Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Category Archives: Economics

Hurricanes Hammer OPEC as Well

This article appeared online at TheNewAmerican.com on Monday, September 11, 2017: 

English: Flag of the Organization of Petroleum...

Estimates are that Hurricane Irma knocked out the power to nearly six million Floridians’ homes and businesses, while both Harvey and Irma have either destroyed or heavily damaged 300,000 homes in Texas and hundreds of thousands more in Florida. Further estimates are that these two massive storms have reduced demand for oil by nearly a million barrels a day.

This is being reflected in the price of NYMEX (New York Mercantile Exchange) crude oil dropping to $47 a barrel early Monday. Last Wednesday crude was selling at more than $49.

Part of the problem facing OPEC and its grand plan to cut production to raise oil prices was its assumption that

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New York Fed: Economy Will Benefit From Harvey and Irma

This article appeared online at TheNewAmerican.com on Monday, September 11, 2017:

Frédéric Bastiat

Frédéric Bastiat

In a statement reflecting a worldview taught by all major universities and espoused by central bankers around the world, the president of the Federal Reserve Bank of New York, William Dudley, said on Friday that, on net, the destruction wrought by the hurricanes will be positive for the economy: “[The initial] effects tend to be pretty transitory. [But] the long-run effect of these disasters unfortunately is it actually lifts economic activity because you have to rebuild all the things that have been damaged by the storms.”

Dudley got the first part right:

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If Dudley is Right, Then Let’s Pray for the Flooding of the Entire Country!

This article was published by The McAlvany Intelligence Advisor on Monday, September 11, 2017:

Cover of "The Emperor's New Clothes"

Cover of The Emperor’s New Clothes

Taken to its logical conclusion, William Dudley, the president of the Federal Reserve Bank of New York, thinks a flood covering all of the United States would stimulate the economy. Several sources confirmed that this is what Dudley said on Friday in an interview at CNBC concerning the economic effects of hurricanes Harvey and Irma:

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Price-gouging Laws Guarantee Shortages in Miami

This article appeared online at TheNewAmerican.com on Friday, September 8, 2017: 

Florida Attorney General Pam Bondi (shown) railed against so-called price gougers at a press conference in Tallahassee on Wednesday night: “It’s sickening. It’s disgusting. It’s unacceptable and we’re not going to have any of it.” She then provided the number for Floridians who think they’re being ripped off to call to complain: 1-866-9NO-SCAM.

Bondi doubled down the next day, telling would-be “gougers”:

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Shiller’s CAPE, Harvey, Irma, and now Jose: How Much More is Needed for a Stock Selloff?

This article was published by The McAlvany Intelligence Advisor on Friday, September 8, 2017:

English: (left) and meeting shortly after the ...

Republicans Smoot and Hawley

Wall Street prognosticators have watched Robert Shiller’s CAPE – “cyclically adjusted price-to-earnings” ratio – for years for signs that stocks are becoming overvalued. It’s now at a nosebleed level reached just before the October 1929 crash. The good news is that CAPE has been at that level ever since Shiller said that stocks were overvalued earlier this year. It is not a market timing tool, but more of an early warning indicator.

Short sellers have gotten smashed as the stock market continues to defy gravity. Bets against the SPDR S&P 500 exchange-traded fund, the largest ETF tracking that index, fell to lows in July not seen since May 2013.

But Hurricanes Harvey, Irma, and now possibly Jose may finally bring things back to earth. The jump in unemployment claims for the week ending September 2, caused by Harvey and reported by the Department of Labor (DOL) on Thursday, not surprisingly exceeded economists’ consensus. The increase of 62,000 for the week to

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Jump in Jobless Claims Following Harvey Is Just the Beginning

This article appeared online at TheNewAmerican.com on Thursday, September 7, 2017:

View of the eyewall of Hurricane Katrina taken...

View of the eyewall of Hurricane Katrina taken on August 28, 2005 as the storm made landfall on the United States Gulf Coast.

The jump in unemployment claims for the week ending September 2, as reported by the Department of Labor (DOL) on Thursday, not surprisingly exceeded economists’ consensus of just 241,000. The increase of 62,000 for the week to 298,000 nearly broke a claims record that has been in place for 131 weeks: 300,000.

That record will surely be broken in the weeks to come. The unemployment claims are just beginning to come in, and they are a predictor — a proxy — for job layoffs. Some workers

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August Jobs Report Shows Economy Humming Along Nicely

This article appeared online at TheNewAmerican.com on Saturday, September 2, 2017:

English: Bureau of Labor Statistics logo RGB c...

Bureau of Labor Statistics

Laura Rosner, senior economist at Macro Policy Perspectives (known for its ability to “understand how to read the tea leaves of economic and financial developments”), summed up August’s jobs report from the Bureau of Labor Statistics (BLS) on Friday: “The economy is doing well, but it’s not necessarily taking off. We’re on an even keel. The labor market continues to hum along.”

