I keep hearing how we don't need manufacturing jobs because robots and automation are going to save us

 

Democrats are whistling past the graveyard of the industrial downturn, but this article misses their coerced misallocation of investment to a green energy economy the voters don't want

 But perhaps most ominous are signs that domestic manufacturing is on the cusp of a full-blown sectoral recession. Output has declined for five months, no doubt due to uncertainty over interest rates, as well as the debilitating shortage of skilled workers. The contraction, however, isn’t merely a reflection of Federal Reserve policy reinforcing supply-side choke points, which has undercut Team Biden’s efforts to reshore industry. In fact, production has been largely anemic since at least the slump of 2019; according to the Institute for Supply Management, a leading industry association, a 13-month stretch from 2022 to 2023 was the longest downturn since 2000-2002, when Permanent Normal Trade Relations with China went into effect. ... 

These patterns should be of grave concern to progressives—as a matter of politics and policy. A similar, overlooked downturn late in President Barack Obama’s second term likely contributed to Hillary Clinton’s defeat in Pennsylvania, Michigan, and Wisconsin in the 2016 election. That, along with her campaign’s astounding indifference to the industrial Midwest, practically cemented the view among many working-class whites that today’s Democrats have abandoned their New Deal roots. Although the Harris-Walz ticket appears to be sustaining momentum and has trained its focus on preserving the “Blue Wall,” unanticipated headwinds in battleground counties could spell the same fate as Clinton’s. ...

The reality is that dozens of counties reeling from job losses have effectively experienced what many wage-earners rightly feared: stagflation. In more rural regions, peak inflation was higher than the national average, a trend which spread from the South to the postindustrial Northeast. Its toll undoubtedly compounded the sense of helplessness among rural households, who tend to pay more for groceries and other staples. Mainstream liberals seem reluctant to acknowledge as much. ...

An economy pockmarked by mini-regional downturns, moreover, belies headlines heralding a manufacturing renaissance.

More. 

 

 

This is the way the world ends, not with a bang but a whimper

Trend for peak performance

 

1950: 24.0%

1959: 16.6% (9 years)

1984: 11.3% (25 years)

1997:  7.8% (13 years)

2010:  6.3% (13 years)

2021:  4.7% (11 years)

Things noteworthy from my reading October 17-24

 US wildfires may have burned approaching 8 million acres by now in 2020 but tens of millions of acres used to burn in this country annually before World War II, especially in the late 1920s and early 1930s when it was much warmer in the US.

Jim Lee, a pollster with Susquehanna Polling and Research, said "There are a lot of voters out there that don't want to admit they are voting for a guy that has been called a racist, that submerged Trump factor is very real. I don't see this a blue wave. I don't see Biden winning in the states Trump carried in 2016."

Joe Biden, who said he is the Democrat Party now, said after the debate “No one is going to build another oil or gas-fired electric plant." Which is complete lunacy. California has power shut-offs during the wildfires because of its war on oil and natural gas generating capacity. It is dependent on power imported from other states. Renewables can't meet demand when temperatures are too hot, when the wind dies, and when the sun goes down. Biden will turn all of America into California. Who are we going to buy it from then? Mexico?!

Sen. Murkowski of Alaska will vote FOR Judge Barrett.

BLM rioters blocked traffic in San Bernardino CA and keyed cars trying to get through. Left is, in the final analysis, lack of respect for property, including intellectual property, the notional property shared by the citizens and represented e.g. in statuary. By tearing down statues everywhere they declare that they are our enemies. We should treat them as such.

Twitter locked the account of The New York Post on Oct 14 in response to tweets revealing Hunter Biden's emails which Twitter didn't like. Democracy dies in darkness, eh WaPo? One of Hunter's alleged emails said "Hunter to hold 10% of the equity for The Big Guy." A Hunter Biden business associate surfaced who contradicted The Big Guy by claiming he discussed a lot of the business with him.

