Oh The Humanity

Wait

Inflation numbers were released today. We have STAGFLATION. Not.

The mainstream media is so lame. They are so uncurious. If you are listening to them about anything, you are polluting your sense of objectivity and reason.

When you look at the data, you understand just how stupid the Biden Administration was. All they needed to do was “Costanza” their decision-making, and we would have been on the right track.

I was told en masse by central planning and Democrats that tariffs lead to inflation. Well, today’s price data shows the lowest inflation in four years. How’d that happen? How could Paul Krugman, Larry Summers, and the other Keynesians be so incorrect?

As classical economists will tell you, inflation is largely a function of government spending. Since Trump took office, government spending has been lower. As a matter of fact, when Harris lost, Biden opened the spigot. He was spending more than $1B per day and sending it to favored NGO’s. DOGE shut that down.

Turns out, when you shut the illegal immigration problem down at the southern border, government spending goes down as well. I was told in order to do that, we needed an act of Congress. Maybe Harris should go to the border now. Or is she in Europe?

I hope that the federal transfer payments to states drop, too. Watch blue states choke.

But what about eggs? Egg prices dropped by the most since March 1984, 12.5%.

Biden was so afraid of bird flu that he mandated the slaughter of millions of egg-laying chickens. That’s what the Chinese did back in 2007 to combat bird flu, and when it infests their farms, they still do it. It might not be the best strategy. After Covid, I don’t think I would mimic a totalitarian government's strategies to mitigate problems. Anecdotally, I was able to buy ducks at Costco for $3 per pound. They were on the smallish side, which led me to believe they were slaughtered because of bird flu. It takes some weeks to rebuild that egg-laying herd, and farmers are doing it. Egg prices will continue to go down.

Feed prices are going down. Both corn and beans are falling in price.

A word of caution. Beef prices aren’t going to go lower. The size of the US beef herd is at an all-time low. It hasn’t been this small since 1962. With the tapeworm infecting other herds, the US smartly banned the import of beef from countries south of the US. That’s not going to help taper beef prices. Feeder cattle prices were up $6.50! That is a huge move. The good news for beef producers is that feed costs should be dropping.

The other problem with livestock in the US is that there is a bottleneck in how we slaughter them. Livestock is a heavily regulated industry, and hopefully, Trump will take that on.

Oil prices are significantly lower as well. This has had a positive effect, lowering inflation. Why? Trump has actually opened up exploration. Biden had faux exploration. He’d issue a permit, then wouldn’t let anyone explore. Or, he’d issue a permit on land where everyone knew there was no hope of finding anything. Biden had paperwork “proving he was Mr. Energy,” but the proof is in the pudding.

Remember “Employment Joe”? Turns out Mr. Job Creator didn’t create as many as he said he created. They faked the statistics to make him look good. This was always rumored during the Bush/Obama/Trump years but Biden actually did it. In addition, Biden’s job creation wasn’t private market job creation but government job creation. Again, thanks to DOGE and Elon Musk, the government is laying off employees and we are spending less money.

Remember all the hue and cry about tariffs and the market falling out of bed? Well, that’s gone too. The NASDAQ is up 20% in 24 days. I’d call that a face ripper for the shorts. Trump is negotiating deals. They aren’t getting 0% on each side, but they are getting better deals than we had prior. Each deal is different, so you’d have to investigate them all for specifics. It’s not the way I would go about this, but Trump seems to be having some success. Of course, he won’t get the credit. The liberals will try and find a lump of coal in a box of diamonds.

I think you need to buy some dips now. The market has gone from overtly bearish to mildly bullish. My guess is we are going to see a lot of productivity gains from technology like AI quickly and robots less quickly. Bessent seems to be running the show, and he knows how to talk to markets similar to Bill Clinton’s Robert Rubin.

The biggest impediment to more success is the Republicans in Congress, who do nothing. They have the damn majority for goodness sakes. Time to primary the RINOs.