"We have wildly added to the fiscal pressures here by admitting several million
illegal immigrants who have few or no skills and thus have a negative net
contribution; that is, they cost more than they produce both in terms of
economic output and particularly their burden on state
and local budgets.  The only way to cut that off and its
inflationary impact is to expel all of them."

So Hell, Then....

Its what you're allowing and in fact demanding.

I don't care if you're a Democrat or Republican.

You're choosing Hell.

Right here, on Earth, right now.

You're allowing it, you're sponsoring it, you're endorsing it and you're smugly letting it approach at high speed.

What am I talking about?

This.

$1.695 trillion of deficits this year, up by $320 billion or twenty three percent in one year, a year in which Biden claimed he had "cut the deficit" from Trump's time in office and the Republicans held the House and rather than rein in spending granted Biden unlimited borrowing authority -- which he immediately used.

Rates are continuing to go higher because of this, and only this.

Net interest was $659 billion or roughly 39% of the entire deficit, it will keep climbing and, within a couple more years, be the entire deficit and more -- at which point the entire federal budget folds back and the market realizes that it is not fundable.

At the same time mortgages, car loans, credit card interest and all other forms of borrowing (and incidentally, all forms of insurance are borrowing even though you probably don't recognize that) have skyrocketed in cost and will continue to until and unless the deficit spending stops.

In a few more years rates on all sorts of loans will be in the double digits and lending will effectively stop.  If you are currently dependent on the capacity to "put it on your credit card" you will be forced to go without whatever that is, up to and including groceries, gas in your car and the electric bill.  Think not?  CRapital One is already charging more than 30% interest on some credit cards.

To those who say that corporations should pay "their fair share" the entire corporate tax burden was $522 billion so you would have to quadruple it in order to bring the budget into balance.  That would be very close to an effective 100% tax rate for many businesses and nobody in their right mind would run a business, nor would there be a price on a stock with an effective 100% tax rate.  The price and value of both is zero.

The excuse of Covid has expired; the pandemic is over.  Spending never went back down and in fact it advanced further, so spare me the lies from both the left and right about how we had to "help people" in a temporary situation.  Neither political party intended for anything to be temporary; that is now documented fact and anyone lending money now knows it and will not fall for that lie (and thus price interest lower) based on that lie again.

Spare me also the often-repeated claim that Social Security is the problem.  This year Social Security took in $1.020 trillion in taxes for the retirement fund and another $173 billion for disability.  Medicare took in $358 billion in taxes.

Medicare and Medicaid spent $2.147 trillion, or $1.789 trillion more than taken in from tax receipts and that understates the total because Medicaid is partially forcibly funded by the States as the "price" of accepting the program.  That is greater than the entire federal deficit and it is up by $80 billion over last year.  Since the pandemic is "over" so should be any excess spending directed at the most-vulnerable, that is the elderly and poor, but obviously it is not so those claims were lies as well.  Never mind all the "old and vulnerable" that Covid killed and since you can only die once that total should have, for several years, dropped precipitously.

Social Security spent $1.419 trillion and this year had a 15% operating deficit.  Of note is that Medicare and Medicaid were only 17% funded while Social Security is unfunded by approximately the same percentage.

The entire problem has been in the medical monopolies for the last three decades and still is yet both parties always accuse anyone attempting to address the issue as "intending to cut Social Security" and "throw Granny in the street."

There is no path for The Fed to come in and "rescue" the economy from this problem because the problem doesn't rest in the general economy.  The Fed cannot lower rates or tamper with the bond curve again without causing an immediate reflexive move higher in prices because the former outlets from this inflationary impulse have been exhausted: The expansion of global trade has ceased and we have sanctioned enough people that this means of sequestering the impulse has been closed off, never mind that China, which was one of the sinks for said impulse, is out of absorption capacity itself and facing both financial and demographic pressures that prevent it from turning that back on even if they wanted to, and they don't -- they've already stolen what they want to steal.

Is not a doubling of your food bill over the last few years enough?  How's your homeowners and car insurance cost looking?  Want more of that?  Every additional dollar of deficit spending will force those prices upward.

We have wildly added to the fiscal pressures here by admitting several million illegal immigrants who have few or no skills and thus have a negative net contribution; that is, they cost more than they produce both in terms of economic output and particularly their burden on state and local budgets.  The only way to cut that off and its inflationary impact is to expel all of them.

Corporate excess domestic private savings have been deeply negative since 2005 and while they showed signs of recovery in 2017 Covid put a stop to that and their negative trajectory has continued despite the end of the pandemic, with a record negative run rate that over the last several quarters indicates abject bankruptcy for corporations is around the corner.  As such trying to tax businesses is a waste of time as they have no surplus to tax and of course bankrupt firms lay off their staff which will force unemployment to skyrocket at the same time government has no available funds with which to help and in fact those bankruptcies will drop tax receipts making the deficit worse.

The extraction rackets of the last decade or so are emblematic of that graph and prove that for the most part the so-called "recovery" since the 2008 crash was a lie and worse, the actual indicator of it showed up in the beginning of 2005, two years before it all went to Hell.  All of it -- literally all -- was "funded" with inflated credit that anyone with two nickels worth of intelligence knew was unsustainable and would blow up in our face.  We are now roughly two years beyond when that trend dove last time except this time it is twice as bad.

Do you really think we won't get the same result -- times two or worse?

Speaking of personal tax receipts at both the state and federal levels they're falling.  How is this possible when we're told we have a "robust" economy and employment situation?

There is no "easy" way out of this. If we do not dismantle all of the medical monopolists right now, throwing those who refuse to obey 100+ year old that twice has been ratified at the Supreme Court in prison, and mean it, doing whatever we have to with those on K Street and elsewhere that cajole, wine, dine and bribe Congress and the Executive along with every single State Government in the Union -- not over the next five or ten years with some sort of alleged "reform" that is promised but never happens but rather right here, right now -- along with cutting off all the freebies and slamming every illegal alien's fingers in the door we are headed for fiscal and shortly thereafter social and civil collapse.

Oh those nice illegals will be happy to help with that collapse too and I'll lay odds they'll go on a crime spree making Al Capone's look like a bedtime story; they have plenty of experience with that in their origin nations and zero national pride in our country -- right?

Think I'm wrong?  Go look over in Europe where they threw open the door and what happened there.  Sweden anyone, which now has the highest per-capita rate of rape in Europe.  That's ok with you, I presume?  Your wife, daughter -- or you, if you're the female half of the population -- are good with challenging Sweden for the title in that category, yes?  After all its only 59% of the rapists in Sweden that were, according to a fairly recent study, migrants despite being a much smaller percentage of the population.

Now add to that rate the fact that Sweden's economy is, thus far, in pretty good shape.  Take ours and trash it which is inevitable if we don't solve this problem right here and now; what do you think all those who have no employable skills will do when the "free stuff" dries up?

This isn't a political argument.

It's a mathematical statement of fact, exactly as it was 10+ years ago when I wrote Leverage and which has been ignored by both sides of the aisle, the media and virtually everyone in America since.

Here it comes.

(read more)