Alternative Visions

Alternative Visions- Why the Fed is RAISING rates, NOT PAUSING! + War Updates

The Fed this past week held off raising interest rates once again. Or did it? Dr. Rasmus explains why the Fed may have paused raising short term rates but it is simultaneously raising long term Fed interest rates (10,30 Treasury bonds). Rasmus explains how the Fed is flooding markets with excess Treasury sales in order to raise funds to cover the US $2T budget deficit, an act driving up long term US Treasury rates. Fed chair Powell faces growing contradictions in monetary policy: higher short term rates destabilize regional banks & real estate markets (commercial & residential), but long term rate hikes undermine Treasury markets. Fed has no alternative, needing to raise more than $1.5T in next 6 months from sale of Treasuries in order to cover the $2T US budget deficit. Contradictions in US fiscal policy (deficits, debt) are thus exacerbating monetary policy & financial markets, Rasmus explains. The ‘spin’ that  Fed policy has produced a ‘soft landing’ of the real economy is next debunked. The show concludes with updates on the Ukraine war, how Russian forces are growing in number while Ukraine’s manpower & weapons fade-as Zelensky quarrels with his generals. In Israel’s war on Hamas, Dr. Rasmus argues 4 US aircraft carriers at and en route to the region represent US planning for potential war with Iran, not simply military support for Israel. A point further suggested by resolutions just passed by the US Congress calling for war with Iran

Alternative Visions- War and US GDP

 The just released preliminary estimates for US third quarter 2023 GDP, showing how the estimated 4.9% annual rate of US growth is actually much lower than reported. Rasmus explains how GDP in 2013 was redefined, boosting its number by more than $500B a year. Also how US low balls the inflation adjustment to GDP to get a higher number. Prospects for GDP in coming 4^th and 1^st Quarter 2024 are forecast at less than 1% a quarter—as  both consumer spending and business investment ‘core’ of GDP slow significantly. (Core GDP in 3^rd quarter only half, 2.5%, of the 4.9% already). The show next discusses the Israel-Hamas war, the strategies of the US and Israel, the massive US military buildup in the region (including 4 aircraft carriers & subs now) and the increasing likelihood of a US-Iran war that the neocons desperately want. Final comments also offered on the status of the US proxy war in Ukraine now that Zelensky has ordered his generals to go on the defensive everywhere, marking the official end of Ukraine’s failed summer offensive.

Alternative Visions- Most Dangerous Time in Decades

The title for today’s show is a direct quote this past week from Chase Bank CEO, Jamie Dimon. It reflects the growing concern being expressed widely about the global and US economy and geopolitical conditions. In another quote the giant shadow bank, Blackrock, told its customers “get into cash”. After a brief update on the UAW strike, today’s show reviews the University of Michigan’s consumer survey, showing household sentiment in the USA is plummeting, perhaps signaling the consumer’s propping up of the US economy is about to end as inflation starts rising again—as the latest CPI and PPI price reports showed last week. The show then focuses on the growing contradictions in US (Fed) monetary policy, now converging with similar crisis and contradictions in US fiscal policy-especially deficits and debt management. Today’s show then concludes with an analysis of the Ukraine War and the shifting US & Ukraine strategies as the latter’s offensive collapsed. The conclusion is the ‘war is over’ and the US/Biden administration seeks a way to freeze it in a 2024 US election cycle.

Alternative Visions- President Jimmy Carter’s True Legacy + Updates on UAW, Writers & Actors Strike

 Latest developments as of 9-30 in the auto workers, writers & actors strikes. Former president Jimmy Carter turns 99 this weekend. No doubt US corporate media has prepared puff piece obituaries, hailing Carter as the most humane and moral president ever. The show today provides the facts and a different picture, however: What were Carter’s real legacies? How Carter paved the way for USA’s disastrous 20 yr middle east wars (2001-21), launched the 4 decades war on unions that inaugurated concession bargaining and union labor’s ‘Great Detour’, and provided the dress rehearsal and economic policy template for Neoliberalism that followed under Reagan.

Alternative Visions- Ukraine: Political Fallout from Failing Offensive + UAW Strike + Fed Rates & Govt Shutdown

 As Ukraine’s Failed Offensive becomes increasingly obvious, political repercussions are being felt in the US, Ukraine and Europe. Half of UN delegates refuse to show up for Zelensky’s speech; 32 House Reps and 6 Republican Senators go on record they won’t support more Ukraine war aid; Zelensky feuds with Poland over grain shipments & Poland’s president says Poland won’t send more weapons to Ukraine; Zelensky gives interview to Economist magazine threatening Europe with angry Ukrainian refugees; Biden tells Zelensky US will send only a few ATACMS missiles and not now. US Ukraine war policy is clearly about to shift as Biden admin. seeks a freeze in the conflict during 2024 election year as US faces $1.5T deficit for 2023 and rising debt. Dr. Rasmus summarizes the economic and political legacies of the Ukraine war. The show then discusses the latest events in the UAW strike and negotiations, explains why the Fed paused rate hikes despite rising inflation again, and why a govt shutdown later this year is growing increasingly likely this time around as Republican House ‘Freedom Caucus’ slaps down House Speaker McCarthy’s latest attempt to exempt Defense Dept. and War spending from budget cuts.

