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Is The Small Business Sector Being Deliberately Targeted For Destruction?

Is The Small Business Sector Being Deliberately Targeted For Destruction?

Authored by Brandon Smith via Alt-Market.us,

The past 18 months have not been kind to small businesses. If you were unfortunate enough to live in a blue state during..

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Is The Small Business Sector Being Deliberately Targeted For Destruction?

Authored by Brandon Smith via Alt-Market.us,

The past 18 months have not been kind to small businesses. If you were unfortunate enough to live in a blue state during the onset of the covid lockdowns and you own a brick-and-mortar business then you have probably spent a large part of that 18 months closed, or struggling to stay open with a skeleton crew of employees. If you did manage to get a PPP loan from the government during shutdown you are now realizing that the 24-week grace period is running out and you will probably have to pay most if not all of that money back soon. Many who tried to get a PPP loan failed because the money was quickly chewed up by major corporations instead of being reserved for small businesses.

And this isn’t even the beginning of the list of troubles for small companies. I have to say, unless a large part of your business is handled online your chances of staying solvent are slim. This is not the fault of most business owners, though, it is a consequence of artificially created conditions and restrictions.

What do I mean by this? Well let’s look at some factors that many people might not be aware of…

Here’s why small businesses are suffering

For example, both state and federal governments have been offering some level of covid unemployment stimulus. In the case of federal programs this could amount to $300 extra a week on top of a person’s existing unemployment checks, even more if their state has a separate program. This has created a massive drought in the employee pool. No one wants to work when they can stay home, do nothing and make more money than they ever were before the pandemic. The reality is that there are jobs everywhere right now, but almost no one is applying.

This has led to major corporations and retailers offering unheard of sign-on bonuses in the range of $300 to $500. Some companies are offering to pay people just to put in an application. Many are offering incredible wage increases in the range of $15 an hour for unskilled labor.

But guess who can’t make offers like that? The majority of small businesses. Large corporate chains have enjoyed endless stimulus packages from the federal government and the central bank and as long as this continues they will always be able to outbid small businesses for employees. And though the federal covid checks are slowly winding down, there are still millions of people receiving regular unemployment for many months to come. In a bizarre twist, the jobless are now flush with cash and are in no hurry to rejoin the workforce. Small companies simply cannot compete and lure these workers from their covid vacations.

On top of this, we are now witnessing a dynamic which I have been warning would happen for years now – a stagflationary grind. That’s right, the debate that has been raging for a decade among alternative economists is finally over: It’s not a deflationary depression or a Weimar-style hyperinflationary collapse that is bringing America down, but a crippling stagflationary malaise. This means that U.S. GDP will continue to decline and certain sectors of the economy will continue to decline while prices on many products (primarily necessities) will continue to increase or remain very high.

This creates a conundrum for small business owners – Their overhead is rising and this is shrinking their profit margins. But, if they raise prices it makes it even harder to compete with large corporations that are able to keep prices lower for longer because they have government stimulus backing them up. So, not only are brick and mortar businesses unable to compete for employees, they also can’t compete in terms of prices as the cost of materials and goods spikes. It’s inevitable, they will have to close down. There were over 200,000 extra small business closures in the past year alone due to covid and the lockdowns.

With small businesses being hit with a perfect storm leading to mass closures, the end result will be that only major corporations will be left to offer services in the near future, and I’ve been wondering for the past several months now if this is not part of the plan…

Re-engineering the Great Depression

I am reminded of the situation that took place during the Great Depression involving small banks. In the 1920s there were thousands of small town and county banks across the country that were unaffiliated with major banks like J.P. Morgan or Chase National. It might sound strange to hear it but before the Depression many banks used to be small mom and pop businesses. By the end of the 1930s over 9000 small banks had failed, and the primary beneficiaries were the major corporate banks that absorbed all the assets into their portfolios for pennies on the dollar.

In other words, the banking industry and the massive power it holds today was consolidated in the wake of the economic collapse of the 1930s, and nothing was ever the same again. This beneficial crisis was helped along by the Federal Reserve, which had artificially lowered rates through the 1920s, only to rip rates higher in the late 1920s and the early 1930s. In an address to economist Milton Friedman on his birthday, former Fed Chairman Ben Bernanke admitted that the Fed was essentially responsible for the disaster of the Great Depression, stating:

“In short, according to Friedman and Schwartz, because of institutional changes and misguided doctrines, the banking panics of the Great Contraction were much more severe and widespread than would have normally occurred during a downturn.

Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.”

It’s interesting to me that the collapse that the Federal Reserve “accidentally” caused just happened to be the same collapse that allowed their good friends in corporate banking to centralize financial power for decades to come.

Today, we may be seeing a similar scenario unfolding. Look at it this way – The lockdowns were completely unnecessary. They didn’t stop infection rates and thus they didn’t save any lives anyway. In fact, the states with the harshest lockdowns and strictest mask mandates also had the worst infection spikes.

The covid unemployment programs are mostly unnecessary and only justified by the pointless lockdowns. And the stagflationary conditions have been mainly inflamed by the trillions in stimulus that the federal government and the Federal Reserve printed from thin air to pay for the unnecessary covid response programs and unemployment. The covid checks and loans have conjured a workforce calamity, but they have also fueled a retail buying spree which is mostly enriching manufacturing hubs like China, triggering exploding shipping demand and shipping costs, straining the supply chain, jamming up cargo ports and raising overall prices by leaps and bounds.

Every single element of this crisis has been engineered. And I would suggest the possibility that, like in the Great Depression, major corporations are once again in a convenient position to devour the small business sector and become the only game in town for all retail and services.

Not only do corporations benefit from the death of small business, but so does the Biden Administration in its relentless pursuit of covid vaccine mandates. Consider for a moment that small businesses are the antithesis to covid controls. Why? Because they offer people who refuse to take the experimental vaccines an alternative to major retailers that might demand to see their vax passports. Small businesses are much more likely to defy the draconian mandates, so Biden also wins by removing competition to the corporate oligarchy that support his controls.

Even if a small business complies with the passport mandates it will not save them, because the amount of extra costs involved in enforcement will be too much for most of them. Constantly policing customers and employees for up-to-date vaccine cards will become a full time job. Any slip up could mean a $70,000 to $700,000 fine, and because they have already submitted to the passports those businesses will have no backup from the community if they try to refuse to pay. They will ultimately close down anyway.

Without liberty minded small businesses, the only options left for the unvaxxed will be self employment (which will also be made more difficult over time), or barter and black markets.

Ironically, it is this threat that also creates an opportunity for small business owners. If they band together within their communities and let their communities know that they absolutely will not enforce the vaccine passports on employees or customers, then they could actually have a way to compete with and defeat the big box stores. They would have far more potential workers applying for jobs so their employee pool would grow at this critical time, and, they would gain all the customers in their area that also refuse to comply with the jab. Unless they are operating in a blue county, they will likely gain considerable business.

All the incentives are there. Small businesses will succeed and local communities will have options for defiance of medical tyranny. Will it anger the overlords? Yes, but who cares. They want to put you out of business anyway, so why not take a risk and fight back? The choice is to make a stand now, or live under the heel of a boot for the rest of your days. That’s all there is.

However, these measures need to be taken now before it’s too late. I also expect that as stagflationary pressures mount smaller businesses and the communities around them will have to start considering alternatives to the U.S. dollar. Precious metals are one option, along with barter and trade or local scrip as long as it is backed by commodities. There is much to be done. It is time for small businesses to accept the possibility that they have been targeted for destruction; they can do nothing and wait for the hammer to fall, or they can take measures to protect themselves. I suggest the latter.

*  *  *

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Tyler Durden Sat, 10/09/2021 - 21:00

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Analysts issue unexpected crude oil price forecast after surge

Here’s what a key investment firm says about the commodity.

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Oil is an asset defined by volatility.

U.S. crude prices stood above $60 a barrel in January 2020, just as the covid pandemic began. Three months later, prices briefly went negative, as the pandemic crushed demand.

By June 2022 the price rebounded all the way to $120, as fiscal and monetary stimulus boosted the economy. The price fell back to $80 in September 2022. Since then, it has bounced between about $65 and $90.

Over the past two months, the price has climbed 15% to $82 as of March 20.

Oil prices often trade in a roller-coaster fashion.

Bullish factors for oil prices

The move stems partly from indications that economic growth this year will be stronger than analysts expected.

