The Middle Class Is Struggling

November 11, 2022
Leyendecker Executive Search

November 11, 2022

Rome wasn’t built in a day, but they were laying bricks every hour.
James Clear on habits and motivation

THOUGHTS FROM DOUG

António Guterres, the UN’s secretary general, just said: “We are on a highway to climate hell with our foot still on the accelerator.” What should we think about this statement coming from a lifelong politician, bureaucrat and member of Portugal’s Socialist Party? The guy has never had a job in the private sector.

Will the political canard of victimhood eventually unravel?

I’ll bet the big credit card companies can tell you the results of their customers’ purchases at the end of every day. We obviously have a broken election system if it’s going to take days, weeks or more to get all the results. Oh yeah…It’s a government-run system.

Because our economic policy has been so bad for the last forty years, we’ve depended on fiscal and monetary stimulus to keep the wheels on our economy. This constant fiscal and monetary stimulus provided a windfall of profit to financial asset owners. What, no windfall profits tax?!?

The problem with reducing wealth inequality is that the wealth effect has been the country’s primary economic engine since the day interest rates started declining. This graph suggests that the turning point was June 1981. Compare that graph to our federal debt to GDP graph. The cheaper the debt, the more you can borrow.

Climate guru John Kerry wants US companies to pay for other countries to wean themselves off carbon. If this happens, then we should expect our companies to pass those costs down to us.

There’s a lot of talk about inequality these days. I wonder when in the history of humanity any real equality has ever existed.

With Western leaders pounding the world to adopt climate change policies that will slow their economic growth, should it be a surprise that some countries are getting cozier with China and Russia? How can we turn them to “our” side? Bribe them, of course.

We probably all need to understand the illusory truth effect.

How many US citizens do you think pray for America each day?

THE ECONOMIC VIEW

Small business optimism
Is way below decades-long average.

The personal savings rate has collapsed
Where did all that “excess savings” go?
Credit card debt soaring again
Consumers keep spending: chart

The housing market
Is it worse than you think
Or better than you think

THE INFLATION BOGEYMAN

Inflation starts to ease
Good news!

The dollar has started declining
So commodity prices have started rising

Because of inflation and recession
Shoppers are trading down

THE LABOR VIEW

The middle class is struggling
As the jobs that built the middle class are in decline.

The US “white collar” recession
As the ax falls on middle management jobs.

The world’s new C-level job
Chief Remote Officer

MEANWHILE IN EUROPE

Europe doubles down on big government
Government dominates Europe’s “industry.”

Europe’s banks are pushing back
They’re not happy with ECB intrusion.

Maybe the EU sneaks through this winter.
But next year’s gas supply looks troublesome

PLAYING WITH FIRE

Russia withdraws from Kherson
I wouldn’t count them out yet.

Negotiations to end Ukraine war
May have started

Putin knows a big Western vulnerability
Our undersea communication cables.

Who is paying for Russia’s war?
Argh…China of course, and others.

WILL THE FIRE SPREAD?

North Korea fires up the artillery
South Korea scrambles its jets

Japan and Australia sign new security pact
The Philippines wants in, too
Is a good guys-bad guys world coming?

GLOBAL

China’s producer prices turn negative
Ominous sign for the global economy.

Is a Mexico-US trade war coming?
What? Who knew?

Egypt has a farming problem
Erratic climate is hard to understand.

A NEW WORLD ORDER?

Japan to sign military pact with UK
Preparing for the inevitable with China?

Egypt is going to build a nuclear plant
Russian company to build it.
While China builds Pakistan a refinery

China to send gifts to Solomon Islands
After Australia did.

THE FINANCE WORLD

CS to spin off investment banking
Is a new decoupling trend coming?

Japan used to be a big Treasury buyer
Now they’ve cooled on the market.

Is the Treasury market in trouble?
Mounting illiquidity isn’t good.
Higher rates are causing Fed losses
This graph tells the story

After every midterm since 1950
The stock market went up.
16%+ on average since 1962

REAL ESTATE

The housing boom went global
Now it’s in retreat.

Office developers hit pause button
Should they panic?

Apartment rents are starting to fall
But still contributing to inflation

TECHNOLOGY

TSMC eyes another Arizona chip plant
Micron to invest $100B+ in New York
More Made in the USA coming.

China locks down “iPhone City”
Reducing holiday iPhone inventory.
Apple most profitable company in China
But that may be history now

The pandemic-inspired tech boom
Is officially over.
Who killed the advertising boom?

THE CRYPTO MEME

He once joked about buying Goldman
Now his $16B fortune is gone.
What the heck just happened in crypto?
Wait, Binance backs out of their deal
Now the Justice Department is involved
Time to look at all FTX options
Bankruptcy around the corner?

Will a crypto “establishment” vaporize?
Crypto prices keep falling
How bad will the cascade be?

THE NEXT NORMAL

More Americans are moving to Mexico
A cheap work-from-home locale.

A school took away kids’ phones
They got smarter and happier.

People are paying big $ for water.
They’ve been taken to the cleaners

THE WAR ON CARBON

A net-zero carbon emissions gas plant
Is about to be constructed in Texas.

We’re not going to stop global warming
Unless we stop living normal lives.
OPEC projects oil demand growth through 2030

China doubles down on coal
Because they can’t ramp up green fast enough?

THE NEW ENERGY TRANSITION

Years of blackouts and shortages are coming
Squeezing Russian energy out has consequences.

Is Germany about to break its climate pledge?
And start supporting fossil fuels?

The Nord Stream pipelines are down.
So Europe buys more Russian LNG

THE EV DREAM

Volvo going all EV by 2030
They’re starting with an $80K car.

The copper needed for EVs
Isn’t so simple to get.
Some insightful facts about EV copper

THE CHINA SYNDROME

China’s exports and imports contracting
Their factories struggle to survive
Blame their draconian covid policies.
Are they pondering opening back up?
With covid cases at 6-month high?

China has secret police stations
Around the world.

American drug money laundering
May have been supported by China.

THE WASHING-TONE

CFOs not happy with Congress
Lobbying to ditch R&D tax rules.

If weather causes damage in other countries
We may have to pay for it.

Looks like Trump’s running again
Not much deters this fella.

MAKING A BETTER YOU

Stressed out?
Then go dig a hole

Clear writing
Means clear thinking

Learn from a Navy commander.
Turn the worst ship into the best ship

HOW ABOUT A BREAK

Stop licking those park toads
What some people do to get high.

Want to read a screenplay?
Here’s instant access to a bunch of them

37,000 deer survive
Thanks to daylight savings time.

SONG OF THE WEEK

Jesu, Joy of Man’s Desiring
An insane music engineering marvel.

VIDEOS OF THE WEEK

This guy has skills
How long did he practice?

Koreans make some smart movies.
Decision to Leave won Cannes’ best director.

Winter’s Watch
Ready for cooler weather?

CASTING AROUND THE PODS

The power of working together
The Knowledge Project with Shane Parrish and Alan Mulally.

FROM THE HEADHUNTER’S KITCHEN

Pie season is upon us…
Apple pie
Cherry pie
Blueberry pie
Pumpkin pie
Pecan pie
Banana Cream pie

Don’t forget savory pie!
Chicken pot pie
Shepherd’s pie
Tamale pie

Making pumpkin pie from scratch
The best of the best of the best.

IN CASE YOU MISSED IT

Economy Is Not in the Chips
November 4, 2022

Is Work Dangerous for Workers?
October 28, 2022

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