For all practical purposes the GOP is the John Birch Society. Of course there is cultural drift on all manner of things since the 50's but the basic impulses that have been here for 150 years. There has been a wild swing on the right from gold buggery to now Trumps inchoate desire for easy money. Everyone should be familiar with this from 1964. 'The Paranoid Style of American Politics' Richard Hofstadter.
https://harpers.org/archive/1964/11/the-paranoid-style-in-american-politics/
These things are not exclusively American. They have European equivalents especially the anti semitism. However they have reached full flower in the US, post Nazism.
ZH demonstrates the fact that alternative views of monetary matters have been deeply entwined with American right wing ideology, or just simply prejudices, since the 1950's when the John Birch society called for eliminating the Fed. Which coincidentally folded into familiar gold buggery and ancient tropes about Jewish bankers. ZH knowingly tapped into these things because that is where the market is. If it is Russian per say or consciously fascist with an agenda to advance such political emotions is probably secondary to just making a buck.
The old John Birch Society ideas of economics, as ill formed as they were, lead to an almost universal belief among Americans who identify as Liberal, or let's say not Conservative, to reject any questioning of 'the money' because such was seen as far rightest. In fact much of it was and is of the right.
Here lies the core of why Lee's analysis goes unheard. Of course the other root of the problem is almost nobody understands where money comes from, that is the mechanisms of it's creation. Which leads back to the rejection of any questioning of 'the money' because it's rightest. A vicious circle in other words. In nearly two decades of trying to engage non Conservatives in examining 'the money' never once have I gotten to first base.
They are all bankrupt but still pumping right up till the last moment. The fracking boom is an even better example than Boeing of stories which encapsulate the entire post GFC period.
I see they are going to continue to operate. If that means produce I can't say.
Early IRA withdrawals up to $100k will not be taxed for 3 years per the bailout bill. Can be reloaded, but 3 years is a long time, This should be a steady and growing source of selling, at the margin.
https://www.marketwatch.com/story/coronavirus-stimulus-package-tax-relief-withdraw-100k-from-your-ira-and-repay-in-3-years-with-zero-tax-liability-2020-03-27
Don't confuse the economy with the market averages. Especially at this point when virtually none of the new money, probably approaching a trillion bucks, has trickled out of the financial system.
Reminds me of a scene from a favorite novel, The Bamboo Bed by William Eastlake. An infantry company pinned down at a low point in the jungle by a larger force and thus doomed, has a "mad minute". Just shooting non stop for a minute, so they can live one more minute.
The loan growth isn't surprising since the news ticker has been full of companies maxing out their lines of credit. $50 million here, $100 million there is adding up fast.
Banks may not be the lead source of credit for awhile as the Treasury with a $500bn war chest of 'loans' with more on the way as needed says Mnuchin this AM, funded by Fed printing, presumably for friends of Trump and who won't be, and the Fed's who knows how many billions or trillions of POMO and TOMO going towards corporate debt. Well that's my idea right now.
The more I think about it the more the Treasury becomes a source of credit, acting as a conduit of Fed printing might be the most profound change.
US, 19,400 Saturday, 18,200 Friday, 17,200 Thursday
Obviously only those tested. Still a decent metric.
https://www.worldometers.info/coronavirus/#countries
Click on the down arrow in the second row, total cases, and you'll find the US. We're #1.
I guess the Fed still will buy up all the Treasury paper after the dealers buy it. $72bn in bills next Thursday. I wonder how that is going to work exactly? Well I'm sure it's figured out but why bother?
I'm trying to come up with words to describe how huge these Treasury offerings are gong to be as the year(s) roll on. I mean they will just be stupendous and humongous now. What about September?
On the other hand being against inflation in America is like being a flat earther. People just don't get it. Don't get that inflating stuff and calling it wealth can be anything but a total positive. Everybody wants some. Let's face it. Real deflation would be a mofo. In large part because the corporate world would make sure it was. Willing to burn it all down if they can't have more and more. And then too human nature and American's belief in the right to get rich, by inflation, would cause, resentment, to say the least.
So I think Tesla or some Elon entity should float $200bn, for a starter. The Fed taking up half. Build starships and send them to Mars. Welcome aboard..
It isn't ownership. It's the supplier of capital to the owners via buying their debt. . With an interest, really an imperative, to make sure they do not default on that debt. Thus all layers of government will support the favored companies and if needs be the Fed will continue to give them more credit.
I came in here 18 years ago saying that somehow, and I didn't know how and back then I didn't really know how the banking system created money, I mean really know the mechanisms, that eventually money would be based upon corporations. So here we are.
Some will say it's the end of capitalism but I look at it as the perfection of it.
The Fed will be precluded from buying non investment grade corporate debt. Ford just was downgraded below that yesterday. At any rate the power to cut off corporations from Fed largess is a great power. I would think anyone buying stock should at a minimum make sure that it's debt rating is investment grade. The gold standard will be corporations that have had their debt bought by the Fed. Once that happens they will not be allowed to go bankrupt. More credit will always be on the way.
Some call this moral hazard. It's actually the way things were always pointing.
I truly think this moment, monetizing corporate debt, and probably soon enough equity, is a monetary revolution. The trick will be preventing revolution down below.
The mechanisms that have developed to create and keep money within the financial sphere are not broken, they have been strengthened. The Wiemar example is thus a poor analog.
