- Wahrheit Macht Frei… Truth Sets You Free
Wahrheit Macht Frei… Truth Sets You Free
Authored by Finian Cunningham via The Strategic Culture Foundation,
This week sees the 75th anniversary of the liberation of the Nazi Auschwitz death camp by the Soviet Red Army. But the momentous event is being overshadowed by renewed attempts by the Polish authorities – aided by American and German officials – to shift the blame for the Second World War on to the Soviet Union.
The grimly deceptive German maxim “Arbeit Macht Frei” (“Works Sets You Free”) adorning the iron-gate entrance to Auschwitz through which millions of prisoners passed on their way to death, could be subtitled today with the more honest phrase “Wahrheit Macht Frei” (“Truth Sets You Free”).
Because what is going on in the Polish commemoration of Auschwitz and claims about the origins of the Second World War more generally is an appalling distortion of history to suit current geopolitical interests in the West of undermining Russia. Concealing or denying the causes of war only traps the world into repeating war.
Rather than being given a full place of honor for the liberation of the extermination camp in southern Poland on January 27, 1945, by the Soviet army, today Moscow is being sidelined despite its crucial role in crushing the Nazi regime and all its horrors.
Russian President Vladimir Putin has reportedly declined to attend the 75th anniversary in Poland. Russia will be represented by its ambassador to the country. Putin is attending an equivalent event in Israel, and at that alternative commemoration will be afforded due prominence to mark the liberating achievement of Russia’s predecessor, the Soviet Union. It is understandable why the Russian president decided to give the event in Poland a miss because of the toxic claims made recently by Warsaw and other Western states concerning allegations that the Soviet Union colluded with Nazi Germany in instigating the war.
This distortion of history has even gained an official status when the European Parliament – after Polish and Baltic state lobbying – adopted a resolution last September in which the Soviet Union is cast as equally culpable along with the Nazi Third Reich for starting World War II.
When President Putin slammed that resolution as “nonsense” and went on to point out Poland’s own documented collaboration with Nazi Germany, the current Polish government, along with German and American diplomats, doubled down on the accusations impugning Moscow for having partial responsibility for the worst conflagration in history.
Those Polish and Western accusations stem from the historical Nazi-Soviet non-aggression pact which was signed on August 23, 1939, one week before the Nazis invaded Poland. Thus it is claimed that Stalin’s detente with Hitler emboldened the latter to launch the war.
As Radio Free Europe reported: “German envoy Rolf Nikel and US Ambassador to Poland Georgette Mosbacher both said on December 30 that Germany and the Soviet Union colluded to start the war in 1939 that led to the death of tens of millions of people on continental Europe.”
Polish Prime Minister Mateusz Moraweicka denounced Putin’s version of history as “lying… trampling the memory of those events. Poland must stand up for the truth, not for its own interests but for the sake of of what defines Europe.”
That’s quite an audacious feat of historical distortion.
The motives for such re-writing of history are obvious. Germany can unburden some of its war guilt for terrorizing Europe with its fascist genocide.
By implicating the Soviets in Nazi horror, the Americans and their rightwing surrogates in Poland and the Baltic states can breath some air into the stale, breathless claims of “Russian aggression” towards modern-day Europe. That twist is especially odious given that the Soviet Union suffered the most out of any nation from Nazi barbarity, with up to 25 million dead and tens of millions more wounded.
Poland has perhaps the most to gain from falsifying history. Its own shameful past of colluding with the Nazi regime before and during the war is, it is anticipated, whitewashed and shoved down the memory hole.
The people lining up to disparage Russia over alleged Soviet complicity with Nazi Germany claim, ironically, that Putin is “rewriting history” by referring to Soviet records and propaganda.
One of the finest scholarly accounts of the period from the First World War until the late 1930s and the outbreak of war is the work by British historian AJP Taylor, entitled ‘The Origins of the Second World War’ (published 1961). Taylor is no “fellow-traveller” of the Soviet Union. His study is a consummate exercise in objective scholarship.
The Russian perspective is substantially corroborated by Taylor (and other Western historians, see for example this recent essay by Michael Jabara Carley). The Nazi-Soviet non-aggression pact on the eve of the war’s outbreak was a desperate attempt by Moscow to keep the Third Reich at bay. Because, as Taylor points out, the Western powers, in particular Britain and France and Poland, had consistently rebuffed Soviet appeals to form a collective European security pact against Nazi Germany.
Britain, France and Poland looked the other way when Hitler annexed Austria in 1936 and invaded Czechoslovakia in 1938. The Fuhrer’s manifesto in ‘Mein Kampf’ and his various ranting speeches during the 1930s explicitly targeted the Soviet Union and European Jewry for annihilation in a Final Solution.
Polish ministers during this period shared the Nazi contempt for Soviet and Jewish people. The case of Polish Ambassador in Berlin Josef Lipski proposing to Hitler in 1938 a scheme to deport European Jews to Africa is indisputable.
What Polish authorities today are compelled to deny is the objective historical record which assigns complicity to their predecessors in unleashing the Nazi monster. The fact Auschwitz and other Nazi extermination camps are on Polish territory does not seem to give these virulent Russphobes any pause for thought. The fact that the Soviet Red Army saved millions of Poles from Nazi barbarity – a barbarity that their vain, deluded political leaders emboldened – is perhaps the clearest example of how “Lies Do Not Set You Free”.
