Crumbs

The theory is that reflation powers small cap. A lot of these do not produce any net income, let alone a yield, which undermines my thesis that the main effect is carry costs. Who knows, but this is a dramatic demonstration that something is happening, probably to sentiment.

• Another article pointing out that Biden and Obama could not be more different, in the sense that Biden is actually getting (some) cash into the hands of consumers, whereas Obama made sure that it was all used to shore up the balance sheets of banks and financial institutions (like AIG or GE).
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Thoughts

The four horsemen have traditionally been the source of destruction an rebirth in societies. In modern times, taxes, revolution, war and raging inflation have performed the same function, of reversing the natural tendency of wealth to become increasingly concentrated in the hands of the few. Taxes, at least redistributive ones, tend to be levied in democratic societies. It’s natural for the beneficiaries of the status quo, whether Russian, American or British, to do everything in their legal power to obstruct this. But, too much obstruction will end in revolution, especially when the population starts to feel hungry. Marx thought that capitalism would always be accompanied by endless accumulation of capital by the capitalist class, and that society would become endlessly unequal. His reasoning here was that all manufacturing was a natural monopoly: economies of scale were large at the scale of markets. Certainly, there does seem an endlessly increasing concentration in many diverse industries, from pharmaceuticals, to consumer discretionary, to advertising. Historically, governments took muscular action to ensure active competition, but as all parties have increasingly captured by producers (whether capitalist or trade unionists), this countervailing effect has shrunk. In the USA capital has persuaded the Supreme Court that actual harm to consumers needs to be proven before anti-trust action will be taken. Proving that the breakup of big, efficient supplier will produce lower prices in the short run is, of course, very difficult. The result of this change in the law is the slow grind towards oligopoly. The EU seems hardly any better.