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With oil prices enjoying a powerful renaissance in recent months amid mounting supply concerns, declining inventory and the growing possibility that China's economy may finally kickstart, energy giants such as Exxon and Chevron had enjoyed a similar rebound in their stock price, and in fact XOM hit a record high as recently as 2 weeks ago. Which is why many were looking to today's earnings reports by the largest US energy company to see if the numbers would validate the rebound in sentiment and, of course, price.

So here is what Exxon reported today for the first quarter:

• EPS of $2.06, down from 2.83 a year ago, and missing consensus estimates of $2.19, as a result of delayed bump in commodity prices (which however will lift results in Q2) and a spike in non-cash charges

The Net Income number was $8.22 billion, down from $11.618 billion a year ago, with weakness in Upstream and Energy products hitting the bottom line number, coupled with an increases in expenses.  The biggest factor behind the drop in earnings was a $2.6 billion hit to price/margin due to lower energy prices in Q1. However, with Brent now well above year ago levels and rising, what XOM lost in Q1 it will more than make up in Q2 absent a collapse in the energy market.

A breakdown by the various operating segments, reveals that price and margin were indeed the biggest culprits for declining earnings.

Taking a closer look at the company's two main divisions, Upstream and Energy products, the company provided the following detail for the somewhat disappointing earnings here, starting with Upstream:

• Lower gas realizations due to high industry inventory
• Advantaged assets volume improved due to continued growth in Guyana
  • >600 Kbd of Guyana quarterly gross production
  • Payara ramped up to 220 Kbd capacity well ahead of schedule
• Base volume lower due to unfavorable sales timing and entitlement impacts
• Timing effects had a negative $120 million impact on the quarter compared to a negative $160 million impact last quarter

Energy products, where we saw the bulk of the earnings delta (some $1.7BN in earnings reductions between Q4 and Q1), was more interesting as Exxon attributed the slide to three primary drivers:

• Volumes and expenses reflect higher scheduled maintenance activity
• Non-cash charges which reflected the absence of favorable year-end inventory impacts, and unfavorable tax adjustments
• Finally, timing effects which had a negative $460 million impact on the quarter, consistent with rising price environment compared to a positive $600 million impact last quarter (this is derivative trades which are completely separate from the core business)

“Any given quarter we’ll have a number of non-cash, just a bit more unusual expenses that kind of ebb and flow,” CFO Kathy Mikells told BBG in an interview. “This quarter we had a number of small ones that added up together to be more significant and that’s difficult for analysts to model.”

“We continue to bring projects in more quickly and under budget so we’ve just had great execution in Guyana,” Mikells said, noting that gross daily production is now more than 600,000 barrels, up from 440,000 in the final three months of 2023.

Exxon’s accounting charges were non-cash items associated with tax and inventory balance sheet adjustments, Mikells said. The company also had higher expenses from scheduled maintenance at its facilities.

Some more highlights from the report:

• Exxon started output at Payara, its third Guyanese development, ahead of schedule late last year, adding 220,000 barrels of daily supplies that earn profits even if crude plunges to the $35 mark.
• Achieved quarterly gross production of more than 600,000 oil-equivalent barrels per day in Guyana and reached a final investment decision on the sixth major development.
• Net production was 47,000 oil-equivalent barrels per day lower than the same quarter last year with the growth in advantaged Guyana volumes more than offsetting the earnings impact from lower base volumes due to divestments, government-mandated curtailments and unfavorable entitlement effects.
• Excluding the impacts from divestments, entitlements, and government-mandated curtailments, net production grew 77,000 oil-equivalent barrels per day driven by the start-up of the Payara development in Guyana.

What is remarkable is that even though earnings missed mostly on the timing effect of commodity price increases and one-time charges, which has sent the stock tumbling this morning, the company still managed to blow away expectations for cash generation: in Q1, cash from operations jumped to $14.7 billion, $1 billion higher than Q4 2023 and also $1 billion higher than forecasts, boosted by the more than 35% uplift in Guyanese crude production.

This in turn led to a $1.8 billion increase in the company's cash balance despite $6.8 billion in shareholders distributions including $3.8 billion in dividends.

