{"id":55794,"date":"2020-11-28T09:36:58","date_gmt":"2020-11-28T14:36:58","guid":{"rendered":"https:\/\/olduvai.ca\/?p=55794"},"modified":"2020-11-28T09:36:58","modified_gmt":"2020-11-28T14:36:58","slug":"weekly-commentary-pondering-the-new-secretary-of-the-treasury","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=55794","title":{"rendered":"Weekly Commentary: Pondering the New Secretary of the Treasury"},"content":{"rendered":"

Weekly Commentary: Pondering the New Secretary of the Treasury<\/a><\/h3>\n
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The U.S. Goods Trade Deficit jumped to a then record $76 billion back in July 2008. A few short months later, financial chaos unleashed the \u201cgreat recession\u201d economic crisis. Traditionally, large trade deficits are evidence of loose monetary conditions and resulting unsustainable spending patterns. By May 2009 \u2013 only 10 months from an all-time record \u2013 the Goods Trade Deficit had shrunk to a seven-year low $35 billion. It\u2019s worth noting, as well, that M2 money supply expanded $253 billion, or 3.1%, during 2009.<\/div>\n<\/div>\n
\nFast forward to the current crisis period. M2 has surged $419 billion in only six weeks. Over the past 38 weeks, M2 has expanded an unprecedented $3.60 TN, with year-over-year growth of $3.785 TN, or 24.7%. October\u2019s Goods Trade Deficit was reported Wednesday at $80.3 billion, lagging only August\u2019s record $83.1 billion. Last month\u2019s Trade Deficit was actually 21% ahead of pre-crisis October 2019.<\/p>\n

No doubt about it, this crisis period is unique. More than three Trillion worth of Fed liquidity injections coupled with more than a Three Trillion fiscal deficit has thrown traditional crisis dynamics on its head. In this New Age Crisis backdrop, financial conditions have actually dramatically loosened. Money supply has skyrocketed, and stocks have gone on a wild speculative moonshot. Corporate bond issues surged to new records. And, as noted above, booming imports pushed the Goods Trade Deficit to an all-time high. At $170 billion, the second quarter Current Account Deficit was the largest since 2008.<\/p>\n

The bloated services sector has accounted for a majority of historic job losses. Massive stimulus has bolstered spending on goods \u2013 which has led to the rapid recovery of imports. Home sales have boomed, with the strongest house price inflation in years. It\u2019s only fitting that stimulus-induced \u201cTerminal Phase\u201d Bubble excess now engulfs the housing sector as well. That asset inflation and Bubble excess run rampant in the throes of crisis should have us all worried.<\/p><\/div>\n

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\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Weekly Commentary: Pondering the New Secretary of the Treasury The U.S. Goods Trade Deficit jumped to a then record $76 billion back in July 2008. A few short months later, financial chaos unleashed the \u201cgreat recession\u201d economic crisis. Traditionally, large trade deficits are evidence of loose monetary conditions and resulting unsustainable spending patterns. By May […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[7756,7783,195,16861,303,23502,28622,538,1234,3650],"class_list":["post-55794","post","type-post","status-publish","format-standard","hentry","category-economics","tag-credit-bubble-bulletin","tag-credit-expansion","tag-debt","tag-doug-noland","tag-fed","tag-government-deficit","tag-government-directed-money-supply-inflation-has-been-the-standard-operating-procedure-in-the-u-s-and-much-of-the-world","tag-money-printing","tag-stimulus","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/55794","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=55794"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/55794\/revisions"}],"predecessor-version":[{"id":55795,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/55794\/revisions\/55795"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=55794"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=55794"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=55794"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}