Won’t You be My Neighbor

Fifty years ago, the United States was in turmoil. Dr King was slaughtered, and later Bobby Kennedy. Protests against the Vietnam War turned violent. So did the Democratic convention. It was the year America fell apart, possibly never to be put back together quite right.

But that year a guiding light came into American homes, flickering with the cool glow of a television. Fifty years ago Mister Rogers achieved national syndication from PBS and quickly became the pastor, the psychologist, and sometimes even parent for a generation.

Today, we may need Mister Rogers more than ever.

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Your Papers, Please

The most recent school shooting seems to have tipped the balance. This time, students are protesting and there is a new determination to get something done. Certainly , this particular shooter had a long history of trouble that raised a number of alarms. But what, exactly, can and should be done?

The FBI has admitted “bungling” a report on the shooting by not referring it to the Miami office. But what system do they have for tracking people? How is information gathered from many different local agencies? If there is a database, what protections are granted anyone in it? How can you find what it has on you and correct it?

It suggests some kind of national tracking and identification system is necessary. If there is some action from this shooting, it raises questions as to how any new or existing laws might be enforced. Who is allowed to buy a gun? Or to board a plane? To vote? To buy protected medicines like marijuana? To even be in this nation? To work?

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The Symptom, the Disease

How many shootings are we up to now? I lost track a long time ago. Too many is not a number you can count on your fingers.

Everyone has an opinion as to why they happen. Too many guns, mental health problems, violent video games, and so on. The noise and arguing will run hot for a week or two and then we will go on.

Yet the answer is right in front of us. The answer is right there in the arguments themselves. Our world is alone and afraid, constantly running on adrenaline, scared of confronting even the obvious – especially the obvious.

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Inflation is Back

Inflation is back. What’s left to see is what anyone does about it.

The Consumer Price Index (CPI) for January came in at a strong 2.1% over the last 12 months. That’s above the target rate of 2.0% set by the Federal Reserve for the fourth month in a row. There will be attempts to explain it away in various ways. In the noise that will be created over this what will count is action by the Federal Reserve one way or the other.

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ICE’ing Fresh Produce

Arrests by Immigration and Customs Enforcement (ICE) were up in 2017, but not as dramatically as you might think. What has increased is the visibility of these arrests and the fear that they bring. It is generally believed, without only scant evidence, that undocumented immigrants are leaving the US in large numbers. This would continue a downward trend which started in 2007.

Some people might cheer this action, but as a whole the economy probably isn’t. Undocumented workers do jobs that no one else wants to, for the most part. Their absence means that work is not being done and wages are rising rapidly in areas that have depended on cheap labor for years. There may be signs that this is accelerating and will ultimately spark a high rate of inflation and even shortages.

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A Bold Prediction

We’ve been talking about the stock market this week, so why not end it with a bold prediction: Once the federal debt ceiling is raised, look for the stock market to utterly tank within two weeks, certainly within a month.

While there are many reasons why the market is taking at least a pause if not slouching towards a correction, the most important is the appetite for government debt. A time like this requires careful management and attention to consequences. We’re not getting it. What we have instead is mismanagement on an epic scale that will certainly spook the market and ultimately kill it.

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Where Do Stocks Go Now?

Stocks appear to have stabilized after a rough week. But several questions remain. Was this a one-time shock event, or is it a correction? And if it’s a correction, how low can things go?

We can be sure that what has happened so far is not an isolated event, but part of a major change in the regime from loose, cheap money to a more normal economy. Corporate profits are high, and America is taking care of business, so there’s no apparent reason to be terribly afraid.

Yet the change is significant, and precisely how significant will not be clear for some time. Here is what to watch for as stocks and other markets absorb the change and make a transition into a new economy.

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