“One of the most cowardly things ordinarily people do, Is to shut their eyes to facts.” – C.S. Lewis
Okay, we know Biden lies constantly and misrepresents facts (hey, he is a politician like Adam Schiff (D-CA). But this graphic praising Bidenomics with Biden having created the most jobs (average per month) since Carter (notice they left out Democrat darling Jimmy Carter!!!). In this absurd graphic, Biden wins by “creating” over 400k jobs per month while Trump lost jobs per month. Riveting … except that it is completely misleading.
Actually, the US economy added 12.53 million jobs after April 2020 (Trump) while Bidenomics created took 2 1/2 years to add 12.56 million jobs. So, Biden took over twice as long to create jobs after Covid than it did under Trump. Simply opening the economy and schools produced that magical claim by Biden. And the National Teacher’s Union and Randi Weingarten worked with Fauci to orchestrate shutting down schools. Blaming Trump for local governments shutting down the economy is pure bunk.
12.53 millions jobs added / 8 months = 1.56 million jobs average per month. Biden? 12.56 million jobs added / 30 months = .43 million jobs average per month. So, Trump averaged more than 3x the job growth post-Covid than Biden.
Here is the “glories of Bidenomics” from the White House. As Biden likes to say, pure malarkey!
I wonder if the Democrat Party is a rebirth of New York City’s Tammany Hall corrupt political movement of the 1800s? Is Biden Boss Tweed? Or is Obama Boss Tweed with Biden as his nasty, dimwitted henchman?
In 1871, Thomas Nast denounces Tammany as a ferocious tiger killing democracy. The image of a tiger was often used to represent the Tammany Hall political movement. Sounds an awful lot like today’s Democrat Party.
Josef Stalin of the old Soviet Union used to be called County Joe. But Biden has so many possible nicknames: Corrupt Joe, Pay-for-play Joe, Sleazy Joe, Bully Joe, etc. How about Green Joe?
Green Joe (or the Nasty Green Giant?) along with his energy goon Jennifer Granholm, have drained the strategic petroleum reserve by 46% while gasoline prices have soared 60% under Bidenomics.
Gasoline prices have rise over 6.5% just since 7/23/2023.
Trump wants to drain the swamp, Biden/Granholm want to drain the strategic petroleum reserve so we can’t go back to fossil fuels. Biden and Granholm as Fossil Fools
Energy Secretary Jennifer “The Evil Pixie’ Granholm demostrating how she will refill the strategic petroleum reserve. Which she never will, of course.
US average hourly earnings continued at 4.4% year-over-year (YoY). However, the last core inflation reading was 4.8% YoY, so real wages continue to decline.
Rent CPI for June was 7.8% YoY.
Here is the rest of the story.
In keeping in with Biden admin’s penchant of constantly fabricating data, both May and June numbers were revised sharply lower of course:
May revised down by 25,000, from +306,000 to +281,000
June was revised down by 24,000, from +209,000 to +185,000.
To show just how ridiculous the data manipulation is, consider this chart – every monthly payrolls report in 2023 has been revised lower.
And on the disappointing jobs report and massive revisions of past data (the REAL inflation plaguing the nation is The Federal goverment lying about data), the US Treasury 2 year yield dropped like Biden on a flight of stairs.
Here are the faces of Washington DC. Lies, corruption, government for sale to highest bidder, cynacism, oppression, fear mongering, etc. This is Biden’s legacy.
Bidenomics, the term for “Government Gone Wild! in terms of spending and EPA regulations, is a disaster for the US middle class and low wage workers. Even the 1% are now hurting if bought into Biden’s green lunacy. Ford is now down -48% since January 14, 2022 as The Fed started raising rates to fight inflation. GM is down “only” -40%.
So far this year, the division has lost $1.8 billion and this year’s $4.5 billion loss figure blows away last year’s $2.1 billion loss. Ford also announced that its electric F-150 pickup trucks will undergo a price cut, according to Fox.
Ford beat earnings on Thursday and reported adjusted EPS of $0.72, beating expectations of $0.54. It posted revenue of $45 billion and adjusted EBITDA of $3.8 billion, above estimates of $3.15 billion.
The company also raised its guidance, forecasting adjusted EBIT of $11 billion to $12 billion from $9 billion to $11 billion. The company is now guiding for free cash flow of $6.5 billion to $7 billion, from $6 billion.
But reality has sunk in about the company’s comments regarding its EV production schedule and spending plans. Price cuts in the industry, led by Elon Musk and Tesla, have thrown Ford’s production targets into a tailspin and Morgan Stanley noted on Friday morning that “major changes to the EV strategy” could be necessary, according to a wrap up by Bloomberg.
