Thank goodness for memes!  A witty, well-placed caption on a still frame from a movie, cartoon, etc. provides welcome comic relief amidst the steady drip of stressful news these last few years. 

The latest templates are rich celebrities and bureaucrats who are basically telling us to suck it up, or buy an electric car to counter spiking gas prices in the wake of the Russian invasion of Ukraine.   

Now the press is vying for some of the meme mockery.

A recent editorial in the San Antonio Express-News tells us that it’s “a small price to pay to help save Ukrainian lives and cripple Russia’s invasion.”  What about the “already high fuel and oil prices” they mention in the next breath?

In any case, all of which can be summed up in three words: a weak dollar.

After the chaos that ensued from President Nixon severing its link to gold, both Presidents Reagan and Clinton came out explicitly for a strong dollar.  Remember how much it cost to fill-up then? 

Probably not, because it was negligible.   

Oil more clearly reflected the commodity that it is: one that is in abundant supply (we’re on “Peak Oil 3” by my count), and nearly identical from one producer to another.  That kind of perfectly competitive setting keeps a natural lid on prices. 

Neither OPEC, nor Russia, nor any other producer could do anything about it because oil is priced in dollars globally (though Saudi Arabia and China are trying to shake that up). 

At the dawn of the 21^st century however, our leaders’ support for the dollar started to flag.  With its subsequent devaluation, it took more to buy the black gold.  Hence, its price soared to almost $140 a barrel in mid-2008 before bottoming-out at $31.

We know what else was happening then: the so-called Great Recession.  Incidentally, the mortgage crisis that precipitated that can also trace its roots to the beaten-down greenback.      

When the dollar is destabilized, investors start parking more of their resources in established assets, where returns are more certain.  In addition to gold, the traditional hedge against dollar volatility, housing is another such asset. 

All this seem eerily familiar right now?

Multiple rounds of “quantitative easing,” two more weak-dollar presidents, and another crash (2014-2016) later, owners of energy companies had had enough.  No longer interested in simply financing growth, they started demanding more fiscal discipline.

As so often happens, bankruptcies and consolidations followed.  Some organizations have emerged in private hands, which might help them avoid a new headwind: ESG limitations. 

The environmental, social and governance movement dictates that investment flow only to politically correct ventures.  Needless to say, that doesn’t include oil and gas firms.

That’s ironic given that it has been them, via the deluge of natural gas unlocked by hydraulic fracturing, that have been as responsible for the steep drop in emissions as any other energy source.

Unsurprisingly, that gets as little attention in the mainstream media as does the fallout from a weak currency, which has only gotten more flaccid since the Fed floored the printing press in response to the dictatorial government shutdowns. 

Now we have politicians in self-preservation mode calling for a suspension of the federal gas tax, and naïve bureaucrats imploring the industry to produce “more right now.”  No doubt that includes from the “9,000 approved, but unused, drilling permits on federal land.”

Nevermind that many of those have little potential, or how long it would take to bring product to market from the others.

It’s especially disingenuous after they, buttressed by their media cheerleaders, have erected all manner of regulatory hurdles to push the fossil fuel industry toward extinction.

Supply and demand fundamentals are not out of whack here.  The price at the pump has actually gone down by a dime in my neighborhood recently.  And though it is inexplicable that we’d court the likes of Venezuela and Iran for their oil, it would matter little.

When the conflict in Ukraine subsides, will these elites start to explain the (near-)doubling of energy prices of the last year or so?  Will they put aside political spin, and instead consult facts, figures and history, and level-up with citizens? 

Or are we just supposed to accept it like the unnecessarily heavy-handed government response to the coronavirus? 

We’re being set up for another economic crash, and those don’t make for funny memes. 

The post The Express-News Passes Gas first appeared on Infuse SA.

“Homeownership is a path for building wealth in the U.S. The median homeowner had $254,900 in wealth in 2019, compared with $6,270 for the median renter, according to the Federal Reserve’s Survey of Consumer Finances.
“’It’s a wake-up call,” said Gay Cororaton, senior economist and director of housing and commercial research at NAR. ‘Policies have to be focused more on making sure that the lower-income and many more middle-income folks participate in the benefit of homeownership.’”

So says a report from The Wall Street Journal this morning.

Unless you live where many people want to be, it is and always has been misleading to call home ownership a “path for building wealth.” If anything, it’s an inflation hedge that guards against poor monetary policy and stewardship of the dollar.

The housing bond in May will not help this, and will arguably make things worse.

When the federal government, both the president and the Federal Reserve, support a weak dollar, a couple things happen. One, it makes some things more expensive because, since it has been devalued, it simply takes more dollars to buy things.

This is why the cost of basics such as food and oil/gas rise.

Two, future gains from investment (what actually drives economic prosperity; NOT consumer expenditures) become less predictable because of the weaker dollar, and uncertainty which direction the value of it will go. As a result, the price of gold goes up.

Another ‘asset’ that rises in value is housing. It’s why you see increased investment in rental properties, and home remodeling, for example.

City and county government know this, and cash in via property taxes. Compounding matters, they embody the true definition of greed in our society when they can’t be bothered to cut rates, nevermind doing the right thing and uprooting and abolishing the whole enterprise.

To think government-directed housing policy, which invariably invites cronyism and corruption, can fix this problem is the height of arrogance or ignorance, or both.

Vote “NO” on the housing bond.

The post A Home is a Basic Expense; Not a Wealth-Building Vehicle. first appeared on Infuse SA.

When you raise taxes on citizens in pursuit of a protectionist trade policy like the last administration did, not only do you erode market efficiency, slow the drive toward future prosperity, and create more cronyism, you see higher gas prices because of the weak dollar that ensues.

When you not only maintain that policy like the current administration has, but also open up the fiscal spigots, borrow more and more in a quest for wasteful social spending, and actively seek to curtail domestic energy production, you get higher gas prices.

When elements of both political parties support freedom-crushing shutdowns in an effort to mitigate a virus with 99+% survival rate, you get the all-around inflation we’re seeing today.

There was room in this report by News 4 San Antonio for a summary of the above if they were really interested in thoroughly informing the public … especially in the 2nd- and 3rd-to-last paragraphs. Someone get them a proofreader to help with their grammar, please

The post Helping the Local Media Inform … and Use Good Grammar. first appeared on Infuse SA.