In the news this morning:
Oil price up; inflation up; 10-year Treasury's yield up; Bitcoin down on an upward trend; Haiti in chaos and Americans there stuck and cannot get out; Biden’s budget trends will add trillions to the government debt in the next decade; Biden blames inflation on big business; another Boeing emergency landing (at LAX-cause not yet clear); polls show an increase of financial nihilism in young people; gangs establishing greater control of Mexico and coordinating with China regarding drugs and manufacturing; the electric grid is in danger of failure because of increased AI and data center requirements; Biden wants to release $6B to Iran; Chuck Schumer is asking for Israeli Prime Minister Netanyahu to step down; a woman in Florida was abducted and sexually abused by three illegal immigrants; Biden’s budget shrinks the military in a world of increasing threats; senators are debating what to do about TikTok; Ukraine slowly losing its war; average price increases at Dollar Stores show no signs of slowing down; California is planning to charge for electricity based on consumers’ income level. What more?
This is a summary of reality in our world this morning. The Biden Administration denies much of this, denies their role causing any of it, and seems unprepared to deal with any of it. No wonder young people are developing nihilistic attitudes. Their own government has created a formidable and all-inclusive mess.
“There is nothing more frightful than ignorance in action” – Goethe
I would add we are seeing that ignorance compounded with arrogance is even worse.
Twenty-first Century U.S. presidents each seem determined to prove they can outspend their predecessor. Biden is laying out plans to outspend himself. His budget predictions and debt forecasts for the next decade claim great benefits. For whom is not clear and nowhere is there a prediction of increases of inflation or interest rates. He also plans to increase taxes on corporations and wealthy individuals - a well-known counterproductive policy which reduces government revenues, not increase them. All this will certainly destroy confidence in U.S. financial strength and the dollar. As noted, 10-year Treasury yields are already going up; so are crypto, oil, and gold prices and further increases can be expected as far as the eye can see.
Haiti lives and dies as a continual catastrophe. Refugees by the thousands are heading for the beach in Florida, just what Florida does not need. What to do? Nobody seems to know. Americans cannot get out and are stuck in the middle of gang warfare. The Biden Administration is still encouraging more illegal immigrants to vote in November’s election.
Biden announced a plan to build a port in Gaza, at which aid for Hamas can be unloaded (Yes, Hamas. Gazan civilians are unlikely to get any). He did not mention the Hamas’ American hostages – or Americans imprisoned by Putin – or China – or Iran – and only reluctantly mentioned “Lincoln” Riley. Biden’s callousness regarding the American public and individual citizens is plain for all to see.
Nearly 50 years ago, I attended lectures by an Army general and a colonel. These gentlemen had experience in guerilla warfare, subversion, raids behind enemy lines, and other forms of unconventional warfare. One of these lectures I remember clearly when I consider 10 million illegal immigrants, so far, entering the U.S. during the Biden Administration. Most of these are military-aged males including 20,000 to 25,000 Chinese, many criminals, and an unknown number from the Middle East. That lecture, by the general, explained how, with 100 men, he could shut down a major American city in 12 hours. The Chinese have described extensively their intent to undermine and destroy the United States with “Unrestricted Warfare.” We can be sure they have updated the general’s techniques with modern technology. We have already had cyber-attacks on our infrastructure. Consider the potential effect, if 25 major U.S. cities were attacked and shut down simultaneously in one night - all coordinated on TikTok.
The Boeing emergency landing last night was the 14th since the first of the year. Boeing made reliable airplanes since the early days of aviation. Is such a sudden series of problems the result of ESG management or DEI hiring? So many problems so suddenly in so short a time is a situation starting to stink. Sabotage? This is consistent with Chinese capability and intent and the type of thing the Chinese describe today in writings as techniques to destroy the U.S. – just as it was described so long ago by the general and colonel.
The International Energy Agency reported that oil demand is up and oil stocks are down. The U.S. Strategic Petroleum Reserve was drawn down by the Biden Administration for election purposes. Irresponsible cynicism. Meanwhile, the Saudis are producing about nine million barrels of oil per day. They have a capacity of about 12 million for a surplus capacity of three million. Last year, they announced they would increase that capacity by one million, but this year announced they would not develop that additional one million. Many commentators framed that as a reduction of production growth. It was not; they decided three million surplus capacity is enough for them to influence the oil market and price.
The Biden Administration wants to increase taxes on wealthy individuals. Gavin Newsom’s California wants to charge for electricity on a sliding scale, increasing charges based on the income of the user. This is all straight out of Marx – From each according to his ability to pay; to each according to his need.
Milton Friedman made it clear: Inflation in the U.S. is only caused by excessive government spending, because the government is the only party in the country that can create money for itself to spend in excess. Excessive government spending is expenditure for reasons that have no tangible benefits (such as welfare for illegal immigrants, EV subsidies, and increasing regulations). That seems like a simple concept, but it exceeds the cognitive ability of the Biden Administration. Reportedly, $460 billion was spent on illegal immigrants in 2023, with no benefit or return to the taxpayers whose money it was. That is more than half the military budget.
A potential electric grid failure in a country with abundant cheap natural gas and the ability to produce small nuclear generating plants would be a blatant result of government overregulation, mismanagement, and misguided priorities.
The Biden Administration’s incompetence is truly all-inclusive.