Profile image
By CoyotePrime (Reporter)
Contributor profile | More stories
Story Views
Last Hour:
Last 24 Hours:

Cui Bono? Of the Acela Corridor… By the Acela Corridor… For the Acela Corridor

% of readers think this story is Fact. Add your two cents.
“Cui Bono? Of the Acela Corridor… 
By the Acela Corridor… For the Acela Corridor”
by David Stockman
“For all his bile, bombast, braggadocio, and bullshit, the Donald is proving to be the Acela Corridor’s Boy. This Trade War brouhaha is not about freer trade. It’s not even about trade policy at all. It’s about K Street-driven corporate welfare and industrial statism… with some big licks for the Warfare State thrown in to boot. “Drain the Swamp?” Hogwash…
The Tweeter-in-Chief doesn’t get it. He thinks he’s attacking the bilateral trade imbalance, the one where China shipped $563 billion of goods to America in 2018 but purchased only $120 billion of stuff from the U.S. The $443 billion gap is ridiculous. It would never happen under a regime of free markets and sound money. But the cause of this freakish outcome is not addressed anywhere by anyone. Indeed, the “Low Interest Man” in the White House is begging for more of it.
The cause of America’s trade deficit with China are the Federal Reserve’s pro-inflation policies and easy-money predilections. They’ve created artificially cheap debt and chronic financial-asset inflation. And they’ve hollowed out America’s industrial economy.
Monetary central planning has pushed nominal domestic wage rates to uncompetitive levels. That makes the devil’s workshop that is the Marriner S. Eccles Federal Reserve Building the nation’s No. 1 jobs exporter. That’s what’s drained good jobs and durable prosperity from Main Street in the 21st century.
At the same time, they’ve turned financial markets into risk-free casinos. “Speculation without consequence” explains the fact that the market value of financial and real estate assets has risen at many times the rate of national income growth since 1987:
Click to Enlarge
Household assets – represented by the purple line – have increased by the staggering sum of $102 trillion since October 1987. By contrast, nominal GDP is up by only $15.5 trillion during the same 31-year period. In other words, asset values have grown 6.5 times faster than economic production.
The “financialization” of the U.S. economy also incentivizes CEOs and CFOs to strip-mine their balance sheets and sacrifice their cash flows to fund growth-retarding buybacks, dividends, and M&A. That all gooses short-term stock prices and executives’ options packages. And it diminishes long-term value-creation via competitive growth.
Is this free-market capitalism at work? Is it sustainable? Is it even rational? Nope. But it’s good for Wall Street. And it’s good for Imperial Washington.
There is a single, fulcrum error behind the gutting of Main Street. It’s based on a Keynesian predicate that arose during your grandfather’s era of relatively closed national economies and union-dominated industrial wage-and-price structures. Statist economists argued that a low, consistent rate of inflation is a growth-and-prosperity tonic. It was a marginally plausible but incorrect idea.
This historical delusion is rooted in what’s called the “sticky wage” hypothesis. Back then (union) wages were inflexible (to the downside). In other words, any loss of demand during a business-cycle downturn would result not in adjustments to market-clearing wage levels. What would result is a self-fueling reduction in output, incomes, and spending. That meant nominal spending – plus a modest annual inflation component – had to be maintained at all hazards. That’s how you made room for real wages – i.e., adjusted for inflation – to shrink in response to changing conditions.
Of course, this always dubious “sticky wages” hypothesis was rendered null and void years ago by globalization. Take a look around: How many “sticky” steelmaking wages are being paid in Youngstown, Ohio? How many “sticky” furniture and textile wages remain in North and South Carolina?
Just about zero… But that reality hasn’t put our monetary central planners out of business at all. Instead, they just invented a new deadly theory to perpetuate the inflation-as-growth-tonic proposition: “Deflation” is what we fight today… “Deflation” is the spiral into which economies… societies… even civilizations descend only at their terminal peril.
Of course, this figurative black hole is no more real than the nine rings of Dante’s hot place… But fighting it is good for Wall Street. And it’s good for Imperial Washington.”


Support BeforeitsNews by trying our natural health products! Join our affiliate program
Order by Phone at 888-809-8385 or online at
Get our Free Ebook, "Suppressed Health Secrets" THEY don't want you to know!

APeX - Far superior to colloidal silver!  Desroys Viruses, Bacteria, Pathogens!
Ultimate Curcumin - Natural pain relief, reduce inflammation and so much more.
Supreme Fulvic - Nature's most important supplement! Vivid Dreams again!
MitoCopper - Bioavailable Copper destroys pathogens and gives you more energy.
Oxy Powder - Natural Colon Cleanser! Cleans out toxic buildup!
B-12 - Supports healthy metabolism, brain function, hormone balance!
Nascent Iodine - Promotes detoxification, mental focus and thyroid health.
Never Wax Your Car Again -
Protects vehicles for years with dazzling shine!
Smart Meter Cover - Reduces Smart Meter radiation! See Video!
Prodovite - The Secret To Healing is in the Blood!

Tactical Laser Blinds
Bring Batteries Back
New Laser Blinds Attackers Instantly! Bring Dead Batteries Back to life!
US Faces 100 Year Drought
Cut Power Bills by 65%
NASA - US Faces 100 Year Drought! Discovery Can Cut Power Bills by 65%
Report abuse


    Your Comments
    Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

    Total 1 comment
    • Anonymous

      No dude. YOU dont get it. “The PROBLEM” is that we have a Federal Reserve at all. Why is a PRIVATE HOLDING CO of 7-9 JEWISH european banks, PRINTING and controlling our Money supply???




    Email this story
    Email this story

    If you really want to ban this commenter, please write down the reason:

    If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.