Episodes
Friday May 01, 2020
Friday May 01, 2020
the US central bank, the Federal Reserve (Fed), is in the process of throwing trillions of dollars at the economy, most to businesses and corporations, in an historic effort to bail out the banks and now non-bank businesses as well (for the first time). The objective is to head off and prevent the deep and rapid contraction of the US economy from spawning a wave of defaults and bankruptcies among non-bank businesses that will soon fail to ‘service’ their massive accumulated debt loads run up since 2010. Broad sectors of US business heavily laden with corporate debt—corporate junk bonds, junk loans, and related debt amounting to several trillions $ in the US alone—are on the verge of failing to make principal & interest payments on that massive debt. The Fed is feeding them free money to continue to do so. As well as pumping up bank balance sheets to provide a cushion for the defaults and bankruptcies and avoid a banking-financial system crash in the event of defaults when they come. Rasmus explains how the capitalist drive to return workers to their jobs now gaining momentum is also about business revenue restoration to avoid defaults. Industries most prone to defaults: travel, oil and energy, retail, entertainment will be the leading edge. Rasmus explains the magnitude and composition of the Fed’s $9T commitment to ‘pre-bail out’ the banks and business, and how the US working class will be required to pay the bill—a present on this May Day to workers.
Friday Apr 24, 2020
Friday Apr 24, 2020
Dr. Rasmus begins today’s show describing the latest Congressional bailout package of $484B just passed, expanding the prior $2.3T ‘Cares Act’ bailout just a few weeks ago. How much is direct money and how much is loans funneled through the Fed and private banks. Why It won’t be enough and what’s in the next bailout package already being debated for May. Jobless numbers now at 26m, going to 40m by end of May. The ways in which big corporations are gaming the bailouts and getting free money they don’t need, while workers, homeowners, renters, and small businesses are starving for funds due to Trump administration mismanagement. Why business interests & Trump are so desperate to force everyone back to work prematurely, almost ensuring a second and potentially worse wave of infections. Rasmus explains the bailout in general is designed to go through the Fed and the private banks, as it was in 2008-09, and why this will mean a very slow recovery under the best of assumptions. Why the Fed’s multi-trillion dollar money injections may yet fail to prevent a financial crisis and an even worse economic crisis. (check out Dr. Rasmus’s blog, jackrasmus.com, for weekly up to date posts on the virus economy and join his twitter feed, @drjackrasmus, for daily commentaries)
Friday Apr 17, 2020
Alternative Visions - Sanders’ Movement: Where’s It Going?
Friday Apr 17, 2020
Friday Apr 17, 2020
Dr. Jack Rasmus interviews Paco Fabian, Campaigns and Communications Director for the ‘Our Revolution’ (OR) organization that has been central to mobilizing progressives and grass roots youth in the primaries for Bernie Sanders. Now that Sanders’ has dropped out of the race for the Democrat party nomination, what next for OR and the progressives movement? Where do progressives who supported Sanders go from here? Rasmus and Fabian discuss the significance of Sanders’ campaign—including his recent abrupt retreat and endorsement of Biden. What’s OR’s own strategy and goals as an organization, before & after the Democrat party convention? What will OR do after the November elections, should Biden lose? How will it work to stop Trump if he’s re-elected? How will it confront Biden and the Democrat party moneybags if Biden wins and he introduces another ‘pro-business go slow, minimalist’ Obama approach to economic recovery?
Friday Apr 10, 2020
Alternative Visions - Explaining the US Economic Bailout
Friday Apr 10, 2020
Friday Apr 10, 2020
In today’s show Dr. Rasmus unravels and explains the array of bailout measures being passed by Congress (3 Acts + 1 in the works) and the Federal Reserve Bank’s multiple programs to inject trillions of dollars into financial markets and non-financial businesses alike. How are the two bailouts—Congress and the Fed’s—integrated? How much of the trillions of loans, grants, tax cuts, subsidies, unemployment benefits, cash checks to households, etc. are actually getting into the economy and how much in bottlenecks. Is the magnitude of the bailout sufficient to prevent a great recession like 2008-09? What about the ‘composition’ (% spending, tax cuts, loans, grants, etc.)? Is it the right ‘mix’ to have an effect? Will the Fed’s trillions of liquidity injection be enough to prevent business, local government and household defaults that can lead to a financial crash? Why are many economists, following Trump’s lead, saying the economy will recover rapidly in the second half of this year despite the record collapse of the economy in this quarter? How does 2020 compare so far with 2008-09? With 1929-33?