Related: The Fed rate decision won't surprise markets. What happens next might

Vanguard has just raised its estimate for 2024 U.S. GDP growth to 2% from 0.5%.

Meanwhile, China’s factory output and retail sales exceeded forecasts in January and February. That could boost oil demand in the country, the world's No. 1 oil importer.

Also, drone strokes from Ukraine have knocked out some of Russia’s oil refinery capacity. Ukraine has hit at least nine major refineries this year, erasing an estimated 11% of Russia’s production capacity, according to Bloomberg.

“Russia is a gas station with an army, and we intend on destroying that gas station,” Francisco Serra-Martins, chief executive of drone manufacturer Terminal Autonomy, told the news service. Gasoline, of course, is one of the products made at refineries.

Speaking of gas, the recent surge of oil prices has sent it higher as well. The average national price for regular gas totaled $3.52 per gallon Wednesday, up 7% from a month ago, according to the American Automobile Association. And we’re nearing the peak driving season.

Another bullish factor for oil: Iraq said Monday that it’s cutting oil exports by 130,000 barrels per day in coming months. Iraq produced much more oil in January and February than its OPEC (Organization of Petroleum Exporting Countries) target.

Citigroup’s oil-price forecast

Yet, not everyone is bullish on oil going forward. Citigroup analysts see prices falling through next year, Dow Jones’s Oil Price Information Service (OPIS) reports.

More Economic Analysis:

The analysts note that supply is at risk in Israel, Iran, Iraq, Libya, and Venezuela. But Saudi Arabia, the UAE, Kuwait, and Russia could easily make up any shortfall.

Moreover, output should also rise this year and next in the U.S., Canada, Brazil, and Guyana, the analysts said. Meanwhile, global demand growth will decelerate, amid increased electric vehicle use and economic weakness.

Regarding refineries, the analysts see strong gains in capacity and capacity upgrades this year.

What if Donald Trump is elected president again? That “would likely be bearish for oil and gas," as Trump's policies could boost trade tension, crimping demand, they said.

The analysts made predictions for European oil prices, the world’s benchmark, which sat Wednesday at $86.

They forecast a 9% slide in the second quarter to $78, then a decline to $74 in the third quarter and $70 in the fourth quarter.

Next year should see a descent to $65 in the first quarter, $60 in the second and third, and finally $55 in the fourth, Citi said. That would leave the price 36% below current levels.

U.S. crude prices will trade $4 below European prices from the second quarter this year until the end of 2025, the analysts maintain.

Related: Veteran fund manager picks favorite stocks for 2024

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International

Disney remote jobs: the most magical WFH careers on earth?

Disney employs hundreds of thousands of employees at its theme parks and elsewhere, but the entertainment giant also offers opportunities for remote w…

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The Walt Disney Co. (DIS)  is a major entertainment and media company that operates amusement parks, produces movies and television shows, airs news and sports programs, and sells Mickey Mouse and Star Wars merchandise at its retail stores across the U.S.

While most of the jobs at the multinational entertainment conglomerate require working with people — such as at its theme parks, film-production facilities, cruise ships, or corporate offices — there are also opportunities for remote work at Disney. And while remote typically means working from home, with Disney, it could also mean working in a non-corporate office and being able to move from one location to another and conduct business outside normal working hours.

Related: Target remote jobs: What type of work and how much does it pay?

What remote jobs are available at Disney?

Many companies, including Disney, have called employees to return to the office for work in the wake of the COVID-19 pandemic, and the bulk of the company’s positions are forward-facing, meaning they involve meeting with clients and customers on a regular basis. 

Still, there are some jobs at the “most magical company on earth” that are listed as remote and don’t require frequent in-person interaction with people, including opportunities in data entry and sales.

While thousands work in forward-facing positions, such as greeting customers at Disney’s theme parks around the world, there are some positions with the Walt Disney Co. that allow work to be done remotely.

Orlando Sentinel/Getty Images

On Disney’s career website, there are limited positions available where the work is completely remote. One listing, for example, is for a “graphics interface coordinator covering sporting events.” This role involves working on nights, weekends, and holidays — times when corporate offices tend to be closed — and it may make sense for the company to hire people who can work from home or to travel and work in a location separate from the game venue.