Tyler Durden
Thu, 01/23/2020 – 02:00 - US Navy To Revive Flak Cannons To Combat Drone Attacks
US Navy To Revive Flak Cannons To Combat Drone Attacks
The proliferation of unmanned aircraft has frightened the U.S. Navy into developing a powerful airburst round to knock drones out of the sky, reported Military.com.
The precision airburst munition, similar to anti-aircraft flak rounds used in World War II, is being designed to combat drones that are targeting warships at sea.
The new round is compatible with the Littoral Combat Ship’s (LCS) 30mm deck gun.
“We’re looking at another round called the proximity round, which detects the drone as it approaches and then blows up,” Kevin Knowles, who works on Northrop Grumman’s LCS and unmanned surface vessel programs, said Tuesday at the Surface Navy Association conference. “It’s not a radar system, but it’s something similar. That’s what we’re looking at for drones.”
Knowles said it’s nearly impossible to hit a drone with a solid round, that’s why the Navy is reviving old technology with a modern twist to combat unmanned aircraft.
The LCS has two Mk44 Bushmaster II 30mm chain guns that can fire 100 to 200 rounds per minute.
Last summer, Iran flew a drone, undetected, over a U.S. aircraft carrier strike group transiting the Strait of Hormuz.
#Trump‘s Lie: #Iranian Drone Was NOT Shot Down#Iran Just released footage captured by the #Iranian drone #Trump claimed it was shot down by #USSBoxer
Video of #USSBoxer & a #US aircraft carrier under full surveillance by #Iranian drone right above them before & after his claim pic.twitter.com/sjrSQFGpj7
— realSeifBitar (@BitarReal) July 19, 2019
https://platform.twitter.com/widgets.js
The Pentagon has tasked a 60-person team to develop new policies and find advanced weapons that can counter the increasing threat of drones worldwide.
Tyler Durden
Thu, 01/23/2020 – 01:00 - How The Military-Industrial Complex Gets Away With Murder In Contract After Contract
How The Military-Industrial Complex Gets Away With Murder In Contract After Contract
Authored by Mandy Smithberger via TomDispatch.com,
Call it a colossal victory for a Pentagon that hasn’t won a war in this century, but not for the rest of us. Congress only recently passed and the president approved one of the largest Pentagon budgets ever. It will surpass spending at the peaks of both the Korean and Vietnam wars. As last year ended, as if to highlight the strangeness of all this, the Washington Post broke a story about a “confidential trove of government documents” — interviews with key figures involved in the Afghan War by the Office of the Special Inspector General for Afghanistan Reconstruction — revealing the degree to which senior Pentagon leaders and military commanders understood that the war was failing. Yet, year after year, they provided “rosy pronouncements they knew to be false,” while “hiding unmistakable evidence that the war had become unwinnable.”
However, as the latest Pentagon budget shows, no matter the revelations, there will be no reckoning when it comes to this country’s endless wars or its military establishment — not at a moment when President Donald Trump is sending yet more U.S. military personnel into the Middle East and has picked a new fight with Iran. No less troubling: how few in either party in Congress are willing to hold the president and the Pentagon accountable for runaway defense spending or the poor performance that has gone with it.
Given the way the Pentagon has sunk taxpayer dollars into those endless wars, in a more reasonable world that institution would be overdue for a comprehensive audit of all its programs and a reevaluation of its expenditures. (It has, by the way, never actually passed an audit.) According to Brown University’s Costs of War Project, Washington has already spent at least $2 trillion on its war in Afghanistan alone and, as the Post made clear, the corruption, waste, and failure associated with those expenditures was (or at least should have been) mindboggling.
Of course, little of this was news to people who had read the damning reports released by the Special Inspector General for Afghanistan Reconstruction in previous years. They included evidence, for instance, that somewhere between $10 million and $43 million had been spent constructing a single gas station in the middle of nowhere, that $150 million had gone into luxury private villas for Americans who were supposed to be helping strengthen Afghanistan’s economy, and that tens of millions more were wasted on failed programs to improve Afghan industries focused on extracting more of the country’s minerals, oil, and natural gas reserves.
In the face of all this, rather than curtailing Pentagon spending, Congress continued to increase its budget, while also supporting a Department of Defense slush fund for war spending to keep the efforts going. Still, the special inspector general’s reports did manage to rankle American military commanders (unable to find successful combat strategies in Afghanistan) enough to launch what, in effect, would be a public-relations war to try to undermine that watchdog’s findings.
All of this, in turn, reflected the “unwarranted influence” of the military-industrial complex that President (and former five-star General) Dwight Eisenhower warned Americans about in his memorable 1961 farewell address. That complex only continues to thrive and grow almost six decades later, as contractor profits are endlessly prioritized over what might be considered the national security interests of the citizenry.
The infamous “revolving door” that regularly ushers senior Pentagon officials into defense-industry posts and senior defense-industry figures into key positions at the Pentagon (and in the rest of the national security state) just adds to the endless public-relations offensives that accompany this country’s forever wars. After all, the retired generals and other officials the media regularly looks to for expertise are often essentially paid shills for the defense industry. The lack of public disclosure and media discussion about such obvious conflicts of interest only further corrupts public debate on both the wars and the funding of the military, while giving the arms industry the biggest seat at the table when decisions are made on how much to spend on war and preparations for the same.
