The looming default is swiftly approaching, leaving little time for intervention. Like a speeding freight train, it’s barreling forward without a chance of being halted.
To begin with, the U.S. government is financially exhausted. The only lifeline sustaining operations in Washington is $1 trillion annually from the Fed’s debt monetization. Without this support, the Treasury would be unable to fulfill its obligations.
Furthermore, it’s impractical for taxpayers to bridge this funding deficit. Lawmakers have made excessive commitments to numerous constituents over many years. Significant budget cuts or tax increases are out of the question; their chances of reelection hinge on spending funds they don’t possess on unaffordable programs.
Unfortunately, the reality is far more serious and alarming than many Americans realize. They have been misinformed to believe in the possibility of a free lunch. This means that the very institutions meant to hold the government accountable have been actively misleading the public.
Take the Congressional Budget Office as an example. Its official budget projections serve as mere propaganda for Congress, failing to fulfill its duty. They misguide American taxpayers instead.Continue reading
This week brought new evidence suggesting that economic conditions may deteriorate before improving. Unfortunately, this is not the trajectory we would prefer, but rarely do our wishes align with reality.
This fresh perspective on the economic landscape comes from small business owners. As they are the backbone of the economy, their outlook deserves our attention, especially when it doesn’t match the prevailing optimism.
According to the National Federation of Independent Business’s Optimism Index, “small-business optimism fell from 93.9 to 91.6, primarily due to a sharp drop in hiring plans and expectations for future small-business conditions. Out of the ten components of the Index, seven turned negative, collectively decreasing by 27 percentage points.”
“Small employers are not misled by headlines announcing record-high stock market indices; they face the stark economic realities of overregulation, increased taxes, sluggish sales, and a government lacking direction or a roadmap for the future,” stated NFIB chief economist Bill Dunkelberg. Continue reading
Understanding the current state of the economy remains a challenge. Even government reports seem to add more questions than clarity.
For instance, last Friday, the Labor Department announced that 204,000 new jobs were created in October. On the surface, this appears promising. But what types of jobs were generated, and will they lead to an increase in household incomes?
Of these new jobs, 53,000 were in leisure, hospitality, and restaurants. While the addition of new jobs is generally a positive sign, unfortunately, these positions often lack the potential for long-term careers and wealth accumulation.
Moreover, despite adding jobs, the unemployment rate actually increased from 7.2 to 7.3 percent. Surprising, right? How can that be the case?
According to The International Business Times, the discrepancy arises from the different methods used to calculate employment—while the payroll count included furloughed federal employees as employed, the household tally did not. Continue reading
The world’s reality often seems more outrageous than anything we could ever have imagined. Observing our surroundings reveals astonishing events occurring every day.
For example, just this week, China’s wealthiest individual, Wang Jianlin, acquired Pablo Picasso’s painting of his children, “Claude et Paloma,” for an astounding $28.2 million—more than double its estimated value. Christie’s in New York must have been thrilled with the sale.
However, it’s unlikely Jianlin will experience buyer’s remorse, given his net worth of $13.2 billion. Yet, one must ask: why spend $28.2 million on a deceased artist’s portrayal of his children? It raises eyebrows.
Another reminder of the incredible nature of our world is the massive construction site at the intersection of Wilshire Boulevard and Figueroa Street in downtown Los Angeles. I spend many of my days at an office nearby, diligently working to generate value for the company. In exchange, we receive not only our paychecks but also an endless supply of complimentary coffee. Continue reading
Overall, the economic landscape is fraught with challenges and contradictions. As we navigate through these complexities, it is crucial to remain aware of the underlying truths and to critically assess the information presented to us. Understanding the real economic conditions will aid in making informed decisions for the future.
