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| Home / College Guide / The BOOM Thesis on Inflation — The Economic Future in Advanced Economies — T |
| Posted on Sunday, June 20 @ 00:00:07 PDT |
BOOM FINANCE AND ECONOMICS “Reading BOOM is the best 10 minutes I spend every week. It keeps me informed, being full of true information, and keeps me motivated†— Peter Underwood – ‘Austrian Peter’ — UK Correspondent for The Burning Platform
Link: https://www.theburningplatform.com/author/austrian-peter/
BOOM seeks out the very best information from authoritative sources and strives for consistency in its quality and trustworthiness. In evidence of this, BOOM has developed a loyal readership which includes many of the world’s most senior economists, central bankers, fund managers and academics. We strive to always have good relationships with our readers. If you want a real edge in understanding the complex world of finance and economics, subscribe to BOOM as a Follower on LinkedIn or as a Subscriber (Free) to the BOOM Newspaper at http://boomfinanceandeconomics.com/#/
THIS WEEK’S EDITORIAL
THE BOOM THESIS ON INFLATION
BOOM’s primary thesis on inflation — Persistent and troublesome high CPI inflation is not coming back in the foreseeable future in the advanced economies because there are just too many dis-inflationary forces in abundance.
These include cheap goods from China, Vietnam, India, Cambodia, Africa plus cheap energy, cheap labor, cheap robotics, increased efficiency from computerization of just-in-time supply chains, cheap commodities and aging demographics (more old people than young people).
Also, in the advanced economies, there is no wages growth pressure occurring and those economies are also overwhelmingly services based. Advanced economies increasingly do not manufacture goods, they import them from emerging economies and from China. Many of the advanced economies are based 70 – 80 % upon the provision of services.
So BOOM is in the “higher CPI inflation is transitory†camp which is what the Federal Reserve in Washington DC is saying. Interestingly, the advanced economy bond markets seem to be agreeing. Many bond prices are slowly but surely rising since Mid March. This implies that long term interest rates (especially mortgage rates) are not going to rise significantly anytime soon.
Many people disagree. They think that increases in the fresh new money supply from Quantitative Easing programs will inevitably cause CPI inflation. And they point to rising commodities prices as evidence of this.
Commodities that have been rising strongly in price include Lumber, Copper and Iron Ore in particular.
Let’s look at the prices of those three key commodities.
COMMODITY PRICE RISES
The price of Copper in US Dollars has more than doubled since March 2020. However, it appears to have surged to a peak on May 10th. And since then it has fallen by 15 %.
The price of Lumber has quadrupled over the last 12 months and doubled in just 2 months from March 2021 to May 10th. But it also peaked then and has been falling ever since. It is now down 48 % since that peak date.
Iron Ore prices are holding at present but they appear to have perhaps also peaked in the Futures market on May 11th. However, the big global Iron Ore companies have seen their shares fall decisively since May 10th. BHP, RIO and VALE have all started to decline. Notably, the shares of BHP and RIO are down 15 % since that date. BOOM is expecting further significant falls in the shares of those companies.
So what has happened? BOOM looks to China. That nation is principally a manufacturer of goods for export. It has a relatively slim services sector. Thus, its economy is very much more sensitive to CPI inflationary pressures.
And the prices of its manufacturing inputs have been surging over the last 12 months as it has gone on a buying spree to stockpile those inputs. Coal, Iron Ore, Copper and other base metal prices have surged as a result.
On 9th June, it was revealed that China’s factory gate prices increased at the fastest pace since September 2008. The producer price index (PPI) rose 9.0% from a year earlier in May, according to a statement from the National Bureau of Statistics. This is a sharp increase and suggests that CPI inflation may follow in China in the months to come.
And on May 25th, China announced that it will strengthen price controls on iron ore, copper, corn and other commodities in its five-year plan from 2021 to 2025 to address abnormal fluctuations in prices. China will also improve its monitoring and forecasting systems for major commodities and strengthen price controls for important goods such as grain, meat, eggs and vegetables according to the National Development and Reform Commission (NDRC).
