Alternative Visions

Alternative Visions - Why the FED Will Soon Raise Rates And What Happens When It Does - 10.07.16

Dr. Rasmus explains why a Federal Reserve interest rate hike is coming very soon. Why central bank monetary policies in US, Europe and Japan have failed miserably to generate real economic growth since 2010, but were always focused on boosting stock, bond and other financial markets.  Now, however, they no longer even stimulate financial assets but are increasingly causing financial instability in pension funds, insurance annuities, bank margins, retirees’ consumption, and will therefore soon be shelved. Anticipating the shift, central banks in Europe and Japan are adjusting their monetary policies in turn.  The likely negative consequences of the US Fed rate shift globally are discussed. A new shift to fiscal infrastructure spending, business tax cuts, and abandonment of austerity fiscal policies are now on the agenda following the US election and in 2017 in Europe and beyond. The show concludes with analysis of the 1^st presidential debate and why Trump, despite a disastrous debate performance may still win critical ‘swing states’ in November.  

Alternative Visions - Deutsche Bank & the Deepening Euro Bank Crisis - 09.30.16

Dr. Jack Rasmus reviews recent developments in the growing instability in Germany’s largest bank, Deutsche Bank, and explains how it is a reflection of a deeper, ongoing crisis in the Euro banking system itself. Parallels of Deutsche Bank—the ‘Goldman-Sachs’ of Germany—with the 2008 crash of US Lehman Brothers investment bank are discussed, with Rasmus predicting the German central bank, Bundesbank, will eventually bail out Deutsche—unlike the US decision in 2008 to let Lehman go under. Also addressed:  how Rasmus’ theoretical work published earlier this year, ‘Systemic Fragility in the Global Economy’, predicted the growing crisis in the Euro banking system, which is now expanding beyond Italy’s banks to Germany and beyond.  How the Deutsche crisis is exacerbating in-fighting between the Bundesbank and the European Central Bank, the ECB, and attacks on ECB chair, Mario Draghi.  The Deutsche-Euro bank crisis is a reflection of the growing awareness of the failure of the ECB and other central banks’ QE and negative rates policies—including the US Federal Reserve—to stimulate the real economy and only boost stock and other financial markets. Jack explains how the Deutsche affair is also a reflection of the failed structure of the Eurozone currency union itself.  The show concludes with brief comments on Saudi Arabia/OPEC’s recent decision to cut oil supplies to raise global prices, how Japan is considering redefining its GDP in order to raise growth on paper, and on the phony debate on taxes during the recent 1^st presidential debates this past week between Clinton and Trump. (For more on Jack’s analysis of the 1^stpresidential debate, read his article at his blog, jackrasmus.com, or go to the PRN website articles archive).

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Alternative Visions - Central Bankers Out of Control - 09.23.16

Today’s show examines and discusses the past week’s major decisions by the Federal Reserve and the Bank of Japan, and how they represent growing failure and desperation of central bank monetary policy globally. Bank of Japan promises to keep bond rates at zero for another ten years and to continue to inject money until inflation exceeds 2%. The Federal Reserve forecasts US growth rates through 2019 at a mere 1.9% GDP, but predicts unemployment rates will fall to 4.5% even as it raises interest rates (staring December) from 0.5% to 2.6%.  Jack discusses how this contradiction makes no sense and why a US recession is on the agenda in 2017-18 that will blow all those Fed projections. Meanwhile, the Fed creates another fictitious ‘target’—by aligning nominal interest rates with an unknown ‘neutral rate’. Monetary policy is broken and central banks are desperately searching for cover.

