Alternative Visions

Alternative Visions - Jobs and the Fed

The Federal Reserve raised rates again last week. Financial markets interpreted the 0.25 bps raise, the lowest in the past year, as evidence the Fed will stop raising and start lowering rates again by summer 2023. But the Fed has said over and over it is targeting the jobs market for evidence that rate hikes are producing unemployment that will lower wages, consumption and demand and therefore prices. (Even though wages have already fallen in real terms throughout 2022). Then the Friday February 3 jobs numbers came out showing 517,000 jobs ‘created’ in January 2023. So what’s going on? Were there really 517k new jobs? Or, as I’ve been arguing the jobs numbers are corrupted and inaccurate. Today’s Alternative Visions show takes on that question (watch for my further detailed written article out soon and accessible from my blog, jackrasmus.com). If the numbers aren’t accurate, why is the Fed continuing to raise rates? Will the Jan. jobs numbers mean it will raise rates longer and higher?

Alternative Visions - US GDP 2022 Analysis

Dr. Rasmus reviews the details of the just announced advance report on US GDP for 2022 and its 4^th quarter. After a contraction throughout the first six months of 2022, the US economy ‘recovered’ at only a 2.9% rate in 4^th quarter after a meager 3.2% in third quarter. For the entire year US GDP registered a mere 2.1% ‘average for year’ growth. That’s down from 5.9% from 2021 when the economy reopened from the Covid shutdowns. And both those grossly weak numbers occurred after a combined US fiscal-monetary stimulus of more than $8 trillion, provided by the Biden administration (Covid relief, spending, tax cuts) a more than $4 trillion and another $4 trillion provided by the Federal Reserve central bank.  Rasmus breaks down the details of the composition of the 2022 weak 2.1% GDP rise, noting the growth due to excessive business inventory expansion (to decline in 2023), contracting real retail sales at the end of 2022, a continuing housing sector contraction, slowing US exports as the world economy slows, and coming US govt austerity social program spending in 2023.

Alternative Visions - Long-Term Global Trends in the Era of Neoliberal Capitalism Decline

 In today’s show Dr. Rasmus describes and discusses the major trends of the past four decades of the era of Neoliberal capitalism—in a recap of his January 14 presentation to the 28^th annual Rosa Luxemburg conference held last week in Berlin. Rasmus explains how Neoliberal era global capitalism, which originated in the late 1970s as a solution to the crisis of the 1970s, has entered a crisis period in the wake of the 2007-15 global financial crash and great recession. The key trends discussed include: US and global capitalism never fully recovered from the 2007-15 crash; the Covid crisis exacerbated the economic problems and created fundamental structural changes in the global economy; traditional capitalist fiscal-monetary policy tools have become increasingly ineffective in stabilizing the capitalist economy; financialization of the global economy has intensified contradictions and accelerated income and wealth inequality while slowing real economic growth as well; technological change has accelerated changing economic relations at work that has reduced wage incomes for workers, accelerating precariate, gig, and AI job displacement; both traditional and secondary forms of labor exploitation have intensified; financial fragility of governments, households and corporations has risen; US imperialism has entered a more aggressive and violent stage; and domestic political divisions and instability has intensified in many countries, including USA and Europe in response to all the above. In short, Neoliberalism is failing and a new capitalist restructuring of the global economy has begun in early phases. (Check out Dr. Rasmus’ blog, https://jackrasmus.com later today for a posting of a text version of this discussion)

Alternative Visions- Long-Term Global Trends in the Era of Neoliberal Capitalism Decline

 In today’s show Dr. Rasmus describes and discusses the major trends of the past four decades of the era of Neoliberal capitalism—in a recap of his January 14 presentation to the 28^th annual Rosa Luxemburg conference held last week in Berlin. Rasmus explains how Neoliberal era global capitalism, which originated in the late 1970s as a solution to the crisis of the 1970s, has entered a crisis period in the wake of the 2007-15 global financial crash and great recession. The key trends discussed include: US and global capitalism never fully recovered from the 2007-15 crash; the Covid crisis exacerbated the economic problems and created fundamental structural changes in the global economy; traditional capitalist fiscal-monetary policy tools have become increasingly ineffective in stabilizing the capitalist economy; financialization of the global economy has intensified contradictions and accelerated income and wealth inequality while slowing real economic growth as well; technological change has accelerated changing economic relations at work that has reduced wage incomes for workers, accelerating precariate, gig, and AI job displacement; both traditional and secondary forms of labor exploitation have intensified; financial fragility of governments, households and corporations has risen; US imperialism has entered a more aggressive and violent stage; and domestic political divisions and instability has intensified in many countries, including USA and Europe in response to all the above. In short, Neoliberalism is failing and a new capitalist restructuring of the global economy has begun in early phases. (Check out Dr. Rasmus’ blog, https://jackrasmus.com later today for a posting of a text version of this discussion)

Alternative Visions - Predictions for 2023 (US & Global/Economic & Political)

Dr. Rasmus follows up last week’s Alternative Visions show on a review of economic & political events in 2022 with today’s show’s predictions for 2023. Included are what’s next for the USA with regard to inflation, recession, fiscal-monetary and trade policy shifts, and potential for financial instability. And on the political scene what’s likely to occur with the USA’s proxy war in Ukraine, tech trade war with China, the situation with Taiwan, and domestically the super-gridlock likely in Congress. Rasmus then predicts important economic and political developments likely to occur in Europe, the UK, China, Japan, Middle East (Saudi, Iran, Syria, Israel) and Latin America (especially Ecuador-Peru, Argentina and Brazil).

