The past 18 months have not been kind to small businesses. If you’ve been unfortunate enough to live in a blue state during the start of the covid lockdowns and own a physical activity, then you’ve probably spent much of those 18 months locked up or struggling to stay open with a skeleton crew of employees. . If you managed to get a PPP loan from the government during the close, you are now realizing that the 24-week grace period is about to expire and you will likely have to pay back most if not all of that money soon. Many of those who have tried to get a PPP loan have failed because the money was quickly chewed on by large corporations instead of being reserved for small businesses.
And that’s not even the beginning of the small business trouble list. I have to say, unless a large part of your business is run online, your chances of remaining solvent are slim. This is not the fault of most entrepreneurs, but is a consequence of artificially created conditions and restrictions.
What do I mean by this? Well, let’s take a look at some factors that many people may not be aware of …
This is why small businesses are suffering
For example, both state and federal governments have offered some level of unemployment stimulus covid. In the case of federal programs, this could amount to an extra $ 300 per week on top of a person’s existing unemployment benefits, even more if their state has a separate program. This created a massive drought in the employee pool. Nobody wants to work when they can stay at home, do nothing and earn more money than they did before the pandemic. The reality is that there are jobs everywhere right now, but hardly anyone is applying.
This has led to major companies and resellers offering unprecedented login bonuses in the $ 300 to $ 500 range. Some companies offer to pay people just to submit an application. Many offer staggering wage increases of the order of $ 15 an hour for unskilled labor.
But guess who can’t make offers like that? Most small businesses. Large corporate chains have enjoyed endless incentive packages from the federal government and central bank and as long as this continues they will always be able to outperform small businesses for employees. And although federal controls for covid are slowly running out, there are still millions of people who will receive regular unemployment for many months to come. In a bizarre twist, the unemployed are now full of money and in no rush to rejoin the workforce. Small businesses simply cannot compete and attract these workers from their covid vacations.
On top of that, we are now seeing a dynamic that I have felt would be happening for years now: a stagflationary routine. That’s right, the debate that has been raging for a decade among alternative economists is finally over: It is not a deflationary depression or a Weimar-style hyperinflationary collapse that is taking down America, but a crippling stagflationary malaise. This means that the GDP of the United States will continue to decline and some sectors of the economy will continue to decline while the prices of many products (mainly basic necessities) will continue to rise or remain very high.
This creates a conundrum for small business owners: their overheads are increasing and this is reducing their profit margins. But if prices rise, it becomes even more difficult to compete with large companies that are able to keep prices low for longer because they have the government’s incentive to support them. Hence, not only are physical companies unable to compete for employees, they cannot compete in terms of price either as the cost of materials and goods increases. It is inevitable, they will have to close. There have been over 200,000 extra small business closures in the last year alone due to covid and lockdowns.
With small businesses hit by a perfect storm leading to mass closures, the end result will be that only large companies will remain to offer services in the foreseeable future, and for the past few months I have wondered if this is not part of the plan …
Reengineering the Great Depression
I am reminded of the situation that occurred during the Great Depression which involved small banks. In the 1920s, there were thousands of small town and county banks across the country that were not affiliated with large banks like JP Morgan or Chase National. It might sound strange to hear this, but before the Depression, many banks were small family businesses. By the late 1930s, more than 9,000 small banks had gone bankrupt and the main beneficiaries were the major corporate banks which absorbed all the assets in their portfolios for a few cents.
In other words, the banking industry and the enormous power it holds today have consolidated in the wake of the economic collapse of the 1930s and nothing has ever been the same again. This beneficial crisis was aided by the Federal Reserve, which had artificially lowered rates in the 1920s, only to raise rates in the late 1920s and early 1930s. In a speech to economist Milton Friedman on his birthday, former Fed Chairman Ben Bernanke admitted that the Fed was essentially responsible for the disaster of the Great Depression, stating:
In short, according to Friedman and Schwartz, due to institutional changes and misleading doctrines, the banking panic of the Great Contraction was much more severe and widespread than would normally have occurred during a recession.
Allow me to conclude my speech by slightly abusing my status as the official representative of the Federal Reserve. I would like to say to Milton and Anna: About the Great Depression. You’re right, we did it. We are very sorry. But thanks to you, we won’t do it again. “
It is interesting to me that the crash that the Federal Reserve “accidentally” caused was the same crash that allowed their good friends in corporate banking to centralize financial power for decades to come.
Today, we may see a similar scenario unfold. Look at it this way: the blocks were completely useless. They haven’t stopped infection rates and therefore haven’t saved lives anyway. In fact, even the states with the most severe blockages and the most severe mask mandates had the worst infection spikes.
Covid unemployment programs are mostly useless and justified only by unnecessary lockdowns. And stagflationary conditions were mostly inflamed by the trillions of stimuli the federal government and the Federal Reserve printed out of thin air to pay for unnecessary covid response programs and unemployment. Checks and covid loans have evoked a workforce calamity, but they have also fueled a rush to retail buying that is primarily enriching manufacturing centers like China, triggering the explosion in shipping demand and shipping costs, putting to strain the supply chain, blocking loading ports and raising overall prices by leaps and bounds.
Every single element of this crisis was designed. And I would suggest the possibility that, as in the Great Depression, big companies are once again in a comfortable position to devour the small business sector and become the only game in town for all retailers and services.
Not only are companies benefiting from the demise of small businesses, but so does the Biden administration in its relentless pursuit of covid vaccine mandates. Let’s consider for a moment that small businesses are the antithesis to covid controls. Why? Because they offer people who refuse to take experimental vaccines an alternative to major retailers who may request to see their vax passports. Small businesses are far more likely to challenge draconian mandates, so Biden also wins by removing competition from the corporate oligarchy that supports its controls.
Even if a small business complies with the mandates of the passport, it will not save them, because the amount of additional costs involved in applying will be excessive for most of them. Constantly checking customers and employees for updated vaccination cards will become a full-time job. Any mistake could mean a $ 70,000 to $ 700,000 fine, and since they’ve already submitted passports, those companies won’t get any community support if they try to refuse to pay. Eventually they will close anyway.
Without freedom-oriented small businesses, the only options left for the unvaccinated will be self-employment (which will also be made more difficult over time), or bartering and the black market.
Ironically, it is this threat that also creates an opportunity for small business owners. If they unite within their communities and let their communities know that they will absolutely not apply vaccine passports to employees or customers, then they may actually have a way to compete and beat department stores. They would have far more potential workers applying for a job so that their employee pool would grow at this critical time, and they would gain any customers in their area who also refuse to comply with the jab. Unless they operate in a blue county, they are likely to earn considerable business.
There are all the incentives. Small businesses will be successful and local communities will have options to challenge medical tyranny. Will it anger the bosses? Yes, but who cares. They still want to make you fail, so why not take a risk and fight back? The choice is to take a stand now, or live under the heel of a boot for the rest of your days. That’s all.
However, these measures need to be taken Now Before it’s too late. I also expect that as seasonflationary pressures increase smaller firms, the communities around them will have to start considering alternatives to the US dollar. Precious metals are an option, along with bartering and local trading or exchange, as long as they are backed by commodities. There is a lot to do. It is time for small businesses to accept the possibility of being targeted for destruction; they can’t do anything and wait for the hammer to drop, or they can take steps to protect themselves. I suggest the latter.
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