Exxon’s capital spending was $5.8 billion in the first quarter, a third lower than the previous three month period when the company incurred some added Guyana costs. If that level of spending is repeated for the rest of the year, annual capital expenditure would come in at the low end of the company’s $23 billion to $25 billion guidance, and in a market where capital efficiency is extremely rewarded, it likely means that new all time highs are just weeks if not days away.

More importantly, XOM says that it is on pace to increase buybacks to $20 billion following the close of the Pioneer acquisition, some time in Q2.

Exxon’s stellar performance in Guyana explains why arch-rival Chevron wants to get into the project via a $53 billion takeover of Hess, which has a 30% stake. Exxon claims it has a right-of-first refusal over Hess’s stake while Chevron says that doesn’t apply because its deal is a corporate merger.

Arbitration is still in its “very early days,” Mikells said. Each side has chosen one arbitrator who will sit on a panel of three, she said. Hess this week extended the closing date of its deal with Chevron by six months to October.

Finally looking ahead, the company forecast that it is on track to more than double upstream profits by 2027...

... and with cost-savings expected to save another $5BN in spending by 2027 (a total of $15BN vs 2019), this translates into a stellar 10% CAGR in bottom line earnings, and about $10BN in incremental earnings potential by 2027.

Commenting on the results, Goldman said that relative to its forecasts, US E&P and International R&M drove the miss. Worldwide production came in at 3,784 MBOE/d vs GS at 3,776 MBOE/d and FactSet consensus at 3,808 MBOE/d, with stronger US and International liquids partially offset by weaker US and International gas production.

More importantly, the Goldman analyst writes that, as noted above, timing effects from unsettled derivative mark-to-market impacts and other primarily non-cash impacts from tax and inventory adjustments contributed to the miss vs GS estimates. Additionally, the company reiterated Structural Cost Savings target of $15bn by 2027, with total savings reported at $10.1 bn vs 2019 levels.

So in its infinite wisdom, when faced with a company that is generating more cash than 99% of companies - and is not reliant on hype and chatbots to keep growing but good, old-fashioned energy which may be boring but is what keeps the world turning - this morning the algos decided to dump their Exxon shares sending the stock some 4% lower, and allowing anyone who pays attention to load up on the dip.

The XOM Q1 investor presentation is below (pdf link)

Authored by Lance Roberts via RealInvestmentAdvice.com,

The latest retail sales data suggests a robust consumer, leading economists to become even more optimistic about more robust economic growth this year. To wit:

“It has been two years since forecasters felt this good about the economic outlook. In the latest quarterly survey by The Wall Street Journal, business and academic economists lowered the chances of a recession within the next year to 29% from 39% in the January survey. That was the lowest probability since April 2022, when the chances of a recession were set at 28%.

Economists don’t think the economy will get even close to a recession. In January, they, on average, forecast sub-1% growth in each of the first three quarters of this year. Now, they expect growth to bottom out this year at an inflation-adjusted 1.4% in the third quarter.” – WSJ

According to the March retail sales data, consumer spending added “fuel” to economists’ exuberance about this year.

Rising inflation in March didn’t deter consumers, who continued shopping at a more rapid pace than anticipated, the Commerce Department reported Monday. Retail sales increased 0.7% for the month, considerably faster than the Dow Jones consensus forecast for a 0.3% rise though below the upwardly revised 0.9% in February, according to Census Bureau data that is adjusted for seasonality but not for inflation.” – CNBC

The chart below shows the monthly change in the retail sales data over the last two years.

While mainstream economists trumpeted the strength of the consumer, the March retail sales data had some interesting points worth noting.

First, retail sales data was extraordinarily weak from October to January, the traditionally strongest shopping months of the year. That period included Halloween, Thanksgiving, Christmas, and NYear’sr’s. So, to some degree, the strength of spending over the last two months is unsurprising as, eventually, consumers need to buy goods or services previously postponed.

