Tag: economy

Bank Branches are the Latest Creative Destruction Casualty

Over 8,000 bank branches are expected to close worldwide in 2025. Approximately 3,200 of those closures will take place in the United States. Q1 experienced 148 net branch closures in the US, with all major banks slated to close branches throughout the year.

These are merely bank closures and not bank failures, although two smaller US banks did fail this year. People simply prefer online banking as we have made the switch from relational to transactional banking.

Bankrate conducted a survey that found 77% of Americans prefer online digital banking, yet other surveys believe the figure is closer to 89%. Digital banking has been rising in popularity in recent years, up from 203 million domestic users in 2022 to the 216.8 million projected users in 2025. The survey found that 34% of consumers use online banking on a daily basis, consistently checking their account and transactions. There has even been a 19% increase in use among the 65+ crowd who is least likely to use digital services.

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No Escape From Washington’s Fiscal Doomsday Machine

If you don’t think Washington is in the maws of a Fiscal Doomsday Machine, think again.

And the place to start is with the 30-year CBO projections—expressed as the dollar increase from the current $29 trillion level of publicly held US Treasury debt.

To wit, if Washington does nothing except leave current tax, spending and structural deficit policies in place (i.e. baseline policy), the publicly-held debt will grow by $102 trillion over the next three decades, reaching a staggering 154% of what would be $85 trillion of GDP by 2054.

Moreover, that outcome assumes that Rosy Scenario does not loose her footing for even a moment through the middle of the century. Stated differently, the underlying CBO projections presume that there will be no recession during the 34 year span from 2020 to 2054, and that, in fact, there will be perpetual full-employment at about 4% from here on out.

Of course, during the last 30 years there have been three recessions (shaded area) and no such full-employment perfection was even remotely achieved. The short spells of 4% unemployment or under, in fact, were few and far between—in stark contrast to the CBO baseline which presumes 4% unemployment year after year until 2054.

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Report: California’s $20 Fast Food Minimum Wage Led to 18,000 Fewer Jobs

California’s new $20-per-hour minimum wage for fast food workers has resulted in a significant decline in employment in that sector, leading to 18,000 fewer jobs than would have been the case otherwise.

That’s according to a new paper released by the National Bureau of Economic Research (NBER) this month, which said:

We analyze the effect of California’s $20 fast food minimum wage, which was enacted in September 2023 and went into effect in April 2024, on employment in the fast food sector. In unadjusted data from the Quarterly Census of Employment and Wages, we find that employment in California’s fast food sector declined by 2.7 percent relative to employment in the fast food sector elsewhere in the United States from September 2023 through September 2024. Adjusting for pre-AB 1228 trends increases this differential decline to 3.2 percent, while netting out the equivalent employment changes in non-minimum-wage-intensive industries further increases the decline. Our median estimate translates into a loss of 18,000 jobs in California’s fast food sector relative to the counterfactual.

HR Grapevine added:

The Employment Policies Institute estimated that “non-tipped restaurant workers [lost] 250 hours of work annually,” translating into up to $4,000 in lost income. That drop equates to seven weeks of work each year per employee.

The California Globe reported that “thousands of fast food jobs were shed by companies in anticipation for the higher costs,” including 1,200 drivers at Pizza Hut. Once the law took effect on April 1, 2024, “restaurants automated what they could to avoid the higher wages,” and “some fast food restaurants also closed.”

By June 2024, Stanford University data indicated “over 10,000 fast food jobs were already lost.” While the Governor’s office disputed the figure, saying fast food jobs had increased, it “stopped by the fall when it became apparent that federal data wasn’t on their side.”

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China’s Economic Demise And Its Impact On The US

Few are as candid and historically accurate as hedge fund manager Kyle Bass when identifying structural breaks in the global economy. In a recent interview, Bass painted a grim but telling picture of China’s economic condition, warning:

“We are witnessing the largest macroeconomic imbalances the world has ever seen, and they are all coming to a head in China.”

While China has long been touted as the next great economic superpower, its recent trajectory reveals a far different story, one marked by policy missteps, systemic financial rot, and a rapidly eroding growth engine.

Bass didn’t mince words either:

“China’s economy is spiraling with no end in sight.”

China’s GDP deflator, the broadest measure of prices across goods and services, continues to decline as economic activity erodes.

For investors around the globe, this isn’t just a regional concern; it’s a seismic macroeconomic event that will ripple through capital markets. The implications are significant for U.S. investors because when global economies falter, especially one as large and interconnected as China’s, capital doesn’t just vanish. It moves. That movement will significantly impact U.S. assets as flows transfer back into U.S. dollars and Treasury bonds. This global repositioning of capital isn’t merely a symptom of market volatility; it reflects a profound reevaluation of risk in the face of deteriorating confidence in China’s financial system.

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Macron’s Globalist Economic Betrayal: Poverty Levels Rise to Unprecedented Levels in France

Under Emmanuel Macron’s leadership, France is grappling with a poverty crisis not seen in three decades. Instead of fostering self-reliance and growth as promised during his presidential campaign, his policies have fueled dependency on temporary government handouts, leaving millions in dire straits as those crutches are withdrawn.

