Powell Seeks to Unwind Government Economic Support-Does it Impact Inflation?

The Federal Reserve sent out the following press release. You can find the actual release HERE. The areas I highlighted below are of special interest. What we find is that inflationary pressures are mounting so reducing the liquidity may help in restoring a level of economic equilibrium. The problem with large macro economics is that there are lots of confounding variables working with and against each other. The inability to easily draw one to one causation means that as of yet economics is an imperfect science. It will be hard to determine precisely how much influence is inflation, supply chain, etc...so we look toward the bigger trends.

November 03, 2021

Federal Reserve issues FOMC statement

For release at 2:00 p.m. EDT

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The Federal Reserve is committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum employment and price stability goals.

With progress on vaccinations and strong policy support, indicators of economic activity and employment have continued to strengthen. The sectors most adversely affected by the pandemic have improved in recent months, but the summer's rise in COVID-19 cases has slowed their recovery. Inflation is elevated, largely reflecting factors that are expected to be transitory. Supply and demand imbalances related to the pandemic and the reopening of the economy have contributed to sizable price increases in some sectors. Overall financial conditions remain accommodative, in part reflecting policy measures to support the economy and the flow of credit to U.S. households and businesses.

The path of the economy continues to depend on the course of the virus. Progress on vaccinations and an easing of supply constraints are expected to support continued gains in economic activity and employment as well as a reduction in inflation. Risks to the economic outlook remain.

The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. With inflation having run persistently below this longer-run goal, the Committee will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and longer‑term inflation expectations remain well anchored at 2 percent. The Committee expects to maintain an accommodative stance of monetary policy until these outcomes are achieved. The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the Committee's assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time. In light of the substantial further progress the economy has made toward the Committee's goals since last December, the Committee decided to begin reducing the monthly pace of its net asset purchases by $10 billion for Treasury securities and $5 billion for agency mortgage-backed securities. Beginning later this month, the Committee will increase its holdings of Treasury securities by at least $70 billion per month and of agency mortgage‑backed securities by at least $35 billion per month. Beginning in December, the Committee will increase its holdings of Treasury securities by at least $60 billion per month and of agency mortgage-backed securities by at least $30 billion per month. The Committee judges that similar reductions in the pace of net asset purchases will likely be appropriate each month, but it is prepared to adjust the pace of purchases if warranted by changes in the economic outlook. The Federal Reserve's ongoing purchases and holdings of securities will continue to foster smooth market functioning and accommodative financial conditions, thereby supporting the flow of credit to households and businesses.

In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on public health, labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Thomas I. Barkin; Raphael W. Bostic; Michelle W. Bowman; Lael Brainard; Richard H. Clarida; Mary C. Daly; Charles L. Evans; Randal K. Quarles; and Christopher J. Waller.

Implementation Note issued November 3, 2021

Marquette MI New Economy: Labor and Economic Opportunity

An announcement from last week that deals with economic development in Marquette. If you don't know the U.P.. Marquette is just to the north of Escanaba. Its important for people to sort of understand the different plans out there and find where people might share some similarities. We sometimes get into accepting or rejecting proposals but really we might be able to look at where they are similar and use those as starting points for discussions on the best economic paths forward. Its a continuing conversation...... You can read the actual announcement HERE.

State officials join local economic and talent leaders in Marquette to discuss plans to implement governor's economic vision for Michigan

October 22, 2021
Media Contact: Beata Kica, 517-614-9773

State officials met today with local business, workforce development and community leaders in Marquette to discuss the ways Michigan can achieve the goals laid out in Gov. Whitmer's MI New Economy Plan. The event is the first of a series, designed to bring stakeholders together to discuss a comprehensive strategy to utilize American Rescue Plan funds to support small businesses, grow the middle class and invest in our communities.

"We continue to build momentum on our economic recovery and our commitment to carrying out the governor's economic vision that tackles structural challenges to grow Michigan's economy, create good-paying jobs and build industries of the future," said Susan Corbin, director of the Michigan Department of Labor and Economic Opportunity (LEO). "These conversations will be critical in guiding our efforts. By working together and hearing from a diverse set of voices throughout the state, we can continue to jumpstart the economy and build Michigan back better."