Some of the senior roles that are shown on the website involve managers who can oversee remote teams, whether that be in sales or data. Sometimes, a supervisor overseeing staff who work outside corporate offices may be responsible for hiring freelancers who work remotely.

On the employment website Indeed, there are limited positions listed. A job listing for a manager in enterprise underwriting for a federal credit union indicates weekend duty, working outside of an 8 a.m. to 5 p.m. schedule, and being able to work in different locations. The listed annual salary range of $84,960 to $132,000, though, is well above the national annual average of around $50,000.

Internationally, Disney offers remote work in India, largely in the field of software development for its India-based streaming platform, Disney+ Hotstar.

The company also offers some hybrid schemes, which involve a mixture of in-office and remote work. For a mid-level animator position based in San Francisco, the role would involve being in the office and working from home occasionally.

How much do remote jobs at Disney pay?

Pay for remote jobs at Disney varies significantly based on location. A salary for a freelance artist in New York City, for example, may be higher than for the same job in Orlando, Florida. 

Disney lists actual salary ranges in some of its job postings. For example, the yearly pay for a California-based compensation manager who works with clients is $129,000 to $165,000.

In an online search for “remote jobs at Disney,” results range from $30 to $39 an hour, for data entry, or $28.50 to $38 an hour for social media customer support.

How can I apply for remote jobs at Disney?

You can look for remote jobs on Disney's career site, and type “remote” in the search field. Listings may also appear on career-data websites, including Indeed and Glassdoor.

How many employees does Disney have?

In 2023, Disney employed about 225,000 people globally, of which around 77% were full-time, 16% part-time, and 7% seasonal. The majority of the workers, around 167,000, were in the U.S.

Disney says that a significant number of its employees, including many of those who work at its theme parks, along with most writers, directors, actors, and production personnel, belong to unions. It’s not immediately known how many remote workers at the company, if any, are union members. 

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International

The Digest #194

Poor Charlie’s Almanack, Ben Graham, GAAP accounting, John Templeton, AI dystopia, Inflation, Bloomstran on Berkshire, Intuitive Surgical, The lessons…

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Poor Charlie’s Almanack

Poor Charlie’s Almanack: The Essential Wit and Wisdom of Charles T. Munger was first published in 2005 as a “coffee table” style book. It was beautifully presented but came with a high price tag. It was also heavy, somewhat unwieldy to read, and not very portable. The book’s format and price probably limited its reach. 

Stripe Press published a new edition of the book shortly after Mr. Munger died last year at the age of ninety-nine. Amazon and other vendors instantly sold all available inventory. After waiting for three months, I finally received my copy last week. 

Peter Kaufman is the editor of all editions of the book and I suspect that his main goal two decades ago was to honor Charlie Munger’s wisdom in a format that was not expected to “go viral.” In 2005, Charlie Munger was well known in the Berkshire Hathaway shareholder community and in the value investing world, but he was not as prominent as he became during his final decade. The clear purpose of the new edition is to disseminate his ideas as widely as possible. 

The new edition is abridged to reduce repetitive content and I will withhold judgment about the wisdom of this abridgment until I finish reading the book. Since the heart of the book is comprised of speeches given by Charlie Munger, there are definitely cases where the same ideas are presented again and again. 

Great books can be read many times while remaining highly relevant. I found this to be the case when I reread Charlie Munger’s Harvard School commencement address delivered in June 1986 when his youngest son was among the graduates. In the speech, Mr. Munger “inverts” the typical advice delivered in such speeches by explaining how the graduates should go about guaranteeing a life of failure and misery through time-tested strategies such as ingesting drugs and indulging in envy and resentment. 

I am not sure how many graduates were convinced by Charlie Munger on that early summer day, but I suspect that most of them remember the speech because it was so unconventional. In contrast, I have no recollection of the commencement addresses when I graduated from high school or college, or even who the speaker was.


