Fed blames coronapanic for inflation

“Fed Chair Sees ‘Long Way to Go’ on Inflation Fight” (NYT):

“Inflation has moderated somewhat since the middle of last year,” Mr. Powell said. “Nonetheless, inflation pressures continue to run high, and the process of getting inflation back down to 2 percent has a long way to go.”

“Inflation has consistently surprised us, and essentially all other forecasters, by being more persistent than expected,” Mr. Powell said. “And I think we’ve come to expect that — expect it to be more persistent.”

He added that there’s a “common factor” that has driven price increases higher. “It’s the pandemic, and it’s everything about the pandemic: The closing of the economy, the reopening of the economy, the fiscal support, the monetary support. All the things that happened went into high inflation.”

Of course, it is the virus that is to blame, not the human response (panic everywhere other than in Sweden) to the virus! But if the wild government spending on coronapanic is now the official cause of inflation, how can the Fed stop inflation? Congress continues to spend wildly with annual budget deficits that were, prior to 2008, seen mostly during wars. From the CBO:

Separately, here’s my latest inflation achievement… paying $30 for Pad Thai (Jackson, Wyoming):

That was one week after getting a haircut in a barber shop… for $55 plus tip (Big Sky, Montana).


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Inflation for home construction and repair higher than the official number?

I hope that all white readers who are members of the laptop class and/or government employees are enjoying their paid holiday for Juneteenth. For readers (like me!) who suffer from reduced income as a consequence of reduced working hours, let’s have a look to see whether we can afford to take it easy…

We are informed that inflation is poking along at about 5 percent per year (so you’ll lose half of your wealth over 14 years if you don’t invest carefully). That shouldn’t be enough to derail an insurance company’s profitability, even with regulators limiting price increases to once per year. What are the insurance companies themselves seeing? From the Insurance Information Institute:

“You have to look at year-over-three-years replacement costs, and they’re high,” [Triple-I CEO Sean] Kevelighan said. “Personal homeowners replacement costs are up 55 percent. We’ve got personal auto replacement costs up 45 percent.

The three-year inflation rate, as perceived by insurers paying claims, is around 50 percent. Maybe the problem is behind us thanks to the muscular efforts of Joe Biden to whip inflation? “State Farm Halts Home-Insurance Sales in California” (Wall Street Journal, May 26):

State Farm is stopping the sale of new home-insurance policies in California effective Saturday, because of wildfire risk and rapid inflation in construction costs.

State Farm is the nation’s biggest car and home insurer by premium volume. It said it “made this decision due to historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure, and a challenging reinsurance market.” It posted the statement on its website and referred questions to trade groups.

I think that we can ignore the wildfire risk as the primary business reason here. The wildfires of 2023 aren’t dramatically riskier than the wildfires of 2022. Maybe State Farm is just being greedy so that they can enrich their fatcat shareholders? They’re not truly losing money on new policies, but are trying to pressure California regulators into giving them yet more profits:

State Farm is a mutual company, meaning it is owned by its policyholders, and it has deep pockets. It ended 2022 with net worth of $131.2 billion.

Why does it matter if construction costs are outpacing inflation, as State Farm says? Our grow-the-population-to-450-million-via-immigration plan will result in skyrocketing rents and miserable living conditions for most Americans unless new housing can be built at some price that is affordable to low-skill migrants (who earn below-median wages).

Let’s have a look at a newly built house just north of us in Martin County, Florida, far away from the high prices of Miami and Palm Beach. It’s only about $5,000 per square foot and comes with 2 acres of land:


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Carflation Chronicles

I took our 2.5-year-old Honda Odyssey in for a B127 service, for which I’d made an appointment. Due to the dealer being short-staffed and, apparently, not completely organized, they couldn’t do “7” (brake fluid change) without adding a multi-hour wait on top of the promised 1.5-2-hours.

