A Four-Day, $80 Billion Bender

A Four-Day, $80 Billion Bender

Meanwhile, from the "I'm compelled to mention" files. Constrained as I am by the finite number of hours in a day and, perhaps more germane, constrained as readers are by humans' finite capacity to absorb information, some things worth mentioning get left behind during any given week. Years ago it occurred to me that if I can only read, say, a dozen articles in a day, the average person's quota is likely much lower. That prompted an editorial shift in favor of incorporating incremental informati
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2 thoughts on “A Four-Day, $80 Billion Bender

  1. The excess savings of the world have to be mopped up — usually by the country with the reserve currency — the United States. The excess savings is not from the factory or service workers of China or Vietnam, Singapore, German, U.S. or “pick your country”. Nearly a majority of the population of each country cannot afford a unexpected $500 bill. The savings is from those that cannot spend as much as they make. Call it the top 5% or the top 1%.

    The United States was able to accommodate the hoard of incoming cash during 2000-2007 with the housing bubble. “Give us your money and we will give you paper called mortgages.” Obviously credit-worthiness of the home-owner at the time had no meaning.

    Now the U.S. meets the demand with its newly minted junk bonds, SPAC’s, high-priced equities, newly issued stock, and housing (again). Credit worthiness of the issuer has no real meaning as before. The rising flood of cash coming into America requires a huge mop and Wall Street provides it. Is one to throw their money into Chinese junk bonds or Chinese equities? I think not… Treasuries? Not if you want to beat inflation.

    Maybe the American worker is no longer a willing participant. Now the worker may be saying, “Hey if you want me to work, give me some of the excess saving from the rich of the world by paying me a higher wage.” Maybe. It will be interesting if this is what breaks the system of low worker pay and high return to the owners of capital as has been in place since the 1970’s.

    A young friend of mine was contacted by Chase (the bank) and offered a job. My young friend throw back a number that was 50% higher salary than his current wage — and put him firmly into a 6-figure category. Chase answered “Yes — when can you start?” He responded, “Give me a couple of weeks to think about it.” Since the job required pressed pants, collared shirts, and on some days, a tie, he had to contemplate whether the change is worth it as compared to working in boxer shorts and wearing a t-shirt of his favorite band while working at home. The world is changing — but probably not fast enough.

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