The goal of these events is to share the governor's vision with key stakeholders and thought leaders and highlight local projects that demonstrate how the MI New Economy plan can move the state's economy forward.

The Marquette stop of the tour included presentations from LEO and Invest UP, and an open discussion with other local leaders to highlight their initiatives - current and on the horizon - that align with the MI New Economy plan.

"Even in the wake of a global pandemic, there is plenty of reason for optimism as we continue building a stronger economy than ever before," said Invest UP Chief Executive Officer Marty Fittante. "I know I speak on behalf of Upper Peninsula businesses and institutions in saying that we are so grateful Director Corbin took the time on behalf of the Governor to not only come up and detail the Governor's MI New Economy proposal but, as importantly, listen to what we believe are the necessary priories for the U.P. to accelerate economic growth and recovery. We look forward to continuing to work with Gov. Whitmer, her team and the legislature on a plan that provides transformative opportunity for not only the Upper Peninsula but the entire State."

Last month, Gov. Whitmer detailed her economic agenda, including the unveiling of the three pillars of her $2.1 billion MI New Economy plan with specific and ambitious goals that will help state officials track progress on efforts to build a stronger and more resilient Michigan. The governor's vision features three central pillars focused on economic development, workforce and community investment.

Pillar 1: Grow the Middle Class - No economic vision for the state can be complete if it doesn't focus on eliminating poverty and lifting families into the middle class. 

• Goal: 60% of adults with a postsecondary credential by 2030  

• Goal: Lift 100,000 families out of working poverty during the next five years (FY22-FY26)  
• Goal: Provide access to low or no cost childcare for 150,000 more families by 2024  

Pillar 2: Support Small Business - To supplement the great economic development work our state already does, Michigan needs a focus on creating and growing more Main Street businesses. 

• Goal: Top 10 state for small business job growth and revenue growth from 2022 to 2026  
• Goal: Top 10 state for household income growth during the next five years (FY22-FY26)  

• Goal: Top 10 state for growth in venture capital funding over the next five years (2022-2026)  

Pillar 3: Build Strong Communities - Michigan's residents deserve to live in vibrant communities with the kinds of services and amenities associated with a high standard of living. 

• Goal: 100% access to high-speed internet and 95% adoption by households during the next five years, while continually investing in higher quality access (FY22-FY26)  
• Goal: 75,000 new or rehabilitated housing units in five years (FY22-FY26) 

Additional stops of the MI New Economy Tour are being planned for many communities across Michigan.

To learn more about the MI New Economy plan, the state's economic and workforce challenges and successes the state has seen to date, visit Michigan.gov/MINewEconomy.

Pence Discusses Patriotic Education

Patriotism is a beautiful thing and it is something we should all strive for as a method of encouraging prosocial activities. The values we teach should transcend generations back to our beginning and apply across our diverse landscape. America has its struggles and should continue down the path of a more perfect union and a stronger and inspiring state. 

How we get there is one of the biggest issues we face in modern times. It relates to how we make decisions and how we empower our population to act for the benefit of its nation and people. Race and religion should not help or hinder anyone in this country but only a beneficial difference in seasoning.

Anther point he brings up is education. Developing a strong education system that pushes student to learn and compete on the global market is important. We must maintain our competitiveness and that may need some levels of reform.....I advocate toward creativity, STEM, and technical abilities. 

Delta County EAGLE (Solid Waste) Grant $764K-Compost and Reuse It!

Delta County has received an EAGLE grant for $600,000 and Delta Solid Waste Management Authority (DSWMA) is required to put forward matching funds of $164,016 creating a total of $764,016. (You can read more in an article by the Daily Press.). There will be a couple of trailers, the tractor, equipment, etc....to help move products from Delta County to Marquette where greater capacity to recycle certain products lay.