Price controls have been used in previous periods in China. Being a centrally controlled economy, this is theoretically easier to police in China compared to other nations. However, the success of such price controls this time will be critical to watch.
China also announced that it will also stick to the minimum purchase price policy framework for rice and wheat. Extraordinary food price rises are intolerable when you are trying to feed 1.5 Billion people.
THE ECONOMIC FUTURE IN ADVANCED ECONOMIES
As BOOM has said before, welcome to the world of low economic growth and low CPI inflation in the advanced economies along with massive central bank ownership of all asset classes and endless asset price inflation. That world will slowly begin to resemble the ancient world of feudalism and peasantry. The rich will get even richer. The poor will get even poorer.
Eventually, it will end in social unrest and political instability. When that will happen is very hard to predict. However, the loss of faith in governments and large institutions during the Covid crisis during the last 12 – 15 months is possibly the beginning of that process. More and more people have become suspicious of their governments and their regulatory institutions.
Let’s examine that in regard to the Covid phenomenon.
THIS IS A BIOWEAPON BY EVERY DEFINITION — DR RICHARD FLEMING
QUOTE: “ This is a man-made Gain of Function virus paid for by US Taxpayer Dollars including monies that came from the US Department of Defense.
THIS IS A BIOWEAPON BY EVERY DEFINITION.â€
“Dr Mengele is right now rolling over in his grave wondering why he could not have the capacity to do this type of human manipulation. Right now this vaccine rollout is the largest research project conducted in the history of mankind. You are either part of the experimental group or part of the control group. For anybody to be forcing or coercing anybody to take this vaccine ……. “
“To give this to our children ….you are injecting a Bioweapon into the arms of our children “. UNQUOTE
LINK: https://rumble.com/vh0b0j-is-covid-19-a-bio-weapon.html
THIS IS BIOTERRORISM — THEY ARE BIOWEAPONS — PROFESSOR PETER McCULLOUGH
Dr Peter McCullough is an internist, cardiologist, epidemiologist, and Professor of Medicine at Texas A & M College of Medicine, Dallas, Texas. He has described the Covid Vaccines as Bioweapons. He is very concerned about mandated Covid vaccinations. BOOM strongly recommends this short video. You will see a passionate Doctor of Medicine who is clearly concerned greatly about the risks attached to the Covid injections . “It is not a safe productâ€.
Listen carefully —
LINK: https://rumble.
com/vhp8e1-massive-world-renowned-doctor-blows-lid-off-of-covid-vaccine.html
“THE SPIKE PROTEIN IS VERY DANGEROUS†— JUNE 15TH 2021
The Covid Vaccines that are currently being used worldwide deliver genetic material to the cells of your body and trick them into producing large amounts of Spike Protein. This effectively turns your body into a Spike Protein factory. That technology is called mRNA technology.
Dr. Robert Malone is the inventor of mRNA Vaccine technology . In an interview last week on YouTube with Brett Weinstein (who has a Ph D in Evolutionary Biology) and Steve Kirsch (a high tech entrepreneur), he said this —
Brett Weinstein: “The Spike Protein itself is very dangerous, cytotoxic. Is that a fair description?â€
Dr Robert Malone: “More than fair. And I alerted the FDA about this risk months and months and months ago. We had a discussion about it.â€
Malone: “So, just to nail the point home, they did know. I did send them the manuscripts. Their determination was — they did not think that was sufficient documentation of the risk that the Spike was biologically activeâ€.
Weinstein: “We now know the Spike protein is biologically activeâ€.
Malone: “Yes, it is biologically active†(nodding in agreement).
Malone: “I’m a regulatory professional and I do talk to the FDA and I have good friends there in senior positions. They were aware, back when we were doing randomized clinical trials, that adverse events were occurring; many of them were oddly delayed and atypical for a vaccine trial.
This is totally new technology. That gets at the core. One of our problems here is the assumption that this is like every other vaccine we have ever seen. And it’s not. It’s very different technologyâ€.
