It is time to stop paying Americans to stay home! Facing this fact employers are looking at ways to replace the missing workforce. If you are making more money by staying home…fine but there are long-term consequences to this. Technology will continue to replace the production of people in some sectors. It could possibly make the big companies get bigger but hurt small businesses that do not have access to the technologies. More people working is what has fueled America in the past. Short-term decisions affect long-term goals. Technology that has come about and that has been implemented in the past year is astonishing. With work from home workers, it will be almost impossible for corporations to sustain their corporate culture. Who will have the leverage when America comes out of this? Cold Economic growth accelerates at a faster speed because of the adoption of technologies and increased productivity.
Commodity prices have soared but Miners are not starting new projects….raising concerns that there will be future shortages of some metals. Copper’s price has almost doubled over the past year. Mining is a boom-bust industry. In the early 2000s, there was a boom. Natural gas prices soared in 2008. We are just coming out of the stage where the industry is coming out of a bust. Investors were unhappy about how the mines invested at the peak of the previous cycle. Their balance sheets were in bad shape over the last decade. shareholders want the dividends. This is why the miners are reluctant to reinvest now.
In other instances, housing has gone up over 13%. Yet inflation is not being captured in Consumer Price Index. Prices have gone up but rentals have not gone up proportionately. Predictions are that rent will go up. Home prices were in the index in the ’70s as were food and energy prices. It includes 65% fewer prices than it did in the ’70s. The Fed this time around as well. Hopefully, inflation will not spiral out of control this time like it did in the ’70s. There may come a point where the Fed is not able to keep doing what it is doing. Speculators in the market have no understanding of this.
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