Keeping up on different grants helps Escanaba-Gladstone to hedge their existing resources with state and federal resources. They want counties to think about how product flows and how to maximize the use of waste by turning it into a usable resource. The better we get at this the more we can insulate the natural world around us from our waste and by products by creating more contained systems (In other words were giving nature a chance by reducing the amount of toxins were putting into it.)

Here is a grant open to counties.....

EGLE grants available for counties to improve materials management in Michigan

Nov. 1, 2021
EGLE Media Office, EGLE-Assist@Michigan.gov, 517-284-9278
Materials Management Planning, EGLE-MaterialsManagementPlanning@michigan.gov

The Michigan Department of Environment, Great Lakes, and Energy today announces a new materials management grant for counties. The purpose of this grant is to help counties transition from Solid Waste Management Plans to more comprehensive Materials Management Plans and to engage counties in future planning activities.

Currently, Michigan uses outdated Solid Waste Management Plans that focus on ensuring waste disposal capacity for each county. Michigan is evolving to recognize waste as a resource and focus on comprehensive materials management, including recycling, composting and other more sustainable management practices.   

This grant will require grantees to complete several tasks designed to prepare counties or regions to think about the flow of materials in anticipation of updating their Solid Waste Management Plans to Materials Management Plans in the future.

Completing these activities will help counties to:

• Create partnerships within regions and counties.
• Understand current materials management gaps and challenges.
• Highlight future changes to the planning process.
• Outline steps that can occur now at the county/regional level to assist with the development of future materials management programs and infrastructure.

Counties are encouraged to collaborate regionally. Counties that work together will receive $12,000 per county. Counties that work alone are eligible to receive $10,000.

For more information on the grant requirements, review the MMCE Grant Requirements and Deliverables.

To apply for this grant, submit a Notice of Funding through Survey Monkey.

For more information, visit Michigan.gov/EGLEM3.

To stay up to date on other EGLE news follow us at Michigan.gov/MIEnvironment.

Why Free Pass for Hate Isn't the Wisest Long Term Choice

There are people throughout our nation that struggle with obtaining justice for important issues that strike at the heart of who we are as a nation. We are a free people with free will and as long as we are doing positive things, as strategic course, should not be subject to the racial, religious, and hate based behaviors of others. Furthermore, as a society we have a responsibility to create an environment where we maximize our human capital through wise leadership and even wiser use of institutions. 

The justice protests have settle down for the time being and all is well now right?  At least it looks that way on the surface. I'm not for or against the protest so much as I see them as a feedback loop (A feedback loop for organizational improvement) so I try and maintain objectivity about them. National stability relies on our ability to recognize the message of the protesters while understanding positive benefits policing can/does bring to our communities to find the best path forward. In other words, I 'm a rational human being who can weigh and balance different complex arguments to come to a divergent conclusion that blends the different "truths" (I'm open to the possibility of being wrong and that is my greatest asset. However, based on what I understand and how I construct my logic we have a bigger issue that needs to be addressed.🤷) 

Of course a conclusion is open to debate depending on our personal values (For 97% of society they rely on others to tell them what they believe....they just don't know it!💁) and the process of evaluation we go through. For the vast majority of us, we simply accept what is told to us and promote it without critical thinking. However, even when there is room for a debate about technical action there should be little debate on the fundamental Constitutional rights of American citizens (Those who are not protecting these rights should not be in a position of leadership as its a social contract that holds everything together.). 

A free pass for hate and hate groups is dangerous as it sends the message there are different legal systems at work for different people (We don't want a system that is highly dependent on social status, ethnic affiliation, religion because it can't be successfully exported to others as a philosophical value system and it limits us from our full potential.). As many of you know, my children and I became targets for an ex mediocre sports group that was commanded by their central leadership to "get the Muslims". Worse, some have lovingly called my kids "nigga babies" and treated them as poor second class citizens that were all to easy to manipulate and discard. 

