Business, Economics, and Taxes: Eat Cereal for Dinner

[Russell Jaslow]

Maybe, maybe not. 90% of the country has no understanding of the FDIC and why it's important.

Don't bank on it. Okay, okay, I'll stop.

Besides, it may only take that 10% to crash the banks. They don't have that much cash on hand. Otherwise, they wouldn't be doing their job loaning and investing it out to make a profit. Maybe, we can hope the MAGAts don't get it or ignore it like during the pandemic, so at the very least, we see them all go personally bankrupt. One can dream...

 

[Handyman]

My personal trainer's wife was fired today. No official letter, they just told her and walked her out.

Her department was built around her. She took a 50% pay cut to come to the govt from the private sector and work at an office providing physical therapy to people returning to the workforce.

Her boss told her the firing was utterly unjustified and after this BS is over they will reschedule the job as contractor and she can come back in at her normal salary.

That is how DOGE is "cutting" costs. Savings pennies to  STEAL dollars.

FTFY

 

[Handyman]

That can't be correct. Tesla isn't even worth 2x that.

The entirety of the fund was probably $0.5T and they probably had 5% of that in TSLA

Edit: it was $585M. Still, that's a decent chunk just under 0.2% of the market cap of Tesla.

Sorry I fat fingerer it...even double checked it when I posted

 

[Handyman]

Short
Tariff
Close position
Back down

Wash rinse repeat

So obvious...

 

[Handyman]

Don't bank on it. Okay, okay, I'll stop.

Besides, it may only take that 10% to crash the banks. They don't have that much cash on hand. Otherwise, they wouldn't be doing their job loaning and investing it out to make a profit. Maybe, we can hope the MAGAts don't get it or ignore it like during the pandemic, so at the very least, we see them all go personally bankrupt. One can dream...

10% would crush for suee...even 5% would kill alot of them.

 

[Russell Jaslow]

So I finally decided to do the research. And folks, it's scarier than you could possibly imagine.

First, the boring fine print:

"Reserve requirements are central bank regulations that set the minimum amount that a commercial bank must hold in liquid assets. This minimum amount, commonly referred to as the commercial bank's reserve, is generally determined by the central bank on the basis of a specified proportion of deposit liabilities of the bank. This rate is commonly referred to as the cash reserve ratio or shortened as reserve ratio. Though the definitions vary, the commercial bank's reserves normally consist of cash held by the bank and stored physically in the bank vault (vault cash), plus the amount of the bank's balance in that bank's account with the central bank. A bank is at liberty to hold in reserve sums above this minimum requirement, commonly referred to as excess reserves."

Every country has different laws to deal with this minimum.

So, guess what the reserve requirements are for the United States? Anyone? Anyone?

ZERO!

That's right. Absolute zero. Banks in America do not need to keep even one penny in liquid assets.

It didn't used to be that way: "The United States removed reserve requirements for nonpersonal time deposits and eurocurrency liabilities on Dec 27, 1990 and for net transaction accounts on March 27, 2020, thus eliminating reserve requirements altogether. Before that, the Board of Governors of the Federal Reserve System used to set reserve requirements (“liquidity ratio”) based on categories of deposit liabilities ("Net Transaction Accounts" or "NTAs") of depository institutions, such as commercial banks including U.S. branches of a foreign bank, savings and loan association, savings bank, and credit union. For a time, checking accounts were subject to reserve requirements, whereas there was no reserve requirement on savings accounts and time deposit accounts of individuals. The Board for some time set a zero reserve requirement for banks with eligible deposits up to $16 million, 3% for banks up to $122.3 million, and 10% thereafter. The total removal of reserve requirements followed the Federal Reserve's shift to an "ample-reserves" system, in which the Federal Reserve Banks pay member banks interest on excess reserves held by them."

Ergo, just the mention of getting rid of the FDIC would completely wipe out this country.

 

[ScoobyDoo]

Stick a fork in the US economy. It's done.

 

[Russell Jaslow]

It probably isn't a surprise to anyone that countries with strong economies and stable governments have very low reserve requirements (USA, Canada, Hong Kong, the Scandinavian countries, Australia, New Zealand are all at zero; the Eurozone is 1%, etc.).

While unstable countries and/or weak economies have very high reserve requirements (Lebanon is 30%, Nigeria is 45%, Suriname is 25%. etc.).

 

[aparch]

This is good, right? [/sarcasm]

Carl Quintanilla (@carlquintanilla.bsky.social)

When the top 10% of your earners do 49.7% of the spending. 🇺🇸 [contains quote post or other embedded content]

bsky.app

 

[RaceBoarder]

This is good, right? [/sarcasm]

Carl Quintanilla (@carlquintanilla.bsky.social)

When the top 10% of your earners do 49.7% of the spending. 🇺🇸 [contains quote post or other embedded content]

bsky.app

See my comments from yesterday.

As much as their is a political divide between D's and R's, there is also going to be a huge financial one moving forward.

 

[ScoobyDoo]

This is good, right? [/sarcasm]

Carl Quintanilla (@carlquintanilla.bsky.social)

When the top 10% of your earners do 49.7% of the spending. 🇺🇸 [contains quote post or other embedded content]

bsky.app

Apparently it's great because it is the policy of the United States and is backed by the entire Congress. Bernie Sanders and AOC long lost the argument and cannot get a majority to support them. It's interesting because the progressives gave in during the Biden administration for the good of the country and their payback is having their fellow Democrats completely capitulate to Trump now. It's f***ing sad.

