The talking heads on financial TV ask everyday where we are in the banking crisis. Is it over yet? After scooping up First Republic, JP Morgan’s Jamie Dimon said, “This part of the crisis is over.” After he said that, however, the shares of regional banks such as PacWest, Zions, and Western Alliance were cut in half. The market doesn’t believe Mr. Dimon.
Elisabeth Kübler-Ross described five stages of grief: denial, anger, bargaining, depression, and acceptance. ‎On Twitter, describing the typical timeline for a banking crisis, Real Vision’s Raoul Pal posted:
It’s one bad apple,
Well maybe it’s just a few
“Banks remain strong”
It’s the evil short sellers (we are considering a ban)
Ok, now we are banning shorts
Oh, seems that didn’t work
Cut rates
That didn’t work

An ongoing debate concerns the plunge in the four-week Treasury note yield in relation to the three-month Treasury yield. At least one tweeter claims it’s all about the coming debt ceiling showdown with the difference in rates (3.145 percent versus 5.070 percent) reflecting the risk of having liquidity tied up within three months as the debt ceiling exercise is run through DC sausage making.
On the other side is Eurodollar University’s Jeffrey Snider who tweeted in response, “The behavior of bills today, esp. 4w[eek], was way too like April 2008 not debt ceiling. Just massive demand for these things to the point that it’s 2008-style below other money alternatives. This ain’t debt ceiling rather pure collateral run.”
Snider tweeting again:
Let’s put this to rest

Every decade or so bank failures and the subsequent bailout response via central bank intervention appear. The latest jangling of depositor nerves involved US regional banks and a certain Swiss bank of great systemic importance. As James Grant writes in his book Bagehot: The Life and Times of the Greatest Victorian, “In economics, the most ostensibly rigorous of the social sciences, progress–and error, too–are cyclical; we keep stepping on the same rakes.” Sounding Rothbardian, Grant writes, “In banking, though, accidents came in clusters. Bank runs, unlike train wrecks, were contagious.” Nothing has changed.
Walter Bagehot famously urged the Bank of England—or “the Old Lady,” as the world’s first central bank is referred to in Grant’s elegant telling of Bagehot’s

“On Wednesday, the Environmental Protection Agency plans to announce tough new tailpipe emission standards designed to effectively force the auto industry to phase out the sale of gas-powered cars,” reports The Verge, with the provocative headline “The End Is Nigh for Gas-Powered Cars.”
Environmental, social, and corporate governance (ESG) is the newest religion, and we all know who the practitioners are. Electric vehicle (EV) owners sing “Hallelujah” when they pull out of their garages. The investor-class ESG evangelists believe the new belief is in its beginnings. Whatever the Biden EPA does, investor Harris Kupperman thinks it’s likely just the Church of What’s Happening Now.
Kupperman, referred to as Kuppy by Real Vision’s Maggie Lake, told her, “Well, I think

Because of inflation and a lack of a savings ethic, Americans are less prepared for retirement than ever. The numbers are discouraging.

Original Article: "Ready for Retirement? Fewer and Fewer Americans Are Saving for That Time"
This Audio Mises Wire is generously sponsored by Christopher Condon. 

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The line for the self-checkout registers at my neighborhood Albertsons stretched into the store’s produce section. Is this human progress? I wondered, scanning my groceries—this just after I had filled my car’s gas tank at a not-so-convenient convenience store near work.
Not long ago, someone not only pumped your gas and cleaned your windshield but also checked your oil and tire pressure while you waited comfortably behind the wheel of your car. Gas retailers were once called service stations for a reason. Someone provided service. Now, gas is sold at convenience stores or big box membership stores, with consumers handling the hose.
Grocery stores are newer to the customers-do-it-themselves model and are still phasing it in. The few visible cashiers are always

The subject of time and money has hit a boiling point. Just look at Sri Lanka and Iran, where food riots have turned deadly, or, shall we say, currency riots have. People can’t buy food, and “protesters angry at the soaring prices of everyday commodities including food, have burned down homes belonging to 38 politicians as the crisis-hit country plunged further into chaos, with the government ordering troops to ‘shoot on sight,’” reports invesbrain.com.
Murray Rothbard used to joke that the masses won’t hit the barricades over indifference curves. They will charge if they can’t afford food. For the better situated, the British pound has fallen to the point where flying to London first class from New York to buy a Rolex makes economic sense versus buying one in the