Going further, because the group leadership had something to gain and fostered through dating and personal friendships social connections with local officers that made it easier to manipulate an environment (Deep down I believe that a few were unwilling participants but their voice didn't come through.). In the end, they were not successful because a couple of checks and balances were implemented that couldn't be ignored or sideswiped in distorted logic (In other words, the inappropriate logical chain they used to justify a conclusion prior to knowing the "facts" was broken using information that couldn't be ignored through selective attention.) 

What I have advocated for is mental health check on the initiators of hate and followed up ongoing counseling. The initiators have problems they don't want to deal with and instead of "manning" up (could be for men or women in this context) and dealing with their problems they projected their dysfunction onto others.  (Lots of bravado in this group but very few real characteristics of advanced development. Because the group formation is distorted there are few appropriate outside anchors to their thinking. You can see the after effects of cultism when participating members support the distortion that the initiators are  "victims". A very simple article on Narcissism)

With hope of creating some good karma and positive outcomes I also encouraged more training for officers involved (As a social correction and a skill development mechanism. From a scientific perspective you will be more accurate and effective in tackling problems/crimes when you can see all the factors involved). Training on critical thinking, appropriate investigative methods, insulation from hate group/extremist members, and a general improvement to the practice of policing (They have an important function in society and I support them, the officers, and their ultimate societal goal. Support also means encouraging positive change where it is most likely to help officers be more successful.). There are ways to get "bad guys/gals" while taking the time to fact check to ensure accuracy.

Notice that despite the personal danger that I have undertaken and the desire to protect my family I am advocating for 1. mental health to deal with the root problems of aggression and 2.) improving policing to ensure it functions at its best without being sidelined by erroneous logic (Should always seek ultimate truth). These would normally be considered a sign of wisdom and an attempt to take a lot of lemons and turn them into sweet lemonade to improve the community (To the ignorant its just another sign of "boogie man".).  

However, there is a difference between lemonade and free pass that lacks a level of accountability. These were dangerous behaviors that could have gotten people killed and/or hurt people in the community; the dangers to everyone involved heightened. It also uncovered a lot of other hidden problems/latent variables between this group and their supporters. At the end of the day a "free pass" is not really a free pass. Its just delaying and empowering the mechanisms that are likely going to require a bigger national correction later (Adjustments in collective conscious...through integration of new ways of viewing the world). 

While we haven't come up with a perfect way to deal with extremism in this country we should be open to the possibility of other explanations. If we were to solve aggression and extremism we must 1. understand it and 2. resolve its social root by helping those who initiate it......through the use of stronger mental health support (mental health is also another place we need improvement.). I don't pretend to know the answers, and so far it seems like everyone else has all the answers, so I humbly bring forward what seems to make sense from my small corner of the world (I get it...I'm a Muslim-Catholic with Black-Arab-White kids....I'm not expected to know much?.....also called implicit bias. In reflection, I have not had to change away from my prosocial resolution suggestions since the whole mess started to unfold in real time because I said what I saw and understood. When logic is internally consistent it has a much higher likelihood of being true. 😬). 

"Leadership is solving problems. The day soldiers stop bringing you their problems is the day you have stopped leading them. They have either lost confidence that you can help or concluded you do not care. Either case is a failure of leadership." Colin Powell

"We cannot solve our problems with the same thinking we used when we created them." Albert Einstein

What is this China Stagflation Thing? An Explanation of U.S. Stagflation

Economists are talking about some indicators that China may move into stagflation What is stagflation? Stagflation occurs when there is little productive growth but rising inflation. Stagnation + Inflation = Stagflation. While we don't know if these issues will hit the U.S. after China we do know that the pandemic will rewrite many of the economic books (virtual adaptations to a physical ailment. It will take a few years for researchers to sort of grasp the shift.). Understanding how stagflation works will help companies hedge their options.

The term stagflation was originally coined by a British politician Iain Macleod in speech to Parliament in 1965. It occurs when prices are rising but there are less products available. It often impacts employment, interest and a number of different factors that can put a country in free fall. There are not a lot of great tools for dealing with such situations.

