GDP is now $28.3 trillion

 Current‑dollar GDP increased 4.8 percent at an annual rate, or $327.5 billion, in the first quarter to a level of $28.28 trillion. https://www.bea.gov/news/2024/gross-domestic-product-first-quarter-2024-advance-estimate

Debt to the Public is today $27.46 trillion, so the ratio is 97.0%.

I just recently started tracking this ratio.  On October 26, it was 96.0%, so this is growing about 2.0% per year.  

We haven't hit 100% yet, but at the current rate we should hit it in about 1.5 years, by about October 2025.

Fake Space News of the Day

 Sorry but I believe that almost all news about Outer Space is fake.

Voyager 1 supposedly launched on September 5, 1977 and is now supposedly outside the solar system and about 15 billion miles from the Sun.  (By way of comparison, Jupiter is 465 million miles from the Sun).  The news is that this 46 year old space probe had a hardware failure.  NASA scientists were supposedly able to remotely diagnose the problem (a defective memory chip in the flight data system) and upload a firmware patch and correct the problem.

See https://hackaday.com/2024/04/22/nasas-voyager-1-resumes-sending-engineering-updates-to-earth/

The firmware patch that got sent over on April 18th contained an initial test to validate the theory, moving the code responsible for the engineering data packaging to a new spot in the FDS memory. If the theory was correct, this should mean that this time the correct data should be sent back from Voyager. Twice a 22.5 hour trip and change through Deep Space and back later on April 20th the team was ecstatic to see what they had hoped for. With this initial test successful, the team can now move on to moving the remaining code away from the faulty memory after which regular science operations should resume, and giving the plucky spacecraft a new lease on life at the still tender age of 46.

IMF warns of Fiscal Slippages

Read:   https://www.imf.org/en/Publications/FM/Issues/2024/04/17/fiscal-monitor-april-2024

I have never heard of the term "fiscal slippage" until today.  It seems to be a euphemism for "excess spending".   Maybe if we see it in a sentence it will make more sense.

Furthermore, the risks of fiscal slippages are particularly pronounced this time around. 

Empirical evidence points to a bias toward fiscal slippages in elections years. 

The risks of fiscal slippages are particularly acute given that 2024 is what is being called the “Great Election Year”: 88 economies or economic areas representing more than half of the world’s population and GDP have already held or will hold elections during the year. Support for increased government spending has grown across the political spectrum over the past several decades, making this year especially challenging, as empirical evidence shows that fiscal policy tends to be looser, and slippages larger, during election years.

Election years are often associated with fiscal slippage, and this risk is further amplified by the current context of increased demand for social spending.

In 2023, the United States experienced remarkably large fiscal slippages, with the general government fiscal deficit rising to 8.8 percent of GDP from 4.1 percent of GDP in 2022, despite strong growth. 

Empirical evidence shows that fiscal policy tends to be looser, and slippages larger, during election years, reflecting a “political budget cycle.”

The analysis further shows that realized deficits are higher than their year-ahead projections by 0.4 percentage point of GDP , indicating a considerable risk of slippages to the modest fiscal tightening projected for most economies in 2024. Such fiscal slippages could potentially add to inflationary pressures, especially in overheated economies. 

Although gradual fiscal tightening is projected to resume in 2024, the risks of fiscal slippages are particularly acute during this “Great Election Year” when numerous elections will be held in countries across the world.

Fiscal slippage. A situation where a government’s actual fiscal performance deviates from its planned or targeted fiscal targets, usually resulting in higher-than-expected budget deficits, increased public debt, or a combination of both.

I think the IMF needs to learn about the Magical Money Tree, and stop worrying.  Fiscal slippages are not a problem because money appears like magic to pay for them!

Never Gonna Let You Go

 

Source: https://www.youtube.com/watch?v=LbNugxHdggs

Pollard's Lessee v. Hagan

 Read: https://supreme.justia.com/cases/federal/us/44/212/

Pollard's Lessee v. Hagan is an 1845 US Supreme Court case.