 

[aparch]

[Paraphrasing]
Lutnick on CNBC: Those jobs are going to come home and we're going to have an employment boom.

CNBC: But if companies have to pay higher wages for all these employees, how will they remain competitive?

Lutnick:

"Robots!"

Aaron Rupar (@atrupar.com)

QUINTANILLA: Robots usually replace people, but you think it's gonna create jobs? LUTNICK: Oh, I'm sure of it.

bsky.app

 

[Handyman]

And if robots don't the cost for American made items skyrockets. Can't wait to see Apple fanboys revolt over 3k Iphones.

 

[RaceBoarder]

My job is actually implementing more automation.

And that's actually one of the reasons I have confidence in being somewhat secure. I know how to run our current systems and am going to learn the new systems that are going to be installed in May/June/July with operational capability starting around Sept. 1.

But the layer pickers we put in will move up to 50,000 cases/day. And they require 3-4 people to operate for an 8 hour shift. An average picker will move 1,500-2,000 cases in that same 8 hour period. So the 3-4 operators are doing the work of 6-10 people in that span.

And that's the golden part for my company... Once the automation starts rolling, they let natural attrition take care of eliminating people. And then they just don't hire as many people to backfill. No actual layoffs or firings needed...

 

[MichVandal]

My job is actually implementing more automation.

And that's actually one of the reasons I have confidence in being somewhat secure. I know how to run our current systems and am going to learn the new systems that are going to be installed in May/June/July with operational capability starting around Sept. 1.

But the layer pickers we put in will move up to 50,000 cases/day. And they require 3-4 people to operate for an 8 hour shift. An average picker will move 1,500-2,000 cases in that same 8 hour period. So the 3-4 operators are doing the work of 6-10 people in that span.

And that's the golden part for my company... Once the automation starts rolling, they let natural attrition take care of eliminating people. And then they just don't hire as many people to backfill. No actual layoffs or firings needed...

FWIW, the auto industry went through this decades ago. It will gut the line workers, and somehow they will take it, and turn the Union to the right. No way those jobs are ever coming back.

At the same time, one should look at the skilled labor required to not just run, but program the devices. Knowing that will secure employment.

 

[FadeToBlack&Gold]

And that's the golden part for my company... Once the automation starts rolling, they let natural attrition take care of eliminating people. And then they just don't hire as many people to backfill. No actual layoffs or firings needed...

This is how it's done with many technology/automation implementations. You tell concerned employees, "This automation will free you up and get you out of your daily grunt work, so that you can focus on the work that really matters or take training to upskill!"

Then you just wait for the attrition and don't backfill. I'm 100% certain Boeing's HR department did that after I finished my work there.

 

[Jimjamesak]

FWIW, the auto industry went through this decades ago. It will gut the line workers, and somehow they will take it, and turn the Union to the right. No way those jobs are ever coming back.

At the same time, one should look at the skilled labor required to not just run, but program the devices. Knowing that will secure employment.

Except they’re gutting that too with AI.

“Learn to code” might actually be one of the worst pieces of advice right now.

 

[RaceBoarder]

FWIW, the auto industry went through this decades ago. It will gut the line workers, and somehow they will take it, and turn the Union to the right. No way those jobs are ever coming back.

At the same time, one should look at the skilled labor required to not just run, but program the devices. Knowing that will secure employment.

It's exactly following the Auto industry. It's just a much more dynamic environment (different package size, weight and quantity) than an Auto robot making the same exact 5 welds on a car's frame 100x/day. Which is why it's decades behind that industry.

But yea, the straight up grunts/muscle aren't capable of working with these machines since they are so dynamic and require real time problem solving. We don't program in-house. We work with outside companies to handle that (basically programming errors have us calling a Phone # and doing the tech-support step by step walkthrough if operators can't solve the basic issue).

 

[rufus]

[Paraphrasing]
Lutnick on CNBC: Those jobs are going to come home and we're going to have an employment boom.

CNBC: But if companies have to pay higher wages for all these employees, how will they remain competitive?

Lutnick:

"Robots!"

Aaron Rupar (@atrupar.com)

QUINTANILLA: Robots usually replace people, but you think it's gonna create jobs? LUTNICK: Oh, I'm sure of it.

bsky.app

Training to transition to jobs in the new high tech economy? Thought MAGA was against that. They wanna keep their jobs digging coal. Just like daddy did.

 

[FadeToBlack&Gold]

Except they’re gutting that too with AI.

“Learn to code” might actually be one of the worst pieces of advice right now.

I'm inclined to agree to a point, but developers and architects aren't going away yet. With the gen AI available now, sure anyone can generate code that's dangerous. It might even work, albeit not efficiently and not necessarily following best practices. I'll admit I've used one of the AI models to generate some simple stub code to save time (like when I need to do a one-time cleanup of records). However, I have to tell it "follow best practice" to get it to include a statement that disables workflow execution, for example, so that I don't go spamming hundreds of people with automated emails that test or old records are updated or closed.