Ford now says it is “throttling back” on plans to ramp up EV production, the wrap up said. It blamed the price war for EVs as part of the cause and told shareholders it would need another year to meet its target of 600,000 EVs produced annually.
Ford CEO Jim Farley said late last week: “The shift to powerful digital experiences and breakthrough EVs is underway and going to be volatile, so being able to guide customers through and adapt to the pace of adoption are big advantages for us. Ford+ is making us more resilient, efficient and profitable, which you can see in Ford Pro’s breakout second-quarter revenue improvement (22%) and EBIT margin (15%).”
CFO John Lawler said yesterday that the company “has ample resources to simultaneously fund disciplined investment in growth and return capital to shareholders – for the latter, targeting 40% to 50% of adjusted free cash flow,” Bloomberg added. He now says Ford is “not providing a date” for producing 2 million EVs per year, which was previously the company’s target for 2026.
Is the company pulling an Intel and “kitchen sinking” its guide for the year, or has Elon Musk’s price cuts over at Tesla really put the legacy automaker on the ropes? Ford reports again on October 26, where we’ll get our next glimpse into its continuing operations this year.
Tesla is down -26% since January 14, 2022. And showing a nice turnaround!
Today, the 10-year Treasury yield is up 11 basis points.
First, the deficit. It’s close to historical wides, bigger than it’s ever been outside of a recession, and almost as wide as it was in the depths of the GFC. It’s the largest in the world in GDP terms, and it is currently heading in the wrong direction. This heaps more pressure on the government debt-to-GDP level, already uncomfortably high at 112%.
Second, tax revenues. These have seen almost their largest annual fall ever, in an economy that’s supposed to be growing at 2.4%.
And then there’s rising interest-rate costs. The total interest expense as a percentage of tax revenue is expected to rise sharply in the next year or two, and make new highs by the end of the decade. However, these CBO forecasts should be taken with a grain of salt as they are based on a 10-year yield of only 3.8% (the ten-year average has been higher than that in every decade bar the 2010s and 2020s).
My former student at University of Chicago’s MBA program, Kevin Smith of Crescat Capital, has this charming chart of state and local income tax receipts collapsing.
There is a view the Treasury is already implementing YCC, based on the fact it has been skewing its issuance towards bills and away from coupons. But issuing more bills is simply the easiest and fastest way for the Treasury to replenish its account at the Fed (the TGA). It was run down to almost zero in the lead-up to the debt-ceiling limit, and has now risen to over $500 billion.
This level of bill issuance is not unusual. The Treasury has an implicit target of about 20% for the amount of bills outstanding as a percentage of total debt. As we can see from the chart below, bills have often been more than 20% of debt outstanding over the last 30 years. Moreover, the Treasury announced this week it was raising its coupon-issuance amounts.
According to the stealth YCC thesis, less longer-dated Treasury issuance implicitly caps longer-term yields, but this has not historically been the case. As the chart above shows, the yield curve typically steepens – not flattens – when there is greater bill issuance – the opposite of what is desired by YCC.
We see the same relationship if we look the duration of US government debt outstanding. When the average duration falls – as it would if issuance is skewed toward bills – the yield curve tends to steepen. The current average duration held by the public is consistent with a steeper, not a flatter, yield curve.
This sounds counter-intuitive. If issuance drives yields, then more issuance at the front-end of the curve versus the longer end – equating to a fall in duration – implies the yield curve should flatten.
But the fact the relationship is the other way implies it’s likely that demand is the more dominant driver of yields in the medium term. There is ready-made demand for bills, from MMFs, etc, so when supply increases, demand rises to meet it, suppressing the yield-curve impact.
It’s thus hard to argue the Treasury is engaging in yield curve control. But that does not detract from the rising possibility it will need to be implemented in some shape or form eventually.
Banks and the Fed are reducing their Treasury holdings, while foreigners now collectively own about $5 trillion less USTs – about 10% – than they did in 2021. At the same time the “Treasury put” means large fiscal deficits are likely to become a feature, not a bug. That means inflation is likely to become embedded.
Fiscal profligacy and elevated price growth are a combustible mix and a road to prohibitively high yields via rising term premium. Yield capping thus starts to look like the endgame.
How it’s done is another matter, whether it’s the Fed co-opted to cap yields as it was in WWII, Treasury buybacks, or financial repression, whereby domestic institutions are forced to hold more government debt. Whatever way, at some point yield curve control in the US is becoming increasingly likely – by stealth or otherwise.
But never fear! Janet “Too Low For Too Long Creating Asset Bubbles” Yellen is still US Treasury Secretary.