For some reason, I am suddenly fascinated with the ownership of land in Mobile Alabama that was below the usual high water mark.  This case is interesting because it is very confusing from a factual perspective and also the issue isn't clear.  And it seems that it overturned two previous cases that were very similar.  The dissent may have gotten this right.  I don't have time to brief this but it would be interesting to do so.

Here is a link to a YouTube video about the case that is also not very enlightening, and talks more about the Equal Footing doctrine (which I don't care about):

 https://www.youtube.com/watch?v=-QpqDa24OXo

I want to know why the Plaintiff, who had a land patent from the US government, lost.

So mark this up for somebody to research when they have time.

Fascinating Mississippi Supreme Court case

 Read: https://law.justia.com/cases/mississippi/supreme-court/2024/2022-sa-01088-sct.html

Issue: Whether a 1784 land grant from Spanish King Charles III was valid.

Holding: Yes.

Reasoning:  The case of Cinque Bambini P’ship v. State, 491 So. 2d 508, 511(Miss.  1986) does not apply because it dealt with a Spanish land grant of 1813, which was after West Florida, south of the 31st parallel, became part of Mississippi Territory in 1812.

The cases of: Pollard v. Hagan,  44  U.S.  212,  11  L.  Ed.  565  (1845),  and Henderson v. Poindexter’s Lessee, 25 U.S. 530, 6 L. Ed. 718 (1827), also do not apply because they dealt with land north of the 31st parallel, which became part of the US in the 1783 Treaty of Paris.  Spain initially disputed the boundaries, but it agreed that the 31st parallel was the dividing line in the 1795 Treaty of San Lorenzo.

However, the ownership of the land below the 31st parallel is more contentious.  The history is detailed in the cases US v. States of La., Tex., Miss., Ala. &Fla., 363 U.S. 1, 80 (1960) and US v. Louisiana, 382 U.S. 288, (1965), and they refer to the cases of Foster v. Neilson, 27 U.S. 253, (1829), overruled by United States v. Percheman, 32 U.S. 51,  (1833).

The ownership of the land in question was passed to Spain from Great Britain by a treaty dated Sept 3, 1783.  By the Treaty of San Ildefonso in 1800, France acquired it, and finally in the 1803 Treaty of Paris, the US acquired the land from France.  Since Spain owned the land in 1784, the land grant is clearly valid.

Hat tip: https://reason.com/volokh/2024/04/11/private-landowner-in-mississippi-beats-state-based-on-interpretation-of-1784-spanish-land-grant/

See also:  https://history.state.gov/milestones/1784-1800/pickney-treaty

Gold just hit $2400

 

The price of gold today (4/12/24) is at $2410.  It first hit $2300 on April 4, only 8 days ago.  It hit $2200 on March 27, I think, and $2100 on March 4.   The $2000 mark was much earlier, on Oct 27, 2023.

I don't think it will continue to go up at this rapid pace, but it will continue to go up, and we will celebrate each $100 increase.

Treasury Yields up 2.7% per month since December

 

Ok, this is a little misleading.  The value of a Treasury goes down when yields go up, so to be clear this is not measuring the value of a Treasury (which is a bad investment at the moment).  Also, this is the relative change, not the absolute change.  If a yield is 4% and it goes up by 2.5%, it become 4.1%, not 6.5%.   I am just making the point that I see a trend that is in line with other commodity prices.

So on 12/13/23, the yield on a 10-year treasury was 3.96%.  I will convert it to a number, 396.  On 4/11/24, the yield is 4.54%, or 454.  So it has gone up 14.6% in 5 months, or about 2.77% per month.   Will this continue?  Probably not, but it is a trend I am seeing at the moment.

DJIA up 2.5% per month since October

 

Starting on 10/20/24 it was at 33127.  Today, 4/10/24, it is at 38492.   That is an increase of 16.2% in under 6 months.   This is in line with other data, and it means the dollar is rapidly losing value.

Federal Reserve Annual Report

 The last time I reported on the Federal Reserve was in a blog post called What is the value of a dollar . As of 9/30/23, the Federal Reserve had assets measured at FMV of $6.787 trillion (including deferred asset of $106 billion) as opposed to liabilities and equity of $8.195 trillion, for a loss of $1.408 trillion.