We forgot about stagflation until recently where it recently became a possibility again. You can read a study that looks at U.S. stagflation from 1975 to 2013 'From the Stagflation to the Great Inflation:Explaining the US economy of the 1970s'. The researchers found by looking at and analyzing the key macroeconomic literature pertaining to the time period that Supply-shocks and inflation inertia were seen as the major mechanisms underlying the stagflation (Goutsmedt, 2020).

Hiking and Tourism-Outdoor Participation Trends Report

Hiking and outdoor enthusiasm is an important part of our economy and can bring benefits to local communities. In addition, to being a positive cultural enhancement it also a healthy lifestyle choice. Difficulties in outdoor activities range from the short stroll to extreme rock climbing thereby accommodating nearly all activity level needs. You may want to look at a few of the outdoor trends in the 2021 Outdoor Participation Trends Report.

-53% of Americans over the age of 6 have engaged in recreational sports. 

-Less devoted outdoor enthusiasts (of which I am one) but more casual. 

-In general less people participated in outdoor recreation. 

(Side note: Outdoor recreation brings with it opportunities. Some places in the Upper Peninsula of Michigan have seen increased outdoor participation. Here is a little article on capitalizing on outdoor enthusiasm to encourage local investment. Adventure-Venture Tourism)

Hiking Mountains

Hiking Mountains

UN World Investment Report 2021-Can the U.S. Become an Investors Reinvestment Choice?

America was once a producer of many things
We can be again! (Julian Historical Society)

The UN World Investment Report 2021 discussed the changes in the investment market since the pandemic started. Investments have declined and many of the world economies are lagging. The U.S. also took a hit but is starting to realize that a new path forward would be helpful. 

We are a large economy and it takes time to get people on board that thoughtful change is needed to help attract investors and ensure that the means of production are maintained within the country. 

One thing that investors want is to realize higher levels of profit with less risk. We know that we need to innovate across most of our society but we don't really have a plan. We wouldn't need a plan if it would have done it naturally but we have failed to be forward thinking in prior decisions. We are likely near the last place in our "window of opportunity" to revamp our society. After that...things might get more costly and resources might not be available if needed (We must develop a mindset of national development and innovation.. I.E. an "American Renaissance". )

To return investment relies on a great many things but having locations where certain industries can rapid develop and mixed with FDI investment can lead to even greater profits for everyone around. Its not perfect but I'm not at the moment seeing a different way to push national competitiveness upwards (See Transactional Cluster Theory. Its not finished yet. Attracting Multinational Investors Delta County and Start Up Firms Delta County)

-Global FDI flows dropped by 35 per cent to $1 trillion, from $1.5 trillion in 2019.

-Developed countries like the U.S. took the most hit as capital moved to developing countries.

-UNCTAD estimates that the value of sustainability-themed investment products in global capital markets amounted to $3.2 trillion in 2020, up more than 80 per cent from 2019.

-Profits of multinational enterprises (MNEs) down 36 per cent on average and reinvested earnings were also down. 

-FDI flows to Europe fell by 80 per cent. North America was down 40%.

-US inward FDI 10, 802, 647 millions and US outward FDI $8, 128, 494 millions

-US decline was caused by failure of companies to reinvest earnings. (See Perpetual Sustainable Development)

The UN World Investment Report 2021

OB Pier and Forgotten New Culture

A photo of Ocean Beach Pier. A popular "hippie" (definition has partly changed to include outdoor enthusiasts and naturalists) destination that always has something fun and interesting going on. What makes it beautiful is that it hasn't yet been gentrified. This should be that place where certain rules help ensure it maintains its "free spirit" nature. Its more than marketing...its also culture and heritage (of which marketing should rely). There are other beaches that have their own themes....PB College....La Jolla Old Wealth......etc...

I might be a free spirited conservative....its possible.🤷
 

G20 Net Zero Emissions by 2050 (Biden Speaks)

 We have an environment to protect and the technology is available for us to move to a much greener society. It takes time and commitment to develop these new technologies such as solar propulsion and other systems. As we focus on new technologies we are also likely to discover things we haven't seen yet and in turn that will push space flight development. 

More details are likely to come out. You may hear President Biden's Speech......