Internal polling by Hillary Scholten (D) and Peter Meijer (R) in Michigan District 03 agreed that Hunter Biden's Big Guy is ahead by 2 points in this heavily Republican district. Quite the thing that. Of course, they disagree about which of the two of them, Scholten or Meijer, is going to win Justin Amash's seat. Fear of a blue wave in Michigan is not misplaced. I'm hearing lowly Republican county office holders campaign on radio. Can't say I've EVER heard that before. Smells like fear to me.

A liberal pastor in Michigan who has been trying since 2015 to steer his conservative parishioners away from Trump has thrown in the towel and resigned, exasperated that they won't listen.

In Arizona Democrat Mark Kelly is trying to unseat Republican Martha McSally in the US Senate race. Someone floated a yearbook photo of someone dressed as a Nazi, claiming it is Kelly. Kelly campaign denies it. AZ Central found a guy named Ed who claimed to be in the photo and to know that the Nazi was definitely not Kelly. Ed must know who the Nazi is, but dang, AZ Central didn't go there.

Meanwhile, same thing at CNN. Ms. Amanpour informed a GOP official it's not CNN's job to investigate the Hunter Biden laptop affair. No kidding. She said that's the GOP's job, and CNN is not going to help them. CNN is an arm of the Democrat Party.

Trump mentioned in the debate that wind turbines kill a lot of birds and are bad for that reason. The New York Times responded that wasn't true because house cats kill far more birds than turbines do.

I think I've detected a pattern from AZ Central to CNN to NYT.

Trump in his first term isn't going to come anywhere close to appointing as many judges as the King, Jimmy Carter, did.

Speaking of Carter, who helped Israel and Egypt make peace, Trump has now presided over the normalization of relations with Israel by Sudan, Bahrain and United Arab Emirates. Quite the feather in his cap.

Republican voter registrations have outpaced Democrat in Pennsylvania over Trump's term as average unemployment in PA fell one full point from 5.4% in 2016 to 4.4% in 2019. In 2018 the average was even lower: 4.3%. COVID wreaked havoc on this record, but will voters blame Trump?

President in waiting, Kamala Harris, said 220 million in the US have died of coronavirus, which should mean fewer votes to count, for sure. In June The Big Guy had said 120 million had already died, but he moved that up to 210 million by early October. cc: TalkingPointsMemo.

The Big Guy predicted only 200,000 more deaths by the end of the year, which comes as quite the relief. The worst is behind us.

Except that the CDC released data showing excess deaths to Oct 3 are running about 90k higher than accounted for by COVID-19 deaths reported so far. In other words, The Big Guy is half way there already!

Young twitter users this week were utterly befuddled in droves by the idea that illegal kids were coming across the southern border on coyotes. One such tweeter is an investment advisor, corporate attorney, and chief deputy whip of the Georgia House Democrats. She said, "How the hell does a coyote bring a whole human across the border?".

Somebody claimed this week that Democrats and Republicans polled about equally reluctant to express openly their political views. Clearly the coyote-perplexed people voting for the Democrat COVID death misoverestimators weren't part of THAT poll.

Santa cancelled his appearance at Macy's for the first time in 160 years because . . . 2020.

But wait, it gets worse than 2020. The Big Guy said in the debate he'd get to zero emissions by 2025. Everyone on Twitter caught it. Democrats excused it saying he meant 2035. But even that is horrifying lunacy. It isn't achievable because most people are like me.

I have a natural gas fireplace, a gas furnace, a gas stove and oven, a gas dryer, a gas water heater, and a gas back-up generator, not to mention 2 pretty old gasoline powered cars. And don't get me started on the power equipment. There's the riding mower, two walk behinds, an edger, a weed whacker, and two snow-blowers, one for light and one for heavy duty. Oh yeah, and a chain saw. All of it is old but works and is well maintained.

The Big Guy wants a buy-back program for AR-15s, which will be cheap compared to a buy-back of all my carbon-emitting equipment. Ain't gonna happen.