Friday Apr 03, 2020
Alternative Visions -Shape Recovery Will Not Happen
Friday Apr 03, 2020
Friday Apr 03, 2020
Dr. Rasmus explains why a V-shape recovery from the current crisis will not happen, despite all the marketing spin by Trump, politicians and myopic economists. The show today addresses first the employment numbers reported by the Labor Dept. Rasmus explains those numbers don’t include the last two weeks of March and the 10m workers filing for unemployment benefits. The official unemployment rate of 4.4% reported is thus a gross understatement (and also useless since it always states job losses for only full time employed). Why aren’t those still working being rewarded for hazard work is the next theme of the show, based on Dr. Rasmus’ recently published ‘Covid-19 and the Forgotten Working Class’. The last half hour addresses the theme why a V shape recovery is not going to happen. Rasmus explains why uncertainty and negative expectations by business and households alike will mean more cash hoarding, savings instead of consumption, debt paydown, slow recovery of bank lending, decline in business and household demand for credit, global trade collapse, and business cost cutting carried forward—all mean a slow and tenuous recovery of business investment and consumer spending. Two additional ‘wildcards’ that could depress recovery still further as well might be politicians returning to austerity in 2021 to offset the massive deficits ($6.7T) and $30T (from $22T) national debt + the Fed’s possible failure to prevent a financial crash in coming months. (Check out Dr. Rasmus’ blog posts on the economy today at jackrasmus.com).
Friday Mar 20, 2020
Alternative Visions - The Great Recession of 2020 (or worse) Has Arrived!
Friday Mar 20, 2020
Friday Mar 20, 2020
Dr. Rasmus explains the dimensions and magnitude of the current contraction underway, including unemployment spiking at a faster and higher rate than in 2008 or 1929. GDP forecast contractions in 2Q20 will be more severe than the worse month in 1932. Rasmus proposes an ‘economic war mobilization’ that requires US government spending to rise from 21% of GDP today to 40%, as in 1942. That means a $4T increase in government spending, from current $4.4 trillion to $8.5T. His phase 1 proposed spending program, published earlier this week on the blog, jackrasmus.com, is reviewed and explained measure by measure. Current proposals in Congress are compared and critiqued as grossly deficient. Why $4T more spending will be needed to protect working class and middle class families and the millions of small businesses. How large corporations abused the economy by giving themselves >$1T/yr in stock buybacks and dividend payouts for 10 years, and should not be given government handouts but reorganized and restructured. A further Phase 2 program is described.
Friday Mar 13, 2020
Friday Mar 13, 2020
Today’s show focuses on the growing ‘dash for cash’ (aka liquidity crisis) underway by businesses and investors, as they anticipate falling revenues, profits, and cash needed to service (i.e. pay principal & interest charges) their $10T run up in corporate debt (bonds, loans, etc.) over the past decade. Rasmus explains how the $5T in junk bond & BBB corporate debt is especially at risk. Initial likely crisis in oil-energy junk bonds as global oil prices plummet into the $20-$30 range. How falling financial asset markets and prices are becoming synchronized globally, how the real (non-financial) global economy is falling into recession everywhere, and how the two sectors—financial markets and real economy—exacerbate each other’s downward trend. Credit crunch and crisis are the mechanism and nexus for transmitting the mutual downturns of financial & real sectors. Rasmus explains what’s going on in the credit markets and why the Fed is pumping $1.5T in just three days into just the Repo market in the US. A general liquidity crisis has emerged now. Dr. Rasmus then reviews the measures proposed by Trump and the Democrats in the House. The show concludes with Dr. Rasmus reviewing his own just published fiscal stimulus measures (also available today on his blog, jackrasmus.com, and on the Counterpunch blog, and soon elsewhere). For a similar discussion, listen to Dr. Rasmus’s interview with Vermont ‘Equal Time Radio’ host, L. Traven, this past Wednesday at http://equaltimeradio.com/2020/financial-crash-underway-prelude-to-deep-recession.
