The Social Security Trust Fund will be depleted in 2035 at current rates of deposits and spending, the trustees said in their annual report released 2 June. The trust fund gained an extra year of solvency because of strong wage growth during the post-COVID recovery, which put more payroll taxes into the fund, the report...
Category: TRENDS ON THE U.S. ECONOMIC FRONT
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MORE HALF-POINT RATE RISES ON THE WAY, FED’S BRAINARD SAYS
The U.S. Federal Reserve is all but certain to raise its key interest rate by a half-point this month and again in July, but it may need to continue that pace further into the year to bring inflation under some kind of control, Fed vice-chair Lael Brainard said in a 2 June CNBC interview. “If...
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EXPANDING ECONOMIC DAYS DYING
A U.S. economy that has grown steadily and reliably has given way to an era in which soaring equity markets, a labor shortage, and strong consumer spending are ending as artificially low interest rates rise and trillions of dollars pumped into the system by Washington to fight the COVID War, dries up. The facts are...
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AMERICANS: SPENDING MORE, SAVING LESS
Since March 2020, Americans have saved $2.5 trillion more than they normally would have, thanks to government stimulus payments, rising wages, and the COVID-related shutdown of stores and entertainment venues, Yahoo! News reported. Now that the COVID War has largely ended and consumers can spend again, some of that $2.5 trillion has begun to flow...
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CONSUMER CONFIDENCE SAGS IN MAY
As we detail above, across the socio-economic and geo-political spectrum, these are “Happy Days are NOT Here Again” U.S. consumer confidence dropped in May to its lowest point since February 2021, according to the Conference Board’s monthly survey. The survey rated confidence in April at 108.6 but found it had slipped in May to 106.4....
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RECKONING DAY FOR THE LIVING DEAD
U.S. “zombie firms”—those whose earnings are unable to cover interest payments on their debts—now comprise 620 of America’s 3,000 largest firms, more than one in five, and collectively owe about $900 billion, Bloomberg reported. The roster includes meme stocks such as AMC Entertainment Holdings as well as familiar names such as American Airlines. ExxonMobil was...
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ECONOMIC “HURRICANE” AHEAD, DIMON SAYS
“I said there are storm clouds, but…it’s a hurricane,” Jamie Dimon, chair and CEO of JPMorgan Chase, the richest U.S. bank, said of the nation’s economic outlook last week at the Bernstein Strategic Decisions Conference. “Right now…everyone thinks the [U.S. Federal Reserve] can handle this [inflation],” he said, but “that hurricane is coming our way....
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ECONOMIC AND MARKET OVERVIEW
Back in 1932, when the Great Depression had hit America, the Democratic candidate running for President of the United States, Franklin D. Roosevelt, declared the hit tune “Happy Days are Here Again,” as the party’s official campaign anthem. It was a huge hit, and in 1986 it was awarded by the American Society of Composers,...
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BIDEN SAYS SHRINKING DEFICIT WILL REDUCE INFLATION. WILL IT?
Hammered by critics who blame his policies for inflation, president Joe Biden lately has emphasized one way to help bring prices down: cut the annual federal budget deficit. That is “one easy way to ease inflationary pressures in an economy,” he has said in several recent statements. The budget, which soared past $1 trillion during...
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DRIVERS STAY PARKED AS GAS PRICES CLIMB
Demand for gasoline in mid-May fell to 8.8 million barrels a day, according to the U.S. Energy Information Administration, its lowest level since 2013, apart from the plunge during the early months of the COVID War. The average U.S. gas price was $4.61 a gallon on 30 May, the American Automobile Association reported, a record...