The parts stock situation has improved compared to 1.5 years ago in that they had all three wiper blades available for the minivan compared to just one back in 2021. The car stock situation is also slightly improved, with a handful of new cars in stock and available at $2,000 over retail. It was $5,000 over in 2022, but of course the total price in nominal dollars is similar because Honda has raised the list price. The identical minivan that we leased in 2021 for $400/month is available… for $800/month. Here’s a 2008 jalopy that, pre-coronapanic, the dealer would have sent to auction (the venerable Ford Taurus sits amidst the parking spaces that in 2019 were jammed with new cars):

Fresh from a checkup with one of America’s 190 board-certified veterinary dentists, Mindy the Crippler was my companion for the two-hour wait and made a lot of new friends inside the dealership. I left her with another customer while I went to get coffee and returned to find that the invasive species had invaded the vinyl seats:

My question for today is how consumers are able to keep spending like drug dealers and/or alimony plaintiffs. A lease quote is the best indication of the true cost of car ownership because it factors in the time value of money and the market’s expectation of depreciation. The cost of car ownership gone up dramatically doubled for anyone who needed to buy a car in the past two years or so, especially when you factor in higher gasoline prices. Therefore, these car owners should have less money to spend on rent, TV/phone subscriptions, entertainment, dining out, trinkets, etc.

What’s new in the Honda minivan world, aside from nothing? Honda seems to have dropped their basic trim level. For Corvette enthusiasts, there is a new “Sport” trim level that has black wheels:

What do readers think? To me, it looks like an old Dodge Caravan whose wheel covers were boosted in the Bronx.

Wikipedia says that pre-coronapanic production of this car was 100,000-130,000 per year between 2009 and 2019. For 2020, however, production fell to 83,000. In 2021, production was down to 76,000. In 2022, it fewer than 48,000 Odysseys were made. Half as many cars at 10X the total profit for manufacturer and dealer? Do we suspect a continued chip shortage or quiet collusion among the handful of major car manufacturers?

If integrated circuits were primarily made in the U.S., it wouldn’t be surprising to find them still in short supply. After all, quite a few Americans were introduced to the advantages of sitting at home playing Xbox all day and habits, once formed, are tough to break. But the Japanese, Koreans, and Chinese continued to work during coronapanic. Why aren’t these hard-working nations making as many chips as car companies need/want?

Against the collusion hypothesis: if the legacy car companies won’t supply a mass market anymore, that opens the door to infiltration by Tesla, Lucid, and Hyundai/Kia (sort of a legacy car company, but also not exactly mainstream until recently).


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Is inflation “abnormally high” given our epic budget deficits?

Pravda says “The U.S. is now two years into abnormally high inflation“:

But wouldn’t it be more accurate to say that we have roughly the inflation that we should expect given the level of deficit spending that we voted for? To prevent runaway inflation, the EU established a deficit limit of 3% of GDP for member countries and a debt-to-GDP ratio of 60%. The US deficit has been 5-15% since 2020 and was higher than 3% before that:

U.S. debt-to-GDP is 115 percent, according to the World Bank (compare to 45ish percent in Germany and Korea and 92 percent in over-the-EU-limit France, the only country with a larger welfare state than the U.S. has).

What’s the news from the New York Times?

U.S. inflation today is drastically different from the price increases that first appeared in 2021, driven by stubborn price increases for services like airfare and child care instead of by the cost of goods.

We can buy as many DVD players as we want, in other words. It is only services that are going to be unaffordable to the non-elite. What percent of the economy is subject to a wage-price spiral, then? 77.6 percent.


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One way to stay organized is to place cables and other miscellanies in hanging folders within a lateral filing cabinet. So that small items don’t fall out, pocketed folders are ideal. I bought 10 in July 2022 for $34.97:

Today they’re $40:

That’s an inflation rate of more than 15 percent annually. The government, however, assures us that these folders have inflated to only $35.63 (BLS calculator).

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Have we had enough inflation to get rid of the penny?

How are folks feeling after today’s inflation report? The Wall Street Journal:

Core prices, a measure of underlying inflation that excludes volatile energy and food categories, increased 5.6% in March from a year earlier, accelerating slightly from 5.5% the prior month. Core inflation, which economists see as a better predictor of future inflation, has stayed stubbornly high in part because of inflationary pressures from shelter costs.

(The journalists don’t speculate on what might be causing shelter costs to rise. It couldn’t be a shift in the demand curve from 175 million post-1965 immigrants and their descendants (half of these folks are already in the U.S. housing market and the other half are forecast to arrive soon), could it?)

The month-to-month chart shows reasonably stable core price inflation of close to 0.5 percent per month.

We, via Congress and the Fed, can’t resist trying to cheat our way to economic prosperity. The deficit spending and quantitative easing aren’t going to stop, in other words, and therefore the steady erosion of the dollar’s purchasing power won’t stop. But maybe we can adapt in a small way….

