Thought for the day

"You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete." -- Buckminster Fuller

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Senator Ron Johnson (R-WI) suggested the unthinkable on Wednesday in the form of actual fiscal responsibility and oversight.

Johnson proposed that Social Security and Medicare, which currently fall into the category of mandatory spending in the federal budget, be approved annually by Congress. 

Something very odd emerges for the second month in a row when looking at the July payrolls report.

Recall last month we showed that a stark divergence had opened between the Household and Establishment surveys that make up the monthly jobs report, and since March the former was sliding while the latter was rising every single month. In addition to that, full-time jobs were plunging while multiple jobholders soared near all time highs.

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If you ask a random EU official if the bloc should continue trying to punish Russia for its invasion of Ukraine, you will invariably get a positive answer. 

The sanction potential is reaching its end, but this is no reason for the EU to relieve the pressure, that official will say, as many have in conversations with the media.

And yet, the EU has quietly begun to unwind its sanctions against Moscow.

Ukrainian President Volodymyr Zelensky in a Thursday night address lashed out at the European Union for what he called an "artificial delay" of 8 billion euros (or about $8.2BN) in financial assistance to the war-ravaged country.

Yes, we have some stagflation. Subsequent to the pre-Covid peak in Q4 2019, real final sales of domestic product have slowed to a crawl, rising by just 0.73% per annum during the last 2.5 years.

We much prefer this measure over real GDP because it removes the abrupt inventory swings from quarter to quarter, which can have out-sized impacts on the headline number. Thus, during the first two quarters of 2022 the reported back-to-back real GDP contraction was owing to inventory liquidation, not an actual shrinkage of current activity.

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The US-led drive to isolate Russia through sanctions has not succeeded, as half the countries in the Group of Twenty leading global economies refused to sign on, Bloomberg reported on Friday.

According to the publication, senior officials from leading Western nations are surprised by the lack of support within the wider G20, despite their efforts to make the case for restrictions against Russia.

Arizona Senator Kyrsten Sinema - the lone Democrat holdout on the Biden administration's revamped reconciliation bill - has finally signed off on it, after Democrats agreed to preserve the so-called carried interest loophole that allows investment managers (like her former bosses) to shield the majority of their income from higher taxes.

Hours after Argentina's new Minister of Economy Sergio Massa was sworn into office, he pledged to stop printing money in an attempt to halt a spiraling currency crisis which has seen inflation hit 60% - and has been projected to reach 90% by the end of this year.

A new US-funded report out of Kiev assesses $108.3 billion in economic damages for Ukraine, but requests a 7x replenishment of $750 billion so that the country can “Build Back Better.”

The Kyiv School of Economics has released a new assessment claiming that Ukraine will need hundreds of billions of dollars to “Build Back Better” from its war against Russia.