Trouble In Texas

Pee Wee’s Big Adventure Deep In The Heart of Texas

“Trouble In Texas” began the first segment on the Boom-Bust financial program, carried by the Russia Today network. The segment, narrated by Ameera David, aired on April 3, 2015:

The crash in oil prices isn’t just hurting economies abroad. It’s very much taking a toll on Americans here at home, especially in Texas – a state driven, in large part, by the oil industry. The latest report out of the Federal Reserve Bank of Dallas shows manufacturing activity declined in March with the production index falling to its first negative number in nearly two years. [1]

Ameera David’s report is corroborated by other sources:

On March 30, 2015 Business Insider (online) reported, “Texas hasn’t been this bad in 2 years.” Something called the “manufacturing outlook index” has huge deterioration, from -11.2 in February 2015 to -17.4 in March 2015. The plunge in oil prices causes the “fracking” projects to operate at a loss so they close down, at least temporarily. This has a ripple effect upon the fabricated metal manufacturing sector, the machinery manufacturing sector, the electrical equipment, appliance, and component manufacturing sector, the paper manufacturers, and the chemical manufacturers. [2]

MarketWatch reported on March 31, 2015, “The Lone Star State is taking it on the chin from the rapid drop in oil prices.” A “Texas retail outlook survey” has dropped to -6.4. [3]

In Illinois, austerity measures loom. For now there has been no drama because an April 7th election means hard choices must not tar persons such as Chicago mayoral hopefuls Rahm Emanuel and Jesus “Chuy” Garcia. For now it is all tall talk. But, “Après moi, le déluge.” Wait until after April 7th.

The “Federal” Reserve (really not federal but privately owned) has kept overnight interest rates near zero since December 2008. [4] Yet ever since, we have kept hearing how “Prosperity is just around the corner.” Each year there have been “hopeful signs”, yet the “Fed” has contradicted this. It was William McChesney Martin, Jr., “Fed” chair from 1951 to 1970, who famously said, “The job of the Federal Reserve is to take away the punch bowl just as the party gets going.” He meant by that that when prosperity is really just around the corner, the “Fed” begins to raise the interest rates. So how has it been that ever since December 2008, in spite of repeated “news” about “hopeful signs”, the “Fed” has not taken away the punch bowl?

In 2007, the year before the crash of the housing bubble, a noteworthy surge in apartment construction occurred locally here in Champaign-Urbana, Illinois. So I find it ominous that an even greater surge in apartment construction than in 2007 is now taking place here. The 2015 apartment construction surge is funded by big-time operators who don’t know what to do with all the cash funneled into the system by the “Federal” Reserve. They are big-time operators who really don’t have much skin in the game. If their gamble goes bust, then the “Fed” will just bail them out (they think). “We are too big to fail,” they might argue. And maybe they’ll get away with it again.

But if the boom goes bust, at least in Illinois, what do you tell the people then? “Prosperity is just around the corner” is wearing mighty thin after 7 years! Will it finally be admitted that we have a systemic crisis? How long can statisticians do a juggling act with gimmicks like zero-hour contracts? How long can people be distracted from “it’s the economy, stupid” via staged dramas such as Indiana’s religion vs. LGBT tempest?

And if you are sickened by all the stupidity, where shall the weary find rest? Isaac Newton found rest while sitting under a tree…

——- Sources ——-
[1] “Texas oil decline and Airbnb in Cuba”, BoomBust, April 3, 2015. Hosted that day by Ameera David.
[2] “Texas hasn’t been this bad in 2 years”, by Myles Udland. Business Insider (online), March 30, 2015.
[3] “More bad news in Texas as retail survey plummets”, by Steve Goldstein. MarketWatch, March 31, 2015.
[4] “U.S. job growth brakes sharply, clouds Fed rate hike timing”, by Lucia Mutikani. Reuters, April 3, 2015.


About ersjdamoo

Editor of Conspiracy Nation, later renamed Melchizedek Communique. Close associate of the late Sherman H. Skolnick. Jack of all trades, master of none. Sagittarius, with Sagittarius rising. I'm not a bum, I'm a philosopher.
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