Media Analysis Brought to You by the Arms Industry
That lack of disclosure regarding potential conflicts of interest recently came into fresh relief as industry boosters beat the media drums for war with Iran. Unfortunately, it’s a story we’ve seen many times before. Back in 2008, for instance, in a Pulitzer Prize-winning series, the New York Times revealed that the Pentagon had launched a program to cultivate a coterie of retired-military-officers-turned-pundits in support of its already disastrous war in Iraq. Seeing such figures on TV or reading their comments in the press, the public may have assumed that they were just speaking their minds. However, the Timesinvestigation showed that, while widely cited in the media and regularly featured on the TV news, they never disclosed that they received special Pentagon access and that, collectively, they had financial ties to more than 150 Pentagon contractors.
Given such financial interests, it was nearly impossible for them to be “objective” when it came to this country’s failing war in Iraq. After all, they needed to secure more contracts for their defense-industry employers. A subsequent analysis by the Government Accountability Office found that the Pentagon’s program raised “legitimate questions” about how its public propaganda efforts were tied to the weaponry it bought, highlighting “the possibility of compromised procurements resulting from potential competitive advantages” for those who helped them.
While the program was discontinued that same year, a similar effort was revealed in 2013 during a debate over whether the U.S. should attack Bashar al-Assad’s Syrian regime. You probably won’t be surprised to discover that most of the former military figures and officials used as analysts at the time supported action against Syria. A review of their commentary by the Public Accountability Initiative found a number of them also had undisclosed ties to the arms industry. In fact, of 111 appearances in major media outlets by 22 commentators, only 13 of them disclosed any aspect of their potential conflicts of interest that might lead them to promote war.
The same pattern is now being repeated in the debate over the Trump administration’s decision to assassinate by drone Iranian Major General Qassem Suleimani and other Iran-related issues. While Suleimani clearly opposed the United States and many of its national security interests, his killing risked pushing Washington into another endless war in the Middle East. And in a distinctly recognizable pattern, the Intercept has already found that the air waves were subsequently flooded by defense-industry pundits praising the strike. Unsurprisingly, news of a potential war also promptly boosted defense industry stocks. Northrop Grumman’s, Raytheon’s, and Lockheed Martin’s all started 2020 with an uptick.
Senator Elizabeth Warren (D-MA) and Representative Jackie Speier (D-CA) have offered legislation that could shut down that revolving door between the major weapons makers and Washington for good, but it has met concerted resistance from Pentagon officials and others still in Congress who stand to benefit from preserving the system as is. Even if that revolving door wasn’t shut down, transparency about just who was going through it would help the public better understand what former officials and military commanders are really advocating for when they speak positively of the necessity for yet another war in the Middle East.
Costly Weapons (and Well-Paid Lobbyists)
Here’s what we already know about how it all now works: weapon systems produced by the big defense firms with all those retired generals, former administration officials, and one-time congressional representatives on their boards (or lobbying for or consulting for them behind the scenes) regularly come in overpriced, are often delivered behind schedule, and repeatedly fail to have the capabilities advertised. Take, for instance, the new Ford class aircraft carriers, produced by Huntington Ingalls Industries, the sort of ships that have traditionally been used to show strength globally. In this case, however, the program’s development has been stifled by problems with its weapons elevators and the systems used to launch and recover its aircraft. Those problems have been costly enough to send the price for the first of those carriers soaring to $13.1 billion. Meanwhile, Lockheed Martin’s F-35 jet fighter, the most expensive weapons system in Pentagon history, has an abysmal rate of combat readiness and currently comes in at more than $100 million per aircraft.
And yet, somehow, no one ever seems to be responsible for such programmatic failures and prices — certainly not the companies that make them (or all those retired military commanders sitting on their boards or working for them). One crucial reason for this lack of accountability is that key members of Congress serving on committees that should be overseeing such spending are often the top recipients of campaign contributions from the big weapons makers and their allies. And just as at the Pentagon, members of those committees or their staff often later become lobbyists for those very federal contractors.
With this in mind, the big defense firms carefully spread their contracts for weapons production across as many congressional districts as possible. This practice of “political engineering,” a term promoted by former Department of Defense analyst and military reformer Chuck Spinney, helps those contractors and the Pentagon buy off members of Congress from both parties. Take, for example, the Littoral Combat Ship, a vessel meant to operate close to shore. Costs for the program tripled over initial estimates and, according to Defense News, the Navy is already considering decommissioning four of the new ships next year as a cost-saving measure. It’s not the first time that program has been threatened with the budget axe. In the past, however, pork-barrel politics spearheaded by Senators Tammy Baldwin (D-WI) and Richard Shelby (R-AL), in whose states those boats were being built, kept the program afloat.
The Air Force’s new bomber, the B-21, being built by Northrup Grumman, has been on a similar trajectory. Despite significant pressure from then-Senator John McCain (R-AZ), the Air Force refused in 2017 to make public or agree upon a contract price for the program. (It was a “cost-plus,” not a “fixed price” contract, after all.) It did, however, release the names of the companies providing components to the program, ensuring that relevant congressional representatives would support it, no matter the predictably spiraling costs to come.
Recent polling indicates that such pork-barrel politics isn’t backed by the public, even when they might benefit from it. Asked whether congressional representatives should use the Pentagon’s budget to generate jobs in their districts, 77% of respondents rejected the notion. Two-thirds favored shifting such funds to sectors like healthcare, infrastructure, and clean energy that would, in fact, create significantly more jobs.