Alternative Visions- UAW Strike + Latest Inflation Reports

most of today’s show is dedicated to understanding the UAW strike that began at midnight last night.  What are the union’s demands and the Big 3 auto corporations offers. Rasmus explains how the companies are flush with cash, with $250B profits, tax cuts, $80B paid out in shareholders buybacks and dividends, tens of billions $ direct subsidies by Biden to build their EV plants, and 40% raises for CEOs. What happened in 2019 UAW negotiations and why autoworkers’ real earnings have fallen by 19.1% since 2019. Dr. Rasmus explains the history of union concession bargaining since 1979 which began with the Chrysler auto strike that year. How concession bargaining expanded last 40 yrs. Recent union negotiations at UPS (Teamsters), west coast dockworkers (ILWU), airline pilots, last year’s railroad negotiations, and current writers-actors strike (SAG-AFTRA) are reviewed in the context of concession bargaining and Neoliberalism ‘Industrial’ policy since 1979. Dr. Rasmus makes some predictions about a possible eventual settlement deal in the current UAW strike, which is possibly planned by negotiations ‘behind the scene’ by Biden, UAW, and Auto corp CEOs that won’t be reported. Show concludes with report on this past week’s CPI inflation report and why prices are creeping back up again.

Alternative Visions- How Reliable is US Economic Data?

Dr. Rasmus comments on a Wall St. Journal report of Sept. 8 admitting that revisions to US data and reports are showing bigger swings in corrections and occurring more often. The show addresses his oft-stated view that the Covid recession fundamentally impacted labor, product and financial markets in ways that US data and statistical reports have not caught up to yet, thus the more frequent and greater revisions to the data. Rasmus explains how JOLT stats (job openings to unemployment ratio), employment surveys, and inflation stats are growing more inaccurate in the post-Covid era. The show then describes how housing, energy, and food prices have begun to rise again and the reasons why Fed interest rate hikes don’t have as great an impact on lowering demand and therefore prices. The show ends with a return to the topic of labor exploitation begun a few weeks ago, showing how aggregate data of relative shares, CO to worker pay, productivity, and Prof. Saez data on the income and wealth of richest 1% households in US continues to rise after every recession. (Next week: How Classical Economists from Adam Smith to Marx explained labor exploitation and why exploitation has been intensifying once again under Neoliberalism since 1980 and especially after 2008-09 crash).

Alternative Visions - How Biden and Mainstream Media Spin the Jobs and Inflation Reports

Today’s show main theme discusses how the Biden administration and mainstream media are spinning the latest jobs and inflation reports. The official ‘messaging’ by politicians and media alike is that both jobs and inflation are steadily-if slowly-improving. The messaging: the August jobs ‘cooled’ to 187,000; inflation moderated to 3% down from last year’s 9% peak, and wages are rising.  Speaking around the country, Biden claims that jobs, inflation, and rising wages show ‘Bidenomics’ is working. But a closer look at the data since April 2023 shows little progress the past four months: since April 2023 job creation is stuck at around 180,000/mo; services inflation likewise stuck at around 6%; and wages rising mostly for the highest paid 10% of the labor force (and for some at the bottom as minimum wages laws take effect) leaving the ‘great middle’ behind. Dr. Rasmus argues the truth is in the details, not aggregate averages, and shows most of the jobs created last 3 months were 520,000 part time, low paid, service work, of which 321,000 were 2^nd and 3^rd jobs, low paid, with few benefits. At the same time, 311,000 full time jobs have disappeared since April. Similarly since April, services inflation (80% of economy) remains ‘stuck’ at around 6% while wage gains continue to be ‘skewed’ to the top 10% and bottom extremes of the labor force. Bidenomics is thus bypassing the middle class! Rasmus further predicts the Fed will continue to raise interest rates, the US economy slow, US$ rise and exports fall, bank lending continue to decline, housing and manufacturing continue to contract, and consumer spending will slow sharply in 4^th quarter and beyond.

Alternative Visions- Jackson Hole: Why the Fed Must Keep Raising Interest Rates

The show begins with an analysis of the past week of the death of Wagner mercenary forces leader, Prigozhin. The show then moves to the main topic: the forces driving the Fed to continue to raise interest rates; for certain this September but possibly even after. At minimum, US rates will remain high for some time. Chronic high services inflation plus emerging new forces globally that keep pressure on chronic inflation and Fed need to raise rates. Rasmus adds that record Fed Treasury sales will add to that pressure and rate hikes, as the Fed needs to sell ever more Treasuries in order to cover US budget deficits. And add still further the rise of the BRICS and declining demand for US dollars

Alternative Visions- Inflation Reduction Act One Year After + What’s Exploitation?

Dr. Rasmus debunks Biden’s and other Dem party notables’ ( HRC, Reich, Krugman)celebration of the Inflation Reduction Act (IRA) on its one year anniversary. Why the IRA has had no impact on inflation but is best understood as part of the 2022 trifecta of Biden bills (including Chips Act & Infrastructure Act) that together provided $1.65T in direct subsidies and tax cuts to US corporations. Rasmus next explains the current structure of inflation, now rising again with services inflation (80% of economy) stuck at 6%+ for the past three months. The chronic inflation reflects the growing contradictions of Fed monetary and interest rate policy and why US deficits funding requirements by means of US Treasury securities will continue to drive interest rates higher in coming months. The show next discusses the growing int’l crisis in the Sahel area of Africa, in particular the country, Niger, and what it means for French neo-colonialism and US future intervention. The show concludes with an initial discussion of ‘exploitation’ and why exploitation of American workers has been intensifying ever since 1980. Various statistical measures of exploitation are provided, including forms of ‘secondary’ exploitation of labor as well as primary.