The Wall Street Journal reported on September 22 that Turkey’s central bank cut that country’s benchmark interest rate to 12 percent from 13 percent, pushing the Turkish lira lower as much as 0.4 percent against the dollar to a new record low after the decision. One US dollar recently bought 18.3866 lira.
The bank of Prime Minister Recep Tyyip Erdoğan made its move the week following Drs. Hans and Gülçin Hoppe’s sixteenth annual Property and Freedom Society salon in booming Bodrum, the port city on the Aegean sea which once hosted a summer population of 170,000 that has since mushroomed to 700,000.
A conference attendee, noting that Bodrum was bustling, queried the panel of Saturday speakers with a question to the effect “Why not go the Turkish way (referring to

The average card-carrying Austrian would say that the Federal Reserve is creating money by the bale, with evidence being Consumer Price Index prints of 8.6 percent per the Bureau of Labor Statistics or over 15 percent per John Williams’s shadowstats.com computation based on the way the government calculated CPI back in 1980. Surely, at best, the US dollar is only the cleanest dirty shirt in the currency laundry basket.
But Uncle Sam’s dollar continues to strengthen (vis-à-vis other government fiat), with the result being market crashes in … everything. “People have started to realize that when the dollar goes up, it’s not good for anybody,” Alhambra Investments’ Jeff Snider told Maggie Lake on Real Vision. Snider’s “anybody” doesn’t just mean stock, bond, and

Monetary inflation results in a general rise in prices, often called “price inflation.” But rising prices are not always “inflation.” In any case, more government regs and subsidies won’t help.

Original Article: “When Higher Prices Are Not Inflation”

Back to 2020, the federal government’s covid-mandated shutdown of meat production plants hobbled the nation’s meat production capabilities, leaving farmers with nowhere to send their beef. This resulted in them having to cull cattle and other livestock. The uncertainty caused farmers to scale back their production at the time, which Arun Sundaram told CNBC “can affect production more than a year, year and a half down the road.”
Processing facilities had labor shortages like all other businesses, which reduced

Back to 2020, the federal government’s covid-mandated shutdown of meat production plants hobbled the nation’s meat production capabilities, leaving farmers with nowhere to send their beef. This resulted in them having to cull cattle and other livestock. The uncertainty caused farmers to scale back their production at the time, which Arun Sundaram told CNBC “can affect production more than a year, year and a half down the road.”
Processing facilities had labor shortages like all other businesses, which reduced their capacity to process meat at the same clip as before the pandemic. Meanwhile, consumers regained their appetites for beef, forcing prices higher.
“You have this huge imbalance of supply and demand which is causing the prices to skyrocket,” Sundaram told

When the economics profession turns its attention to financial panics and crashes, the first episode mentioned is tulipmania. In fact, tulipmania has become a metaphor in the economics field. Should one look up tulipmania in The New Palgrave: A Dictionary of Economics, a discussion of the seventeenth century Dutch speculative mania will not be found. Guillermo Calvo (1987, p. 707), in his contribution to the Palgrave instead defines tulipmania as: “situations in which some prices behave in a way that appears not to be fully explainable by economic ‘fundamentals.’”
Brown University economist, Peter Garber, is considered the modern tulipmania expert. In Garber’s view, tulipmania was not a mania at all, but is explainable by market fundamentals. The explosive

For the Wall Street sequel, the subtitle was Money Never Sleeps. But the Oliver Stone reprisal of Gordon Gecko was the stuff of 2010. In America, a decade plus ago, money slept. Now, it truly doesn’t, with cryptocurrency prices gyrating 24/7/365. This frantic activity has spread to other asset markets.
Once real estate was stable and slow moving. Buyers would walk through a home, and walk it again with someone they trusted, before making an offer. But, as Francesca Mari titles his lengthy New York Times Magazine article, “In Austin and cities round the country, the crazy real estate market has forced regular people to act like speculators.” He wonders, “Will home buying ever be ‘normal’ again?”
Mari’s piece chronicles the trials and tribulations of millennials

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While bankruptcy has a negative connotation in the business world, “Bankruptcy fulfills the crucially important social function of preserving the available stock of capital.”