Natural gas is cheap and clean, but The Big Guy hates it. The Big Guy has a dagger aimed at all of it, 2025 or 2035 doesn't really matter. America runs on cheap energy, and he aims to make it more expensive. Which will mean only one thing.

America won't run. The only thing keeping industrial production above the water line in this country is the energy sector. Take that away and down the toilet we go.

50 years ago this month guns that the black communist Angela Davis bought were used in the execution of Judge Harold Haley. Davis is a forerunner of today's violent communist Black Lives Matter:"She was acquitted in '72 despite her proven ownership of the murder weapons & a cache of letters she wrote to Jackson in prison expressing her unambivalent solidarity with his commitment to political violence". Davis is also a prominent originator of the idea of systemic racism, a system rigged vs. blacks. "With her blanket dismissal of evidence as irrelevant in trials of (automatically innocent) minority defendants, Ms. Davis indicts the entire American legal system as a rigged farce." It's rigged alright . . . in her favor.

Democrat Kamala Harris argued that people can't afford their health insurance under Democrat Obamacare which was rammed down the people's throats by Democrats and that something must be done about it by electing Democrats again.

And if you don't like that, she'll lock you out like Twitter locked out The New York Post.

The person who died in the Oxford coronavirus vaccine trial got the placebo, not the vaccine.

The Big Guy also echoed Gov. Andrew Cuomo of New York this week, who once said "America was never that great".

The Big Guy tweeted: "America was an idea. We've never lived up to it . . .."

The Big Guy also took the endorsement of the Boilermakers Union Local 154 in Pennsylvania, which promptly informed him that they had already endorsed Donald Trump. "Don't try me, pal" was heard in response from the Big Guy according to two clearly disgruntled anonymous sources, one of which sounded Hungarian and the other Polish, who obviously were making this up out of their rancor over The Big Guy calling NATO allies Poland and Hungary "totalitarian" states.

The 80s called. They want their foreign policy back. 

Jeffrey Toobin's one-eyed trouser snake got loose while he was in a Zoom meeting, now known as an erection simulation, and all the ladies saw him stroking the creature, trying to pacify the wayward beast. Toobin apologized to his wife for not including her in the special moment.

Peter Strzok of FBI Trump-Russia Russia Russia! fame is now an adjunct professor at Georgetown. He'll probably find some young chicks there to replace the adulation, and other things, he used to get from Lisa Page. Parents, you have been warned. 

Some asshole pointed out that Trump's point four of America First in 2016 was to "end sanctuary cities".

What a jerk!

The only thing Trump has accomplished at "warp speed" is ruining the US economy because he ignored a deadly virus until it was too late

Trump, the supposed savior of US manufacturing, has presided over the utter collapse of manufacturing capacity utilization to a level in April 2020 never experienced in the post-war. The president could lawfully and easily order this unused capacity to make masks which would in fact protect everyone, and other PPE for hospital workers and care-givers to protect our front line workers, but he has not. Were he serious about re-opening the country, he would have made this JOB 2 on Feb 1, after JOB 1, which was hard-stopping all passenger air travel, the primary vector for the pandemic. Trump didn't do JOB 1, either.

Industrial production generally has imploded to levels never seen since 1919. The so-called America first president has done nothing in three years to make America strong enough to prevent this from happening. Remember Ann Coulter said long ago already that Trump was a lazy ignoramus. 

Motor vehicle production annualized has tanked 11 million units in just two months to fewer than 72,000 annualized. That's the typical monthly sales figure for a single popular car. 

Oh, I've forgotten unemployment, which also is unprecedented, though understated, at 14.7%. It's actually closer to 20%. North of 33 million not-seasonally-adjusted have made first time claims for unemployment from March 19th inclusive.

Trump's numbers are truly great, as in "you great oaf!"

Yes the government has "bailed out" the workers and the businesses, but with a Rube Goldberg machine which has been completely unfair in its results, picking winners by virtue of their established access to bankers or savvy state systems of unemployment administration. Bank or live somewhere not up to speed? Dats tuff, Anwar. You're a loser anyway.