Bidenomics is where the Attorney General Garland gives Hunter Biden blanket amnesty and arrests Biden’s Presidential opponent. Welcome to the United Venezuelan States of America!e
But while Fitch cited “the expected fiscal deterioration over the next three years, a high and growing general government debt burden, and the erosion of governance relative to ‘AA’ and ‘AAA’ rated peers” as reasons for the downgrade, the Biden administration is of course blaming Donald Trump and his supporters due to one portion of Fitch’s explanation: “a steady deterioration in standards of governance over the last 20 years,” and that “repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management.”
Then on Wednesday, Fitch’s Richard Francis told Reuters that the downgrade was ‘due to fiscal concerns and a deterioration in U.S governance as well as polarization which was reflected in part by the Jan. 6 insurrection.’
“It was something that we highlighted because it just is a reflection of the deterioration in governance, it’s one of many,” he said, adding “You have the debt ceiling, you have Jan. 6. Clearly, if you look at polarization with both parties … the Democrats have gone further left and Republicans further right, so the middle is kind of falling apart basically.”
And so of course, the Biden administration is blaming Trump.
“This Trump downgrade is a direct result of an extreme MAGA Republican agenda defined by chaos, callousness, and recklessness that Americans continue to reject,” said Biden re-election campaign spokesman Kevin Munoz. “Donald Trump oversaw the loss of millions of American jobs, and ballooned the deficit with the disastrous tax cuts for the wealthy and big corporations.”
Ah, so now it’s the Trump downgrade™
Meanwhile, White House spox Karine Jean-Pierre also blamed Trump on Tuesday, saying that the White House “strongly” disagrees with the decision, adding “it’s clear that extremism by Republican officials — from cheerleading default, to undermining governance and democracy, to seeking to extend deficit-busting tax giveaways for the wealthy and corporations — is a continued threat to our economy.”
Former Clinton Treasury Secretary Larry Summers called the decision “bizarre and inept,” while former Obama economic advisor Jason Furman called the move “completely absurd.”
On Wednesday, CNBC wheeled out Jared Bernstein, chair of Biden’s Council of Economic Advisers and former Obama official, who similarly blamed Trump.
“I think again the timing issue is is Jermaine here. The deficit went up every year under President Trump. The debt to GDP ratio rocketed under President trump. It has stabilized admittedly at a higher level under this president but we’re doing all we can to try to ameliorate those tensions,” he said.
Bernstein reflected on the “cognitive dissonance” he felt at the downgrade amid the success of ‘Bidenomics’ commenting that “creditworthiness deteriorated significantly under President Trump for good reasons… and under President Biden, it started to track back up…”
Except that’s the exact opposite of what happened. According to the 100% non-partisan “market”, the creditworthiness of US Treasury debt improved almost constantly under President Trump and worsened dramatically almost immediately upon President Biden’s inauguration:
Treasury Secretary Janet Yellen said that the downgrade was “arbitrary and based on outdated data,” adding “Today, the unemployment rate is near historic lows, inflation has come down significantly since last summer, and last week’s GDP report shows that the U.S. economy continues to grow.”
CNN also blamed Trump, penning the headline: Fitch downgrades US debt on debt ceiling drama and Jan. 6 insurrection.”
The stupidity on CNN and Jared Bernstein are appalling. True, the media and Biden Administration are terrified of losing the 2024 Presidential election, but outright lies and misrepresenation are wrong no matter what.
But the claims that the US was downgraded because Trump’s economy lost miilions of jobs is ridiculous.
Actually, the US economy added 12.53 million jobs after April 2020 (Trump) while Bidenomics created took 2 1/2 years to add 12.56 million jobs. So, Biden took over twice as long to create jobs after Covid than it did under Trump. Simply opening the economy and schools produced that magical claim by Biden. And the National Teacher’s Union and Randi Weingarten worked with Fauci to orchestrate shutting down schools. Blaming Trump for local governments shutting down the economy is pure bunk.
Bidenomics and massive Federal spending is the cause for the downgrade. Not Trump.
Inflation under Biden has been very painful for the US middle class and low wage workers. That inflation has resulted to surging mortgage rates thanks to The Fed’s counterattack.
The result? Mortgage rates are up 134% under Bidenomics, while mortgage purchase demand is down -45% since Biden was selected. And mortgage refinancing demand is down a staggering -90%!
Mortgage applications decreased 3.0 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 28, 2023.
The Market Composite Index, a measure of mortgage loan application volume, decreased 3.0 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 3 percent compared with the previous week. The Refinance Index decreased 3 percent from the previous week and was 32 percent lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 3 percent from one week earlier. The unadjusted Purchase Index decreased 3 percent compared with the previous week and was 26 percent lower than the same week one year ago.