Original Article: “Preserving Capital through Bankruptcy”

The New York Times recently published a piece entitled “When Kmart Moved Out, Churches and Flea Markets Moved In.” The article, penned by Kevin Williams, provides an instructive subtitle: “The retailer’s former stores are being used by tenants that might not typically get a crack at such a large haul of commercial space at an affordable price.”
“When it merged with Sears in 2005, Kmart had 2,085 locations. With the abrupt closing of the Astor Place Kmart in Manhattan last month, the number of open Kmart stores is down to 17,”

“If the market continues to see wild swings based on Elon Musk tweets, it’s going to be a big setback for this asset class,” Matt Maley, chief market strategist for Miller Tabak + Co. told Bloomberg. “The fact that it sees such wild swings to the tweets from one person takes away the legitimacy of the asset class.”
Reminds a bit of a financial planner who told me bitcoin is “manipulated” and followed up with the ultimate smear “unregulated.” Yikes. Then the Chinese government made all sorts of threats concerning the mining and holding of crypto’s top brand. A wag on Twitter responded with words to the effect that when the Chinese banned Google in 2010 it didn’t seem to slow down the company.
Weston Nakamura in an interview with Real Vision’s Jack Farley made the

In Las Vegas, asset price inflation is combining with rising prices on building materials to create a real estate bubble of remarkable proportions.

Original Article: “The Real Estate Boom in Vegas Is More Frenzied Than Ever​​”
Summerlin, the suburb of west Las Vegas creeping ever closer to the mountains, looks to be crowded with fully paved streets, streetlights, block walls, and blue top lots. With lumber, labor, and other materials in short supply, home construction can’t keep up.
However, Ali Wolf, chief economist with Zonda, quoted by CNBC, claims, “The lot supply shortage is real, and it is causing prices to rise and builders to move further into the suburbs.”
Diana Olick writes, “The surge in lumber prices in the past year has added $35,872 to the price

Banks and accounting trickery go together. Last year, as I remember back to my banking days, financial institutions followed the advice once proffered by one of our board members, “If we’re going to the dump, let’s take a full load.”
When the pandemic struck, banks dumped plenty in their loan-loss provisions, $60 billion, expecting the worst. The cavalry arrived led by Jerome Powell’s Fed liquidity flood, Steven Mnuchin’s Paycheck Protection Program (PPP) loans, Congress’s Coronavirus Aid, Relief, and Economic Security (CARES) Act, and moratoriums on foreclosures and evictions. Instead of an Austrian business cycle cleansing, the cracks were papered over, including bailing out money market funds, allowing us to watch the pandemic comfortably on TV.
Here we are a

A gentleman who does work for us sent me a text recently saying the price of his supplies has increased 20 percent, so he wants to increase his monthly fee 10 percent. It was a nice way to ask, and I said sure, especially given that he’s willing to take a haircut on his labor to make the increase more palatable.
Chairman Jerome Powell would be happy to hear this story, as the Federal Reserve prints mightily to push the CPI (Consumer Price Index) to 2 percent and beyond. Though perhaps Chairman Powell would prefer my tradesman to pass a full 20 percent price increase to me.
In a town with a double-digit unemployment rate, price increases are hard to pass on. Although I noticed while shopping for Thanksgiving that a small bag of pine nuts was a full $2 more than the

Rothbard: “At the outset of every step forward on the road to a more plentiful existence is saving….Without saving and capital accumulation there could not be any striving toward nonmaterial ends.”

Original Article: “The Upside of Lockdowns: More Saving​”
This Audio Mises Wire is generously sponsored by Christopher Condon. Narrated by Michael Stack.

Original Text:

Something good is coming out of the covid lockdowns. Economist David Rosenberg released a special report via the eponymous Rosenberg Research, concluding “the pre-COVID-19 ‘norm’ of a 7% personal savings rate will morph into a post-COVID-19 norm of 10%.”
Rosenberg makes frequent TV appearances after he was chief North American economist at Merrill Lynch in New York from 2002 to 2009, when he was

Something good is coming out of the covid lockdowns. Economist David Rosenberg released a special report via the eponymous Rosenberg Research, concluding “the pre-COVID-19 ‘norm’ of a 7% personal savings rate will morph into a post-COVID-19 norm of 10%.”
Rosenberg makes frequent TV appearances after he was chief North American economist at Merrill Lynch in New York from 2002 to 2009, when he was consistently included in the Institutional Investor All-Star analyst rankings. From there he spent ten years as chief economist and strategist at Gluskin Sheff.
Rosenberg doesn’t portray his prediction of a savings rate increase necessarily as a positive, instead writing, “for the 70% of aggregate demand called ‘the consumer,’ this will exert an everlasting drag on the

[unable to retrieve full-text content]The New York Times managed to find some young people whose silver spoons provide a sour taste in their mouths. To hear them talk, their good fortune is making them sick.