Meanwhile coronavirus infections are set to soar again because our president is throwing a tantrum to open the country but hasn't made it safe to do so. He's had two months for that but has produced BUPKIS. If you want people to go back to work, they need masks. Where are the masks? Oh well, you were on your last legs anyway.

How anyone can vote to re-elect this level of horrific incompetence and reptilian danger is beyond me.

The only thing saving industrial production in this country since 2007, up less than 5%, has been fracking to mine oil and gas

It has had little to do with Trump or Obama either way, political support or no political support.

The only thing giving an additional recent boost to oil and gas was the 2015 bipartisan agreement to end the oil export ban, signed by Obama.

Industrial production from all mining categories is up almost 17% 2015-2019, and a whopping 53% 2007-2019.

Industrial production from coal mining, a subset of this like oil and gas, is down over 39% since 2007, and 21% since 2015 despite Trump's promise to restore the industry. Industrial production from base metals mining is up less than 3% since 2007. Industrial production from gold and silver mining is down almost 15%.

Industrial production from crude oil mining is up a whopping 140% since 2007, and from natural gas 79% from 2007 through November 2019 on an average basis.

Otherwise it's a sorry picture.

Industrial production from manufacturing is down 1.3% 2007-2019, despite Trump running on bringing manufacturing back to the United States.

And industrial production from electric and gas utilities has grown a paltry 2% 2007-2019.

It's all mining of crude oil and natural gas.

If the anti-capitalist climate kooks get their way, we're all in big trouble.

Laugh of the Day: German industrial production tanks 4.7% in November, Reuters calls it a tentative sign of slowing growth momentum

The signs were tentative in H1 and worrisome since then. November was a disaster.

Global economy is headed for recession:

[T]here were tentative signs of slackening momentum in the United States and Germany in November.

Our wizards of smart have hollowed out our country and run it straight into the ditch

Fake economic boom: Industrial Production went negative in May 2018

Compared to the 1950s, this economy might as well be sleeping.

The boom goes bust: "Investment activity is grinding to a full stop for the first time in China's modern history"

Also, "weakest consumer spending since 2003".

And, 46 consecutive months of industrial production at or below 8%, "unprecedented for modern China".

Jeffrey Snider, here.

Warped New York Times views inflation as sign of increased demand

Nelson D. Schwartz, here:

Besides the increase in consumer prices reported on Thursday, data Wednesday on producer prices showed a rise of 0.6 percent last month, the largest increase since September 2012 and an indication that demand for a number of basic goods is growing faster than economists expected.

Never mind industrial production fell 0.6% (expectation was 0.0%) along with capacity utilization, which dropped to 78.6% (expectation was 79.2%). Import prices were down 0.4% (expectation was for an increase of 0.3%). Retail sales also disappointed up just 0.1% vs. expectation of 0.4%. The expectation ex-autos was even higher up 0.6%, and the disappointment even lower with a flat 0.0%. Crude oil supplies were up .947M when they were expected to be down .400M. The housing index came in lower at 45 vs. expectation of 49.

Against this backdrop of soft demand, higher producer and consumer prices along with back to back months of flat wages are indicative of nothing so much as . . .

PAIN.

Which is what, evidently, The New York Times enjoys inflicting the most. 

Massive Central Bank Purchases Of Gold Boosted Price Over 30 Percent In Last Year

This baby weighs one metric ton

That's the upshot from this report in The Wall Street Journal, here, in early June:

Central banks increased their gold hoards by 400 metric tons — each equal to almost 2,205 pounds — in the 12 months through March 31, up from 156 tons during the prior year, according to recent World Gold Council data. ...

Central banks “will probably be continuous buyers of small volumes of gold for the foreseeable future,” says Jeff Christian, founder of New York–based commodities consulting firm CPM Group. By small volumes, he means 311 to 374 metric tons a year, or about 10% of the global supply. ...