Secondly, while the March retail sales data was strong, it was weaker than February. However, March contained two significant spending periods, Spring Break and Easter, which generally don’t occur. Since Spring Break and Easter are considerable travel and shopping periods, it is unsurprising that the retail sales data increased with oil prices rising. As shown below, there is a very high correlation between nominal retail sales and oil prices.

Paying More For The Same Amount

Economists often overlook another important point about the retail sales data. As noted above, the March retail sales report was NOT adjusted for inflation. Furthermore, the report is in nominal “dollar volume” and not the amount of goods or services sold. Oil and gasoline prices are an excellent example of the issue with the retail sales data.

Let’s assume you own a car with 18-gallon fuel tank. Your daily activities are mostly going to work, going to the grocery store, eating out, having entertainment, etc. As such, you consume one tank of gas each week. Here is the math:

Week 1: 18-gallons of gas @ $3/gallon = $54.

That week, the store adds $54 to the monthly retail sales total for selling 18 gallons of gasoline. However, the price will increase to $4 per gallon next week.

Week 2: 18-gallons of gas @ $4/gallon = $72.

Here is the question.

While the retail sales data increased by $18 in week two, did the consumer purchase more gasoline? In other words, if the economy’s strength is ultimately measured by how much we produce (gross domestic product), then does spending more for the same amount of goods or services equate to a stronger economy?

The picture is quite different if we adjust the nominal retail sales data for inflation. Again, it is unsurprising that even on an inflation-adjusted basis, retail sales rose in February after declining for four months previously. However, with March containing Spring Break and Easter, the data suggests a weaker consumer that headlines tout.

It is worth noting that retail sales data is not very useful in determining whether the economy is nearing a recession. As shown below, an annual growth rate of 2% has been a good marker for economic growth. As such, retail sales should grow at roughly 2% annually as well, given that personal consumption expenditures comprise approximately 70% of the economic equation. However, other than 2007, retail sales did not clarify economic strength.

In other words, spending more for the same amount of goods and services is not a sign of economic strength.

Economic Forecasts Tend To Be Erroneous

Furthermore, while the recent nominal sales data was robust, it is crucial to remember the economic data has a significant lag. Each of the dates below shows the economy’s growth rate immediately before the onset of a recession. You will note in the table that in 7 of the last 10 recessions, real GDP growth was running at 2% or above. In other words, according to the media, there was NO indication of a recession. But the next month, one began.

Crucially, I am not saying a recession is starting next month. However, I suggest that relying heavily on one month’s retail sales data to claim the economy avoided a recession is not likely ideal. Let’s revisit that chart of the WSJ economic forecast. I have added two notations: the start and end of recessions and when the NBER officially dated that period. As shown in both previous recessions, WSJ economists had a very low probability of the economy entering a recession just before it occurred.

The reality is that on an inflation-adjusted basis, the retail sales data suggests the consumer remains weak. While spending more to buy the same amount of goods or services may look good on paper, the average household has less money to spend elsewhere. As shown, the annual rate of change in real retail sales is near some of the lowest levels outside of a recession.

Lastly, consumer credit supporting retail sales will become more problematic with rising interest rates. Higher interest rates tend to reduce the average growth rate of retail sales data.

Our advice is to remain cautious about economic exuberance. Those forecasts are often disappointing.

Having already lost more than 10% of its value versus the US dollar this year, the yen plunged further overnight after Bank of Japan Governor Kazuo Ueda indicated monetary policy will stay easy as he kept rates unchanged and showed little to no support for the embattled currency during the press conference.

While investors had not expected the BoJ to change its policy this week, there was an expectations that Ueda would strike a hawkish tone regarding future rate rises to slow the yen’s decline.

Instead, Ueda said at a news conference on Friday that the central bank’s board members judged there was “no major impact” from the weaker yen on underlying inflation for now.

“Currency rates is not a target of monetary policy to directly control,” he said.

“But currency volatility could be an important factor in impacting the economy and prices. If the impact on underlying inflation becomes too big to ignore, it may be a reason to adjust monetary policy.”

And that sent the currency reeling (amid chaotic swings) back above 157/USD...

Source: Bloomberg

“There is no intention by the BoJ to stop the yen’s decline, at least looking at its statement and its outlook report,” said UBS economist Masamichi Adachi.