As the price of a crummy apartment trends toward $2000/month, can we let go of the pennies that litter our floors and clog our vacuum cleaners? The BLS CPI calculator goes back only to 1913, but it shows that the economy functioned just fine back then with the smallest coin being worth more than today’s quarter:

Given that most transactions are via credit card anyway and that we expect continued Bidenflation, why not declare that the smallest coin going forward will be the quarter? While we’re at it, we can decree that all quarters must be from the American Women Quarters Program, e.g.,

The next step up from quarters would be a $1 coin with a picture of (cloth-masked) Dr. Fauci on one side and Pfizer CEO Albert Bourla holding a positive COVID-19 test result.

Today’s $5 bill is worth less than a quarter was in 1913 so we’d get rid of it in favor of a $5 coin showing the legitimate government’s victory over the January 6 insurrection (Jacob Angeli, the QAnon shaman; obverse) and Joe Biden’s victory over Corn Pop (reverse).

Paper money would start with the $10 bill, which is worth a little more than the 1913 quarter.

Any better ideas for streamlining the use of cash?

Inflation anecdote: Chewy shipped Mindy the Crippler’s food recently. It was $2.97 per pound in September 2019. The same brand/variety food is $5.13/lb. today. That’s 73 percent inflation over a 42-month period…. roughly 17 percent compounded annual inflation. We are informed by the BLS that the price should have gone up to $3.48/lb. I.e., the government says that inflation is 17 percent and Chewy says it is 73 percent.

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Argentina investor looks at another government that can’t resist spending beyond its means

A recent Wall Street Journal interview with a guy who made $billions in Argentine bonds… “Paul Singer, the Man Who Saw the Economic Crises Coming”. First, let’s check his track record as a prophet:

“Men and nations behave wisely,” the Israeli statesman Abba Eban observed, “when they have exhausted all other resources.”

In an interview for these pages in 2011, he warned about the broad discretion the then-new Dodd-Frank law gave government officials to deal with what they deem systemic risks. The “atmosphere of unpredictability” doesn’t “make the system any safer,” he said. “This is nuts to be identifying systemically important institutions.”

A dozen years later, he still thinks it’s nuts: “As we’ve seen with SVB and Signature, virtually any institution can be deemed systemically important overnight and seized, with the government then completely empowered to determine what happens to various classes of creditors.”

The result is to destroy market discipline and encourage bankers to behave recklessly. He recounts a conversation on the trading desk at his firm following the recent weekend of bank bailouts. “If they hadn’t guaranteed all the deposits,” a colleague said, “things would’ve gotten very ugly in the markets on Monday.”

Mr. Singer replied: “That is entirely true. Things would’ve been ugly. But is that what regulation is supposed to be? Wrapping all market movements in security blankets?”

What about the most significant economic phenomenon of the moment?

Mr. Singer saw inflation coming at the start of the Covid pandemic. “We think it is very unlikely that central bankers will move to normalize monetary policy after the current emergency is over,” he wrote in an April 2020 letter to investors. “They did not normalize last time”—meaning after the 2008 crisis—“and the world has moved demonstrably closer to a tipping point after which money printing, prices and the growth of debt are in an upward spiral that the monetary authorities realize cannot be broken except at the cost of a deep recession and credit collapse.”

Mindful of the history of the 1970s, when inflation retreated several times only to come roaring back, Mr. Singer figures short-term declines will convince policy makers that they’ve slain the beast. They’ll “probably go back to their playbook,” resuming the policy of easy money.

The guy’s remedy is one that will never fly with the American voter:

How do we chart a course back toward sound money and long-term prosperity? “The optimistic scenario,” Mr. Singer replies, “would entail pro-growth reforms across the board, including tax reductions, entitlement reforms, regulatory streamlining, encouraging energy development including hydrocarbons . . . cutting federal spending, selling the asset holdings on central bank balance sheets.”

(see quote from Abba Eban, above)

Let’s assume that Congress and the Fed are never going to change. How does an individual investor protect him/her/zir/theirself from the doom that Singer predicts? That’s where it gets tough! The guy is bearish on nearly all assets, especially crypto. His $55 billion Elliott Management fund can do things that none of us can do, e.g., buy a big stake in Salesforce and get the company to fire 10 percent of its employees to boost profits (and therefore stock value).

A friend who has done some co-investing with Paul Singer’s fund points out that “talk is cheap” and he won’t accept Singer as a prophet without evidence that he made huge money in inflation swaps after that April 2020 newsletter to his clients. Wikipedia points out that Singer was predicting doom in 2014:

In short, if this smart and experienced fund manager is right, U.S. and European assets will be eroded by inflation for the next few years and returns to investors will be minimal.