[unable to retrieve full-text content]“Russia, Russia, Russia,” the current president used to sarcastically chastise opponents for wondering about 2016 election tinkering from Putin’s principality. Recent MAGA rallies featured “Covid, covid, covid,” with President Trump complaining that the press could think of nothing else.

Make the money cheap enough and government intrusive enough, and incongruous headlines appear side by side. For instance, from the Las Vegas Review-Journal comes this head-scratcher: “Las Vegas Housing Market ‘on Fire’ as Economy Limps Along.”
Almost Daily Grant’s reminds us the Federal Reserve is on the job 24/7/365,
There’s more where that came from. Last week’s release of the minutes to the Federal Reserve’s July meeting indicated that the Open Market Committee is unlikely to rest on its laurels, following its move to a near-zero overnight funds rate and 65% expansion of its balance sheet since March. Those exertions have coincided with a thunderous rebound in asset prices, most notably a 53% surge on the S&P 500 over the past five months.
Here on Main Street

Economist Irving Fisher famously said just before the 1929 stock market crash, “Stock prices have reached what looks like a permanently high plateau.” Whoops. Fisher wasn’t just any old economist. Joseph Schumpeter called him “the greatest economist the United States has ever produced.” Milton Friedman and James Tobin agreed.
After the sharp March COVID crash, stocks have come roaring back: nevermind the pandemic, protests in the streets, shuttered businesses, and double-digit unemployment rates. In Fisher’s day the Federal Reserve was but a pup; now Chairman Powell decided to print and ask questions later, expanding his central bank’s balance sheet by $3 trillion dollars in four months, a 75 percent increase.
Now a lesser light than Fisher is repeating the

While the economic storm caused by COVID-19 has seemed to wane (temporarily?), the stock market can’t seem to go but one direction—up. Graham and Dodd’s meaty 700-page Security Analysis has soared to number 7695 on the Amazon best-seller list. According to Warren Buffett, the book is “A road map for investing that I have now been following for 57 years.”
One wonders what roadmap the young people who saw the pandemic March meltdown as an opportunity to buy slices of familiar technology stocks are following?
CNBC reports, “The major online brokers — Charles Schwab, TD Ameritrade, Etrade and Robinhood — saw new accounts grow as much as 170% in the first quarter, when stocks experienced the fastest bear market and the worst first quarter in history.”
What company

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Does a pandemic trump entrepreneurial foresight? Many in business will say yes, “nobody saw this coming.” Lack of customer demand and government lockdowns are “no fault of their own.”
But Penny Chutima, co-owner of the Lotus of Siam restaurant, did see it coming. Chutima and her mother, Saipin, have operated the off-Strip Las Vegas staple for years. Saipin opened the original location with her husband in 1999. Yelp gives the northern Thai eatery 4.5 stars with over fifteen hundred reviews, which typically start with something like “OMG, WHERE DO I BEGIN.”
The food is great. The wait can be long but worth it.
Saipin is a James Beard Award–winning chef and also pays attention to what’s happening in China. So,

The year 2006 seems like a lifetime ago. The housing boom seemed to be going full throttle, but danger lurked. I wrote on LewRockwell.com in March of that year, concerning a Las Vegas real estate seminar, that “nary a discouraging word was spoken.”
But despite the happy talk coming from the podium that day, pleasing the thirteen hundred attendees, I was hearing something different: “builders I talked to at the Outlook don’t believe [Dennis] Smith’s numbers. They say their traffic numbers are half what they were last year and cancellations are soaring.” A builder described the market as a bloodbath.
Again, that was 2006, home prices would peak in June of that year. Two years later we know what happened. In between, the conventional wisdom was that the market ship

In a bit of holiday news no one will care about, the Treasury announced it would return to selling twenty-year treasury bonds to aid in funding the nation’s trillion-dollar deficit. It was 1986 when the Treasury last issued twenty-year paper. Of course the question is: who or what will be the buyers?
Daniel R. Amerman, CFA, is keeping a steady eye on the Treasury and Fed’s operations and has come to the conclusion,
In just the last four months, the U.S. government has spent $457 billion—almost half a trillion dollars—more than it has taken in. In that same time and using monetary creation, the Federal Reserve has created and put $457 billion in new cash into the financial system, either buying U.S. Treasuries or funding the ownership of those Treasuries by