“The finance ministry will have to act [to stem the yen weakness]... It would have been more effective if both the government and the BoJ faced the same direction,” he added.

Blowing further below the 'interventionist' levels seen previously to a fresh 34-year low...

Source: Bloomberg

“Markets remain on high alert for any indication of whether the yen’s current weakness will be interpreted as a lasting inflationary signal,” said Naomi Fink, global strategist at Nikko Asset Management.

“The BoJ however is likelier to find any knock-on impact from yen weakness upon inflation as more concerning than short-term currency moves.”

Driving the depreciation is the yawning gap between the interest rates in the US - which are at highest in decades after the Fed’s aggressive tightening cycle last year - and those in Japan, where borrowing costs remain stubbornly low near zero.

“Intervention is possible at anytime, but it could have been just someone selling a large lot, which stoked intervention speculation and spurred follow-through moves,” said Koji Fukaya, a fellow at Market Risk Advisory Co. in Tokyo.

“It does not look like intervention, but the only way to confirm is to check data that will be released later by the Ministry of Finance.”

Policymakers have repeatedly warned that depreciation won’t be tolerated if it goes too far too fast.

Finance Minister Shunichi Suzuki reiterated after the BoJ meeting that the government will respond appropriately to foreign exchange moves.

Potential triggers for interventions are public holidays in Japan on Monday and Friday next week, which bring the risk of volatility amid thin trading.

“Should the yen fall further from here, like after the BOJ decision in September 2022, the possibility of intervention will increase,” said Hirofumi Suzuki, chief currency strategist at Sumitomo Mitsui Banking Corp.

“It is not the level but it’s the speed that will trigger the action.”

But so far, nothing! And so the market continues to call Ueda and Suzuki's bluff, knowing full well that a sudden intervention will perhaps briefly support the currency but will pancake the current gains in Japanese stocks.

However, not everyone is convinced intervention is imminent.

In a note this morning, Deutsche Bank says the currency's decline is warranted and finally marks the day where the market realizes that Japan is following a policy of benign neglect for the yen.

We have long argued that FX intervention is not credible and the toning down of verbal jawboning from the finance minister overnight is on balance a positive from a credibility perspective. The possibility of intervention can't be ruled out if the market turns disorderly, but it is also notable that Governor Ueda played down the importance of the yen in his press conference today as well as signalling no urgency to hike rates. We would frame the ongoing yen collapse around the following points.

1. Yen weakness is simply not that bad for Japan. The tourism sector is booming, profit margins on the Nikkei are soaring and exporter competitiveness is increasing. True, the cost of imported items is going up. But growth is fine, the government is helping offset some of the cost via subsidies and core inflation is not accelerating. Most importantly, the Japanese are huge foreign asset owners via Japan’s positive net international investment position. Yen weakness therefore leads to huge capital gains on foreign bonds and equities, most easily summarized in the observation that the government pension fund (GPIF) has roughly made more profits over the last two years than the last twenty years combined.

2. There simply isn't an inflation problem. Japan's core CPI is around 2% and has been decelerating in recent months. The Tokyo CPI overnight was 1.7% excluding one-off effects. To be sure, inflation may well accelerate again helped by FX weakness and high wage growth. But the starting point of inflation is entirely different to the post-COVID hiking cycles of the Fed and ECB. By extension, the inflation pain is far less and the urgency to hike far less too. No where is this more obvious than the fact that Japanese consumer confidence are close to their cycle highs.

3. Negative real rates are great. There is a huge attraction to running negative real rates for the consolidated government balance sheet. As we demonstrated last year, it creates fiscal space via a $20 trillion carry trade while also generating asset gains for Japan's wealthy voting base. This encourages the persistent domestic capital outflows we have been highlighting as a key driver of yen weakness over the last year and that have pushed Japan's broad basic balance to being one of the weakest in the world. It is not speculators that are weakening the yen but the Japanese themselves.