SHORT VIDEO LINK: https://www.youtube.com/watch?v=Du2wm5nhTXY&t=22s
LINK: https://www.youtube.com/watch?v=Du2wm5nhTXY&t=407s
FULL VIDEO ON BITCHUTE — 3 HOURS
The full video is over three hours long and is highly scientific and technical in its subject matter, dealing with the Covid phenomenon. If you are worried about what you are being told, watch and learn.
LINK: https://www.bitchute.com/video/SjOH3w7AVXFq/
WEINSTEIN: “Everybody who is getting these vaccines is part of an experimentâ€.
MALONE: “This morning I called some friends at the FDA again and talked to them about the databases and their analysis.
I wanted to check if I wasn’t mis-understanding or mis-representing. They used words like “its chaotic, its disorganized. They are not analysing the data sufficiently, they are understaffed, they are overwhelmedâ€.
Further more … (on VAERS) it is self reported. We don’t do this in a clinical trial. We evaluate EVERY single adverse event. “
“They have authorized wide distribution of an experimental productâ€.
In regard to the adverse events data — “What we have is almost worthlessâ€.
“The vaccines are gene therapy technology and are producing Spike Proteins in cellsâ€
“I don’t know how else to say itâ€. “It is a re-tooled gene therapy method applied to vaccinesâ€
KIRSCH: “The deaths and adverse events reported for Covid Vaccines so far are more then the combined deaths and adverse events from all other vaccines over 30 yearsâ€
SHOULD YOU GET VACCINATED?
Steve Kirsch — “I always get vaccinated. I have been fully vaccinated with the Moderna COVID vaccine. My three daughters have all been vaccinated.
I recently learned that these vaccines have likely killed over 25,800 Americans (which I confirmed 3 different ways) and disabled at least 1,000,000 more.
And we’re only halfway to the finish line. We need to PAUSE these vaccines NOW before more people are killed.â€
Should you get vaccinated? “What I find deeply disturbing is the lack of transparency on how dangerous the current COVID vaccines are. Healthy people could end up dead or permanently disabled at a rate that is “off the charts†compared with any other vaccine in our history. Look at the death report in our government’s official Vaccine Adverse Event Reporting System (VAERS) summarized in the tweet below. This is the most deadly vaccine we’ve ever made by a long shot. That’s why they have to give you incentives to get vaccinated. They need to vaccinate everyone BEFORE people read this article or watch this video of Dr. Peter McCullough explaining clearly why the current COVID vaccines are unsafe and completely unnecessary for our children.â€
Now let’s look at the dosing of the COVID genetic vaccines (mRNA, recombinant adenovirus) versus the more traditional vaccines (including Novavax). There are some inconvenient truths here.
DR ROBERT MALONE SPEAKS OUT ON LINKEDIN
QUOTE — “ First, the current genetic vaccines (Sanofi, J&J, Pfizer, Moderna) did not undergo the time tested assessments of dose ranging and dose timing clinical studies, to the best of my knowledge.
I have direct first person report of how the dose was selected for Moderna (confidential source), and it was basically a SWAG by committee consensus — (Editor — a Scientific Wild Ass Guess) .
Personally, for what it is worth, it is my opinion that the current mRNA vaccines selected a dose that was too high, too far up on the sigmoidal dose response curve – so that we may have excess adverse events. Dose selection with vaccines is usually about careful balancing of adverse events with potency/efficacy/effectiveness, with a bias towards safety.
Second big inconvenient truth is that the spike protein is the actual active agent, in terms of eliciting an immune response. And in the case of the traditional vaccines, the dose of spike protein is defined relatively precisely. With the genetic vaccines, it is not (to the best of my knowledge). I know of no data wherein the mean, median, range etc of total amount of spike protein produced in a patient after administration of the COVID genetic vaccine has been defined. Usually, the FDA is quite persnickety about such things, but I am not aware of this key variable having been determined. Therefore, the range and severety of adverse events potentially attributable to the level of expressed spike protein may reflect patient to patient differences in genetic transfer efficiency and subsequent spike expression.