The growth in jobs was in all the right places, too,

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Ford, Domino’s Team Up to Deliver Pizza Next Week in Driverless Cars

This article appeared online at TheNewAmerican.com on Wednesday, August 30, 2017:  

This coming Monday night someone in Ann Arbor, Michigan — more than likely a student at the University of Michigan — will order a pizza from Domino’s, and the conversation is going be a little different. After confirming the order, the order taker will then ask: “Is it all right if we deliver it driverless?” If the answer is yes, then instructions will be provided about what to do when the Ford Fusion, driverless but containing the pizza, arrives in front. There will be instructions on the side of the car pointing to the back hatch which will open automatically. Inside is the “heatwave” container — large enough for five pizzas and three sides — with a keypad. When the last four digits of the customer’s phone number are punched in, the container opens. That’s it. No fuss, no mess, no tip. Enjoy your pizza and have a nice night.

It will be the first in a series of test runs announced by Ford on Tuesday. Sherif Marakby, who just left Uber in April, has a title that explains everything: He’s the vice president of Autonomous and Electric Vehicles. He stated:

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Hurricane Harvey, President Trump Putting More Pressure on Venezuela

This article appeared online at TheNewAmerican.com on Sunday, August 27, 2017:

On Friday President Donald Trump once again ramped up sanctions against Venezuela’s Marxist dictator, shutting off his ability to sell new debt or equity in the U.S. financial markets. On Saturday, Hurricane Harvey, the worst hurricane to hit the Gulf Coast in 50 years, has all but sealed Maduro’s fate.

Following Maduro’s installation of his illegal “constituent assembly” in July, President Trump placed sanctions on Maduro himself, freezing any and all of his assets lying within American jurisdiction. A week later Trump added a few of Maduro’s cronies to that list, and on August 9 he added a few more. At the time The New American expressed skepticism that they would have any effect on Maduro’s obstinacy and determination to continue policies that have caused Venezuela’s economy to shrink by 35 percent just since 2014.

On Friday the Trump administration broadened those sanctions to include

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Mississippi’s Second Amendment Sales Tax Free Weekend: “Bigger than Black Friday”

This article appeared online at TheNewAmerican.com on Friday, August 25, 2017:

According to Todd Sarotte, the manager of Van’s Sporting Goods in Brandon, Mississippi, this weekend’s Second Amendment celebration — firearms and related accessories are exempt from the state’s 7 percent sales tax through midnight Sunday —  is the biggest of the year for him: “It’s actually bigger for us than Black Friday. It’s grown every year, and for the last two years it’s been bigger than Black Friday for us.”

The exemption saves a buyer of a Glock semi-automatic pistol nearly $40 while a purchaser of a Stag Arms Model 3 Typhoon AR-15 saves more than

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OPEC Leaving Its Options “Open” as Production Cuts Fail to Raise Oil Prices

This article appeared online at TheNewAmerican.com on Friday, August 25, 2017:  

Even the subtitle was misleading: “JMMC Reports Positive Indications of Oil Market Rebalancing in Progress.” That is the subtitle of the report issued on Thursday by OPEC’s Joint Ministerial Monitoring Committee, the toothless enforcement arm of OPEC.

OPEC is down to its last option: verbiage. The JMMC reported that everything is rosy:

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Carbondale, Illinois Seizes Eclipse Opportunity to Boost Its Economy

This article appeared online at TheNewAmerican.com on Monday, August 21, 2017:

Two years ago Carbondale, Illinois’ mayor Mike Henry learned of the epic cosmic event headed his way and decided not to say, “Oh, no!” but instead said, “Oh, yes!”:

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Another Nail in OPEC’s Coffin: Fracking Old Wells Dropping U.S. Breakeven Points Further

This article appeared online at TheNewAmerican.com on Monday, August 21, 2017:

Ed Morse, Citigroup’s head of commodity research, told a Bloomberg television audience last week that OPEC’s position “is not sustainable over a long period. In the end, the markets are going to win, and [the winner] is going to be shale. If we’re in a $40 to $45 world, we’ll have enough drilling to add to the [world’s] surplus.”

Morse is reiterating the mantra sung for years: OPEC has long since run out of options and has all but lost its monopoly influence over world crude oil prices. If it reduces supply, prices go up, making U.S. frackers more profitable and inviting more capital in to expand production. If it increases supply, the lower prices cut further into each member’s cash flow, forcing them to continue to deficit spend without gaining any advantage over the Americans.

The breakeven point for U.S. frackers has been estimated to be between $40 and $50 a barrel. On Friday U.S. crude oil closed at $49 a barrel on the New York Mercantile Exchange (NYMEX – see floor photo above).

Now OPEC is faced with another challenge from the American oil industry:

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Morgan Stanley: Tesla Not as Green as You Think

This article appeared online at TheNewAmerican.com on Friday, August 18, 2017:

English: Tesla Roadster Sport 2.5, the fourth-...