According to the latest data from INSEE, France’s national statistics agency, poverty shattered records in 2023. A staggering 9.8 million people—roughly 15% of the population—fell below the monetary poverty line, defined as monthly income under 60% of the median (about €1,288 for a single individual). That’s an alarming increase of 650,000 people in just one year.

“This marks an unprecedented surge in nearly 30 years,” observed Michel Duée, director of INSEE’s household resources and living conditions division. To find comparable levels, one must look back to the economic turmoil of the early 1970s.

The root cause? The abrupt end to short-term “exceptional aids” like inflation bonuses and back-to-school payouts introduced in 2022 to prop up purchasing power. As these fiscal band-aids expired, reality hit hard.

Hardworking self-employed individuals and micro-entrepreneurs have borne the brunt, their livelihoods eroded by bureaucratic hurdles and economic stagnation. Meanwhile, indicators of hardship are exploding, utility shutoffs for unpaid power and gas bills have skyrocketed and rental evictions are surging at an unprecedented rate.

Most heartbreakingly, single-parent families, predominantly led by dedicated mothers raising children alone, are suffering the worst. Their poverty rate jumped nearly three percentage points from 2022 to 2023, dragging more children under 18 into destitution.

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From the eggs to the courts: A clash over animals, eggs and affordability

In an escalating federal-state battle over food policy, the Trump administration this week sued California over its animal welfare laws, alleging they drive sky-high egg prices. The lawsuit, filed July 9 in Los Angeles federal court, argues California’s ballot initiatives—which banned restrictive hen cages and set space requirements for farm animals—violate federal authority. Agriculture Secretary Greg Zoeller called the state standards “bureaucratic red tape” suppressing supply and hiking costs in a market already strained by avian flu outbreaks.

Legal battle over animal welfare standards shelved under the spotlight of price increases

The lawsuit targets two key California laws: Proposition 2 (2008) and Proposition 12 (2018). These measures mandated that egg-laying hens, veal calves and breeding pigs be allowed to stand, lie down and turn freely without cages—a rule applied to all eggs sold in California, including out-of-state imports.

The Justice Department claims these voter-approved requirements conflict with the 1970 Egg Products Inspection Act, which grants federal regulators sole authority to set safety and quality standards. “California has blocked affordable farming practices,” argued Assistant Attorney General Brett Shumate, citing a 20% statewide price hike post-Proposition 2.

Critics, however, frame this as a repackaging of the administration’s prior inflation-fighting rhetoric. “This is another chapter in Trump’s crusade to dismantle humane laws while blaming states,” said Humane Society director Kitty Block. Her organization points to studies linking crowded cage systems to salmonella risks—arguments unresolved in Friday’s filing.

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The Shadowy Past of the Secret Bank That Controls the World

Few people—even diligent media followers—are likely to speak knowledgably about the Bank of International Settlements (BIS). Yet, hidden in plain sight in a 20-story tower (with four more stories below ground level) in Basel, the BIS influences the leaders of the world’s top central banks and controls the global economy. Moreover, it cannot be questioned or held accountable for any of its actions. In his 2013 book Tower of Basel, Adam LeBor, a former reporter for The Economist and author of thoroughly researched works such as Hitler’s Secret Bankers, The Last Days of Budapest, and City of Oranges, analyzes the bank’s history to explain how it gained unlimited power.

He also exposes its complete amorality. Thomas McKittrick, the bank’s chief during the war, whom the author calls “Hitler’s American Banker,” kept passing critical information to the Nazi regime. The BIS financed the Holocaust by accepting gold stolen by the Nazis from Belgium and marking it as German, even though a Belgian central banker warned that the gold had probably been melted down and re-stamped with German markings.

Austrian and Czech gold was also accepted as German deposits and kept out of reach. It was common knowledge that, besides gold from the governments of occupied nations, the Nazis were depositing gold stolen by the Devisenschutzkommando (DSK), Hitler’s special squads of treasure-hunting torturers. But that did not matter to the BIS. Kapital über alles, as LeBor titles the first part of the book.

Hunger for profit and disregard for ethics—these seem to be ingrained in the very DNA of the BIS. As recently as 1991, when the Argentinian economy collapsed and the country was $81 billion in debt, the BIS accepted—and thus kept out of creditors’ reach—money that should have rightfully been returned to them. Besides two fund management firms, the creditors were mostly pensioners who had invested in Argentinian bonds. The firms have sued the BIS and brought some attention to its highhandedness.

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Los Angeles is Broke – City Declares Fiscal Emergency

The city of Los Angeles declared a state of fiscal emergency amid a $1 billion deficit. The council approved of the emergency declaration unanimously in a 14-0 vote. This comes after Mayor Karen Bass approved a $14 billion budget for the fiscal year that began on July 1. The city is a prime example of what happens when socialist policies are allowed to run rampant at the expense of the people.

