Good Morning Kids. Sure the horrendous jobs report is nothing to gloss over. But with trillions in monopoly money dumped into the economy over the past several years, along with massive borrowing and on top of it, a welfare state and open borders, and the decision to destroy a major foundation of the traditional American economic miracle, the petrochemical industry, is it any wonder that the markets in Japan and elsewhere are tanking right now with the prospect of Kamala Harris being given the car keys, or bus keys to an exploding electric bus. Yes, the epicenter of the current tanking is Japan but the ripple effect is immediate. Irnic that today is Hiroshima anniversary day.

For the last three years, it has felt as if markets were waiting for the other shoe to drop. Today, many believe that it has finally done so. Japanese markets crashed on Friday, and even more on Monday; the Topix plummeted 13 percent, a drop not seen since 1987. Global markets followed suit. One might write this off as just another day of volatility. The worry, though, is that this is something much worse: the start of a bear market and a long-feared recession. It’s too soon to tell; markets have been jittery for a long time. But the turmoil does show that we have become over-reliant on monetary policy as the solution to our economic problems.

Since the pandemic, markets had risen—a lot. The S&P 500 was up, just last week, 133 percent from its pandemic lows. Its strength mainly owed to the Magnificent Seven tech stocks. Even if you think that artificial intelligence will be the greatest thing ever to happen to the United States economy, such high valuations this early in the innovation cycle are hard to justify. It also seemed unlikely that inflation would be defeated without a significant slowdown; a soft landing had never happened before.

Despite all these concerns, markets mostly kept climbing, and the economy remained strong, though it never felt completely secure. A recession always seemed in the offing, once something finally broke. Perhaps it has now.

Still, the great Milton Friedman was right, you cannot have a welfare state and open borders. Yet, as I touched upon at the outset, that's just the tip of the iceberg of radical egalitarian socialism/communism whose home is the anti-American Left and Democrat party, and businesses that go along to get along.

Why do our Democratic friends keep wrecking the economy?

It all comes down to the binary of gifting your supporters and going to war against the enemy. So every Democratic administration decides to throw more money at free health care and maybe start a war.
It’s odd how often our Democratic friends start a war right after a presidential election: Woodrow Wilson in 1917, FDR in 1941, Harry Truman in 1950. And LBJ waited until 1965 to really crank up the Vietnam war.

You and I think about the economy: our jobs, careers, getting inflation down and growth up. But politicians don’t. They think about heroic deeds, like bashing the Kaiser, taking out Hitler and Tojo, sorting the Commies, and “tackling” climate change. Why do they do it? Because wars are what rulers do. They can tax and spend and inflate to their hearts’ content, and if all the taxing and spending and inflating impoverishes the people, well, it’s all in a good cause: saving the world.
And when there’s no war, then politics is all about taxing the rich and helping the poor. . .

Let’s look at things another way. Suppose there was no climate change to fight. Suppose there were no oppressed peoples. Do you see the problem? There would be nothing for national governments to do. There would be nothing for headline politicians to do. There would be nothing for devoted activists to do. There would be nothing for government bureaucrats to do.

NOTE: The opinions expressed in the links may or may not reflect my own. I include them because of their relevance to the discussion of a particular issue.

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