US interest expenses have surged by about 50% in the past year, to nearly $1 trillion on an annualized basis.
Look at the share of net worth by the top 1% as Treasury borrows more money.
Oddly, Biden is not talking about about putting US government policies up for sale to the highest bidders. But don’t worry. Biden is the King of Corruption in the District of Corruption (Washington DC).
President Jimmy Carter is usually the bar for terrible Presidents. Under Carter, the US experienced economic stagnation and soaring inflation. At least it led to the election of Ronald Regan!
So, Biden’s much mentioned Bidenomics have produced REAL MEDIAN WEEKLY EARNINGS FOR MEN that is currently below 1979 levels under Jimmy Carter.
Even worse for Bidenomics, REAL MEDIAN WEEKLY EARNINGS GROWTH FOR MEN was -4.45% In April 2023, while the last reading prior to Covid under Trump was 6.674% YoY in February 2020. So, Bidenomics isn’t even back to Trump levels for men.
I like this chart which I call “Yellenomics” because it illustrates The Fed’s Folly of money printing and its impact on real earnings. After the Trump wage growth boom, real median weekly earnings for men has been steadily declining.
Women, on the other hand, did show a gain since Carter, but still lower than the last month before Covid struck. Women’s real median weekly earnings growth YoY since Q2 2021 are down -5%. So, Bidenomics has been less sucky for women than men.
Reminds me of The Yardbird’s classic “I’m A Man.” Worse off under Biden than under Jimmy Carter. Although The Yardbird’s “Over Under Sideways DOWN” is more emblematic of Bidenomics.
Bidenomics should be renamed Corruptionomics given Biden’s habit of selling government influence to anyone willing to waive a few million.
Bidenomics, aka the Federal government takeover of the US economy with Soviet-style economic central planning, is highly dependent on loose Federal Reserve monetary policy (Janet Yellen and Powell’s wild overreaction to the massively inappropriate Covid shutdowns),
So, how is Bidenomics working out? On the bank lending front, commercial and industrial (C&I) lending growth is crashing along with bank credit growth YoY.
The US Treasury 10Y-2Y yield curve remains deeply inverted at -91.031 basis points and M2 Money growth has crashed. The 30 year mortgage rate is hovering around 7.27%.
Commercial real estate (CRE), particularly office space, reminds me of the Arthur Brown tune “Fire!” except that Jerome Powell of The Federal Reserve is the God of Hellfire! While fighting inflation caused by … The Federal Reserve and insane Federal spending (aka, Bidenomics). Call this the Over, Under, Sideways Down economy. The top 1% are doing quite well, while the lower 50% of net worth households are struggling.
The Q1 2023 NCREIF Office property (value) index shows declining office value since Q2 2022 as The Fed began raising its target rate to combat inflation.
From Trepp, we have this shocking table showing the decline the average total value loss over the span of around a decade. The oldest buildings experienced the largest reduction in value of 60%, and the newest experienced the least (but quite substantial) reduction of 52%. Although the newest buildings performed the best relatively, their 52% value reduction is easily the most concerning, and displays truly how much distress is present in the office sector. This group has the highest percentage of Class A buildings, but its reduction value over the past decade is still approximately on par with buildings constructed over half a century prior. With north of $150 billion in securitized maturities beyond 2023, these trends set a gloomy tone for their future and the performance of office properties as a whole.
Then we have this alarming headline from Trepp: “Commercial Mortgage Sector Faces Another Wall of Maturities as $2.75 Trillion Rolls by 2027.” An estimated $528.7 billion of commercial mortgages mature this year, according to Trepp data, which projects that next year, maturities will increase to $532.8 billion. The projections are based on data for the first quarter compiled using the Federal Reserve’s flow of funds and made various assumptions regarding loan terms for each of the major lender categories. The data would indicate that the market is facing a wall, if not a mountain of maturities that would make the 2015-2017 wall of maturities look almost inconsequential. During that period, roughly $1.1 trillion of loans were scheduled to come due. But attention was focused on the CMBS market, as more than $335 billion of loans were set to mature during the period.
Well, REAL gross domestic income fell -0.8% YoY in Q1 2023 as M2 Money growth crashes. Not a good sign for the US economy or commercial real estate.
Of course, office properties are suffering from almost out-of-control crime in major American cities and the desire of workers to work from home rather than commute to work in cubicles.
But never fear! We have massively corrupt and compulsive liar Joe Biden as President!! He is the President of The 1%! Not the other 99%.
Confounded Interest - Anthony B. Sanders 
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