And keep in mind that, in this big-time system of profiteering, hardware costs, however staggering, are just a modest part of the equation. The Pentagon spends about as much on what it calls “services” as it does on the weaponry itself and those service contracts are another major source of profits. For example, it’s estimated that the F-35 program will cost $1.5 trillion over the lifetime of the plane, but a trillion dollars of those costs will be for support and maintenance of the aircraft.
Increasingly, this means contractors are able to hold the Pentagon hostage over a weapon’s lifetime, which means overcharges of just about every imaginable sort, including for labor. The Project On Government Oversight (where I work) has, for instance, been uncovering overcharges in spare parts since our founding, including an infamous $435 hammer back in 1983. I’m sad to report that what, in the 1980s, was a seemingly outrageous $640 plastic toilet-seat cover for military airplanes now costs an eye-popping $10,000. A number of factors help explain such otherwise unimaginable prices, including the way contractors often retain intellectual property rights to many of the systems taxpayers funded to develop, legal loopholes that make it difficult for the government to challenge wild charges, and a system largely beholden to the interests of defense companies.
The most recent and notorious case may be TransDigm, a company that has purchased other companies with a monopoly on providing spare parts for a number of weapon systems. That, in turn, gave it power to increase the prices of parts with little fear of losing business — once, receiving 9,400% in excess profits for a single half-inch metal pin. An investigation by the House Oversight and Reform Committee found that TransDigm’s employees had been coached to resist providing cost or pricing information to the government, lest such overcharges be challenged.
In one case, for instance, a subsidiary of TransDigm resisted providing such information until the government, desperate for parts for weapons to be used in Iraq and Afghanistan, was forced to capitulate or risk putting troops’ lives on the line. TransDigm did later repay the government $16 million for certain overcharges, but only after the House Oversight and Reform Committee held a hearing on the subject that shamed the company. As it happens, TransDigm’s behavior isn’t an outlier. It’s typical of many defense-related companies doing business with the government — about 20 major industry players, according to a former Pentagon pricing czar.
A Recipe for Disaster
For too long Congress has largely abdicated its responsibilities when it comes to holding the Pentagon accountable. You won’t be surprised to learn that most of the “acquisition reforms” it’s passed in recent years, which affect how the Department of Defense buys goods and services, have placed just about all real negotiating power in the hands of the big defense contractors. To add insult to injury, both parties of Congress continue to vote in near unanimity for increases in the Pentagon budget, despite 18-plus years of losing wars, the never-ending gross mismanagement of weapons programs, and a continued failure to pass a basic audit. If any other federal agency (or the contractors it dealt with) had a similar track record, you can only begin to imagine the hubbub that would ensue. But not the Pentagon. Never the Pentagon.
A significantly reduced budget would undoubtedly increase that institution’s effectiveness by curbing its urge to throw ever more money at problems. Instead, an often bought-and-paid-for Congress continues to enable bad decision-making about what to buy and how to buy it. And let’s face it, a Congress that allows endless wars, terrible spending practices, and multiplying conflicts of interest is, as the history of the twenty-first century has shown us, a recipe for disaster.
Tyler Durden
Thu, 01/23/2020 – 00:05 - "The 2-Child Policy Has Failed": China's Birth Rate Hits Record Low As Growth Slows
“The 2-Child Policy Has Failed”: China’s Birth Rate Hits Record Low As Growth Slows
China finally abandoned its controversial one-child policy in November 2013. But more than six years later, millions of Chinese couples are still unwilling to have a second child. And that’s a huge problem for the Communist Party, whose legitimacy in the eyes of the public depends on its ability to deliver on promises of unbridled growth and prosperity.
And who can blame them? Entrenched behaviors die hard, and after the government’s brutal treatment of citizens who defied its policy (which was initially imposed to ward off famine), we can sympathize with Chinese who simply believe that having two children isn’t in keeping with the fundamentals of patriotic socialism with Chinese characteristics.
But as the FT reported this week, issues of culture and perception aren’t the only reasons Chinese women are still refusing to have more than one child. As we reported last week, Chinese GDP growth slowed in 2019 to its weakest level in 29 years…
…proving unequivocally that Beijing’s massive credit stimulus hasn’t done much, if any, good.
Meanwhile, official statistics agencies reported that China’s birth rate dropped to 1.05%, a record low. That’s equivalent to 10.5 births per thousand Chinese.
The UN expects China’s population, the largest of any country in the world, to start declining by the end of this decade.
It’s the latest sign that the ‘two child policy’ is now considered an abysmal failure – so much so that party functionaries are apparently unafraid of discussing this fact with the Western press.
Weng Wenlei, vice-president of the Shanghai Women’s Federation, a government body, said birth rates in Shanghai had plunged despite efforts to relax China’s population control. She said births in the city had fallen “swiftly” following a brief recovery in 2016, when China began allowing couples to have two children.
“This suggests [the two-child policy] has failed to serve its intended purpose,” said Ms Weng. “Consistently low birth rate will have a negative impact on Shanghai’s social and economic development.”
Leftists in the US love to complain about the costs associated with having a baby, even for couples who have insurance. But even in a society where most of the people’s health-care needs are met by the state, Chinese citizens are still put off by the cost of care.
Josephine Pan, a Shanghai-based data analyst, abandoned plans to have a second child after spending half of her family’s monthly salary of Rmb20,000 ($2,900) on her seven-year-old son. “It costs a fortune to raise a child,” said Ms Pan, 41, who after giving birth gave up her decade-long hobby of buying designer bags. “I couldn’t afford a second one.”
