10.06.20 20:30 ET
I was challenged several weeks ago to come up with a name for the current economic recession/depression our county is now officially mired in. Unlike the Obama era the NBER had no problem rapidly passing judgement this time to declare we are in a deep recession. I know this is shocking news for the 30 plus million who are unemployed and the thousands of business owners lining up to file for bankruptcy.
The projections from the Atlanta Federal Reserve GDP Now calculations do not lie. As of June 9, 2020, the projection is for -48.5% in Q2. I am sure this number still will vary greatly in the weeks ahead as more states open and some business returns to a semblance of normalcy and probably settle to down only 30-35%.
Ouch. But last week we had a great super duper hey look at how strong the employment number report was, right?
Please note, I prefer the non-seasonally adjusted data to get the raw numbers. And apparently it’s not below 20% yet despite the insane headlines last Friday.
Better yet, let’s see the impact on total number of people employed:
Bend over, here it comes again with hardcore numbers that well, suck.
Could it get worse? Ummm, yeah. Continuing claims are nothing to write home about:
Regardless of all this, the bigly numbers should not scare anyone. In fact today the drama queen fake news “financial” media attempted to scare us with the Consumer Price Index, aka, inflation numbers. The big highlight it turns out was “oh my God, look at the increase in the cost of food” blah, blah, blah.
So when prices increased at a HIGHER pace under Obama, it was no big deal, but because it’s “Orange Man Bad” everyone will starve and have to whore their wives out to buy one small box of Fruit Loops.
Insanity. This self-inflicted economic depression, or as I like to call the The Great Vipression, is the result of a faulty politically motivated scientific based scare which has crippled the lowest 30% of our economic citizenry; right when they had a chance to advance their lives and improve their lot.
The Vipression should be over by October to December of this year, if we are lucky, much like the Forgotten Depression of January 1920 through roughly July of 1921. Coincidentally it followed a truly fatal pandemic, the Spanish Flu, which wrought death and disaster upon the economic landscape by killing younger citizens in the prime of their productive lives.
The results of that nightmare set the table for the fear American society is enduring today, be it warranted or not.
The difference between this economic nightmare and that one is the honorable President Warren G. Harding, a great leader who has been bypassed by the liberal elites in history. His inaction, the refusal to insist on the Federal Reserve interfering with the business cycle and allowing failing businesses to fall during a massively deflationary crash gave America the ability to recover, restart, and boom for a decade to follow.
Instead, this Vipression, only enduring phase 1 now of the infection cycle, will result first in an stagflationary economic cycle to be followed by the deflationary disaster that Japan has endured for 20 years and America will undoubtedly duplicate. In the end, the citizens who have elected to become subjects of the state will endure an economic model where their servitude will perform what the state demands for subsistence, but other citizens who elect to bypass that economy will live in the other duality; a nation where some degree of economic freedom allows advancement.
Of course, this is not how the story ends this time.
I wish that I too could guarantee a 1921 happy ending; I fear however, it will be more like 1837 which eventually ended up in setting the table for greater problems in 1859. The insane actions by our government and central bank is defining an era where the economic divisions created by one’s success will result in violent political divisions, much like what our nation has witnessed over the past two weeks.