How I Learned to Stop Worrying and Love Deflation BY GARRETT BALDWIN
WHY DO MAINSTREAM ECONOMISTS FEAR LOWER PRICES? INVESTORS CAN EMBRACE DEFLATION BY BUYING TECH STOCKS AND BITCOIN.
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nemployment recently dipped to 4.6% as the economy added 531,000 jobs, according to the monthly jobs report issued in November by the United States Department of Labor. Those top-line numbers always make headlines, but a truly startling statistic is buried deep in the report. For 14 straight months, more than 100 million able-bodied Americans have been out of the workforce. That means only 61.4% of the labor pool is on the job. That percentage has declined steadily for two decades, and it’s continuing to decrease even now with 10.9 million jobs open. To be fair, the 100-million figure includes retirees, students, family caregivers and discouraged job seekers no longer looking for employment. But most of the jobless don’t fit those categories. Armchair economists and political pundits have been trading barbs and assigning blame for the trend since at least 2001, when 66.7% of potential workers had jobs. They trace the decline in participation to everything from low wages to an understandable reluctance to uproot a family and move to where jobs are available. They blame Amazon’s domination of retailing. They blame Biden. They blame Trump. And now they blame COVID-19. But what about the march of technology and the U.S. monetary system’s commitment to debt-based growth? Don’t they deserve some of the blame?
Luckbox | December 2021
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