In a November 2014 investment letter, Elliott described optimism about U.S. growth as unwarranted. “Nobody can predict how long governments can get away with fake growth, fake money, fake jobs, fake financial stability, fake inflation numbers and fake income growth,” Elliott wrote. “When confidence is lost, that loss can be severe, sudden and simultaneous across a number of markets and sectors.”

Anyone who acted on that advice would have done quite poorly until 2022!

Maybe the take-away should be that Americans today aren’t smarter than Americans were in the 1960s and 1970s. Inflation jumped dramatically in 1966 as Lyndon Johnson and Congress spent like alimony plaintiffs on (1) the Great Society programs of Medicare, Medicaid, etc., and (2) the Vietnam War. The inflation rate did not come down to the pre-1966 level until 1998. Maybe we could argue that inflation was finally whipped by 1992 (chart):

If we’re expecting at least 26 years of elevated inflation, what do we do? For a person who doesn’t already have a house, one reasonable response is for him/her/zir/them to try to get a 100 percent mortgage at today’s 6.5-7 percent 30-year rates. Put some stocks in as collateral as necessary to hit the 100 percent number. If Paul Singer is right that the D.C. technocrats won’t be able to resist inflation-as-usual policies, inflation will render the real cost of borrowing almost $0. If Paul Singer is wrong, there is no prepayment penalty so just refinance if rates fall dramatically.

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Inflation chronicles: car insurance going up 30 percent

We have two cars. They’re older than they were a year ago and presumably less valuable. We have had no tickets, accidents, or claims. Progressive is bumping the rate by 30 percent. I talked to a friend in Austin, Texas. His rate is also going up 30 percent.

Readers: What are you seeing for car insurance rate increases? What’s the explanation for this in what we are informed is a market economy? Most of the premium is for collision, right? Have body shop rates gone up 30 percent now that Americans realize it is more pleasant to relax on the sofa than to work in a body shop?

Separately, the news is not all bad. When one goes to the Progressive web site, the first and most prominent link is to learn about the company’s “commitment to diversity and inclusion” (not their actual diversity and inclusion, but their commitment to the religion).

What if we follow the link?

For years, we’ve been saying there’s a very real and important business case for DEI. It’s been proven time and time again that a more diverse, equitable, and inclusive organization drives profit and productivity by creating brands, products, and services that are more relevant and desirable in our competitive and multicultural marketplace.

It was almost impossible for a DEI champion such as Silicon Valley Bank to fail, in other words.

How about over at State Farm? Instead of being at the very top of the homepage, Diversity & Inclusion is relegated to the footer, under Careers:

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Inflation chronicles: 11 percent inflation from ADT for doing nothing

The question for today is whether we’re in a wage-price spiral. If everyone’s monthly bills are being bumped 5-15% annually because of the inflation that happened over the past year, shouldn’t we expect continued inflation because workers will need salary bumps of 5-15% and then the monthly fees will go up 5-15% in 2024?

Anecdote: When we moved in a year ago, ADT bamboozled me into signing up for a three-year monitoring contract for the alarm system that was already installed in the house. Apparently buried in the fine print is a clause that allows them to raise the rate as much as they want. It is going up 11 percent. Here’s the email:

For the percentage calculation:

ADT did not get the memo from Joe Biden, Janet Yellen, and Jerome Powell that inflation has been whipped?

On the bright side, our lawn care monthly fee recently was bumped up by only 5 percent. The letter from the owner explains that his break-even rate is $30 per hour per person. Where are the low labor costs for laptop class members that open borders was supposed to deliver? (Harvard study)

Readers: Are we in a fully-established wage-price spiral?

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Post #2 on The Lords of Easy Money (inflation and the Federal Reserve)

With April Fools’ Day coming up, a look at the second half of The Lords of Easy Money: How the Federal Reserve Broke the American Economy (2022) by Christopher Leonard… (the first post: A book about the Federal Reserve and inflation)

The book covers the pointless nature of the Fed’s hyperinflation program, which Fed insiders sold to each other with good intentions. The author points out that one reason the Fed’s easy money program didn’t create jobs or boost the real economy is that corporate CEOs can boost their own compensation most effectively by using free money to fund stock buybacks. If a CEO’s pay is based on earnings per share or stock price, he/she/ze/they will enjoy an instant pay boost following a stock buyback.