The bottom line, Deutscxhe concludes, is that for the JPY to turn stronger the Japanese need to unwind their carry trade. But for this to make sense the Bank of Japan needs to engineer an expedited hiking cycle similar to the post-COVID experiences of other central banks. Time will tell if the BoJ is moving too slow and generating a policy mistake. A shift in BoJ inflation forecasts to well above 2% over their forecast horizon would be the clearest signal of a shift in reaction function. But this isn’t happening now.

The Japanese are enjoying the ride.

But there is potential for yen upside as Bloomberg's Simon White notes that profit taking on foreign asset positions might soon prompt some yen repatriation and pressure USD/JPY lower.

If it is perceived that the yen won’t get much cheaper due to intervention risk, domestic investors might choose to start switching some of their US equity positions back to the domestic market, repatriating yen and pressuring USD/JPY lower in the process.

The chart below shows that on the year, the Nasdaq in yen terms and the Nikkei are both up by the same 13%-14% on the year. A stronger yen would present an ongoing headwind to the US position.

Equity positions are typically less FX hedged than bond positions, meaning that the repatriation of the currency is not neutered by the unwind of the hedge.

The dynamics of spot trading, options barriers and potential intervention as well as US PCE data released later today will dominate the currency’s short-term gyrations, but the slightly longer-term considerations of profit taking on foreign positions will start to drive the medium-term outlook.

Once that trend establishes itself, longer-term drivers of the yen will come into focus. Japan is the world’s largest net creditor, and there is a significant structural short in the yen.

The country’s net international investment position is $3.3 trillion, but its net position in portfolio assets, i.e. so-called hot flows that could be liquidated quickly, is $4.4 trillion.

Only a fraction of that being repatriated has significant potential to drive the yen considerably higher.

The question is, how much pain is China willing to take from its regional neighbor's 'devaluation'?

George Soros and his far-left movement is paying student agitators to co-opt and amplify anti-Israel protests at colleges across the country, the NY Post reports.

The protests, which began at Columbia University, have expanded nationwide - with copycat tent cities erected at colleges including Harvard, Yale, Berkeley in California, the Ohio State University and Emory in Georgia, with organized branches of the Soros-funded Students for Justice in Palestine (SJP) having organized them.

Biden has sparked a wildfire. pic.twitter.com/YXbHCKONcm

— Edward Snowden (@Snowden) April 25, 2024

Which might explain this:

Something odd about those campus tent encampments. Almost all the tents are identical - same design, same size, same fresh-out-of-the-box appearance. Which suggests that rather than an organic process, whereby students would bring a variety of individual tents, someone or some… pic.twitter.com/86JV5BD9NM

— Afshine Emrani MD FACC (@afshineemrani) April 23, 2024

The parent organization of SJP has been funded by a constellation of nonprofits which all lead to Soros.

At three colleges, the protests are being encouraged by paid radicals who are “fellows” of a Soros-funded group called the US Campaign for Palestinian Rights (USCPR).

USCPR provides up to $7,800 for its community-based fellows and between $2,880 and $3,660 for its campus-based “fellows” in return for spending eight hours a week organizing “campaigns led by Palestinian organizations.”

They are trained to “rise up, to revolution.”

The radical group received at least $300,000 from Soros’ Open Society Foundations since 2017 and also took in $355,000 from the Rockefeller Brothers Fund since 2019. -NY Post

The group has three "fellows" who have helped propel the protests into a nationwide phenomenon, which you can read more about here...

We're sure if the protests get violent, prosecutors will take appropriate action, yes?

And while many of the protesters are just morons...

“I wish I was more educated.”

Video captured at New York University shows that some of the students protesting there have no idea why. Full report: https://t.co/iYSbhaxxEf pic.twitter.com/iqXpoZexiP

— m o d e r n i t y (@ModernityNews) April 25, 2024

Some of them are quite spicy, like the leader of Columbia's encampment...

“Be glad — be grateful — that I’m not just going out and murdering Zionists. I’ve never murdered anyone in my life, and I *hope* to keep it that way.” This is a top leader of @Columbia’s encampment, with whom the school is “negotiating,” expanding on his thoughts about how Israel… pic.twitter.com/ugodO4O7M5

— Guy Benson (@guypbenson) April 25, 2024

Short-term inflation expectations rose... again... according to the latest UMich sentiment survey with 1-year expectations at 3.2% final, up from preliminary 3.1% for April, and 2.9% for March. This is the highest level since Nov 2023...