Women in China are still reluctant to have children, even with the state promising cash handouts to couples who have two children, because they fear more children will hurt their careers.
As in the west, a growing number of Chinese women are reluctant to have babies because they fear children would hurt their career. Chinese employers have a tradition of discriminating against pregnant workers as many female staff face demotion, if not unemployment, after returning from maternity leave.
“I don’t want to risk my career to have a second child,” said Lucy Zhang, a Beijing-based newspaper editor with a five-year-old daughter. “I have worked so hard to get to where I am now.”
All signs suggest that public sentiment is firmly entrenched against breeding. Surveys carried out in Shanghai and Shanxi province last year suggested that the number of women willing to have a second child is languishing between 10% and 25%. Furthermore, only 6.7% of women in Shanghai who are of child-bearing age and also possessed a local residence permit, or hukou, gave birth to a second child in 2018.
“Raising a child takes so much time and energy,” said Mary Xu, a Shanghai-based magazine editor who has a three-year-old daughter. “I have had enough.”
Though they are largely ignored or censored in the mainland press, China’s debt burden is already becoming unwieldy. Last month, a state-owned giant defaulted on a dollar bond, the largest default in two decades. But the issues of being over-leveraged aren’t strictly limited to the corporate sector. Local government financing vehicles are also in trouble.
China bulls in the west argue that the Communist Party exercises such an unshakeable hold on the economy that they simply won’t allow for a systemic debt cross-default. But as the party struggles to contain capital outflows, the country’s reliance on monetary stimulus is finally pushing up against the boundaries of what’s possible.
To be sure, China isn’t the only country struggling with population shrinkage: 27 countries have fewer people now than in 2010. The UN expects 55 nations, including China, to experience declines between now and 2050. Most of these are countries have developed economies, a status that China has only recently achieved.
A declining population places inevitable constraints on economic growth. And as China’s momentous rate of growth slows, its economy will come to resemble a frog sitting in a pot of water on a hot stove.
For investors hoping to increase their exposure to China at a time of slowing growth, when the Chinese economy faces myriad difficulties, slowing population growth might create an opportunity in China’s domestic government bond market, according to one of WSJ’s Heard on the Street columnists.
Numerous studies suggest that a shrinking population should cause real rates to fall. And of course we have a real-world example of this phenomenon in Japan, where government bond prices have never been higher. Of course, this doesn’t necessarily guarantee that the Chinese bond market will follow suit. But it’s certainly some worthwhile food for thought.
Tyler Durden
Wed, 01/22/2020 – 23:45 - Deadly Distractions: Laying The Groundwork For The Next Civil War
Deadly Distractions: Laying The Groundwork For The Next Civil War
Authored by John Whitehead via The Rutherford Institute,
“Pity the nation oh pity the people
who allow their rights to erode
and their freedoms to be washed away…”– Lawrence Ferlinghetti, poet
And so it continues.
This impeachment fiasco is merely the latest in a never-ending series of distractions, distortions, and political theater aimed at diverting the public’s attention from the sinister advances of the American Police State.
Don’t allow yourselves to be distracted, diverted or mesmerized by the cheap theater tricks.
This impeachment spectacle is Shakespearean in its scope: full of sound and fury, signifying nothing.
Nothing is the key word here.
Despite the wall-to-wall media coverage, nothing will change.
Mark my words: the government will remain as corrupt and self-serving as ever, dominated by two political factions that pretend to be at odds with each other all the while moving in lockstep to maintain the status quo.
So President Trump’s legal team can grandstand all they want about the impeachment trial being “an affront to the Constitution” and “a dangerous perversion of the Constitution,” but that’s just smoke and mirrors.
You know what is really “an affront to the Constitution”? The U.S. government.
We’ve been losing our freedoms so incrementally for so long—sold to us in the name of national security and global peace, maintained by way of martial law disguised as law and order, and enforced by a standing army of militarized police and a political elite determined to maintain their powers at all costs—that it’s hard to pinpoint exactly when it all started going downhill, but we’re certainly on that downward trajectory now, and things are moving fast.
The republic has fallen.
The Deep State’s plot to take over America has succeeded.
The American system of representative government has been overthrown by a profit-driven, militaristic, corporate oligarchy bent on total control and global domination through the imposition of martial law here at home and by fomenting wars abroad.
Even now, we are being pushed and prodded towards a civil war, not because the American people are so divided but because that’s how corrupt governments control a populace (i.e., divide and conquer).
These are dangerous times.
These are indeed dangerous times but not because of violent crime, which remains at an all-time low, or because of terrorism, which is statistically rare, or because the borders are being invaded by foreign armies, which data reports from the Department of Homeland Security refute.
No, the real danger that we face comes from none other than the U.S. government and the powers it has granted to its standing armies to rob, steal, cheat, harass, detain, brutalize, terrorize, torture and kill American citizens with immunity.
The danger “we the people” face comes from masked invaders on the government payroll who crash through our doors in the dark of night, shoot our dogs, and terrorize our families.
This danger comes from militarized henchmen on the government payroll who demand absolute obedience, instill abject fear, and shoot first and ask questions later.
This danger comes from greedy, power-hungry bureaucrats on the government payroll who have little to no understanding of their constitutional limits.
This danger comes from greedy politicians and corporations for whom profit trumps principle.
You want to know about the state of our union? It’s downright scary.