Articles

A Memorial for Charlie Munger by John Harvey Taylor, March 12, 2024. This is a brief account of a recent memorial service for Charlie Munger at Harvard-Westlake School. “We learned Sunday that someone once asked if he knew how to play the piano. ‘I don’t know,’ he said. ‘I’ve never tried.’ Yet he tried and finished so much in his century. Imagine what he is making of eternity.” (Episcopal Diocese of Los Angeles)

Benjamin Graham: Big Moments on the Way to Big Earnings, March 2024. Ben Graham’s granddaughter reflects on the challenges Graham experienced when he applied for college. “Most graduating seniors make their college plans in advance, but Ben Graham had no money for tuition. All through the long days of arduous farm labor, my grandfather dreamed of winning a Pulitzer Scholarship.” (Beyond Ben Graham)

Graham’s “Unpopular Large Caps” Part 2: Thoughts on Diversification by John Huber, March 19, 2024. “I would segment these ideas into two groups: core operating investments and bargain assets. In the former, you want to be very selective in picking a relatively small number of companies you intend to own for the long term. In the latter, you’d want to think like the insurance underwriter, buying as many as you can to ensure that the law of large numbers is on your side.” (Base Hit Investing)

Warren Buffett Minds the GAAP by Donald E. Graham, March 13, 2024. “I have a challenge for the FASB and the SEC: If you believe today’s accounting rules present a clearer picture of Berkshire’s results, put it to a test. Ask Berkshire’s shareholders if they prefer the present method of reporting earnings over the status quo ante. I don’t believe a single informed shareholder would say so. The rule is confusing and uninformative.” (WSJ)

  • Berkshire Hathaway’s Distorted Quarterly Results, August 7, 2022. “Berkshire’s net income figure has been totally useless for analytical purposes since 2018. This is true on an annual basis and even more true on a quarterly basis.” (The Rational Walk)

Sir John Templeton: The Gentleman Bargain Hunter by Kingswell, March 12, 2024. “Templeton, who passed away in 2008, arrived on the investing scene with a series of uber-profitable contrarian bets in the early days of World War II — and continued to outwit Mr. Market with maddening consistency for the next several decades.” (Kingswell)

They Praised AI at SXSW—and the Audience Started Booing by Ted Gioia, March 19, 2024. Many recent innovations seem to have a dystopian aura. Apparently, this sentiment is not restricted to the usual luddites (old men shouting at clouds) but is shared by some of the attendees of SXSW. What seems cool to tech bros in Silicon Valley might not seem so cool to those outside tech culture. (The Honest Broker)

We Still Don’t Believe How Much Things Cost by Rachel Wolfe and Rachel Louise Ensign, March 12, 2024. People tend to focus on the aggregate amount of inflation over the past few years and interpreted transitory to mean that price spikes would reverse. Of course, politicians and economists only meant that the rate of inflation would decrease, not that prices would ever return to pre-pandemic levels. (WSJ)

My 2023 Apple Report Card by John Gruber, March 18, 2024. A solid report card overall from a widely read technology blog. (Daring Fireball)


Podcasts

Christopher Bloomstran on Buffett, Berkshire, Munger, and China, March 19, 2024. 1 hour, 1 minute. Video. Also be sure to check out the latest Semper Augustus client letter which has a lengthy section on Berkshire Hathaway. (Value After Hours)

Renaissance Technologies, March 18, 2024. 3 hours, 10 minutes. Notes“Renaissance Technologies is the best performing investment firm of all time. And yet no one at RenTec would consider themselves an ‘investor’, at least in any traditional sense of the word. It’d rather be more accurate to call them scientists — scientists who’ve discovered a system of math, computers and artificial intelligence that has evolved into the greatest money making machine the world has ever seen.” (Acquired)

Intuitive Surgical: Robotic Precision, March 20, 2024. 1 hour, 6 minutes. Transcript“Intuitive creates robotic products to assist minimally invasive surgeries. Its Da Vinci system is a pioneer in this area as it increases the efficiency & accuracy of surgery and reduces the burden on the surgeons themselves.” (Business Breakdowns)

The Lessons of History (Will & Ariel Durant), March 18, 2023. 53 minutes. Notes“In every age men have been dishonest and governments have been corrupt.” (Founders)

A Classicist Believes that Homer Directly Dictated the Iliad, and Was Also an Excellent Horseman, March 14, 2024. 53 minutes. “The Iliad is the world’s greatest epic poem—heroic battle and divine fate set against the Trojan War. Its beauty and profound bleakness are intensely moving, but great questions remain: Where, how, and when was it composed and why does it endure?” (History Unplugged)


Triumph of Achilles

Triumph of Achilles by Franz von Matsch, 1892 (public domain)

Copyright, Disclosures, and Privacy Information

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