Source: Bloomberg

The headline sentiment also declined in April from three-year-highs. Consumers’ perceptions of their current financial situation and the economic outlook over the next year both slid to four-month lows. The current conditions gauge dropped to 79 from 82.5. A measure of expectations fell to 76 from 77.4.

Source: Bloomberg

While “consumers’ frustration over high prices in their day-to-day spending decisions grew this month, price concerns for large purchases - durable goods, vehicles, and homes - were all little changed from last month,’’ Joanne Hsu, director of the survey, said in a statement.

About 38% of consumers reported that high prices were weighing down their living standards, up from 33% who said so last month.

Sentiment gauges also provide insight into voters’ feelings about the economy and their finances leading up to the presidential election in November. President Joe Biden’s recent polling bump in key battleground states has mostly evaporated amid economic pessimism, the latest Bloomberg News/Morning Consult poll found.

“Consumers continue to express uncertainty about the future trajectory of the economy pending the outcomes of the upcoming election,” Hsu said.

Partisan differences in views of the economy remain pronounced. While Democrats and Independents saw little change in sentiment this month, sentiment for Republicans fell about 6 index points.

Republicans reported declines for four of the five components of the sentiment index, reflecting their deteriorating views across multiple facets of the economy. Despite these declines, sentiment for Republicans remains well above 2022 and 2023 levels.

In fact, the current reading for Republicans’ Expectations Index is the second highest (after last month) since the end of 2020, as the Trump presidency came to a close.

Authored by Michael Snyder via The Economic Collapse blog,

According to the absurd numbers that the government feeds us, the unemployment rate is very low and there are lots of jobs available.  But if what they are telling us is true, why are so many Americans not able to find work?  As you will see below, some people haven’t been hired even though they have literally applied for hundreds of jobs. 

There seems to be an enormous disconnect between what is actually happening in the real economy and the economic narrative that they are constantly pushing.  By the time you are done reading this article, I think that you will agree with me.

Earlier this week, I received an email from a reader that has not been able to find work after seven months of searching.

He gave me permission to share part of that email with you, and it is certainly quite heartbreaking…

Hi Michael,

I am a long-time reader of theeconomiccollapseblog.com, and your recent article comparing the economy to the movie “Weekend at Bernie’s” really stood out to me.

I’m really trying to figure out WHY it is so hard to find a job.

I was laid off from my job as a Custodial Foreman in September 2023, and have had ZERO results for my countless hours spent searching for comparable work.

I don’t know if you want to use any of this for an article or not, but if you do, please just keep doing what you normally do: Praising Jesus Christ. Without my faith in him I don’t know what I’d do.

When I wake up, I make coffee and turn on the computer and go through the state’s unemployment job search sites they provided me when I was laid off. I have been looking and also applying for jobs DAILY since September 2023. And these are not “rocket science” positions; I’m simply looking for Maintenance or Custodial or Groundskeeper type jobs. You know, “normal working class” type jobs.

But after ~300 applications (And these are all just to the jobs that I not only have experience for but also would actually want to do), I have had 1 interview. One interview in 7 months of applying and sending tailored cover letters with, daily!

If the economy is doing so “great”, why can’t he find employment?

Some of you may be tempted to think that he is just an isolated case.

Well, here is another example of an experienced worker that has applied for approximately 300 jobs without any success…

Royal Siu, who lives in Seattle and is trained as a pharmacist, likes to make his friends guess how many jobs he’s applied to. They’ll often toss out some number around 40, he told BI. He’ll tell them to keep going. Most give up by the time they reach 100. That’s when Siu drops that he’s applied to about 300 jobs. “It’s usually a shock factor to them,” he said.

Siu, who’s trying to use his pharmacy degree to work in other parts of healthcare, is finding it harder to land interviews than in a prior job search. The 28-year-old was getting more phone screenings and first and second interviews in the past. This time, it’s been a couple of months since he had a screening call. So he continues to turn to his network but also doesn’t stop applying.