Consider, if you will, all of the dastardly, devious, diabolical, dangerous, debilitating, deceitful, dehumanizing, demonic, depraved, dishonorable, disillusioning, discriminatory, dictatorial schemes inflicted on “we the people” by a bureaucratic, totalitarian regime that has long since ceased to be “a government of the people, by the people and for the people.”
Americans have no protection against police abuse. It is no longer unusual to hear about incidents in which police shoot unarmed individuals first and ask questions later, such as the 16-year-old teenager who skipped school only to be shot by police after they mistook him for a fleeing burglar. Then there was the unarmed black man in Texas “who was pursued and shot in the back of the neck by Austin Police… after failing to properly identify himself and leaving the scene of an unrelated incident.” And who could forget the 19-year-old Seattle woman who was accidentally shot in the leg by police after she refused to show her hands? What is increasingly common, however, is the news that the officers involved in these incidents get off with little more than a slap on the hands.
Americans are little more than pocketbooks to fund the police state. If there is any absolute maxim by which the federal government seems to operate, it is that the American taxpayer always gets ripped off. This is true, whether you’re talking about taxpayers being forced to fund high-priced weaponry that will be used against us, endless wars that do little for our safety or our freedoms, or bloated government agencies such as the National Security Agency with its secret budgets, covert agendas and clandestine activities. Rubbing salt in the wound, even monetary awards in lawsuits against government officials who are found guilty of wrongdoing are paid by the taxpayer.
Americans are no longer innocent until proven guilty. We once operated under the assumption that you were innocent until proven guilty. Due in large part to rapid advances in technology and a heightened surveillance culture, the burden of proof has been shifted so that the right to be considered innocent until proven guilty has been usurped by a new norm in which all citizens are suspects. This is exemplified by police practices of stopping and frisking people who are merely walking down the street and where there is no evidence of wrongdoing. Likewise, by subjecting Americans to full-body scans and license-plate readers without their knowledge or compliance and then storing the scans for later use, the government—in cahoots with the corporate state—has erected the ultimate suspect society. In such an environment, we are all potentially guilty of some wrongdoing or other.
Americans no longer have a right to self-defense. In the wake of various shootings in recent years, “gun control” has become a resounding theme. Those advocating gun reform see the Second Amendment’s right to bear arms as applying only to government officials. As a result, even Americans who legally own firearms are being treated with suspicion and, in some cases, undue violence. In one case, a Texas man had his home subjected to a no-knock raid and was shot in his bed after police, attempting to deliver a routine search warrant, learned that he was in legal possession of a firearm. In another incident, a Florida man who was licensed to carry a concealed firearm found himself detained for two hours during a routine traffic stop in Maryland while the arresting officer searched his vehicle in vain for the man’s gun, which he had left at home. Incidentally, the Trump Administration has done more to crack down on Second Amendment rights than anything the Obama Administration ever managed.
Americans no longer have a right to private property. If government agents can invade your home, break down your doors, kill your dog, damage your furnishings and terrorize your family, your property is no longer private and secure—it belongs to the government. Likewise, if government officials can fine and arrest you for growing vegetables in your front yard, praying with friends in your living room, installing solar panels on your roof, and raising chickens in your backyard, you’re no longer the owner of your property.
Americans no longer have a say about what their children are exposed to in school. Incredibly, the government continues to insist that parents essentially forfeit their rights when they send their children to a public school. This growing tension over whether young people, especially those in the public schools, are essentially wards of the state, to do with as government officials deem appropriate, in defiance of the children’s constitutional rights and those of their parents, is reflected in the debate over sex education programs that expose young people to all manner of sexual practices and terminology, zero tolerance policies that strip students of any due process rights, let alone parental involvement in school discipline, and Common Core programs that teach students to be test-takers rather than critical thinkers.
Americans are powerless in the face of militarized police. In early America, citizens were considered equals with law enforcement officials. Authorities were rarely permitted to enter one’s home without permission or in a deceitful manner. And it was not uncommon for police officers to be held personally liable for trespass when they wrongfully invaded a citizen’s home. Unlike today, early Americans could resist arrest when a police officer tried to restrain them without proper justification or a warrant—which the police had to allow citizens to read before arresting them. (Daring to dispute a warrant with a police official today who is armed with high-tech military weapons and tasers would be nothing short of suicidal.) As police forces across the country continue to be transformed into outposts of the military, with police agencies acquiring military-grade hardware in droves, Americans are finding their once-peaceful communities transformed into military outposts, complete with tanks, weaponry, and other equipment designed for the battlefield.
Americans no longer have a right to bodily integrity. Court rulings undermining the Fourth Amendment and justifying invasive strip searches have left us powerless against police empowered to forcefully draw our blood, strip search us, and probe us intimately. Accounts are on the rise of individuals—men and women—being subjected to what is essentially government-sanctioned rape by police in the course of “routine” traffic stops. Remember the New Mexico man who was subjected to a 12-hour ordeal of anal probes, X-rays, enemas, and finally a colonoscopy—all because he allegedly rolled through a stop sign?
Americans no longer have a right to the expectation of privacy. Despite the staggering number of revelations about government spying on Americans’ phone calls, Facebook posts, Twitter tweets, Google searches, emails, bookstore and grocery purchases, bank statements, commuter toll records, etc., Congress, the president and the courts have done little to nothing to counteract these abuses. Instead, they seem determined to accustom us to life in this electronic concentration camp.
