Crime
Apart from the attempts of the Biden administration, so far unsuccessful, to implement their socio-ecological initiatives worth almost $ 2 trillion, analysts identify the following main phenomena on the front of economic crime.
Increased large-scale shoplifting by organized gangs of thieves, followed by the sale of stolen goods on online trading platforms such as ebay. Hard-hit stores, especially in California, are closing and moving to safer neighborhoods.
Ordinary citizens, with or without children, frightened by the rise in crime in general, flee from Los Angeles, Chicago, New York to the south and southwest. Together with them, more and more enterprises and organizations are moving to the same relatively prosperous and tax-free places.
In connection with the transfer by corporations of a significant part of their activities online (under the influence of the pandemic and other factors), the number of hacker attacks on business computer networks has increased. The more businesses depend on computers, the more vulnerable they are to hackers. Memorable in May, the cyber pirate attack on Colonial Pipeline, which supplies fuel to the country’s southeastern states. The company had to pay the bandits a multimillion-dollar ransom, part of which, however, was returned.
Whether or not to pay the victims of virtual gangsters a ransom is the question. There is evidence that those who pay are subject to repeated raids. On the other hand, the more successful the company is, the stronger its desire is to quickly free its computers from captivity, the downtime of which costs them more than the ransom demanded by the racketeer. Be that as it may, business spending on computer security has risen and is likely to continue to grow.
Trade
In the retail sector, the trend towards the transition from traditional offline to online business continues, which is especially clearly confirmed by the current holiday sales. Tangible stores and entire chain stores are closing, Amazon is thriving extraordinarily.
Differentiation
The covid pandemic has exacerbated the wealth and class stratification of American society. Those who are included in the modern digital economy feel more and more alienated from fellow citizens who remain in the material economy, which presupposes a high degree of direct contact between its participants. The former, capable of working remotely, suffered much less from the virus than the latter. They even more calmly demolish all kinds of restrictions that the authorities of the left-oriented states continue to impose on business activities in a physical, high-contact space.
Fashion
The virtual segment of society is the main driving force behind the new hobby for cloud programming, cryptocurrencies, electric vehicles, and unmanned vehicles. It is for the financial stimulation of this segment that many of the “green” initiatives of the Biden administration are designed.
Unemployment
The labor market situation has improved significantly compared to the disastrous last year, but remains worse than it was on the eve of the pandemic. Unemployment remains above the 4 percent level; employment among racial minorities, which had recovered under Trump, has dropped again. The return of people to work has been hampered for months by the super-generous benefits that the previous and current administrations have paid them. The stabilization of the situation, primarily in the service sector, is hindered by the growth of strikes and, most importantly, by the sharply increased labor force mobility. People began to change jobs much more actively, increasing their qualifications along the way, and sometimes without any improvement, demanding higher remuneration for their work. The number of vacancies that are not filled is enormous; it clearly exceeds the number of people actively looking for work. The share of the working-age population employed in production does not reach the pre-pandemic level, although that was far from amazing – 63.3%.
Inflation
The most noticeable and popularly discussed event in the field of economics in the outgoing year is undoubtedly inflation. The injection of huge funds into the national economy by the state could not remain without consequences. As the pandemic weakened and economic activity began to rebound, deferred demand, fueled by subventions, burst out. Supply, that is, production suppressed during the epidemic, objectively could not recover as quickly. The voluntaristic games of the authorities with the closure of the economy are costly for their subjects. Disruptions have occurred in global value chains. The result was the acceleration of inflation across the entire line of goods and services. Inflation today has returned to a record 40-year-old rate of 5-6 percent, or even more, as can be seen, for example, in prices in grocery stores, restaurant bills, hotel bills, airfare and taxi fares. In recent years, inflation has been moderate at around two percent per year or less.
The change of scenery in the price arena forced the Central Bank to promptly modify its priorities. If at the peak of covid the Central Bank considered its primary task to preserve the liquidity of the banking system and prevent a catastrophic rise in unemployment, then after the diagnosis was made that the current inflation is not a fleeting phenomenon, but quite a long-term one, the emphasis shifted to counteracting further rapid price increases. Anti-inflationary measures also occupy a lot of the White House, whose sentiments the Central Bank cannot ignore, although it is nominally an absolutely independent structure. As a result of the change in exchange rate, the Central Bank will prematurely curtail the program for purchasing securities held on the balance sheets of commercial banks, through which monetary resources were pumped into banks at the height of the pandemic, and will also start to systematically increase its key rate ahead of schedule; the latter has a decisive influence on the percentage that commercial banks charge on their regular loans to businesses and individuals.
Consumption
Consumer spending accounts for about two-thirds of US GDP. Citizen spending skyrocketed in the second and third quarters; retail turnover in March 2021 increased by 11.3% against the level of the previous year. However, in November, growth slowed to 0.3% – a clear indication that the easy money spilled on the population by the orders of Trump and Biden is being depleted. Big discounts are not expected in the post-holiday season.
This circumstance, according to a number of analysts, should, among other things, ease the pressure on the cost of purchased and rented housing in the overheated real estate market in Florida. The current insane prices that migratory birds from the north pay for housing in the “Sunshine State” in winter will probably not last until next year.
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