Alternative Visions

Alternative Visions - From Silicon Valley Bank to Larger Banking Crisis?

 Dr. Rasmus gives an update on US and global banking instability in the wake of the collapse of Silicon Valley Bank a week ago this friday. What exactly happened at Silicon Valley Bank and is that process occurring elsewhere? What is the role of the Federal Reserve in causing and precipitating the crisis? Have the efforts of the Fed and big banks to staunch the crisis in the US regional banks in recent days working? Is the Fed solution in the short run the cause of future banking instability in the longer run?  What happened to bank regulation after Dodd-Frank Act? The three indicators of continuing bank instability. What’s happening at Credit Suisse bank in Europe? Similarities and differences with 2008 crisis. What does it all mean for future Fed rate hikes (next week) and Fed strategy to slow inflation? Consequences of the current banking crisis for US real economy and global economy. (Check out Dr. Rasmus’s print article on these topics this weekend at his blog, http://jackrasmus.com)

Alternative Visions - Silicon Valley Bank Collapses—Canary in the Financial Coal Mine?

Dr.Rasmus discusses the collapse of the Silicon Valley Bank in California in last 24 hrs and what it means for the Tech sector and potential financial instability.  Stocks & bond mkts plummet in response. Fear of uncertain contagion effects over the weekend. 250 companies with potential asset losses + SVBs largest investor: US Home Loan Bank (yes, believe it or not). What SVB and financial instability means for the Fed’s rate hike policy, as rates get pushed to 6% now. Why Fed won’t continue to hike rates to 6% if financial instability happens. And if so, why Fed rate hikes won’t be sufficient to reduce even Demand inflation. Today’s jobs report shows another 311,000 jobs, making rate hikes more likely. Rasmus shows, however, most jobs are part time service while layoffs in tech, transport, warehouse already rising. Why contradictions in economic policy are intensifying and hard landing recession more likely.

Alternative Visions - Social Security Under Attack—Again! Here Comes Austerity Policy

In today’s show Dr. Rasmus discusses the dimensions of the current attack on the social security system taking shape behind the curtain of the Debt Ceiling negotiations and just before Biden releases his final budget proposals for 2023 next week (listen to our next week’s Alternative Visions show on that subject).  Rasmus describes the main elements of the new cuts to Social Security being proposed by the latest group of Senators: creating a so-called Sovereign Wealth Fund that will invest in private financial markets; raising the payroll tax; and raising the retirement age to 70 starting 2025. The history and evolution of the social security system is described, from 1938 to present and how the key year revisions in 1986 created a massive $trillion SURPLUS in social security by 2000; how that surplus has been depleted since by Bush, Obama and Trump. He 4 funds of social security trust are described and financed (retirement, medicare, medicare advantage, prescription drugs). Why just raising the income limit of $160,200 ‘cap’ would enable social security financing for 75 years more AND increase retirement benefits. Rasmus explains how attacks on social security always occur when politicians shift fiscal spending to Austerity and social program spending cuts which is now occurring. (Next week: Biden’s final budget proposals).

Alternative Visions - Ukraine: Revisiting ’10 Reasons Why the US May Want Russia to Invade Ukraine’ Article, January 2022

Dr. Rasmus revisits his article of January 2022 in which he predicted reasons why the US wanted Russia to invade Ukraine and why the invasion of February 24, 2022 happened. The show initially discusses the past year’s sanctions on Russia and its economic effects (and lack thereof) on the Russian economy. Economic indicators of the Russian economy (per the independent source, tradingeconomics.com) are reviewed, showing neither Russia’s currency, its oil production, oil exports, manufacturing, employment levels, business confidence, or inflation have been seriously impacted by the sanctions.  Why the US may now, in its latest sanctions, be preparing to use ‘secondary sanctions’ on India and other countries to enforce failing primary sanctions.  Dr. Rasmus then revisits each of the 10 points of his January 2022 article to verify the 10 reasons: Results indicate the US has ‘succeeded’ in achieving at least 8 of the 10 objectives it sought by luring Russia to invade. (For further analysis see the re-posting of the January 2022 article and a subsequent ‘Revisiting the 10 Reasons..” on Dr. Rasmus’s blog, http://jackrasmus.com this weekend). NEXT WEEK on Alternative Visions: A review of the military and geopolitical objectives and consequences of the Ukraine War after one year.

Alternative Visions - Ukraine: Revisiting ’10 Reasons Why the US May Want Russia to Invade Ukraine’ Article, January 2022

 Dr. Rasmus revisits his article of January 2022 in which he predicted reasons why the US wanted Russia to invade Ukraine and why the invasion of February 24, 2022 happened. The show initially discusses the past year’s sanctions on Russia and its economic effects (and lack thereof) on the Russian economy. Economic indicators of the Russian economy (per the independent source, tradingeconomics.com) are reviewed, showing neither Russia’s currency, its oil production, oil exports, manufacturing, employment levels, business confidence, or inflation have been seriously impacted by the sanctions.  Why the US may now, in its latest sanctions, be preparing to use ‘secondary sanctions’ on India and other countries to enforce failing primary sanctions.  Dr. Rasmus then revisits each of the 10 points of his January 2022 article to verify the 10 reasons: Results indicate the US has ‘succeeded’ in achieving at least 8 of the 10 objectives it sought by luring Russia to invade. (For further analysis see the re-posting of the January 2022 article and a subsequent ‘Revisiting the 10 Reasons..” on Dr. Rasmus’s blog, http://jackrasmus.com this weekend). NEXT WEEK on Alternative Visions: A review of the military and geopolitical objectives

Alternative Visions - Is Inflation Really Slowing?

 Dr. Rasmus takes a deep look at last week’s latest Consumer Price Index (CPI) and Producer Price Index (PPI) inflation reports. A detailed summary of his view of the various supply forces causing inflation and demand forces. Why inflation remains mostly supply side driven, not demand driven, and why the Fed won’t slow inflation much further despite continuing interest rate hikes in 2023. Supply forces include: global supply chain issues, war and sanctions, global commodity price speculators, widespread price gouging by monopolistic corps in the US, and in general record falling productivity (and rising unit labor costs) for US businesses being passed on to consumers. Dr. Rasmus reviews the US ‘productivity crisis’ driving unit labor costs in particular. The show concludes with recap of statistics on US GDP slowdown after $8T in fiscal monetary stimulus and the causes of US deficits and national debt now at $31T and projected to rise another $12T by end of decade. (NEXT WEEK: the show will be dedicated to reviewing the war in Ukraine and revisiting Dr. Rasmus’s January 2022 article, ‘Ten Reasons Why the US May Want Russia to Invade Ukraine’.

Alternative Visions - Fact-Checking & Debunking Biden’s State of the Union Speech

this week’s show is dedicating to debunking various claims Biden made in his State of the Union speech last week. Topics include claims of 12 million jobs created, unemployment rate at 50 yr. low, inflation, taxes and national debt. An explanation of Biden’s claims his 3 big investment bills passed last year will soon have a big impact on the economy, specifically the Infrastructure bill, Chip & Science Act, and Inflation Reduction Act. How the three represent a trillion dollar shift in spending from Covid relief social programs to subsidies to corporations to invest.  Why austerity in social program spending is now on the agenda, to finance in part an even bigger rise in defense and Ukraine war spending than in 2022.  Dr. Rasmus explains how chronic deficits for the past 20 years have been due to $15 trillion in tax cuts and $7T in war spending (not counting Ukraine), driving the national debt from $4T in 2000 to $31.5 trillion today. Rasmus explains why the main target in spending cuts is social security and medicare, despite Biden and Republican claims they won’t cut social security.

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)