 

Alternative Visions - US Incomes And Pre-Election Hype About Economic Recovery - 09.16.16

Jack takes on recent reports from private and government sources this past week that US incomes and the economy are finally recovering. Taking issue with Paul Krugman’s column today, ‘Trickle Up Economics’, hyping the reports, Jack cites and explains contrary data that show the reports and Krugman punditry are questionable. Alternative sources, like the Gallup Poll, show 87% of US population surveyed consider the economy poor or getting worse. Other sources show the doubling of death rates from drugs, suicide, and alcohol for the 25-64 age group—Trump’s target voters in key swing states.  Jack discusses data showing Trump now leads in key swing states, Ohio and Florida, where incomes remain down as much as 10%, as well as in other swing states.  Why Clinton’s campaign is trying to reorient to the 25-64 group and millennials—too little too late.  The show concludes with Jack repeating his prediction of US recession in 2017-18, and predicting post-election policies of more business tax cuts, infrastructure spending, TPP, and Fed interest rate hikes are coming. 

 

(Check out Jack’s recent 2016 books, ‘Looting Greece’ and ‘Systemic Fragility in the Global Economy’, Clarity Press, now available at discounts of 25%-33% from his blog, jackrasmus.com, and website via paypal

Alternative Visions - Why US Workers Are So Angry This Election Cycle - 09.09.16

Media, press, pundits and politicians in the US today keep hyping the US economy as doing well. We hear the US economy is growing nicely, better than other economies at least. Wages are finally rising, and full employment is here.  Jack bunks these and other myths about the US economy on the eve of the US election, and explains why a recession in 2017-18 is increasingly likely.  Explained are why the US GDP growth rate for the first half of 2016 was really only 0.65%, thus nearly stagnant, and real income growth was even lower at 0.1%, or on net stagnant (with wage and income growth for top 10% but declining at median and below 70 million). Jack reviews household consumption growth, the only indicator, keeping the economy from recession, and predicts it is about to falter.  The recent PMI data for manufacturing and services, investment, and auto sales are reviewed. The show concludes with an explanation why wage growth figures are misrepresenting and biased toward upper end and full time employment, benefitting 20 million, but wage stagnation and decline is the fact for 70 million at the median and below. US part time, temp, independent contract, unincorporated self employed, gig economy, and the underground economy now comprise close to half of the US labor force today (60-70 million), up from 33% a decade ago.

Alternative Visions - The New Financial Imperialism How It Works - 09.02.16

 Dr. Jack Rasmus summarizes his just published book this month, ‘Looting Greece: A New Financial Imperialism Emerges’, Clarity Press, Sept. 2016, explaining how debt and credit are becoming new and even more efficient and generalized means by which the more powerful capitalist countries are beginning to extract and transfer wealth from the smaller and more vulnerable.  Jack describes the various techniques and means by which financial measures are used to extract surplus. Greece is a case example of the new imperialism taking shape increasingly globally.  ‘Looting Greece’ is a sequel to Dr. Rasmus’s January 2016 publication, ‘Systemic Fragility in the Global Economy’, which described how the shift to financial investing is slowing down the global economy, and how a new global finance capital elite is increasingly dominating national economies and slowing growth. In the last half of the show, Rasmus reviews the major economic events of the past week, including today’s US job numbers, recent US manufacturing data, the US central bank meeting—and why the Fed will raise interest rates for certain before year end and the impact that will have on a shift to fiscal spending in 2017 andthe US economy’s coming recession in 2017-18 as well as on emerging markets, China and US corporate profits. The show concludes with a commentary on recent IMF and BIS reports on the global economy.

Alternative Visions - Greek Debt Crisis II: Why Syriza Lost - 08.26.16

Jack takes a detailed look at the strategic and tactical errors of the Syriza party and Greek government in 2015 that led to its eventual capitulation to the Troika, resulting in continued austerity and economic depression in Greece. Among the errors noted are Syriza’s naïve reliance on the support from social democratic allies in Europe that did not exist or abandoned it, Syriza’s repeated unilateral concessions to the Troika without any concessions in turn, its allowing the ECB to slowly shut down Greece’s banking system and its refusal to nationalize its banks to remove them from ECB control, Syriza’s agreement to extend the prior debt terms and continue making debt payments to the Troika while the Troika denied Greece loans and payments it was due, amateur bargaining tactics by Syriza negotiators, Syriza’s refusal to leverage potential support from Russia, China, threaten to leave NATO, or to demand concessions from the Troika in exchange for Greece assistance controlling refugee flows into Europe, Syriza continued signals it would not Grexit or form an alternate parallel currency, Syriza’s poorly worded referendum vote in July, and its leaders’ rejection of the results of the vote. (For more detailed analysis of the Greek debt events from 1999 through May 2016, see Jack Rasmus, ‘Looting Greece: An Emerging New Financial Imperialism’, Clarity Press, September 2016.)  See also the article by Rasmus on Greece posted on the PRN website and at Jack’s blog, jackrasmus.com.