One thing that the government never lost was faith in itself. Tom Hoenig, who moved from the Fed to the FDIC, was one of only a handful D.C. insiders who imagined that there were limits to what D.C. insiders could accomplish via regulation.

Hoenig said [in 2012] they should tear up the very complicated rules they’d been negotiating for years (called the Basel III accord). When he spoke to a group of bank lobbyists and journalists, he told them the banks should be broken up rather than regulated, and monitored under the new Dodd-Frank Act, which was roughly 850 pages long.

The Obama administration took a different approach. It is true that Congress passed bank reform laws, and even created a new regulatory agency, called the Consumer Financial Protection Bureau, that had a real impact. But rather than restructure the banking system, the government chose to create a hyperdense web of new rules that would be layered over the big banks, allowing them to remain big but subjecting them to scrutiny and micromanagement. It was the regime spelled out in the hundreds of pages of the Dodd-Frank law in the United States and the international banking agreement called the Basel III accord.

Hoenig argued that this was a losing game. He said that bank rules needed to be simple in their aims, easy to understand, and straightforward to enforce. He argued that the banks should be broken up again as they had been under the New Deal. Banks should once again be divided up by their function, with commercial banks handling insured customer deposits, while other banks did riskier things like trade derivatives contracts. This division would help ensure that taxpayers were on the hook only to insure deposits at commercial banks (which would still be covered by FDIC insurance), instead of extending that safety net to megabanks that held deposits and also engaged in riskier speculation. Once the banks were broken up, Hoenig believed, they needed to live by simple rules that determined how much capital they should keep on hand in case of an emergency.

The key idea behind the Hoenig rule was breaking the riskier parts of banking away from the economically vital parts (like making business loans), so that the riskier banks could fail without taking down the rest of the system if they made bad bets. The financial columnist Allan Sloan, who wrote for Fortune and The Washington Post, published a widely read column after Hoenig’s Senate hearing that said the Hoenig rule is exactly what Wall Street needed. “It’s so simple, it’s brilliant,” Sloan wrote. “It’s a smart separation of high-risk from low-risk activities.”

While the taxpayers have taken a beating from Dodd-Frank recently, maybe it helped some folks previously?

The very complexity of Dodd-Frank, while vexing for the banks, became helpful to the biggest institutions. The law spawned about four hundred new rules, and each rule became a small regulatory quagmire of battles as it passed through a long process to become finalized by agencies like the FDIC. This gave the banks numerous chances along the way to dispute every detail of the rules. One rule, on the regulation of derivatives, received 15,000 public comments. Some agencies were so overwhelmed that they missed deadlines to put the law into effect. By 2013, only about one third of the law’s rules had been implemented. The banking lobby didn’t let up. It spent about $1.5 billion on registered lobbyists alone between 2010 and 2013, a figure that didn’t include the money that went into public campaigns or think-tank papers. The Dodd-Frank system tried to manage the risk inside big banks while allowing them to grow bigger. One of the key ways it did this was through something called a “stress test,” a procedure championed by Obama’s Treasury secretary, Timothy Geithner. The stress tests required banks to pretend that they were facing a crisis, and then to explain, in writing, why they would survive it. To pass a stress test, the banks had to prove that they had enough capital on hand to cover losses during a hypothetical crisis. But this just opened a lot of debate over what counted as capital and even what counted as a crisis.

Basel III was a similar fraud, according to the author, allowing banks to hold minimal reserves on the theory that Greek government bonds could never default. JPMorgan Chase had a capital ratio under Basel III of 12 percent, but that could also have been as low as 4 percent under conventional accounting rules.

The Fed printed money every day that these debates were going on.

Between 2007 and 2017, the Fed’s balance sheet nearly quintupled, meaning it printed about five times as many dollars during that period as it printed in the first hundred years of its existence. All those dollars were forced into a zero-interest-rate world, where anybody was punished for saving money.

The McKinsey Global Institute, for example, determined that the Fed’s policies created a subsidy for corporate borrowers worth about $310 billion between 2007 and 2012 alone, by pushing more money into corporate bonds. During the same period, households that tried to save money were penalized about $360 billion through lost earnings on interest rates. Pension funds and insurance companies lost about $270 billion during that time, and that was just the beginning of the ZIRP [zero interest-rate policy] era.

The Fed’s policies created such an intense and broad-based search for yield that the risks were building up all over the place.

One hedge-fund trader, who was a bit more caustic by nature, described the frothy stock market of 2016 as being like the crowded deck of the Titanic as it sank. The deck wasn’t getting crowded because it was a great place to be. It was getting crowded because people had nowhere better to go.