They have now produced their annual report for the year ending 12/31/2023, and their SOMA assets show a FMV of $6.524 trillion and face value of $7.472 trillion for an unrealized loss of $948 billion.  Their deferred asset account has $133 billion.  So total unrealized losses are $1.081 trillion.  The total balance sheet as of 12/31/23 was $7.836 trillion.

So on a fair value basis, they earned $327 billion for the quarter, which is better than a loss.  But the deferred asset account increased by $27 billion.  This is really a disguised loss.  So the Federal Reserve is still losing money, benefitting the big banks and to the detriment of taxpayers.

Deficit of $236 Billion in March 2024

 See: https://www.cbo.gov/system/files/2024-04/60115-MBR.pdf

The FYTD deficit is $1,064 billion and it less than it was one year ago, when the FTYD deficit was $1,101 billion. Net interest expense for March was $80 billion, and in March 2023 it was $68 billion, so this is up 18%.

On 3/29/2024 the total national debt was $34.586 trillion, and one year earlier on 3/31/23 it was $31.458 trillion, so this increased 9.9% in one year.

Silver is up 2.5% per month since October

 

On 9/26/23, silver was at 23.20.  That is the data I am starting from, and ignoring the valley on 10/5/23 when it dropped to 21.02, and ignoring the peak on 12/1/23 when it hit 25.86.  Today, April 4, it is at 26.95.  So it is up 16% since Oct 1, about 2.5% per month.  That is the trend at the moment.

Bitcoin is up 15% per month since September

 I don't think Bitcoin is a good investment but I am just pointing out that since September 1 it has been rising an average of 15% per month.   It will probably start dropping at some point but that is where the trend is today.

Oil prices are going up 3% per month

 

I am starting on 12/1/23 when they were 74.07.  I have 5 data points where they don't hit exactly but they are close.  Today (April 4), oil is at 86.96, which is 17% higher.  The trend may not continue, but as of now and since December 1, the price is consistently rising.

Doomslang

 Read: https://www.esquire.com/lifestyle/a60295595/doomslang-trend/

Doomslang also takes different forms depending on your politics. Yee-Lum Mak, a rhetoric scholar and the author of Other-Wordly, pointed out that she mostly hears doomslang among highly educated folks under 35 from “reasonably comfortable backgrounds.” She noted the left-leaning tint to much of this language—e.g., “You know how it is in our neoliberal dystopia” or “How are you holding up under late-stage capitalism?” Mak said that some speakers might see it as “politically irresponsible” not to acknowledge the state of the world, even casually. Doomslang could serve as “a small act of resistance to groups they oppose, like climate change deniers or politicians averse to climate legislation.”

But not every doomslanger is in Mak’s algorithm. Compare progressive speakers’ jokes about the brain-eating zombie virus that is Fox News to the alt-right’s “wojak” and “doomer” memes. Originating on 4chan, wojak is a simple outlined sketch of a man, symbolizing melancholy and loneliness. Its cousin, doomer, depicts the same character beanie-clad and smoking a cigarette. According to The Atlantic reporter Kaitlyn Tiffany, the doomer meme represents young men who “are no longer pursuing friendships or relationships, and get no joy from anything because they know that the world is coming to an end.”

Gold is going up at the rate of 2.5% per month

This is just a rough estimate, but there are 4 data points: 9/6/23 at $1917, 10/27/23 at $2006, 11/29/23 at $2047, and now 4/3/24 at $2296.  If this keeps going up, by 12/31/2024 it will be at about $2800.  That is 30% plus per year growth.  

Maybe I am cherry picking my data, but you could go back another year until late 2022 when it was below $1700 and find another point of intersection.  So the price has broken through this on the upside.  Let's see what the next valley is and recalculate. 

