoiding paying taxes. 

Last but not least, it could be argued Amazon is aligned with the World Economic Forum's 2030 agenda that offers a telling glimpse into what the technocratic elite has in store for the rest of us. This is the vision that by 2030 "You will own nothing. And you'll be happy." Simply put, Amazon is a robot-loving, job-killing, propaganda spreading, energy-sucking, spy operation. Because of all of the above, it is not surprising Amazon has enemies on both the far left and far right of the political spectrum. Amazon is bad for America. Amazon is not your friend, with that in mind, boycott Amazon.

Footnote; Below are links to some past articles related to this post. Also, at the bottom is a link to a YouTube video titled; How Jeff Bezos Became Public Enemy Number One

 

https://brucewilds.blogspot.com/2021/09/the-war-on-cash-is-it-real-thing-answer.html

https://brucewilds.blogspot.com/2021/06/by-2030-youll-own-nothing-and-youll-be.html

https://brucewilds.blogspot.com/2020/08/grocers-and-food-producers-profit-from.html 

https://brucewilds.blogspot.com/2020/12/the-staggering-impact-of-online-shopping.html https://www.youtube.com/watch?v=QTOFrg2EAQs

 

 (Republishing of this article welcomed with reference to Bruce Wilds/AdvancingTime Blog)

Our $29 Trillion Deficit, Interest Rates, Inflation, And Debt

The emergence and acceptance of Modern Monetary Theory has turned our economic system upside down. Skeptics of its substance and sustainability have been brushed aside temporarily but expect the MMT experiment to collapse and end in ruin. To us that believe in old school economics, debt matters and is tied directly to interest rates and inflation. Central banks across the world claim the lack of inflation is the key force driving their QE policy and permitting it to continue, however, the moment inflation begins to take root much of their flexibility will be lost. This translates into governments being forced to pay higher interest rates on their debt.

With America's national debt now blowing past 29 trillion dollars, it is important to keep the numbers in perspective. Nothing is as sobering as looking at future budgets. Those of us rooted in the tried and true economics relied upon in the past are worried.  For years the argument that "This Time Is Different" has flourished but history shows that periods of rapid credit expansion always end the same way and that is in default. This also underlines the reality that any claims Washington makes about the budget deficit being under control is a total lie.

Click (Here) To View National Debt Clock

 

America is not alone in spending far more than it takes in and running a deficit. This does not make it right or mean that it is sustainable. Much of our so-called economic growth is the result of government spending feeding into the GDP. This has created a false economic script and like a Ponzi scheme, it has a deep relationship to fraud.

Global debt has surged since 2008, to levels that should frighten any sane investor because debt has always had consequences. Much of the massive debt load hanging above our heads in 2008 has not gone away it has merely been transferred to the public sector where those in charge of such things feel it is more benign. A series of off-book and backdoor transactions by those in charge has transferred the burden of loss from the banks onto the shoulders of the people, however, shifting the liability from one sector to another does not alleviate the problem.

When the 2018 financial year budget was first  unveiled it was projected to be $440 billion. An under-reported and unnoticed later report painted a far bleaker picture. The report titled the “Mid-Session Review” forecast the deficit much higher than originally predicted. The newer report predicted the deficit would come in at $890 billion which is more than double what they predicted in March of 2017.

Such a miss should bring up the question of whether the discrepancy in the 2018 budget is an outlier or a sign of incompetence. This is especially troubling because what was projected as a total budget deficit of $526 billion for the 2019 Fiscal Year was later revised to a staggering $1.085 trillion. Not only should the sheer size of these numbers trouble us but we should remember that until recently some Washington optimists were forecasting that deficits would begin to decline in 2020 and that we would even have a small surplus of 16 billion in 2026. Since then, the wild spending those in charge have justified due to Covid-19 has blown the lid off that glimmer of hope and replaced it with more trillion-dollar deficits going forward.

Back then, the summary that began on page one of the Mid-Session Review came across as a promotional piece using terms like MAGAnomicics. It praised and touted the Trump administration for its vision and great work. This is a time when it would be wise to remember numbers don't lie but the people using them do. That report is an example of how to re-frame a colossal train wreck into something more palatable. The report even went so far as to assure us that the deficit would fall to 1.4 percent of the GDP in 2028, from what was then 4.4 percent.  

 

As a result of the American economy having survived with little effect what was years ago was described as a "financial cliff" the American people have become emboldened and now enjoy a false sense of security. Today instead of dire warnings we hear news from Washington and the media about how the stock market continues to push into new territory and all is well.

