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2023-09-12 07:00 by Karl Denninger
in Consumer , 376 references Ignore this thread
The Consumer Is Strong!
[Comments enabled]

Uh, no he isn't.

He's maxed out on his plastic, he's wondering if next week the food bill is going to go up another $20, he's watching gas prices like a hawk and expecting trouble there too, he is being hounded at his job to "do more for the same pay" and more.

And those are the producing ones.  The folks who are not inclined to produce, and there's a lot of them, are sensing the Sword of Damocles over their heads.  This was always the problem with "RIP" (Retire In Place) or "DTL" (Do The Least) which many adopted and some even advocated post-lockdown.  It seemed like a reasonable bid if and only if the labor market was continually and permanently "tight" -- that not only would it be hard to replace you but your job had to be done and the firm couldn't manage without anyone in your position at all.

I get it when it comes to incentives; training people that they they're "worth" $30,000/year tax free (which is about $50,000/yr from a job, when you account for all the taxes such as FICA, income tax and similar) to sit at home and get drunk, stoned or whatever during the pandemic, which we did, was idiotic.  That is more than a huge percentage of people can generate with their current and, in some a decent percentage of cases, their highest level of skill and earnings capacity.  Doing that was beyond stupid but it continues a trend that goes back decades of considering people worthy of a check not because they did something but simply because they exist.  People call this "compassion" but it isn't at all: It destroys the motivation to better oneself and worse, to the extent the give-away is greater than the person's current earning potential it may well permanently destroy their incentive to better themselves because that which they got once without effort they now believe they can get again, not due to their own industriousness and effort but simply by screaming at the right people in the right way, whether that's by voting, agitating, burning or just taking.

Go feed a bear some human-style food a few times whether by intentionally putting it out there or through stupidity (e.g. an un-secured outdoor trash bin.)  When the food disappears said bear will now try to eat you to get more and you'll have to shoot it lest it kill you or your child.  This outcome is not the bear's fault -- it is your fault because you created the association between easy food and humans.  Thus it should be a really big shock when we give away things to invading people or simply those who would have to work hard to meet basic needs and, when that ceases to satisfy what they "deserve" they trash everything within reach and steal or even murder to get more "easy" -- right?

Here's the ugly part: The same sort of mental gymnastics applies to anyone who gets without earning it or otherwise by reasonable progression of society and doesn't recognize that was a windfall, but rather is led to believe the "gain" is something they have a "right" to continue to possess.

Heh Mr. or Ms. American, what's that crap you've been running your mouth about and letting the media and politicians shove in your head with regard to your house price -- or stock portfolio -- again?

Did you do anything personally to make that property more-valuable? Nope.

Did you do anything personally to make the price of Tesla or Nvidia stock go up?  Nope.

Why do you think you're owed that price?

A lot of you think you indeed are -- in fact, I hear all the time "this can't come back out."

Oh yes it can, and yes it has in the past.  In fact 50% losses in the stock market happen fairly regularly!  We haven't had one  in the stock market that has "stuck" for a decade or more in quite some time (close to 100 years now) but that has happened too and I might remind you that the time before it recovers exceeds your remaining time before you need to spend any of it then it may as well not recover at all from your personal point of view.

All those places you've heard about that can't attract sufficient employees at the offered wages and which is, in fact, due to the pandemic $600/week handouts and the "training" it did in people's minds are real.

But you, fellow American, probably believe if you're not only of "those people" -- you know, the folks looting stores, stealing anything not nailed down, or those "unable to find help" in the economy -- almost-certainly think you're not one of "them."

If you're one of those people who believe that the ramp in your house's "value" over the last three years is in fact "yours" and it "can't and won't" go back down, indeed, if you think the increases since 2003 or so are "yours", or that the insane expansion of multiples in the stock market, again all driven by "gimmes" from Congress buying votes which it can no longer afford to do without them showing up immediately and in greater amount in inflation, will not and cannot come back out you are exactly the same in your mental space as the person who refuses to work for $10/hr because he or she got $600/wk to sit at home and get drunk, or who smashes and grabs out of the store because they are "owed" it.

It is the precise same mental thought process folks as exactly zero of you have earned a single nickel of that alleged "appreciation" through the actions of your own hands and mind.

Welcome to a Hell of your own making, America.