Industrial production fell more than expected in May

Industrial production fell more than expected in May, said the Federal Reserve on Tuesday. Overall production fell by 0.2%, after increasing 0.1% in April. Production by the manufacturing sector increased 0.1% in May, driven by motor vehicles and parts. Mining production rose 0.1% and production by utilities decreased 2.9%. Industrial capacity utilization was 77.4% compared to 77.7% in April.

Inventory levels held by retailers, wholesalers and manufacturers were unchanged in May.

US raw steel production was down

In the week ending June 14, 2025, US raw steel production was 1,783,000 net tons at an ACUR of 79.4 percent. Production for the week was down 0.1 percent.  Adjusted YTD production was 39,855,000 net tons at an ACUR of 75.5 percent.

US drill rigs running down from previous week

There were 555 drill rigs running in the US on 6/13, down 4 rigs from the previous week and down 35 rigs from one year ago.
Meanwhile Canadian drillers added 24 rigs, to 138, down 22 rigs from one year ago.

June 2025 Manufacturing Business Outlook Survey reports manufacturing activity in the region remained weak

The Federal Reserve Bank of Philadelphia released its June 2025 Manufacturing Business Outlook Survey results and reports manufacturing activity in the region remained weak, according to firms responding to the survey. The survey’s indicator for current general activity remained slightly negative, unchanged from May. The new orders index fell, but remained positive, and the shipments index improved, turning positive, both readings remain below their non-recession averages. The survey’s future indicators suggest less widespread expectations for growth over the next six months.

News Headlines

Tehran “signals readiness to renew diplomacy” a headline in Tuesday’s Wall Street Journal. If anyone believes that after their decades of lies, they are blind. I think Israel should continue their effort to completely destroy the nuclear facilities of Iran. It is too bad for the Iranian people for I think most would prefer to live in peace. Who wouldn’t? I hope President Trump sticks to his guns, he warned the citizens of Tehran to leave, they should, post haste.

There is now talk of the US using bunker buster bombs to destroy the Fordow nuclear facility in Iran. On Tuesday, President Trump demanded unconditional surrender from Iran. Of course, they said no and even threatened the United States with “irreparable consequences” were we to get involved. How dare they. These mullahs have gotten away with so much shit from previous administrations, its ridiculous. Now they are fucking with the wrong guy. I hope he will make them pay dearly.

On Wednesday, Jay Powell and the Federal Reserve kept interest rates where they were.

The Tariff Tantrum has proven that the consensus was wrong about soaring inflation and an economic slump. Why? The exaggerated perception of tariffs economic impact stemmed from the belief that American consumers would bear the full burden of tariffs. Why were they wrong?

The first reason was because most analyses made a simplistic calculation of tariffs as if supply chains were made of buyers and sellers alone. Supply chains are very complex, and most exporters must deal with overcapacity challenges and working capital problems. Thus, the impact of tariffs is likely to be absorbed by the numerous links in the supply chain, including transport, storage, distribution, manufacturing, retailers and purchaser chains. Furthermore, most exporting companies face a significant problem of overcapacity and working capital; if they don’t sell their products quickly and effectively, their debt soars, and the losses at warehouses can lead to a chain of bankruptcies.

Ignoring that the world of exporter businesses, particularly in China, has a structural overcapacity problem and mounting financial issues due to working capital build was one of the mistakes made by excessively pessimistic analysts. In fact, there is no sign of inflation soaring anywhere…inflation hit a four year low in April, a month that should have reflected a massive increase due to tariffs, according to consensus estimates, while wage growth rose to a four-year high.

Inflation in April decreased to the slowest pace since 2021. Egg prices fell by 12 %, and prices for bakery items, meat, and poultry also decreased. Americans are not suffering the apocalyptic inflation that interventionists predicted.

The key to understanding the lack of inflation is to look at monetary aggregates. Tariffs do not cause inflation. There are other reasons we can use to criticize tariffs, but not inflation causation. Market participants have realized that tariffs serve as a tool for negotiating better trade deals and facilitating the opening of markets, rather than being used solely as a protectionist measure.

What causes inflation is soaring government spending, leading to rising money supply and money velocity. Deficit spending is down 35% between February and April 2025 compared to the same period last year. While money supply is rising, albeit at a moderate pace, velocity of money is gradually declining. The public sector is slowly shrinking and the private sector is strengthening, hence there is no real risk of inflation.

The US economy is stronger than it appears, and the negotiating power of importers is larger than estimated due to two factors; the previously mentioned overcapacity challenge of most exporters and the global relevance of the US market. Exporters cannot substitute their US sales with other markets. Even thee European Union is relatively weak as a market.

Ultimately, the Tariff Tantrum has proven that Keynesian analysis is wrong and that successful trade deals were the goal of the administration.

Daniel Lacalle, PhD, is chief economist at hedge fund Tressis. The article was written for Epoch Times May 28-June 3 issue

There were ZERO illegal crossings at the southern order in the month of May. ZERO

State and Local Taxes (SALT) all this talk about the SALT deduction, why not just ELIMINATE the tax? They waste and/or steal our money anyway. You want votes and happy constituents? Stop stealing their money.

Democrats push for blanket amnesty for the 20 million illegals here. Are you kidding me? Not a chance in hell.

Friday is the first day of summer, make the best of it…

MAKE AMERICA GREAT AGAIN

“KEEP AMERICA GREAT”

Have a great weekend…. God bless America!

Buy American made products whenever you can, it’s good for you, good for your friends and neighbors and good for our country.

If you are hiring…try to hire a veteran…. they are loyal, disciplined, hardworking…and they deserve our support.

By the way, if you wish to comment on my rants or offer any other insights you may have, you are encouraged to email me.

TEDDY ROOSEVELT ON IMMIGRANTS IN AMERICA…1907

In the first place, we should insist that if the immigrant who comes here in good faith becomes an American and assimilates himself to us, he shall be treated on an exact equality with everyone else for it is an outrage to discriminate against any such man because of creed, or birthplace, or origin. But this is predicated upon the person’s becoming in every facet an American and nothing but an American. There can be no divided allegiance here. Any man who says he is an American, but something else also, isn’t an American at all. We have room for but one flag, the American flag…We have room for but one language here and that is the English language…and we have room for but one sole loyalty and that is a loyalty to the American people.”