Is the US economy a virtual reality?

An owner of the bar explained to me that he has been closed for a full year and yet miraculously still survives, thanks to vast infusions of government money to cover his rent and upkeep and sustain essential employees. He is looking forward to reopening but is having a hard time finding employees. Many have moved to Florida. Others, he said, “are happy to live off government money rather than work.”

Article by Jeffrey A. Tucker from AIER.

His main puzzle is how it can be true that the government has the resources to sustain so many businesses in a full year of lockdowns. The money is falling like manna from heaven.

“From all my years in business, every instinct tells me that this can’t be right. It might work for a little while but someone has to pay these bills. There is no magic money tree out there to achieve such things.”

The tree might not be magic but it does exist. It’s called the Federal Reserve. Here is the alarming chart of the broadest definition of national money, which reveals an unprecedented increase in the money supply over the last year.

The effects of such a thing can be difficult to trace. And much depends on factors outside the Fed’s control. Even the attempt to reign in the long-run effects could fail. Even so, the short-term effects, combined with unprecedented increases in government spending, have been to create the appearance of near full recovery.

By the aggregated data alone, the US economy seems almost back to normal. Gross Domestic Product is higher now than pre-pandemic and poised to roar much higher. “What’s amazing,” writes the Wall Street Journal, “is that U.S. output is nearly what it was in the fourth-quarter of 2019 even with payrolls being about 5% smaller.

Consumer spending on durable goods is through the roof with a 41% increase for the quarter.

Private residential investment, which is to say consumer spending on housing, has blown past the point at which the last housing bubble blew up.

Is Valhalla really around the corner? New riches? What’s the downside?

Following a lockdown collapse in prices, the consumer price index is pointing toward inflationary signs. The Everyday Price Index is climbing at an annualized double-digit rates.

No question that much of this “growth” is fueled by historically high increases in government spending, producing charts we’ve never seen before.

No question that much of this “growth” is fueled by historically high increases in government spending, producing charts we’ve never seen before.

These increases were not paid out of some resource reserve sitting in DC. They are paid by astronomical increases in borrowing. Here are the increases in the public debt to GDP ratio.

What all this aggregate data misses is the huge dislocations, distortions, and outright destruction that occurred because of the unprecedented use of extreme lockdowns in 2020. The New York Times provides a helpful analysis of existing sectors relative to what might have happened outside the pandemic lockdowns.

Thus are some sectors of the US economy booming to new highs, while others are still in deep depression. The sectors that were locked down (entertainment, art, food, hotels, recreation), and those other sectors indirectly affected by lockdowns (exports, transportation, energy) are still wallowing in misery, having been battered by compulsory shutdowns that wrecked so many business models or otherwise forced them onto the government dole.

One of the figures that fascinates me is the one on health care. It is still down 5.9% from what it might have been without the pandemic. Historians of the future will surely be amazed by such data. In a pandemic with such tremendous sickness and death, one would expect spending on health care to rocket higher than ever before.

Instead, what we see in health care is a collapse of fully 18% in the worst months of the pandemic, a statement that sounds ridiculous in the saying.

What this illustrates is one of the least-talked-about aspects of government policy over the past year: state government’s interventions in the medical system that essentially reserved most if not all hospital space for Covid patients. Routine medical care and “elective surgery” was put on hold. Dentistry services collapsed a year ago by 70%.

This meant missed cancer screenings, routine checkups, and normal doctor’s visits, not only because people were afraid but also because medical services faced a brutal form of central planning that had never previously happened. Thus do we get the most perverse results one can imagine: a collapse of spending on health care during a pandemic. It’s hard to isolate one piece of data that best captures the folly of government pandemic policy but perhaps this one is it.

It’s impossible to know precisely what the future portends for all these unprecedented policy shocks over the last year, from money supply and spending bonanzas to lockdowns to sky-high debt accumulation. But because a thing called cause-and-effect still operates in this world – we do not live in virtual reality – it seems wise to look at the seemingly great aggregate data with a gravely skeptical eye. We might be in the midst of the calm before the real storm hits.

‘The Purge’ by Big Tech targets conservatives, including us

Just when we thought the Covid-19 lockdowns were ending and our ability to stay afloat was improving, censorship reared its ugly head.

For the last few months, NOQ Report, Conservative Playbook, and the American Conservative Movement have appealed to our readers for assistance in staying afloat through Covid-19 lockdowns. The downturn in the economy has limited our ability to generate proper ad revenue just as our traffic was skyrocketing. We had our first sustained stretch of three months with over a million visitors in November, December, and January, but February saw a dip.

It wasn’t just the shortened month. We expected that. We also expected the continuation of dropping traffic from “woke” Big Tech companies like Google, Facebook, and Twitter, but it has actually been much worse than anticipated. Our Twitter account was banned. Both of our YouTube accounts were banned. Facebook “fact-checks” everything we post. Spotify canceled us. Medium canceled us. Apple canceled us. Why? Because we believe in the truth prevailing, and that means we will continue to discuss “taboo” topics.

The 2020 presidential election was stolen. You can’t say that on Big Tech platforms without risking cancellation, but we’d rather get cancelled for telling the truth rather than staying around to repeat mainstream media’s lies. They have been covering it up since before the election and they’ve convinced the vast majority of conservative news outlets that they will be harmed if they continue to discuss voter fraud. We refuse to back down. The truth is the truth.

The lies associated with Covid-19 are only slightly more prevalent than the suppression of valid scientific information that runs counter to the prescribed narrative. We should be allowed to ask questions about the vaccines, for example, as there is ample evidence for concern. One does not have to be an “anti-vaxxer” in order to want answers about vaccines that are still considered experimental and that have a track record in a short period of time of having side-effects, including death. One of our stories about the Johnson & Johnson “vaccine” causing blood clots was “fact-checked” and removed one day before the government hit the brakes on it. These questions and news items are not allowed on Big Tech which is just another reason we are getting canceled.

There are more topics that they refuse to allow. In turn, we refuse to stop discussing them. This is why we desperately need your help. The best way NOQ, CP, and ACM readers can help is to donate. Our Giving Fuel page makes it easy to donate one-time or monthly. Alternatively, you can donate through PayPal as well. We are on track to be short by about $4100 per month in order to maintain operations.

The second way to help is to become a partner. We’ve strongly considered seeking angel investors in the past but because we were paying the bills, it didn’t seem necessary. Now, we’re struggling to pay the bills. We had 5,657,724 sessions on our website from November, 2020, through February, 2021. Our intention is to elevate that to higher levels this year by focusing on a strategy that relies on free speech rather than being beholden to progressive Big Tech companies.

During that four-month stretch, Twitter and Facebook accounted for about 20% of our traffic. We are actively working on operating as if that traffic is zero, replacing it with platforms that operate more freely such as Gab, Parler, and others. While we were never as dependent on Big Tech as most conservative sites, we’d like to be completely free from them. That doesn’t mean we will block them, but we refuse to be beholden to companies that absolutely despise us simply because of our political ideology.

We’re heading in the right direction and we believe we’re ready talk to patriotic investors who want to not only “get in on the action” but more importantly who want to help America hear the truth. Interested investors should contact me directly with the contact button above.

As the world spirals towards radical progressivism, the need for truthful journalism has never been greater. But in these times, we need as many conservative media voices as possible. Please help keep NOQ Report going.

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