From Asia Times, September 5:
Zodiacal light is a metaphor for current economic conditions
Zodiacal light seen behind the Submillimeter Array from the summit of Mauna Kea, Hawaii. Photo: Steven H Keys / www.keysphotography.com via Wikipedia
The term “false dawn” refers to the zodiacal light that is a result of the sun reflecting (much as it does in respect of the moon) its light toward Earth, via the trillions of tiny particles of interplanetary dust: This dust acts like miniature moonlets, they being scattered throughout the space of the solar system.
The light appears along the curve of the zodiac, which is the track apparently followed by sun, planets and moon as that track is seen from Earth. The Z light at midnight can be bright enough on a really dark night to be mistaken for an eerily early dawn light. But midnight remains, in fact, quite a long way away from true sunrise.
Such a false dawn is a metaphor for current economic conditions.
US President Joe Biden likes to say that the recent reduction of the price of gasoline from its high point is a signal that the rate of inflation is diminishing. He is wrong.
His most recent policy innovation consisting of an infusion of three-quarters of a trillion dollars in new spending, some of it devoted to forgiveness of certain student loans, will, among other factors, assure me that inflation will remain high, as long as such spending, most to it financed by new debt, continues.
The price of gasoline in the US has fallen from its topmost level because that price in itself, along with price increases in an entire range of householder products, combined with diminished asset values in property (here is one of many depressing factors shared with China), has reduced consumers’ wealth and so reduced their demand for dispensable, discretionary goods like recreational travel.
Travel-related goods like gasoline fall off, and so does their price.
Inventory cycle
Just as the zodiacal light is caused by many moonlets, there are a number of economic processes that give off economic signals that are often confused with “dawn,” with imminent recovery from today’s combination of recession/inflation. One of them is the inventory cycle.The inventory cycle sometimes looks like a reversal of inflation, and it sometimes looks like businesses are suddenly becoming the friend of the consumer.
The inventory cycle has to do with the dynamic motivation given to producers when they observe the inventory-to-sales ratio of their unsold but produced goods “on the shelf” to goods “going out the door” in the form of actual sales. Consumers also modify their normal behavior during an inventory cycle.
It works like this:....
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