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Is America Marching Toward A Recession?

by | Oct 27, 2021 | Blog, Federal News, Words of Wisdom from Wayne

It becomes increasingly obvious every day that members of the Biden Administration and the liberal left members of both the House and the Senate have little knowledge of economic theory.  Even more disturbing is they are ignoring the reports of left-leaning financial analysts like Goldman Sachs, Morgan Stanley, and Forbes.  Many of the financial institutions as well as a respected economist have identified economic indicators that the United States is headed toward a recession.  One of the key drivers is due to the reckless spending and accrued debt being generated by the liberal left.  We want to apologize for this economics lesson.  However, it is critically important to understand the problem if you want to become a part of the solution.

Why should you be concerned about another recession in America?  And, exactly what is a recession, and how does it impact me?  The definitions for the financial and economic terms are provided by “Forbes Advisor”.

  • A recession is a significant decline in economic activity that lasts for months or even years. Experts declare a recession when a nation’s economy experiences negative gross domestic product (GDP), rising levels of unemployment, falling retail sales, and declining measures of income and manufacturing for an extended period. 
  • During a recession, the economy struggles, people lose work, companies make fewer sales, and the country’s overall economic output declines.

What Causes a Recession?

  • A sudden economic shock: An economic shock is a surprise problem that creates serious financial damage. The following are examples of economic shock caused by Biden policy and decisions:
  • Open border facilitating illegal migration, generating unfunded costs to other states, cities and then passed on to the taxpayer
  • Supply chain issue causing a sharp decline in good available thus decreasing supply.  This generates higher costs for the demand or consumer
  • Increased taxes to fund the two bills currently being promoted by the liberal left
  • The Biden administration is imposing vaccination mandates.  Private and public sectors require being vaccinated as a condition of continued employment.  Thousands have opted to resign thus creating a substantial number of unemployed workers in the job market
  • Asset bubbles: When investing decisions are driven by emotion. Investors can become too optimistic during a strong economy.  This is exactly what we are seeing.  Under the Biden administration America is declining both economically, and politically.  Inflation continues to climb each month.  If inflation remains unchecked, the Central Banks are likely to increase interest rates.  This tool is used to reduce consumer spending, but often negatively impacts the stock market, resulting in a rush to sell-off.
  • Too much inflation: Inflation is the steady, upward trend in prices over time. Inflation isn’t a bad thing per se, but excessive inflation is a dangerous phenomenon. Out-of-control inflation was an ongoing problem in the U.S. in the 1970s. To break the cycle, the Federal Reserve rapidly raised interest rates, as high as 20 percent, which caused a recession.  There is empirical evidence that the policy decisions by the liberal progressive and supported by Biden have contributed to the highest inflation rate in the past 13 years.  If and when the Biden proposed Infrastructure Bill and the Human Infrastructure Bill (an estimated total of over $4 trillion) are dumped into the economy, inflation will certainly be negatively impacted.  The following are but a few of the inflation impacts on some goods and services:
    • Gas price in California on Oct 22 was reported to be $7.99 per gallon, the nationwide average on this same date is $3.38 per gallon
    • New vehicles and used automobiles and trucks soared by 8.7 percent and 24.4 percent year-over-year, respectively
    • The benchmark 10-year Treasury yield tumbled by 0.045 percent to 1.535 percent (this is called a yield curve inversion when our year yield is lower than the current year’s yield. This phenomenon has been identified by economists as a strong indicator of a pending recession
    • Lumber up 42%
    • Beef up almost 7%
    • Housing on average up 30% (this usually means a property tax increase for many Americans)

Inflation: Your Warning Sign

When Press Secretary Jen Psaki was asked about the unusually high inflationary rate, she replied inflation was good for the economy, people have money and are spending.  What she failed to say was, yes small incremental inflation is a good indicator of a healthy economy, but out-of-control inflation is a warning sign that should alarm all Americans.

As we have previously indicated, dumping trillions of dollars into the economy is going to further fuel the runaway inflation.  The supply chain failure of the Biden administration alone is going to negatively impact inflationary rates.

One final thought.  By now many of you have read or heard that China recently launched two hypersonic intercontinental ballistic missiles (ICBM’s).  For those of you who might know what this means, this ICBM is extremely fast, able to reach the U.S. in less than 30 seconds.  It also flies a zig-zag avoidance pattern, making it currently almost impossible to intercept.  These tests caught the Biden administration completely by surprise, specifically the intelligence community and our missile defense systems. When informed of these missiles launch tests, the Biden administration simply replied, “We welcome the competition.”

One of the overarching conservative ideologies is to ensure a strong, robust and capable national defense.  One that would assure all citizens that their government was making national defense a top priority.  Our country does not have the financial freedom to spend and spend on social programs, driving up the debt, creating large government, and prioritizing spending towards socialism while ignoring our national defense shortfalls.

Will You Join the Team?

We continue to ask all Americans to wake up to the reality that our country is clearly headed to a socialistic society, incapable of defending ourselves against military powers like Russia and China.  WE NEED EVERY ONE OF OUR READERS TO SIMPLY THINK ABOUT THE INFORMATION WE ARE PROVIDING AND ASK YOURSELF DO YOU WANT TO BE A PART OF THE TEAM THAT WILL SAVE AMERICA?

This is what you can do now, today.

  1. Start writing letters, sending emails, and calling Congress to voice your concerns.  As we have stated before; we stand ready to assist you in drafting letters or emails.  All you will do is hit send or place in your outgoing mail.
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We also want to invite you to attend the next NHC GOP County Meeting.  The meeting will be held on October 28th, starting at 6:30 PM is a meet and greet, the meeting starts at 7:00 PM.  The location is the Spring Hill Baptist Church Reception Hall, 801 N. College Road, Wilmington 28405