Alternative Visions - Year End 2022 Review--USA & Global Economy & Politics

Today’s show provides a review of the main events and developments for the USA and global economies—as well a review of the major political events of the past year. Included are US, Europe and other economies’ central bank (interest rate hike) policy shifts and their effects; the global currency crises unleashed; USA fiscal policy shift from Covid relief to subsidizing corporate investment Acts (Infrastructure, Chip & Inflation Reduction trio acts); sanctions on Russia & Ukraine; China Covid policy shift; escalating US-Europe-Japan war spending; and the continuing slide into recession in the US & G7 economies.  Political analysis focuses on the developments in the Ukraine war; US midterm elections; US attempts to provoke China over Taiwan; and the US January 6 political theater and refusal by Biden administration to indict Trump.  (Next week’s show will address Predictions for 2023: Economic and Political. So tune in)

Alternative Visions - Fed Turns More Hawkish & Warns Higher Rates & Recession Coming

This past week’s Federal Reserve latest rate hike forewarns financial market investors in no uncertain terms the Fed is prepared to raise rates further, longer and higher in order to reduce inflation in 2023, even if it means more likely and deeper recession. Dr. Rasmus reviews the statements of Fed chair Powell and debunks the Fed’s forecast for inflation and (GDP) in 2023. Fed plans to raise base interest rates to 5.1% in 2023, reducing CPI prices to around 4% (vs. 7-8% so far) while slowing the real economy to only 0.5% and unemployment of 4.6%for 2023. Rasmus explains why 2023 will witness more than 5.1% rate hikes, a deeper recession than 0.5%, and more unemployment than 4.6%. Fed chair Powell’s latest press conference focus was twofold: 1. Telling investors get ready for rates to go higher and longer, 2) show Fed’s plan to attack wages & reduce spending on core services by generating more layoffs. Rasmus reviews follow on central bank rate hikes in Europe, Japan and explains how rising US dollar and geopolitical policies are responsible for Europe’s even greater inflation and deeper recession.

Alternative Visions - Economic & Political Updates: Sinema, Credit Suisse, Price-Caps, PPI Report & Consumer Debt

Today’s show discusses various political events and economic developments of the past week, in anticipation of next week’s big announcements on the Consumer Price Index report and the Federal Reserve’s latest rate hike decisions. Today’s show discusses Senator Kirsten Sinema’s decision to leave the Democrat party and become independent and what that means for the media’s hype of the Democrats ‘safe’ control of the Senate now with Warnock’s win in Georgia; Biden’s announcement of a sop thrown to labor to save multiemployer pension system (a history of the evolution of pensions in US is offered); Exxon’s announcement of a new $50B stock buyback bonanza for shareholders (+ history of stock buybacks in US since 2010); financial problems at the big EU bank, Credit Suisse and crypto company FTX in US; the politics behind the announcement last week b y the EU/G7/US to impose a maximum $60/barrel on Russian global oil sales. Show concludes with a breakdown of today’s Produce Price Index (PPI) report that shows a record surge in food prices and only moderate slowing of energy prices + a brief review of the Fed’s latest Consumer Credit report showing consumer debt has risen by $500 billion over the pre-Covid 2019 levels.

Alternative Visions - Railroad Strike Settlement & Jobs Numbers

Today’s show begins with an analysis of the just announced passage by Congress and Dems preventing a railroad strike—the 19^th time Congress has intervened to prevent a strike. The pro-corporate actual nature of the Biden administration is made clear by the action. What has happened since September to the present. The show then addresses the Biden-Macron press conference and talk of an emerging UKS-EU trade war over US subsidies to US corporations in the Chip and Inflation Reduction Acts this year. Did Biden cave in to Macron? What does the US tech trade war with China have to do with it all? Finally, Fed chair Powell’s press conference this past week and the jobs numbers out today.

Alternative Visions - Takeaways from US Midterm Election

 Republicans spinning their taking control of the US House. Democrats spinning their wasn’t a red wave. So what’s the significance of the recent midterm Congressional elections? My answer: as the French say, plus ce change, rien ce change’ (Everything changes but nothing changes). In today’s show Dr. Rasmus provides his analysis of the midterm elections, making the central point that there’s been little change in the midterms from 2020 alignments because both parties offered little different to the voters in 2022 than they did in 2020.  Rasmus reviews the proposals and strategies of both parties in some detail, revealing neither offered voters much of any substance. The more important outcome was the DeSantis strong win in Florida, which opens a political pissing match in the Republican party between Trump and DeSantis. Today’s show also comments on the Federal Reserve governor, Esther George, statement today that the Fed might not be able to bring down inflation without recession, admitting more rate hikes coming and 100% certain recession (already here) after the holidays. The show ends with a comment on the implosion of the crypto currency firm, FTX; the possible financial contagion effects; and its Ukraine money laundering connections. (see Dr. Rasmus blog, jackrasmus.com, this weekend for a written article on the recent midterm election).