Every bad and money-losing idea got funded, thanks to Uncle Fed’s cheap money. Hoenig pointed out that unwinding would be almost impossible because all of the investments and decisions that had been made on the basis of cheap money forever.

It is fashionable in corporate media (as Ron DeSantis likes to call legacy journalism that is aligned with our rulers) to blame SARS-CoV-2 for our woes. Since #Science requires us to shut down our economy, print/borrow $20 trillion, etc., any time that a new virus appears, Congress and the Fed cannot be blamed. “What Really Broke the Banks” (Atlantic, March 23, 2023) is typical: “The Fed, among others, is blameworthy. But the ultimate culprit is COVID-19.”

The Lords of Easy Money: How the Federal Reserve Broke the American Economy shows that our overlords were eagerly printing and borrowing before governors ordered lockdowns (except of marijuana stores, of course!) and school closures and before Congress created the $600/week Xbox Corps:

Between September 2019 and February 2020, the Fed created about 413 billion new dollars in the banking system, judging by the increase of its balance sheet. This was one of the largest financial interventions of any kind in many years.

The author reminds us that, although the governors and most Americans were willing sheep, it was the CDC that shepherded young Americans into cowerhood:

On February 26, a U.S. health official turned this concern into a panic. Her name was Nancy Messonnier, and she worked at the U.S. Centers for Disease Control and Prevention. During a conference call with reporters, Messonnier said that the virus was spreading quickly, humans had no natural immunity to it, and there was no vaccine. The United States was probably going to have to do things like close schools and keep people at home.

When confronted by a novel virus, the Fed acted like our 7-year-old when the 5-year-old plugged his ears and said that he didn’t want to hear the same story over and over: “Okay, I’m just going to tell it to you louder.”

Powell’s Fed [in a March 15, 2020 meeting] would do virtually everything that Ben Bernanke’s had done in 2008 and 2009, but this time did it in one weekend, rather than over several months. It slashed interest rates to near zero. It opened up their “swap lines” with foreign central banks, flooding them with dollars in exchange for their local currencies (this was important because so much global debt is denominated in dollars). It executed a new round of quantitative easing, worth a total of $700 billion, and bought the bonds at a faster rate than before. The Fed would buy $80 billion worth of bonds before the following Tuesday, meaning that it pushed as much money into the banking system in forty-eight hours as it had done in the span of a month during earlier rounds of QE. It gave forward guidance, promising to keep rates pinned near zero as long as necessary. And it launched all of this in one day.

But by Friday evening, March 20, a week of financial carnage proved that the Fed’s actions weren’t enough to stem the panic. By this point, Powell was already designing the next phase of the Fed’s bailout, which would push the central bank into areas it had never been to before. The bank would, for the first time, directly purchase corporate bonds, CLOs, and even corporate junk debt. This would expand the Fed Put to entirely new realms of the economic system, changing the debt markets from that point forward.

The author describes how the Fed created $3 trillion in 90 days, a full three hundred years of money printing prior to 2008. What about Congress’s great works under the #coronapanic rubric?

… more than half of all the PPP money went to just 5 percent of the companies that received the loans. Even that figure understated the narrowness of the impact. Fully 25 percent of all the PPP went to 1 percent of the companies.

About $651 billion of the CARES Act was in the form of tax breaks for businesses, which were often complicated to obtain. This meant that the tax benefits went largely to the big companies that could hire the best tax lawyers. The Cheesecake Factory restaurant chain, for example, claimed a tax break of $50 million, even as it furloughed 41,000 people. About $250 billion of the tax breaks were given to any business in any industry, without regard to how much they might have been hurt by the pandemic. People who owned businesses were given tax breaks worth $135 billion, meaning that about 43,000 people who earned more than $1 million a year each got a benefit worth $1.6 million.

The rich hadn’t been getting rich enough during 20 years of mostly-free money and 30 years of open borders providing $500 billion/year (pre-Biden dollars) in transfers from the working class.

I kept wondering in this blog how the numbers could be real. With Americans paid to sit at home playing Xbox, their out-of-school-for-12-to-18-months (Boston, San Francisco, LA, NYC, etc.) kids moping around the house, how were rising stock market and GDP numbers believable? The author points out the same apparent contradiction:

As always, asset price inflation was portrayed in the media as a boom. And this time the boom was so intense that it was almost surreal. Millions of people were

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