top... men
I have this niggling suspicion that this whole COVID-19 pandemic was ginned up deliberately by a group of people who are going to take advantage of the chaos they created to make a killing, financially speaking. I am not sure it is even a cohesive group, it might just be that several people saw the same opportunity and simultaneously acted on it, and once the panic started they realized their plan was working better than they could have hoped, and they started shoveling more manure onto the fire on the theory that while a small disaster would give them a small advantage, a big disaster would give them a big advantage. Manure burns, and in this case it is the perfect fuel for this conflagration.
Some of it I can understand. Shutting down the economy is going to cause numerous businesses to fail. The creditors will gain possession of the remains and once things get back to 'normal', they will own outright a whole swath of the business world. Since everyone who was working at those businesses will be desperate to go back to work, they will be able to hire them back at reduced wages. We will have to wait and see whether they will be able to get all those businesses up and running again. I suspect they will because desperate people can easily be persuaded to become slave drivers.
The two trillion dollar stimulus package, though, I don't quite understand the rational for that. Yes, a large number of people will no doubt be grateful for the check with the Donald's signature on it, and it might help Trump get reelected, but I don't see how anyone is going to make any money off it. What it will do it is bump up the rate of inflation, probably by 5 or 10 points. It should make investors leery of buying treasury notes. The US has dutifully been paying interest on the trillions of dollars we've borrowed, but our total debt just took a big hike. And all those oil rich nations who used to be the biggest purchasers of US debt aren't going to be buying much of anything since the price of oil collapsed.
People are going to put a political spin on it, some people will blame Trump and some will blame the democrats, but I don't think they had anything to do with it. They might have thrown more fuel on the fire, but they didn't organize this disaster, they are just along for the ride along with everyone else. I just wonder what things are going to look like this summer.
Well, Christmas came early for the environmentalists of Washington State, Whatcom County, and especially the greenies of the City of Bellingham. Buried in Alcoa's quarterly report was the statement:
ReplyDelete"Announcing the curtailment of the remaining 230,000 metric tons of uncompetitive smelting capacity at the Intalco smelter in [Ferndale] Washington State as part of continuing portfolio review."
So they're shutting the place down after 54 years. I'm not sure what makes it uncompetitive, aside from the generally anti-business, pro-union, pro-radical environmentalism of the state. Not to mention the federal government monopoly on Columbia River electricity. (DIRT + ELECTRICITY = ALUMINUM) Plus high minimum wages, and high business taxes. Plus a long term county moratorium on industrial construction projects.
Unfortunately, my sister-in-law is one of the 700-or-so employees who will be unemployed as of the end of July.
Next two targets: BP and Conoco-Philips refineries.
Anon, last fall the demand and price for Aluminum was way down. I don't imagine with China slowing down, and Trump's trade war, it will bounce back very soon. Condolences to your sister-in-law I've been there done that when Westinghouse closed our plant. It sucks.
ReplyDeleteWelcome to the world of negative interest rates from banks and government bonds.
xoxoxoBruce: I totally agree with your market assessment. What's unfortunate in this situation is that the "uncompetitive" nature of the Intalco operation is almost entirely the work of politicians. Maybe that's what happened to Westinghouse too? We've seen this coming for twenty years. There were non-stop discussions with "our representatives" to stop the anti-business onslaught, all to no avail. Will "our representatives" be pilloried for their total lack of empathy? And for their failure to protect a large employer from the thugs and parasites? Not at all. Blue-color jobs don't count in this state. Especially in "dirty" industries. Perhaps somebody who is better connected is standing by to buy up those 300 megawatts at bargain prices. Perhaps the property will be sold and turned into a pot farm. Or a data center. And to really beat a dead horse, let us remember that many of those 700 employees have families, homes, cars and living expenses. They represent a significant proportion of the county population and their contributions to the local economy will evaporate. All so Bellingham can have more parks, Seattle can have more bike lanes, and Olympia can feed its purple SEIU hog farm.
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