When in drought: the California farmers who don’t water their crops
Venezuela's Four Day Week Isn't About Drought But Socialist Stupidity Apparently, they are the same, both run their governments on variants of socialism (California is the softer, less authoritarian progressive variant). And both are foolishly failing to act in ways which would help ameliorate a serious drought problem. The problems both of these governments face are likely to worsen not lessen. They will need to make serious changes to their public policies, but likely neither will. The death of Venezuela will come soon. California's will take a while.
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China Evicts Investment Firms Amid Fears of Unrest
. . . China might not make it through the decade! More below! Men with guns kindly ask Chinese economists to keep comments on the Chinese economy positive!5/4/2016 China Warns Economists, Analysts, Reporters About “Overly bearish” Remarks | MishTalk
They would hate for the truth to find its way out! Go read the whole thing. The Chinese economy is little more than a massive structure of lies attempting to confuse the world into believing something that is not. The Chinese economy will have its come-to-Jesus moment, and it will likely be spectacular. Well, unless you are one of the CCP. Then it might come at the end of a rope tied off to a lamppost. Or maybe the parties luck will hold. We need Chinese economy a dead pool! QE Sponsored Stagnation: Productivity Declines Again As Unit Labor Costs Rise 4.1% | MishTalk
. . . first thing we do, we kill all the Central Bankers. Mish: "QE Sponsored Stagnation and Cannibalization Loosey-goosey monetary policy and low interest rates led to a proliferation of retail businesses, mall construction, fast food places that would not have been built in the absence of over-stimulation. Those stores are now competing against each other. Frequently stores cannibalize their own sales. Pick Your Poison To achieve 2006 productivity, Study Says 20% of Mall Space Should Close. If 20% of mall space closed, guess what that would do to employment. And if we stay on the same course, guess what happens to profits. Meanwhile, the push for higher minimum wages is on." It is not clear this is the worst possible outcome, but it is pretty close. What this means is we need to reduce the total number of the physical stores, which would result in a reduction in total number of jobs, and an increase in productivity. Many of the positive elements in the Obama economy, are fictitious. When this finally goes, and it will likely take a recession to clear out all of this deadwood, it will be bad. This will likely drive another round of workforce participation rate reductions, a significant boost in unemployment, and increasing wage weakness. Apparently, all at the time the progressives will be forcing an increase in the minimum wage, which will just accelerate these outcomes. Progressives really want to help the poor, but all of their instincts drive them to policies which only hurt the poor more. The Arab Implosion Continues
. . . the Arabs will have to find some way to assimilate to this or be destroyed in the process. The mere fact that this way exists and is obvious to all is sufficiently corrosive to destroy non-conforming cultures. Expect this to continue, to grow, and to gain speed. "What we are seeing is not so much a clash between civilizations as a crisis of Arab civilization: the failure of the Arab world to master modernity—to find a way to be economically and politically successful under modern conditions without losing the core cultural and social values. This is comparable to what happened in China in the 19th century, when China failed to find a way to adapt Western methods and ideas to Chinese conditions—which led to decades of state failure, weakness, and immense suffering for the Chinese people." All we can do now is lay pressure to move them onto the path we know works -- republican governance, free markets, limited government power, and reformed religions. The economy is firmly stagnant, and seems to be strengthening its hold on stagnation . . .5/2/2016 Stagnation: ISM and US PMI Converge on 50.8 – Comparing the Reports | MishTalk
. . . if that is possible. This is a pathetic PMI report. I would hate to live in the country where this is happening. Oh wait! Read the whole thing it is short and pithy. The religious compact that constrains Saudi economic reform - FT.com
. . . created upon the linking of a binary. While evil corrupts, absolute evil corrupts absolutely. Little Arab Lord Fauntleroy wants to reform the dilettante's in Saudi by putting the them to actual work, and reforming, completely, the corrupt system, stem to stern. "All this rewrites the social contract whereby Saudis forgo political rights and offer fealty to the House of Saud in return for public sector jobs and cradle-to-grave welfare funded by oil. Coming even close to these goals implies radical social change, an upheaval in governance — all without much sign that the absolute monarchy intends its subjects to become fully participatory citizens. While no one can fault MbS for his boldness, his programme resembles a mobilisation of technocrats to bypass big political obstacles. The biggest of these is the cornerstone of the state: the historic compact between the House of Saud and the House of ibn Abdul Wahhab, the 18th century preacher behind the most extreme version of Sunni Muslim orthodoxy ever attempted as a form of governance. The ruling family has until now relied on the Wahhabi establishment — as reactionary and bigoted as ever — for its legitimacy, in exchange for clerical control over areas such as education and the judiciary, as well as the segregation of women." This will only work if the House of Saud follows what we know works here at the End of History: republican governance, free market economics, reformed religions, and a state which strictly limits its regulations, including regulations of life and business. This is really simply, good government, good religions, free markets, and liberty. Saudi has none of these. Good luck with this. If you want to be taken seriously cut loose the religion today. Until you do so, no one will believe you have a chance, and more than anything you need others to believe and support your plan. After that you will need to pair the liberalization of the economy with the liberalization of politics. Sorry, that means the House of Saud will have to give up power to the people through a plural republican mechanism of some kind. Choose the form of your destructor. Not choosing is a choice. Choose wisely, young Arab Lord Fauntleroy, choose wisely. Italian unemployment falls to 3-year low - FT.com
The rate today is a super low 11.4%. Wait! What? "Italy’s unemployment rate fell to a three-year low in March, providing relief for Matteo Renzi, the centre-left prime minister, and stoking hopes that months of stagnation in the labour market of the eurozone’s third-largest economy have ended. According to Istat, Italy’s statistical agency, joblessness slid from 11.6 per cent in February to 11.4 per cent in March, its lowest level since late 2012, as the number of unemployed Italians fell by 63,000 and the economy added 90,000 positions compared with February. Italy’s jobless rate still remains well above the eurozone average of 10.2 per cent, a result of the country’s long recession, meek economic recovery and widespread structural problems." Remember these are the official figures which do not account for the numbers of people who have slipped into disability, or on to welfare of some kind. In the US, we simply do not tolerate these unemployment levels, but in the southern swing of Europe they are life as usual. Europe must begin to seriously reform its work rules, wage rules, union rules, welfare rules, and oh so much more if it is to remain in the first world. If these countries do not wish to do so, fine, but attempting to remain in the EU is silly if they don't. The game is, however, to remain in the EU since this offers the politicians much cover for endless graft and corruption, and deflects the voters from anger at the Italian politicians and towards the EU bureaucrats. None of this will make the Italian people wealthier, more prosperous, or more secure. In fact it does the opposite. I am concerned we are about to see the final fracturing, and a great depression in the European southern swing of countries. All to afford the local politicians a bit more time at the graft and corruption trough. Please note the entire Eurozone unemployment averages 10.2%, again a disastrously high number by US standards. Good bye Italy, good bye Europe, we hardly knew you! If you would like to see some internals on the Italian labor market this link has graphs, and more information. The trials and tribulations of Italy’s labour market in 8 charts You're welcome! Venezuela's economic disintegration hit a sad milestone this week
. . . if it wasn't, Maduro would have been treated to an Il Duce necktie long ago. Bureaucracies which live for themselves
. . . a weakness which only manifests itself immediately before the fall. More below the fold. |
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