#Science #Data #honestyisthebestpolicy #Transparency #evidencebasedmedicine †— UNQUOTE
JOHN GOSS REPORTS
Up to date reports on global Covid Vaccine Adverse Reactions (including death numbers) can be found here
LINK: https://johnplatinumgoss.com/
A MATTER OF URGENCY DR ROGER HODGKINSON
Dr. Hodkinson Interview – COVID-19 Vaccines, Infertility & Spike Protein Dangers
LINK: https://johnplatinumgoss.com/2021/06/13/a-matter-of-urgency/
AND https://www.thelastamericanvagabond.com/dr-hodkinson-interview-covid-19-vaccines-infertility-spike-protein-dangers/
LOCKDOWN SCEPTICS
LINK: https://lockdownsceptics.org/2021/06/15/vaccine-safety-update-5/
ARE THE COVID VACCINES “SAFE AND EFFECTIVE� LINK: https://trialsitenews.com/are-the-covid-19-vaccines-safe-and-effective/
In economics, things work until they don’t. Until next week ………… Make your own conclusions, do your own research. BOOM does not offer investment advice.
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HOW MOST MONEY IS CREATED
BANKS CREATE FRESH NEW MONEY OUT OF THIN AIR (but they always need a Borrower to do so) THERE IS NO SUCH THING AS A DEPOSIT
BANKS PURCHASE SECURITIES, THEY DON’T MAKE LOANS
BANKS DON’T TAKE DEPOSITS, THEY BORROW YOUR MONEY
Watch this short 15 minutes video and learn as Professor Richard Werner brilliantly explains how the banking system and financial sector really work.
https://www.youtube.com/watch?v=EC0G7pY4wREhttp://
How is Most New Money Created ?
LOANS CREATE DEPOSITS — that is how almost all new money is created in the economy (by commercial banks making loans).
From the Bank of England Quarterly Bulletin Q1 2014 —
“Whenever a bank makes a loan, it simultaneously creates a matching deposit in the borrower’s bank account, thereby creating new money . “
“Most money in the modern economy is in the form of bank deposits, which are created by commercial banks themselvesâ€.
Youtube Video — https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/money-in-the-modern-economy-an-introduction
and
https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/money-creation-in-the-modern-economy
Paper: Money in the Modern Economy PDF — CLICK HERE
Quarterly Bulletins Index
http://www.bankofengland.co.uk/publications/Pages/quarterlybulletin/2014/qb14q1.aspx
Most economists are unaware of this and even ignore the banking & finance sectors in their econometric models.
On 25th April 2017, the central bank of Germany, the Bundesbank, released a statement on this matter —
“In terms of volume, the majority of the money supply is made up of book money, which is created through transactions between banks and domestic customers.
Sight deposits are an example of book money: sight deposits are created when a bank settles transactions with a customer, ie it grants a credit, say, or purchases an asset and credits the corresponding amount to the customer’s bank account in return. This means that banks can create book money just by making an accounting entry : according to the Bundesbank’s economists, “ this refutes a popular misconception that banks act simply as intermediaries at the time of lending – i.e. that banks can only grant credit using funds placed with them previously as deposits by other customersâ€. By the same token, excess central bank reserves are not a necessary precondition for a bank to grant credit (and thus create money).â€
Reference: https://www.bundesbank.de/Redaktion/EN/Topics/2017/2017_04_25_how_money_is_created.html
The Reserve Bank of Australia (Australia’s central bank) has also contributed to the issue in a speech by Christopher Kent, the Assistant Governor on September 19th 2018.
“…… the vast bulk of broad money consists of bank depositsâ€
“Money can be created …….. when financial intermediaries make loans “
“In the first instance, the process of money creation requires a willing borrower.
â€
“It’s also worth emphasizing that the process of money creation is not the result of the actions of any single bank – rather, the banking system as a whole acts to create money .â€
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