Tesla Roadster Sport 2.5, the fourth-generation Roadster from electric carmaker Tesla Motors Inc.

Morgan Stanley, the international banking behemoth, released the results of its study on the best “green” companies in which to invest. This is based, said the bank, on the assumptions that some, perhaps many, investors who have drunk the “green Kool-Aid” want to invest in ways to “save” the environment and fight against “climate change.” Missing from the top of their list is perhaps the most visible “green” automobile company: Tesla, Inc., formerly known as Tesla Motors.

After comparing the savings in carbon dioxide (CO2) achieved by Tesla’s high-mileage electric vehicles to all the “secondary and tertiary” factors involved in their manufacture, Morgan Stanley said,

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Trump Takes Credit for Banner Jobs Report

This article appeared online at TheNewAmerican.com on Friday, August 4, 2017:  

Within 15 minutes of Friday morning’s release of the July jobs numbers by the Bureau of Labor Statistics (BLS), President Trump tweeted: “Excellent Jobs Numbers just released — and I have just begun. Many job stifling regulations continue to fall. Movement back to USA!”

He has good reason to cheer:

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Warehouse Automation Causes Employment to Increase?

This article was published by The McAlvany Intelligence Advisor on Friday, August 4, 2017:

Image of Autonomous Robot From Second Grand Ch...

Image of Autonomous Robot From Second Grand Challenge Advancing to Urban Challenge.

The crux of the anti-capitalist cabal’s complaint about the robotic revolution taking place all across the country is this: since robots can do anything that a human can do, everyone’s job is on the chopping block. So how do they explain the simple bald fact that warehousing jobs – where much of the robotic revolution is taking place – have increased? A year ago there were 867,300 people employed in warehousing. Today that number is approaching 950,000. And Apple is looking to add thousands more. How is that possible?

Part of the answer of course is

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Robots Making Humans More Efficient, Opening Up New Jobs

This article appeared online at TheNewAmerican.com on Thursday, August 3, 2017:

Factory Automation with industrial robots for ...

Factory Automation with industrial robots for palletizing food products like bread and toast at a bakery in Germany,

SAM, the Semi-Automated Mason, can be seen on YouTube laying bricks alongside human masons. While SAM can, according to contractors, lay around 2,000 bricks a day compared to an average of 600 to 700 for a human mason, the video illustrates a key point missed by many: It shows human workers programmming SAM and providing it the bricks and mud and following behind cleaning up after it. In other words, SAM, produced by Construction Robotics, isn’t replacing masons, it is making them more efficient and saving their backs.

A year ago, Rick Cohen, the founder of Symbotic LLC, which develops autonomous robots for warehouses, said,

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Debt Ceiling Debate Charade Begins, Again

This article appeared online at TheNewAmerican.com on Wednesday, August 2, 2017:

Treasury Secretary Steve Mnuchin warned Congress in a letter sent Friday that they had precious little time to raise the federal government’s debt ceiling before his department ran out of money. He even put a date on when that would happen if the ceiling wasn’t raised: “Based upon our available information, I believe that it is critical that Congress act to increase the nation’s borrowing authority by September 29.”

That’s the day before the end of the government’s fiscal year, and closely coincides with the moment when the Treasury will be unable to pay the government’s bills. The Treasury’s cash balances are expected to drop close to $25 billion in September, dangerously low when compared to the government’s budget of $4 trillion.

Mnuchin no doubt is referring to the Congressional Budget Office (CBO) report released in June that reminded citizens that

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Democrats and Fiscal Reality Present Roadblocks for Trump’s Budget

This article appeared online at TheNewAmerican.com on Tuesday, August 1, 2017:

speaking at CPAC in Washington D.C. on Februar...

Deciding to move on following the failure of the Senate to pass the “skinny” ObamaCare repeal bill, the Trump administration announced on Monday its accelerated plans for passing its budget bill. According to Marc Short, President Trump’s director of legislative affairs, background work on the budget will take place in August in preparation for committee action in the House in September. Assuming little resistance there, Short hopes for a floor vote in October, a Senate vote in November, and the president’s signature on it immediately thereafter.

It’s good to dream big.

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Texas Grows 3.9 Percent in First Quarter. California? 0.1 Percent

This article appeared online at TheNewAmerican.com on Friday, July 28, 2017: 

This map shows the incorporated areas in Colli...

This map shows the incorporated areas in Collin County, Texas. McKinney is highlighted in red.

Melissa, a resident of San Diego with degrees in psychology and Spanish, could find work only at a fast-food restaurant, recounted an article in (of all places) the Los Angeles Times about how some conservatives fed up with California are looking to Texas for greener pastures — and not just economically. The final straw for Melissa was when her daughter came home from public school one day with a “young adult” novel as homework. The book celebrated the use of cigarettes and pills to cope with stress, and Melissa decided it was time to leave the Golden State.

She found Conservative Move, a website just launched to help Californians

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Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.