Americans can no longer rely on the courts to mete out justice. The U.S. Supreme Court was intended to be an institution established to intervene and protect the people against the government and its agents when they overstep their bounds. Yet through their deference to police power, preference for security over freedom, and evisceration of our most basic rights for the sake of order and expediency, the justices of the Supreme Court have become the architects of the American police state in which we now live, while the lower courts have appointed themselves courts of order, concerned primarily with advancing the government’s agenda, no matter how unjust or illegal.
Americans no longer have a representative government. We have moved beyond the era of representative government and entered a new age, let’s call it the age of authoritarianism. In fact, a study conducted by Princeton and Northwestern University concluded that the U.S. government does not represent the majority of American citizens. Instead, the study found that the government is ruled by the rich and powerful, or the so-called “economic elite.” Moreover, the researchers concluded that policies enacted by this governmental elite nearly always favor special interests and lobbying groups. It is not overstating matters to say that Congress, which has done its best to keep their unhappy constituents at a distance, may well be the most self-serving, semi-corrupt institution in America.
In other words, we are being ruled by an oligarchy disguised as a democracy, and arguably on our way towards fascism: a form of government where private corporate interests rule, money calls the shots, and the people are seen as mere subjects to be controlled. Rest assured that when and if fascism finally takes hold in America, the basic forms of government will remain: Fascism will appear to be friendly. The legislators will be in session. There will be elections, and the news media will continue to cover the entertainment and political trivia. Consent of the governed, however, will no longer apply. Actual control will have finally passed to the oligarchic elite controlling the government behind the scenes. Sound familiar? Clearly, we are now ruled by an oligarchic elite of governmental and corporate interests. We have moved into “corporatism” (favored by Benito Mussolini), which is a halfway point on the road to full-blown fascism. Corporatism is where the few moneyed interests—not elected by the citizenry—rule over the many.
History may show that from this point forward, we will have left behind any semblance of constitutional government and entered into a totalitarian state where all citizens are suspects and security trumps freedom. Even with its constantly shifting terrain, this topsy-turvy travesty of law and government has become America’s new normal. From Clinton to Bush, then Obama and now Trump, it’s as if we’ve been caught in a time loop, forced to re-live the same thing over and over again: the same assaults on our freedoms, the same disregard for the rule of law, the same subservience to the Deep State, and the same corrupt, self-serving government that exists only to amass power, enrich its shareholders and ensure its continued domination.
Elections will not save us.
I haven’t even touched on the corporate state, the military industrial complex, SWAT team raids, invasive surveillance technology, zero tolerance policies in the schools, overcriminalization, or privatized prisons, to name just a few, but what I have touched on should be enough to show that the landscape of our freedoms has already changed dramatically from what it once was and will no doubt continue to deteriorate unless Americans can find a way to wrest back control of their government and reclaim their freedoms.
There can be no denying that the world is indeed a dangerous place, but what the president and his cohorts fail to acknowledge is that it’s the government that poses the gravest threat to our freedoms and way of life, and no amount of politicking, parsing or pandering will change that.
It is easy to be diverted, distracted and amused by the antics of politicians, the pomp and circumstance of awards shows, athletic events, and entertainment news, and the feel-good, wrapped-in-the-flag evangelism that passes for religion today.
What is far more difficult to face up to is the reality of life in America, where unemployment, poverty, inequality, injustice and violence by government agents are increasingly norms, and where “we the people” are at a distinct disadvantage in the face of the government elite’s power grabs, greed and firepower.
The Constitution doesn’t stand a chance against a federalized, globalized standing army protected by legislative, judicial and executive branches that are all on the same side, no matter what political views they subscribe to: suffice it to say, they are not on our side or the side of freedom.
As I make clear in my book Battlefield America: The War on the American People, the powers-that-be want us to remain distracted, divided, alienated from each other based on our politics, our bank accounts, our religion, our race and our value systems. Yet as George Orwell observed, “The real division is not between conservatives and revolutionaries but between authoritarians and libertarians.”
You either believe in freedom or you don’t. It’s that simple.
Everything else is just a deadly distraction. As Orwell observed in 1984:
“All that was required of them was a primitive patriotism which could be appealed to whenever it was necessary to make them accept longer working hours or shorter rations. And even when they became discontented, as they sometimes did, their discontent led nowhere, because, being without general ideas, they could only focus it on petty specific grievances. The larger evils invariably escaped their notice.”
Tyler Durden
Wed, 01/22/2020 – 23:25 - Automation Nation: Walmart Deploys Robots To 650 Additional Stores
Automation Nation: Walmart Deploys Robots To 650 Additional Stores
America’s largest retailer/employer is adding shelf-scanning robots to 650 more stores by August, expanding its total robotic fleet to 1,000 stores, reported Bloomberg.
Walmart’s push for robots comes at a time when labor-costs are eating into profits. The company will have trouble passing increased costs to consumers; it will have to embrace automation on the front and back end of stores to drive labor costs lower, which will, in return, lead to a significant amount of its workforce slashed by 2030.
The U.S. unemployment rate lingers at several decades low and risks reversing as rising employment costs have led to a decline in job openings at the start of 2020. This could suggest the labor market has lost momentum, and rising costs have forced employers to stop hiring. Like Walmart, other companies will have to adopt automation and artificial intelligence to replace low-skilled workers to drive costs down.
C-suite executives at Walmart are ahead of the trend, some have argued they’re creating the trend, with the widespread adoption of robots in stores.
Already, the retailer has robots in its order fulfillment center, cleaning floors on the front-end of stores, and unloading delivery trucks.