Friday Mar 06, 2020
Friday Mar 06, 2020
Dr. Rasmus comments on the continuing fall in financial markets and how that may prove a contagion channel to the real economy and recession. Why the Fed’s .5% rate drop earlier this week had no effect at all on the stock market implosion, continuing to this day. Worst since 2008. Why other financial asset markets (oil, commodities, currencies, etc.) are also contracting sharply. How financial asset deflation can translate into US junk bond, BBB bonds, leveraged loans, Repos, and derivatives financial problems. How the latter propagate then to the real economy via a credit crunch. Rasmus explains why monetary policy solutions are dead in the water. What’s coming possibly this weekend and next in fiscal (tax, spending) responses by US and other government. Rasmus reviews the 4 channels of coronavirus contagion to the real and financial economy (supply chains, demand, asset deflation, currency devaluations). The show concludes with an analysis of this week’s ‘Super Tuesday’ and the now more clearer evidence of Democrat Party leaders and financiers’ strategy to stopo Sanders. How this may lead to an irrevocable split in the Democratic Party and defeat of Biden should he become the nominee (now likely). For analysis of the primaries, read Dr. Rasmus’ just published print piece, “Super Tuesday and the Irrevocable Split in the Democratic Party’ on his blog, jackrasmus.com).
Friday Feb 28, 2020
Alternative Visions - Global Stock Markets Crashing: What’s Next?
Friday Feb 28, 2020
Friday Feb 28, 2020
The big news of the past week is the collapse of global stock markets, now having fallen by nearly 15% and continuing. Dr. Rasmus explains why, and why such a fast rate of contraction—comparable to what happened in 2008-09. Also, an update on the various ‘channels’ by which the virus impacts stock and other financial markets, and in turn how both propagate by means of various channels to the ‘real’ US and global economy. Discussion next examines the weak state of the US economy in fourth quarter 2019, driven by ‘weak’ indicators like inventory build up and faster fall in imports than in exports. Why business investment, manufacturing, commercial building are all falling, and why the household consumer spending picture is especially weak for the middle class and below. How the virus effect will depress the real US economy in coming weeks. A review of the rest of world economies’ markets and emerging recessions. Dr Rasmus concludes with a review of the lack of preparedness and reporting of actual virus cases in the US, especially in California. Why there are essentially no virus test kits now available. Will consumer panic buying in Hawaii soon spread to California and elsewhere? The show concludes with a comment on the Democratic party primaries and the growing ‘get Sanders’ movement within the party leadership and money contributors. (For more on this check out Dr Rasmus’ recent published articles on the primaries on his blog, jackrasmus.com) Next week: the Super Tuesday primaries results analysis, with guests.
Friday Feb 21, 2020
Friday Feb 21, 2020
Dr. Rasmus provides an update on latest developments of past week on the Coronavirus and its growing impact on China’s economy, and the contagion channels to the rest of the global economy. Media and business ‘consensus’ that effect and recovery will be ‘V-shape’ in China is now collapsing. Ditto that the economic effects will be largely contained to China itself. Multiple sources of evidence emerging the virus is spreading faster, and outside China now. Five channels of economic contagion are discussed: trade/supply chain channel; currency channel; commodities and commodity futures channel, financial asset market channel, consumption channel (tourism & luxury goods). Why Japan (and So. Korea) economy is most fragile and susceptible to China contagion. Other Asian economies at risK: Honk Kong, Singapore, Thailand, Australia. (Why no reporting coming from Taiwan?). Goldman Sachs, IMF, S&P forecasts. Review of Japan’s current recession underway and deepening due to sales tax hike, Trump trade war, China-Japan supply chain & tourism impacts. Why monetary and fiscal stimulus won’t work. The show concludes with brief analysis of the recent Democrat party candidates debate and why the ‘traditional middle’ of the party is collapsing in favor of Sanders & Bloomberg.