Ready, set, stop
The economy is clearly grinding some gears trying to get going amid the not-so-over pandemic. Plus: Hollywood was never serious about boycotting Georgia
General Motors announced a temporary halt in full-size pickup production on Wednesday. The auto industry has been rocked badly by a massive chip shortage paired with enormous pent-up demand as the lockdown economy ends in America, and people are flush with stimulus cash.
Chevy Silverado sales in 2021 are up 8.3 percent over 2020, yet still trailing both the Ford F-Series and Dodge Ram. Ford closed its Chicago factory where the company assembles Explorer SUVs for the rest of July, and its F-150 (the most popular truck in America) plant in Kansas City is taking a two week pause.
Used car prices are up over 20 percent, while new cars cost about 5 percent more than they did in 2020. This means if you’re trading in a decent used car for a new one, now is a good time to buy. It also means that if you’re looking at used cars, you’re going to pay.
CNN reported Thursday that wholesale used car prices have begun to fall off a bit in the first two weeks of July, but industry experts predict that a market “constrained for supply” will keep prices high for the “foreseeable future.”
Some items are not hard to find at all, however. Certain consumer items flooding in from China and available on Amazon are still easy to get. If it’s cheap and plastic and doesn’t involve electronics or chips, you can get it. If it’s made by Apple, you can probably get it, though COVID-19 Delta variant’s march through India has hit production there pretty hard.
Getting back to normal is a spotty business. Summer campers in Peterborough, N.H. saw an abrupt end to their suffering after Camp Quinebarge turned into “Fyre Festival.” (A century ago, in 2017, if you remember, Kendall Jenner et al of the glitterati promoted a Bahamas private island adventure in food, art and music, which ended up being an empty tent city on a deserted beach with nothing.)
The camp wasn’t a scam, but they simply couldn’t get traction with trouble hiring staff, fixing a broken dishwasher (leading to dirty dishes and sick campers), and late food deliveries. Counselors quit, the camp photographer disappeared from the camp’s Facebook group days after kids arrived, leaving parents scratching their heads. Clearly, some things aren’t ready to resume.
While markets remain sanguine about recovery and getting over the hump of persistent inflation, some say they are too optimistic. Our worldwide economy and supply chain has proven to be very fragile. Many writers have penned essays, and many news stories have been published about the division of labor, the satisfaction of working, the level of disruption by a single super container ship stuck in the Suez, and the potential for supply chain havoc from the threat of ransomware.
Over all of this, the pandemic hovers. The Racket News readers tend to be American, employed, and somewhat comfortable in our lifestyles. In places like Indonesia, India, and Bangladesh, the pandemic is not even close to done. This means some basic parts that are cheaply made, along with clothing and other goods, are suffered and will continue to suffer manufacturing halts and delays. This piled up, leading to depletion of stock and supply constraints. The supply chain caused shutdowns of bigger goods plants, and sidelines transportation (trucks that can’t get fixed don’t run). As the New York Times headline proclaimed, “the world ran out of everything.”
Though we can (thankfully) get toilet paper and other basic goods, meat prices are still sky high, and likely to continue to be higher for quite a while. The big meatpackers will survive but medium-sized and small ranchers may find themselves out of business.
“If things don’t change, our food chain is going to change in a very negative way,” said Senator Jon Tester, Democrat from Montana. He warned that small and medium-size feeding operators were already being pushed out of business, and he worries that cow and calf breeders will soon be forced to do likewise.
I am confident that, given time, all these things will work themselves out. That is, if nothing else happens. But the problem with assuming nothing else will happen is that something else always happens.
The pessimist in me looks to a troubling passage in Revelation 6.
5 When the Lamb opened the third seal, I heard the third living creature say, “Come!” I looked, and there before me was a black horse! Its rider was holding a pair of scales in his hand. 6 Then I heard what sounded like a voice among the four living creatures, saying, “Two pounds of wheat for a day’s wages, and six pounds of barley for a day’s wages, and do not damage the oil and the wine!”
7 When the Lamb opened the fourth seal, I heard the voice of the fourth living creature say, “Come!” 8 I looked, and there before me was a pale horse! Its rider was named Death, and Hades was following close behind him. They were given power over a fourth of the earth to kill by sword, famine and plague, and by the wild beasts of the earth.
The rich get richer, and the poor get sick, then die. Or, we fall on the Lord’s great compassion and mercy, while we still have opportunity, and bless each other with all we have. America is still a very rich nation, richer than the rest of the world. This is not the time for “America First” or “Fortress America.” It’s not a time for tying strings to aid. It is a time for calling out bad actors and opportunistic tyrannical regimes.
But I have now digressed into theological exegesis and moralizing. What I really mean to say is if we just remain good people, and be good to each other, things will improve. They may never get back to pre-pandemic “normal,” but we will find a better situation than we have today, if we don’t make it worse by playing greedy games.
It’s going to be a while before we understand the global earthquake that COVID-19 caused. We need to be ready to drive like the I-45 traffic in Houston: 70 to nothing in one second flat.
Hollywood was never serious about leaving Georgia.
Just a quick hit here. An article in today’s Atlanta Journal Constitution noted that the movie biz here in the Peach State “quickly bounces back” after COVID-19, and set a record.
That’s $4 billion versus the previous record in 2019 which was $2.9 billion. Now we have 30 to 50 productions going on, including major studio films “Black Panther: Wakanda Forvever,” and “Shazam! Fury of the Gods.”
NetFlix, Disney/Marvel, Warner Brothers/DC, Paramount, and everyone else is taking advantage of the tax credits in Georgia. This despite the fact that they pledged to leave because of the Heartbeat Law that Gov. Brian Kemp signed in 2019, then pledged to leave again over the election reform law this year.
Hollywood’s god is money, and their altar is in Georgia. They aren’t leaving. They haven’t left. They won’t leave while the money is here. They were never serious about leaving, it’s all theatrics. After all, it’s Hollywood.
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(I feel like given the length of the discussion of some of your past posts this week, I should post something inflammatory to kick things off. In lieu of that, I'll congratulate you and Jay and David on growing this young site into an interesting place where I come back many times a day to see who said what.)