What in the world is going on here?

I thought that there were “millions” of good jobs just waiting for someone to step into them.

Something definitely does not add up.

Even Americans with advanced degrees from top schools are increasingly finding themselves out of work.

If you doubt this, just check out these numbers…

Even at some top business schools, the number of recently minted M.B.A.s without jobs has roughly doubled from a couple of years ago, when U.S. companies were rushing to hire as many workers as they could, according to data from the schools.

At Harvard Business School, 20% of job-seeking 2023 M.B.A. graduates didn’t have one three months after graduation, up from 8% in 2021. At Stanford’s Graduate School of Business, 18% didn’t, compared with 9% in 2021. About 13% of those at the Massachusetts Institute of Technology’s Sloan School of Management didn’t have a job within three months, up from about 5% in 2021.

How are those numbers possible if the unemployment rate is hovering near “historic lows”?

Of course the truth is that we have been sold a lie.

If you do not have a job, you are classified by the U.S. government as either “unemployed” or “not in the labor force”.

In 2008 and 2009, the combined total of those two categories never even reached 90 million.

Today, the combined total of those two categories is over 106 million.

The Biden administration says that only 6,429,000 Americans are officially “unemployed”.

The other 99,989,000 Americans without a job are considered to be “not in the labor force”.

And more will be lumped into those two categories soon, because large employers all over the nation continue to conduct mass layoffs.

For example, thousands of Tesla workers in California and Texas were just notified that they will be losing their jobs…

The notifications in California and Texas, where the electric vehicle (EV) maker has large presences, came in the form of WARN notices, according to reports.

In California, the planned Tesla headcount reductions will hit approximately 3,300 workers, The San Francisco Standard reported Tuesday.

They will apparently occur at locations in a total of four different cities in the Golden State.

Meanwhile, Texas will see almost 2,700 employees in Austin lose their jobs, according to the Austin American-Statesman.

Sadly, the pace of layoffs is likely to increase during the months ahead, because business activity in the U.S. is declining…

The U.S. economy lost momentum in April, a pair of S&P surveys found, as businesses reported a decline in new orders and reduced employment for the first time since the pandemic.

The flash U.S. manufacturing purchasing managers index slipped to a four-month low of 49.9 in April from 51.9 in March.

The S&P flash U.S. services PMI fell to a five-month low of 50.9 this month from 51.7 in March.

The surveys are the first indicators of each month to give a sense of how the U.S. economy is performing.

Meanwhile, the cost of living crisis just continues to escalate.

Shockingly, at one station in California gasoline now costs $7.29 per gallon…

Soaring gas prices have skyrocketed to a whopping $7.29 per gallon in some parts of California – which is above the current the national hourly minimum wage.

While the average price for a gallon of gas varies from state to state – drivers in a certain Silicon Valley town are facing particularly extortionate rates that set them back almost $150 for a full tank.

The Chevron gas station in Menlo Park was exposed on Sunday by a bewildered customer who posted on X that the price per gallon was four cents ‘above the federal hourly minimum wage.’

If you think that this is bad, just wait until the war in the Middle East transforms into the apocalyptic conflict that I believe it will become.

I am entirely convinced that inflation will continue to be a major problem even as economic activity in the U.S. slows down even more.

We are already experiencing “stagflation”.

What is eventually coming will be so much worse than that.

Of course the economic pain that we are going through is just one of the factors that is systematically destroying our nation.

A Warning to America: 25 Ways the US is Being Destroyed | Explained in Under 2 Minutes pic.twitter.com/qwmBO8DmMt

— Western Lensman (@WesternLensman) April 22, 2024

Just about all of our major institutions are crumbling, just about every sector of our society is in the process of melting down, and conditions are rapidly getting worse all around us.

And now we are heading into the most chaotic election season in the entire history of our country.

This is a recipe for disaster, but there is no turning back now.

*  *  *

Michael’s new book entitled “Chaos” is available in paperback and for the Kindle on Amazon.com, and you can check out his new Substack newsletter right here.