In 2019, National Debt Hit 23 Not 12 Trillion dollars

The chart to the right predicted that by 2019 the national debt would top 12 trillion dollars, instead it hit 23 trillion. Projections made by the government or any group predicting budgets based on events that may or may not happen at some future date are simply predictions and not fact. This means that such numbers are totally unreliable. The ugly truth many people ignore is that starting in 2018 entitlements became the driving force that will carry the deficit higher and higher into nosebleed territory. Even though we have seen deficits reach unprecedented levels the deficits in our future will be dramatically worse.

It is very disturbing that so many people have forgotten or never taken the time to learn recent financial history. By recent, I'm referring to the last fifty to one hundred years. The path that Fed Chairman Paul Volcker set right decades ago has again become unsustainable and many people will be shocked when this reality hits. Do not underestimate the value of insight gained from decades of economic perspective. It tells us the economy of today is far different from the way things have always been.

 

Back in September of 2012, I wrote an article reflecting on how the economy of today had been greatly shaped by the actions that took place starting around 1979. Interest rates, inflation, and debt do matter and are more significant than most people realize. Rewarding savers and placing a value on the allocation of financial assets is important. It should be noted that many Americans living today were not even born or too young to appreciate the historical importance and ramifications of the events that took place back then. The impact of higher interest rates had a massive positive impact on corralling the growth of both credit and debt. It acted as a crucial reset to the economy which lasted for decades. Below is a copy of that article. 

                       A Time For Action, 1980?

In his book "A Time For Action" written in 1980 William Simon, a former Secretary of the Treasury tells how he was "frightened and angry".  In short, he sounded the trumpet about how he saw the country was heading down the wrong path. William Simon (1927 – 2000) was a businessman and a philanthropist. He became the Secretary of the Treasury on May 8, 1974, during the Nixon administration, and was reappointed by President Ford and served until 1977.

I recently picked up a copy of the book that I had read decades ago and while re-reading it I reflected on and tried to evaluate the events that brought us to today. As often the future is unpredictable, looking back, it is hard to imagine how we have made it this long without finding long-term solutions and addressing the concerns that Simon wrote about so many years ago. Back then it was about billions of dollars of debt, today it is about trillions of dollars. It appears that something has gone very wrong.

Do Not Underestimate The Importance Of The Reset By Paul Volcker In 1980

By the end of the 70s inflation started to soar. Only by taking interest rates to nosebleed levels was then-Fed Chairman Paul Volcker able to bring inflation back under control. Paul Volcker, a Democrat was appointed as Federal Reserve chairman by President Carter and reappointed by President Reagan. Volcker is widely credited with ending the stagflation crisis where inflation peaked at 13.5% in 1981. He did this by raising the fed fund rate which averaged 11.2% in 1979 to 20% in June of 1981.  This caused the prime rate to hit 21.5% and slammed the economy into a brick wall. This also affected and shaped the level of interest rates for decades.

Rates Today Are Ready To Fall Off The Chart!

This action and the increased interest rates in the following years are credited by many to have caused  Congress and the President to eventually balance the budget and bring back some sense of fiscal integrity and price stability to America.  As the debt from the Vietnam war and soaring oil prices became institutionalized we moved on. Interest rates slowly dropped and the budget came under control. In recent years spending has again started to grow and at the same time taxes have been cut. This has slowly occurred over years and has been ingrained in the system.

In 2012, with our debt at 23 trillion and growing the path has again become unsustainable and many people will be shocked when reality hits. As our debt climbs some Americans feel just as frightened and angry as Simon did so many years ago. America has kicked the can down the road, failing time and time again to face the tough decisions. Part of the problem is the amount of debt has grown so large that we can no longer imagine or put a face on it. Until now, a series of different events have delayed the day of reckoning that will eventually arrive. Many of us see it coming, but the one thing we can bank on is that when it arrives most people will be caught totally off guard. 

 

Summary of the current situation; Today we stand at the abyss, yet no one sees or feels threatened by a "financial cliff." Insane spending has become the new normal. Who would have thought it would come to this? The updated revisions of the past have been washed away and replaced with more numbers, larger numbers. What we are witnessing today is insane. It is time to revisit the issue of how interest rates, inflation, and debt all come together. While this is not what those in charge want, it will happen. Simply put, there will be a reckoning, this time is not different. 

 

 Republishing this article is permitted with reference to Bruce Wilds/AdvancingTime Blog