Bass approved of raising the budget from $12.9 billion in FY2024-25 to $14 billion in 2025-26 despite the looming $1 billion deficit. Unsurprisingly, overspending is the main culprit for the deficit, and yet, lawmakers have every intention of spending more. Over 600 public sector workers will be let go as a result of fiscal mismanagement, and although small government is usually applaudable, the city plans to fire 248 LAPD employees, 44 sanitation workers, and 41 firefighters. LA is experiencing a significant uptick in crime, but plans to defund the police to appease the mobs.

California Governor Gavin Newsom boasts of California’s robust economy but fails to acknowledge that it’s a state basically living “paycheck-to-paycheck,” with the payee being the taxpayer. Read the state’s plan to cover its budget deficits – endless taxes. Spending growth from 2025-26 to 2028-29 is 5.8%, above the average of 3.5%. Growth over the same period is just above 4%, “lower than its historical average, largely due to policy choices that end during the forecast window. Taken together, we view it as unlikely that revenue growth will be fast enough to catch up to ongoing spending.” Even residents who choose or are forced to leave the state will incur taxes to cover government thievery. Los Angeles is one of countless examples of how the public sector will virtue signal to rob Peter, not to pay Paul, but to pay themselves, as they are not hiding the corruption.

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France’s Fiscal Reckoning: Is The Eurozone’s Second Giant Next In Line?

France is caught in a debt spiral. Now the president of the French Court of Auditors is warning of the consequences of political inaction.

Pierre Moscovici has served as president of the French Court of Auditors for five years, overseeing regular audits of the nation’s public finances. From 2012 to 2014, he was France’s finance minister and then spent five years as EU Commissioner for Economic and Financial Affairs, Taxation and Customs. The man knows his way around empty coffers.

On Wednesday, Moscovici called on Prime Minister François Bayrou to take urgent steps to consolidate public finances. France’s budgetary situation, he said, has spun out of control, especially in 2023 and 2024. If a turnaround is not achieved soon, the capital markets will force one. “We can still act voluntarily,” he warned the government, “but tomorrow, the markets may impose austerity.”

For Now, Calm in the Bond Markets

Once the dominoes start falling, it goes fast. Investors dump French government bonds en masse. Yields spike, prices plummet, and refinancing the country’s massive debt becomes even more costly. Already, interest payments consume 10.6% of France’s state budget—roughly the same as education spending. As debt levels rise, fiscal maneuvering space shrinks.

With sovereign debt at 114% of GDP, the trap could snap shut unexpectedly. For now, European officials still point fingers at the U.S., whose debt ratios are similar. But no one can say how long that deflection tactic will work. Credit risk materializes suddenly—usually without warning.

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Not Parody: Socialist NYC Mayoral Candidate Lectures Billionaire About How DEI Is Good for Business

As if the Democrat Party — which still hasn’t recovered from the decisive beatdown it suffered at the hands of President Donald Trump in the 2024 election — wasn’t already in a self-inflicted free fall, recent events have only accelerated the decline.

First, Trump’s successful attack on key Iranian nuclear sites, which Democrats frantically continue to downplay (lie about), was a “yuuge,” (as Trump might say) setback for the TDS-riddled among us. 

Then, Zohran Mamdani, the so-called “Democratic Socialist” candidate for mayor of New York City, bested former New York Gov. Andrew Cuomo in Tuesday’s Democrat primary. Given the demographics of NYC, Mamdani is the hands-down favorite to become the Big Apple’s next mayor. 

Incidentally, I wonder if Chicago Mayor Brandon Johnson might soon become the second-worst mayor in America, but I digress.

Anyway, billionaire hedge fund manager Bill Ackman is among those who fear for the future of NYC, often dubbed “the financial center of the world,” given Mamdani’s socialist positions. Ackman posted an extensive missive on X (formerly, Twitter) on Thursday, in which he shared his concerns about Mamdani. Ackman wrote, in part (emphasis, mine):

I awoke this morning gravely concerned about New York City. I thought “What has NYC become that an avowed socialist who has supported defunding the police, whose solution to lowering food prices is city-owned supermarkets, who doesn’t understand that freezing rents will only reduce the supply of housing, who has no experience managing an organization — let alone a city with a $100+ billion budget and a $2 trillion economy — and who believes chants for ‘Globalizing the Intifada’ are acceptable, wins the Democratic Primary.

After speaking with those supported @ZohranKMamdani, I believe that he won the primary largely not due to his policies, but rather because he is a superb politician who ran a remarkable and inspiring campaign. He is intelligent and articulate. He is young and charming, and he successfully played down incriminating @X posts and statements from his past, pitching a joyful campaign of unity.

Isn’t that — the bolded passage — always what wins elections for Democrats? Think about it. 

For example, Barack Obama soared into the presidency on January 20, 2009, after having declared at the 2004 Democratic National Convention: “There is not a liberal America and a conservative America, there is the United States of America.” Yet, when Obama became president, he set about dividing America on class and racial bases for eight years — and then some. 

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