Kevin Drum misses the message

 

Note the debt to equity rises during downturns. This chart does not include the current down turn and that number will be closer to 60%.

Second, equity is driven up as accounts avoid the Fed tax.  Here is a better chart:

This is the amount of debt relative to cash flow.  Velocity has dropped, there are fewer transactions supporting debt charges.

Note, this chart does no include the down turn, yet. It is built up to 2020 Q1 before the data was stable.

We know who educated Drum on economics, and we have to check his work, always, as he is running with the 'This time is different' fraud.  He likely has no idea he was conned.

And another shout to Mish, monetary velocity does indeed matter, on its own.

The Wall Street article Kevin drew from was written by someone who was unable to do a competent search on the topic.  Had they done so, they would have discovered debt to cash is the proper ratio.  In pure basic theory it is loans to deposits.  The first chart I saw was loans to surplus, but the interactive graph was a pain.  Loans to cash flow is a good enough proxy for the short term.

The good senators need to ask, who is raising bank taxes on accounts

On September 17th, Senators Kirsten Gillibrand (D-NY) and Bernie Sanders (D-VT) went on Facebook Live to announce their introduction of the Postal Banking Act, a bill that would have the US Postal Service provide a "public option" in some retail banking services. Postal banking has been proposed

If they are worried that regulated banking is applying too many fees, then ask themselves, where are those  fees doing? To Congress, in the form of regressive taxes. Who is raising those taxes on the middle class? The Fed. Why? Because the same two dipshit senators demand the Fed raise regressive taxes.

They are part of the MIT fraud of 50 years ago. Either out of stupidity or pure fraud, they cannot grasp the concept,  having been sworn to the 'This time is different' crap.

Good news

Pelosi signals no coronavirus deal likely with White House

The House will move ahead with its partisan stimulus bill on Thursday night.

The devaluation is coming sooner than later. Why clog the system up now? 

The NSA dunnit

The Treasury Department on Thursday issued two adversaries highlighting the dangers of ransomware cyberattacks, and warning against paying ransoms demanded by hackers.

Both the agency’s Office of Foreign Assets Control (OFAC) and Financial Crimes Enforcement Network (FinCIN) issued alerts around ransomware attacks, which have been increasingly widespread over the past two years and have ramped up during the COVID-19 crisis.

“Cybercriminals have deployed ransomware attacks against our schools, hospitals, and businesses of all sizes,” Deputy Treasury Secretary Justin Muzinich said in a statement. “Treasury will continue to use its powerful tools to counter these malicious cyber actors and their facilitators.”

Personal secure identity is illegal due to ignorant senators and a misguided NSA. 

 It is not just information protection, it is also about identifying the safe UAVs flying around. The NSA is currently creating more risk, not less. The NSA is also holding banking technology back. The NSA is reducing efficiency of the government payment system, encouraging identity theft.  The NSA is asking the terrorist threat worse because it cannot identify the good guys.

The Swamp can implement its own inflation tax

The Limits of American Recovery

Brad goes through the usual fraud and indicates the Swamp is our last hope.  His argument is zero bound (velocity has collapsed), and the doom loop described earlier in a PS article.

The government do what, exactly? He cannot say it. Treasury is in charge of the right to coin, if we need inflation then give Treasury to ability to use the right to coin in a single entry accounting system. But given the lifetime of fraud on this issue, his Overton window is slammed shut. Inability to tell the truth will cause the banking crisis.

Bezos dunnit

Amazon says more than 19,000 workers got Covid-19

It is not the yields, it is the tax

Pelosi-Mnuchin Call Yields No Deal Yet on U.S. Virus Stimulus

Note that macro economists know the problem and are deliberately silent, committing fraud. When the bank  crisis hits we know who is at fault. remember, they are collecting the tax right no, as we speak, some 1% of the economy is taken as taxes from the banks and remits to Treasury.

If the yields were fine then the financial repression would be minimal. It is increasing. We have the great Paul Samuelson fraud coming apart as we speak, hysterical economists afraid to speak out.

I am not the only one to notice:

Identity politics advocates have succeeded in making certain research conclusions within the university verboten. They have made it very hard for any university professor (particularly the junior and untenured ones) to publish and publicly promote any conclusions that these advocates dislike.

And we have at least two research papers confirming, follow John Cochrane. Otherwise the fraud is quite extensive.

Business Leaders Who Reject Woke Culture To Be 'First People Lined Up Against The Wall And Shot In Revolution': Ex-Twitter CEO

We have been woken to the fraud, we know we are being taxed excessively via our bank accounts and we know who dunnit.  We know that shedding a bit of blood on the unfair tax is a normal American response. Why the widespread fraud? It is no secret.

Oil at 38

 Not getting above 40.

This is deflation, there is a 4% price decline across the board to match with costs of production. How much of that has already been taken out? Dunno, didn't do the numbers. Covid sent us a huge deflation spike. I do not think it is stopping, money is way too tight and Powell is on a deflation hunt, and lying about it. The macro economists are getting a bit hysterical, close to Wile e Coyote.

The exception is no taxation without representation

Trump To Biden On Antifa: "Ideas Don't Burn Down Buildings"

Trump and the conservatives are a bit slow on American history.  

We burn and loot when the government taxes us without legislature approval. We have done this since the beginning, in fact, we have a bunch of welfare bums named the Tea Party to advance the concept of looting.  This is why we have Antificants, to loot and burn on the fiat tax issue like good old Americans do.

Same deal:

Americans Increasingly Believe Violence is Justified if the Other Side Wins

When the issue is taxation without representation.  This is not me complaining about some obscure theory of economics. No, this is about armed guards ejecting folks from regulated banking because they cannot afford the seigniorage tax, and it is collected and remitted.  It is not about some complex economic theory, that was Paul Samuelson horse manure of 50 years ago.

This is about right now, today, the regulated banks are going to collect the tax or kick more Antificants out of their bank accounts. According to American history and culture, violence is well justified in this case.

Egad the 'doom-loop'

The global response to the pandemic confirms that we have not solved the problems that brought us the Great Recession more than a decade ago. The world remains trapped in a “global doom loop” in which governments and central banks must ensure the survival of “universal banks” (banks that engage in capital markets activities) and “shadow banks” (large nonbank financial institutions such as private equity firms, hedge funds, insurance companies and mutual funds). Central banks must buy troubled financial assets to ensure the stability of financial markets and forestall threats to the survival of financial giants. Meanwhile, financial giants underwrite rapidly rising levels of debt for governments, businesses and households.

He wants more financial repression, more seigniorage taxes, more doom loop. He cannot help himself.

Shall we engage in financial repression to save our politicians? Evidently the politicians think yes, but the Antificants who are kicked out of banking do not any financial repression, they want bank accounts without a 2% Fed tax on transactions.  We are headed for a bunch of fraudulent claims on this subject.

And here is Powell and the deflation machine:

After the stock market closed today, the Federal Reserve announced that “in light of the economic uncertainty,” and to provide “a cushion against loan losses,” and to support lending, it would extend for another quarter, so through December 31, the blanket prohibition on share buybacks by large banks (banks with over $100 billion in assets). For the same reasons, it would also cap dividend payments tied to a formula based on recent income.

The Fed said that according to a stress test and additional analysis, whose results were released in June, “all large banks were sufficiently capitalized” to deal with the fallout from the Pandemic.

How does NGDP targeting work in a regime of financial repression?  Something has not been thought out and the fraud uncovered.  Having the banks increase cash balances is deflationary, folks. It is tight money. And the central banks does this because it has taxed collateral to about one percent per year, half the interest charges are going to be central bank fees.