Alternative Visions - On the Anniversary of the Greek Debt Crisis of 2015: Part 1 (Neoliberal and German Origins of Greek Debt) - 08.19.16

Dr. Rasmus discusses the first of a two part series on the nature of Greek debt crises, and how they are the consequence of Euro neoliberalism, dominance of the Eurozone’s ‘Troika’ (European Commission, European Central Bank, IMF) by German bankers, allies and politicians, and the continuing insolvency of European private banks.  Citing recent studies that show 95% of Greece’s debt payment to the Troika since 2010 have gone to European bankers, Rasmus argues the recycling of debt and interest payments represents an emerging new form of financial imperialism that is built into the Eurozone’s very structure since 1999.  The deeper analysis is available in Dr. Rasmus’s new book, to be released in September, ‘Looting Greece: An Emerging New Financial Imperialism’, by Clarity Press. Rasmus discusses the origins of the 2010, 2012, 2015 (and April 2016 mini) debt crises in Greece, and concludes with the Greek Syriza party’s main strategic error. Next week, Part 2: ‘Why Syriza’s strategy (and tactics) failed and why the Troika’s prevailed’—plus more on the new financial imperialism taking form in the Eurozone periphery and its prospects globally elsewhere.

Alternative Visions - Japan’s Perpetual Recession Economy: QEs, Negative Rates, and Helicopters - 08.12.16

Jack reviews the current condition of Japan’s economy, after 8 years of virtual perpetual recession despite record QE central bank injections, negative interest rates, and talk of helicopter money.  The Central Bank of Japan as harbinger of global capitalist central banks policy direction and innovation.  How central banks-bank of japan free money policies are not only no longer working, but are now having contrary negative effects on the global economy. Japan’s history of monetary policy first, plus austerity, since 1991 has doomed it to perpetual recessions—8 since 1991 and 5 since 2008. Japan as innovator of QE and negative rate policies. The results in creating trillions of non-performing bank loans (NPLs) and more than $13 trillion in negative bond rates since 2014 are reviewed. Growing NPLs and negative rates as indicators of failing capitalist monetary policies as investment slows, productivity declines, wages stagnate and real consumption falters worldwide. Why global economies are about to shift in 2017 to more fiscal infrastructure spending—but will do so ‘too little and too late’ to prevent recessions in 2017.

Alternative Visions - Why QE Policy is ‘Dead and Dying’ and ‘Helicopter Money’ Is An Alternative - 08.05.16

Jack Rasmus explains why all economic indicators for the US economy are ‘flashing red’ except for consumer spending, driven mostly by surging household debt again in credit cards, mortgages, auto loans and student loans. Meanwhile, 7 years of continued low interest rates created by the Federal Reserve (and other central banks) are creating a crisis in pensions, insurance, and sectors of banking.  Jack explains why global central banks continue the massive free money injections for investors and why it is now destabilizing the global economy.  The UK central bank’s just announced new QE2 program is described and critiqued, as the European Central Bank continues to expand its QE, and the Bank of Japan does the same. Why Global capitalists are beginning to rethink the reliance on free money via QEs and reconsider some form of fiscal stimulus, which Jack predicts is coming in 2017 as interest rates rise.  What form will the new fiscal stimulus take? One discussed is ‘helicopter money’—i.e. QE for Main St. Jack concludes with explaining helicopter money and his recent proposal to US Green party presidential candidate, Jill Stein, to use it to expunge most of the US $1.3 trillion student debt.