Even as interest rates skyrocketed over the past 18 months, a good job market and strong consumer spending kept the US economy moving.
This led to hope that a soft landing was coming, where the Federal Reserve could defeat inflation without millions of Americans losing their jobs.
However, there are growing signs that the strength of the US consumer is starting to crack. Continue reading
Banks are closing branches faster than they’re opening new ones. U.S. banks closed over 3,000 branches last year while opening just 1,000. JPMorgan Chase led in branch closures last year, shuttering 144 branches, while opening 133. The trend will likely continue as banks face staunch competition for deposits and younger customers from online banks, fintech firms and Big Tech. Continue reading
Our standard of living is being systematically destroyed, but for a lot of years many Americans didn’t fully understand what was taking place because it was happening so slowly. But now we have reached a stage where the purchasing power of our money is collapsing and the cost of living has become exceedingly painful. Thanks to our rapidly rising cost of living, the middle class is becoming “the impoverished class”, and the poor are increasingly being pushed out into the streets. If we do not find a way to turn these trends around, it won’t be too long before we have tremendous societal turmoil on our hands. Continue reading
By many of the most reliable leading indicators of the U.S. economy, we are long overdue for a recession. Yet the economy stubbornly refuses to cooperate.
The Conference Board released its latest index of leading economic indicators on Thursday. It declined for the seventeenth consecutive month, dropping an additional 0.4 percent in August. That’s an acceleration of the pace of decline since July, when the index fell 0.3 percent.
The Conference Board’s index is a composite of ten so-called “leading indicators.” These are gauges of economic activity and sentiment that tend to move up or down several months before overall economic growth indicates an acceleration or a slowdown. Continue reading
As I read about the demise of the U.S. dollar’s status in world trade, I’m struck by the misdirection and irrational “thinking” employed by our politicians and bureaucrats. In this article, legislators think another law, rule or regulation will solve the underlying problem.
Going back on the gold standard is not a bad solution. Had we been on the gold standard in 2008, the Fed Reserve could not have printed 8 trillion U.S. dollars and driven us into such extreme debt, resulting in dollar devaluation and inflation. In fact, the gold standard is a good way to limit the Federal Reserve’s ability to print dollars, but this is not the long-term solution. Continue reading
America’s middle class is being systematically eviscerated. When the Federal Reserve pumped trillions of dollars into the financial system during the pandemic, most Americans didn’t realize what that would do to them. That money certainly made the wealthy a whole lot wealthier, but it also dramatically increased the cost of living for the rest of us. So now inflation has been rising much faster than paychecks have, and the cost of living has become exceedingly oppressive. In fact, last year we witnessed the largest decline in real median household income in more than a decade… Continue reading
Many historians labeled the twentieth century as the American century, with many metrics used. The end of the Cold War in 1989 and the fall of the Union of Soviet Socialist Republics in December 1991 changed world affairs: several new countries formed, the Warsaw Pact dissolved, the economy of China rose, and many US military bases shut down.
The twentieth century wound down with the US as the world superpower, and yet the vision of the 1990s was not clear for our political and military leaders going into the twenty-first century. Continue reading
Image Credit: Ron Cogswell
For “Ask an Economist” this week, I have two questions from J.R. He says,
“My question is what happens when the government continues to spend out of control where it potentially out spends its ability to pay its bills/debt?
With the national debt over $30 trillion and climbing when do you think we will hit the tipping point and what do you think will happen?”
So what happens if we can’t pay our debts? To understand, we need to think about where the government’s money comes from. Continue reading
Since its founding in 1913, the unelected central planning bureaucrats at the Federal Reserve have been given the incredible privilege of legally creating money out of thin air, which mere mortals like us are not allowed to do. They have also been given the tremendous responsibility of maintaining (1) maximum employment, (2) a stable price level, and (3) low interest rates.
How have they done so far?
Since 1913, the bureaucrats at the Fed have helped cause… Continue reading
When the first shot rang out at Dealey Plaza on November 22, 1963, most bystanders didn’t even realize that it was the sound of gunfire.
But Texas Governor John Connally was an avid hunter. He recognized the sound, sensed danger, and turned behind him to check if President Kennedy was OK.
Moments later, the second shot was fired, striking Connolly in his back. And as he looked down and saw his blood-soaked shirt, he shouted, “My God, they’re going to kill us all.” Continue reading