He says that central bankers will avoid buying any quantity that dramatically affects the price. They know that the market is tiny, compared with the $4 trillion-a-day foreign-exchange market. Still, consistent buying of 10% of annual supply can’t but help keep the price elevated.

Up from 156 tons? That's a 156 percent increase in purchases by banks in the last year, March over March.

That's a remarkable development in the face of the enormous growth in central bank balance sheets to support weak economies at the same time that stiffer Basel III capital rules are imposed on the world's largest fiat money banks. Central banks are the banks of last resort and have been demonstrating rather vividly what they think counts as the capital of last resort.

Is it any wonder then that gold soared from $1,400 the ounce in March 2011 to $1,900 by September 2011? Gold has been above $1,750 as recently as March 2012. Clearly central bank demand has boosted price. 

Purchases of 400 metric tons at today's pull-back-price of $1,600 the ounce would imply $22.58 billion allocated to gold purchases by central banks during the one year period. Purchases of 156 tons at $1,400 the ounce at the top previously comes to at best only $7.7 billion allocated to gold purchases just prior to the period. That's a nearly three-fold increase, and a sign that central banks' confidence in sovereign support of fiat currencies has eroded to say the least. 

The implications for gold price going forward, however, are tricky.

The Wikipedia gold investing article, which also depends on figures from the World Gold Council, puts annual demand in 2005 at 3,754 tonnes and states annual production figures, for example, of as few as 2,500 tonnes as of 2010 to as many as 3,859 tonnes in 2005. Complicating matters is its assertion that 2,000 tons routinely gets allocated to jewellry and industrial production annually, making central bank acquisitions of 375 metric tons annually far more than 10 percent of the remaining supply on either accounting of the total.

It would seem that the very wide spread for annual production reported between 2,500 tons and nearly 3,900 tons (over 50 percent!) is part of a delicate balancing act by the industry, which attempts to pay its respects to all sides concerned in the gold business, both those who profit from production and those who profit from consumption.

Jeff Christian, cited in The Wall Street Journal article above, hints perhaps at how to split the difference. If his low end estimate for bank purchases of 311 metric tons is really 10 percent of annual supply, that means annual supply is probably closer to 3,100 metric tons. Sans jewelry of 2,000 metric tons, bank consumption of 350 metric tons or so going forward would be nearly a third of remaining production if sustained at that level.

In response to this surging demand by banks in the last year, however, production has probably run up against a new and unsustainable level, which is why the price of gold has softened roughly 15 percent off the high in recent months. Add to this that significant fresh inputs from consumers are unlikely in view of declining wages and the increased demand for return on investment which gold cannot give. Few have significant resources left to mop up increased supply of gold.

Oversupply of gold has been noted as recently as mid-July, here, by Dominic Schnider, an analyst at UBS Wealth Management in Singapore:


"The market is in oversupply -- production growth is solid and we simply don't see incremental gold purchases," he said.


That suggests banks continue to buy at levels consistent with the recent past, but are restraining themselves a little bit. This coheres with an observed supply glut and softened prices.

An attempt at a non-partisan evaluation of supply here suggests that already mined gold "above ground" historically totals 170,000 metric tons, with another 100,000 metric tons in the ground, less than half of which is profitable to mine under current conditions. In other words, you could devalue the above ground supply with the below ground supply over time, but only by another 28 percent at the extremes, not counting such factors as the small amounts of above ground gold lost to industrial production, the long time required for mines to become profitable, the changing costs of extraction, and the like.

My take is that bank purchases of gold at higher levels in recent times signals that the pendulum has started to swing against endlessly devaluing fiat currencies and against the elite consensus which created them. Official gold reserves around the world already approach 31,000 metric tons, and I expect they will only increase from here, if but gradually. The effect, however, may be to shore up existing currencies rather than to replace them, which would augur for a stabilization of gold prices near present levels and improved conditions for the world's economies.