The National Debt will be $141 trillion by 2054

Professor Joao Gomes
Source: https://executiveeducation.wharton.upenn.edu/faculty/joao-gomes/

See: America will be left with ‘severe, irreversible scars’ if national debt goes unchecked. Now, a blockbuster report warns the bill is higher than believed, hitting $141tn by 2054 (msn.com)

The "blockbuster report" is by the CBO and is here:  https://www.cbo.gov/publication/60127

Who said there will be "severe, irreversible scars" (in quotes)?   That is Wharton Professor Joao Gomes.

Without a course correction a fiscal crisis is likely to occur in 2030, said Gomes, or as early as 2025 if the next administration rolls out an "expensive fiscal package that relies on implausibly rosy economic assumptions." Regardless, warns Gomes: "It's consequences will be severe and leave lasting—probably irreversible—scars on our economy and society."

See also: What is the current national debt, how can the U.S. get out of debt? | Fortune

Finding the Money

Finding the Money is a documentary about the Magical Money Tree, that will be in theatres everywhere on May 3. where literally hundreds of people will pay to see it.  In it, economist Stephanie Kelton explains why the National Debt is a good thing - it should be called the National Savings Account instead.  The higher the debt, the more money "we" have.  There should be no debt limit, and healthcare should be free for everyone.  Oh also everyone is guaranteed a job. (This sounds like socialism).  We shouldn't worry about the deficit, instead we should be finding ways to increase it!

Julian Assange and Vault 7

Read: https://www.zerohedge.com/geopolitical/chris-hedges-crucifixion-julian-assange

 Julian Assange is in the news again.  I don't understand either side's position.  Julian Assange is an Australian citizen who was living in London, running WikiLeaks.  He has gone to extreme measures to fight extradition, which has been pending since November 2010, first to Sweden for alleged rape charges, and then since December 2017, to the United States.  He hid out in the Ecuadorian embassy from 2012 to 2019.   He was arrested on 11 April 2019, and has been in Belmarsh Prison ever since.  I don't understand why he doesn't just consent to extradition, and fight the charges in US courts, and then he could appeal his conviction there, if necessary.  If he wants to be a martyr for free speech then he would be much more sympathetic if he were actually persecuted and suffering in a prison in the US.

On the other hand, the attorneys for the US won't provide assurance that he won't face the death penalty.  Really, why so extreme?  Maybe it is because he leaked some hacking tools used by the CIA.

The 26 September [2021] Yahoo report alleges the following amongst other matters. The disclosure by WikiLeaks of exceptionally sensitive intelligence, relating to CIA hacking tools and known as “Vault 7”, caused the CIA director, Mike Pompeo, and other senior officials inside the CIA, to become “completely detached from reality because they were so embarrassed… They were seeing blood.” In 2017, Mr Pompeo publicly described WikiLeaks as a “non-state hostile intelligence service.” The designation as a non-state hostile intelligence service enabled the CIA to take far more aggressive actions. Some senior officials inside the CIA and the Trump administration discussed killing the applicant, requesting options on how to assassinate him. Discussions over kidnapping or killing the applicant occurred “at the highest levels”.

https://www.tareqhaddad.com/wp-content/uploads/2024/03/24.03.26-Assange-v-USA-Approved-Judgment.pdf , page 23.

What is Vault 7?  It is information about the CIA's covert hacking program.  WikiLeaks didn't spread the actual programs (malware, viruses, trojans, etc) or their source code, just information about their existence.  https://wikileaks.org/ciav7p1/

Does leaking information about CIA's hacking tools justify the death penalty?

I don't have a conclusion.

Notes on the Crisis

 See: https://www.crisesnotes.com/

This is a very interesting website.  The author is Nathan Tankus, an independent financial thinker, who not only doesn't have a PhD (someone should give him an honorary one), he apparently doesn't even have a bachelor's degree.  In the Crises Notes website, he does FOIA requests on old Federal Reserve memos and writes about them.

Read  https://www.crisesnotes.com/revealed-the-seven-secret-federal-reserve-books-i-won-through-foia/

I ran across this while searching for anything written by Zoltan Pozsar, a mysterious guy with a very cool name who has written research papers on the shadow banking system, but none of them are publicly available.