The Great Leap Backward

September 23, 2022
Leyendecker Executive Search

September 23, 2022

Without price stability, the economy doesn’t work for anyone.
Fed Chairman Jerome Powell

THOUGHTS FROM DOUG

Pakistan now wants the world to pay for its latest flood. Climate change is the new scapegoat. The developed world is now financially responsible for any emerging market weather event.

Just in case you missed the hot news about ants: They’ll probably survive climate change.

To really understand climate change, maybe the best science to study is behavioral science. Pay particular attention to mass psychosis

In addition to so much else, we also have inflation in the cost of capital. Argh…

Now that Germany has nationalized a large gas importer, I’m wondering how long before the EU nationalizes most of their energy industry.

How easy will it be for Europe to execute a complete realignment of all their hydrocarbon-produced energy? Hydrocarbons represent 68.4% of European energy generation.

Russia will not likely be allowed back into the “nice guys” economy anytime soon. Europe and the US seem to stick a pin in China’s eye regularly. We seem to have lost collaborative and cooperative globalization. Today’s poor economic coordination and cooperation should be naturally inflationary. The just-in-time deflationary global economy seems long gone now.

I’m not sure the economic aftershocks of Russia invading Ukraine are well understood.

The US Preventative Service Task Force thinks all adults under the age of 65 should be regularly screened for mental health. Their focus is on anxiety. So what if someone has anxiety dealing with a government agency? Ever get pulled over for speeding?

How does increasing US interest rates fix supply chain challenges caused by the Ukraine war?

Back when Fed Chairman Paul Volcker tackled inflation in the 1970s, stocks bottomed out at a P/E of 8. Today, the P/E of stocks is about 16. Just sayin’.

THE ECONOMIC VIEW

A stronger dollar
Is not good for the global economy
Yet interest rates are rising all over

California tax receipts decline
NYC has $10B fiscal deficit
Canary in the coal mine?

Hot housing bubbles about to pop
Double digit value declines are coming.
As home goods retailers struggle

Construction spending is declining
Led by homebuilding, of course.
As mortgage rates rise measurably

THE INFLATION BOGEYMAN

Butter prices are soaring
Great, is margarine coming back?

FedEx raises rates 6.9%
Here comes service inflation.

Rents may have peaked
After an 18-month explosion.

Inflation hammers the middle class
Wages need to rise.
Is worker dissent on the rise?

THE LABOR VIEW

Bosses can spy with tech tools
Will this decrease productivity?
Bosses have productivity paranoia

People are returning to the office
But only around 50% so far.

Jobless rate is starting to rise
New England leads “the charge.”

MEANWHILE IN EUROPE

Corporate insolvencies jump in the UK
A snowball about to roll downhill?
While Truss pushes a free market strategy

Peaceful Sweden has a bombing problem
Two new ones happened this week
The unintended consequences of immigration.

Europe doesn’t understand essential energy
Many industrial companies may vanish.
Their farming industry is also threatened

THE NEW ENERGY TRANSITION

UK lifts ban on fracking
Time to drill baby drill.

They also want US LNG
Argentina wants more LNG exports
Oil & gas leads the new energy transition.

EU will move away from wood energy
Why are they burning wood for energy?!?

PLAYING WITH FIRE

Russians are protesting
After Putin’s new soldier call-up.

Russia orchestrates a sham annexation
While Europe eyes new sanctions

“How to leave Russia”
Google searches are soaring.

GLOBAL

Japan has a yen problem
Requires first intervention in 24 years.

The world’s largest exporters
A time series video.

North Korea approves preemptive nuke strikes
Does this ant have a big stinger?

A NEW WORLD ORDER?

NATO member joins China-led SCO
Can Turkey play both sides?

Mexico pledges to work with US
On semiconductors and EVs.

China is rolling over EM loans
Hoping the IMF comes to their rescue.

THE FINANCE WORLD

Jamie Dimon not happy with capital rules
Thinks they’re holding banks back.

Higher bond yields
Are not good for stocks.

Not enough Citrix debt buyers
Losses estimated at $600MM
Credit markets are tightening up.

Cash flow problems are showing up
At some big PE firms.

REAL ESTATE

Luxury home market deflates
It’s like crickets for buyers.

All those empty office buildings
May be turned into apartments

E-commerce warehouses spring a leak
Is this an overbuilt market?

TECHNOLOGY

The internet may be great
But it gives the state massive power

Silicon Valley’s golden age
Is it over?

The US warns Apple
Do not use Chinese chips.

THE CRYPTO MEME

Is Kraken crackin’?
Another crypto platform wobbles.

Crypto data center goes bust
Leaving $500MM in unpaid debt.

Stablecoin issuers own $80B of T-bills
Regulators need to understand their risks.
The crypto crisis has a credit problem

THE NEXT NORMAL

Tattooed employees are good for you
This research says so.

La Niña is behind this year’s weather
And will be behind next year’s, too.

Not everything in the US is contracting.
STDs are on the rise, says the CDC

THE WAR ON CARBON

The Great Leap Backward
The West mimics Mao Zedong.

Rare eagles are flying into wind turbines
Germany wants to use AI to save them.

There’s some bad news
About LED lights.

THE EV DREAM

A great copper squeeze is coming
As lithium prices soar
EV prices have to go up.

China seeks retaliation
Over US EV tax breaks.
South Korea also not happy

Charging EVs at night is not good
Concludes Stanford research.

THE CHINA SYNDROME

Chinese scientists are leaving the US
Were they also spies?

Biden pledges support for Taiwan
But the US may be unprepared
China is capable of a blockade

The countries that trade with Taiwan
Future allies in a war?

THE WASHING-TONE

Crypto regulation may be coming
White House has framed it up.

Student loan forgiveness
Is about to face legal challenges

Washington wants more chip plants
Wall Street says maybe not.

MAKING A BETTER YOU

Taming the mammoth
Stop caring what others think.

Want to reduce your blood pressure?
Just breathe deeply for 5 minutes a day.

27 decluttering tips
Or just download the app, Toss.

HOW ABOUT A BREAK

Who’s responsible for space junk?
Russia leads the pack.
It’s getting crowded up there

Is there life on another planet?
Today’s tech tools may tell us.

Homo sapiens and Neanderthals
The mutation that made us different

SONG OF THE WEEK

Background music
For sustained concentration.

VIDEOS OF THE WEEK

Here comes The Fablemans
By Steven Spielberg, about Steven Spielberg.

How the Titanic sank
James Cameron directs a CGI enactment.

The very first transit map
Was made by the Romans.

CASTING AROUND THE PODS

“Better Decisions, Fewer Mistakes”
Shane Parrish interviews LinkedIn co-founder Reid Hoffman.

FROM THE HEADHUNTER’S KITCHEN

The best chili recipe
No, this one is the best
No no, it’s this one
Oh heck, here are 17 recipes to try

The Michelin Guide’s top food cities
Tokyo beats Paris, hands down. Whoa!

The Bacon Bible
Where bacon is worshiped!

IN CASE YOU MISSED IT

China Preparing to Go It Alone
September 16, 2022

Democracy Is Now in Decline
September 9, 2022

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