If this is your first visit to my blog, welcome! My name is Christine Springer and I'm the founder of Desert Edge Legal Services, LLC and the creator of this blog. I am solely responsible for the content in this post. I am not a lawyer and I cannot give you legal advice. Please seek legal advice from a competent attorney for your individual situation.
We need some new economic measuring tools for a new era, because the ones we are using aren't an accurate indicator of economic recovery.
We are in uncharted territory right now in the post-pandemic era. So much has changed and we're still using old yardsticks from a bygone era to make policy decisions.
This is misleading to the public. In fact, there's a lot of misinformation, disinformation, spin, bullshit and straight up lies out there. It's important to educate yourself so that you can tell the difference, or even disagree.
These are my educated opinions, of course. You don't have to agree with me.
However, the media and even some of our elected leaders will point to these old measurements to lie to you about the economic recovery, force people off unemployment and do a lot of other things.
Here are some examples that come to mind:
- The Real Estate Market.
Completely disconnected from reality. You can do your own research on this to see what's going on.
And, let's not forget about how the National Association of Realtors has been lobbying to end the eviction moratorium so your house will be foreclosed upon and they can sell it to someone else.
Anything to make a buck, right?
Unemployment has not been a good measure of unemployment for as long as I can remember. The way unemployment is counted actually leaves a lot of people uncounted, which distorts the real unemployment numbers.
When we still made things in the USA, manufacturing was a reliable indicator of the strength of the economy. However, manufacturing has increasingly been sent offshore in the last half-century. I don't think it is nearly as relevant as an economic indicator anymore.
- Interest rates.
Interest rates have been at or near zero for a long time. Some central banks flirted with negative interest rates. Yes, you read that correctly. I think this is going to happen during the next economic recession.
"Negative interest rates occur when borrowers are credited interest rather than paying interest to lenders. While this is a very unusual scenario, it is most likely to occur during a deep economic recession when monetary efforts and market forces have already pushed interest rates to their nominal zero bound.
Typically, a central bank will charge commercial banks on their reserves as a form of non-traditional expansionary monetary policy, rather than crediting them interest. This extraordinary monetary policy tool is used to strongly encourage lending, spending, and investment rather than hoarding cash, which will lose value to negative deposit rates. Note that individual depositors will not be charged negative interest rates on their bank accounts.
The Federal Reserve has kept interest rates low for a very long time. Unless they are prepared to pay negative interest rates, they aren't really a useful tool at this point. To go any lower would mean negative interest rates.
If you are intrigued, do your own research into this. It's actually pretty fascinating to understand how it incentivizes the banks.
We're hearing a lot of hype about inflation lately, but in my opinion, people and possibly the media are confusing inflation with pandemic supply chain issues.
In theory, the additional money printed by the Federal Reserve should dilute the value of the money supply across the world. But money isn't backed by gold anymore -- ever since Bretton-Woods -- and money is worth whatever the Fed says it's worth.
Additionally, we should have had out of control inflation for the last decade given that interest rates were so low. But that didn't happen and nobody can really explain why.
- The National Debt
This has become a Faux News talking point because they literally don't have anything else to talk about. The current administration's policies are very popular with Americans regardless of their party affiliation.
The current narrative about "our children will be paying for our spending" is based on economic myths that are just not true. They are just trotted out before the public and used as a fear tactic.
We never hear about this when there's a big tax cut for the rich on the table or when we're funding a huge defense budget. We only hear about the national debt when certain people don't want YOU to have more money in YOUR pocket.
The national debt is a myth. Money hasn't been tied to anything real, like gold, for decades.
There are some other reasons why I think the national debt narrative being pushed is ridiculous, but someone else has already written about it.
USAPP has written a book review that discusses a book called "The Deficit Myth: Modern Monetary Theory and the Birth of the People’s Economy," by Stephanie Kelton.
It felt good to talk about this -- it's been on my mind for awhile. What do you think?
I hope you enjoyed this post!