The latest one is a six-foot-tall shelf-scanning robot equipped with 15 cameras that checks if products on shelves need restocking.
Watch: @Walmart’s new robots scan shelves for our-of-stock ítems. pic.twitter.com/5d4ylH3EJA
— Shakthi Vadakkepat (@v_shakthi) January 15, 2020
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CEO Doug McMillon has said automation in stores is a way to improve store performance and lower labor costs.
Walmart has adopted automation in stores for the last decade — most of the 4,750 U.S. stores have self-checkout kiosks, doing away with humans ringing up items for customers.
A recent report via McKinsey & Co. found about 50% of all retail jobs will be slashed in the coming years because of automation.
As we’ve mentioned before, automation will displace at least 20 million U.S. jobs by 2030, with food service, retail, transportation, and warehousing being the industries most affected with job losses.
If you’re currently employed in one of these industries – now would be the time to get reskilled for a high-demanding job.
Tyler Durden
Wed, 01/22/2020 – 23:05 - Nearly 5 Times As Many Police Officers Killed Themselves Than Were Shot In 2019
Nearly 5 Times As Many Police Officers Killed Themselves Than Were Shot In 2019
Authored by Matt Agorist via The Free Thought Project,
In 2019, according to the Officer Down Memorial Page, 47 police officers were shot, 7 killed in a vehicular assault, and three died from assault. Another 77 cops died as a result of car crashes, heart attacks, and illnesses. Absent from the database of fallen officers, however, are the 228 cops who ended their own watch. This number is a giant leap from the year before and the fourth consecutive year that it’s risen.
As the number of officers killed in the line of duty decreased by 20%, the number of cops taking their own lives has increased 35%. The website Blue H.E.L.P. (Honor. Educate. Lead. Prevent.) has already recorded five officer suicides in 2020.
The mainstream media often portrays the unfortunate random killing of police officers as analogous to a larger “war on cops.” The reality is that there is a concerted public relations effort underway, on the part of law enforcement, with the intention of stemming the growing public calls for more oversight and accountability.
If law enforcement were genuine about wanting to save the lives of cops, they would begin by attempting to put focus on the out of control epidemic of police suicides, which dwarfs the number of cops fatally shot the line of duty. Cops are killing themselves at a rate 4 times higher than they are dying in the line of duty and this subject seems entirely taboo.
Over the past three decades, the number of on-duty police killings has decreased substantially. Instead of attempting to fix the glaring problems in policing, law enforcement has invested itself in attempting to distract and divide the public. With the help of mainstream media, they attempt to portray themselves as victims of a rabid and out of control anti-police campaign which is violently and systematically targeting cops. But this is simply not true.
If people really care about cops, then it’s incumbent upon them to focus on the true threats to officers’ lives and not just buy into the spin machine.
The public must realize the dire situation, and extreme scope of the mental health epidemic currently facing law enforcement. There’s an extremely high rate of suicide, a domestic violence crisis and much higher rates of addiction in policing than the general public. It’s clear that the mental health issues affecting law enforcement should be a top priority if we hope to stem the number of citizens and cops being killed by police in America.
In an interview with The Free Thought Project, former LAPD officer Alex Salazar pointed out why many of his friends ended their own lives:
People are tired of being killed by these cops. They operate with a gang-like mentality similar to the military, in that they are pawns in a larger game, but perceive themselves as warriors for a righteous cause. Cops often turn to suicide after they lose control of their personal lives. They are taught to be control freaks and to be always be in control and it often ends in tragedy.
When I was a LAPD officer I had at least 6 partners and supervisors included who “ate” their guns. This police propaganda crap is occurring because they’re desperate and cops backs are up against the wall. They will resort to ANY tactic or issue and use it to inflate the situation. I perceive in the not so distant future some of these cowboy “John Wayne” types will instigate a fear driven attack against activists.
We have seen this fear driven attack play out many times over the years.
This isn’t about ‘us vs. them,’ or attacking police; it’s about the necessity of purging a critical sickness from U.S. policing in an effort make the streets a safer place for citizens and police alike.
We need to start looking at this increasing rate of officer suicides and realize the underlying problems attributing to them. If we can begin to correct those problems, the cops shooting citizens rate may start to fall too.
According to other experts in the field, cumulative exposure to trauma, horrific accidents and shootings can lead to mental health struggles that too often go untreated. A report by Blue H.E.L.P. reveals the rate of PTSD and depression for police and firefighters is five times higher than the civilian population.
A report commissioned by the Ruderman Family Foundation showed that officers’ highest risk of death is by suicide with most deaths in California and Texas.
Critics believe the lack of resources for mental health also adds to lives being lost. Mental health experts say the barrier that keeps officers from seeking help are shame, fear of being off the job and the stigma behind it. Perhaps if cops were better trained at dealing with their own mental health issues, they’d be less likely to kill those with similar problems.
* * *
If you know a police officer who is experiencing this, the National Suicide Prevention Lifeline can be reached at 1-800-273-8255. Police officers can also text the word “blue” to 741741 or simply text “talk” to 741741.
Tyler Durden
Wed, 01/22/2020 – 22:45 - Goldman's CEO To DJ Super Bowl Party
Goldman’s CEO To DJ Super Bowl Party
Just when you thought it couldn’t get more bizarre, the CEO of Goldman Sachs – who has been making a solid effort to appear as one of “the humans” with his recent push to hand every subprime consumer an Apple co-branded credit card – David Solomon is going to be DJing the world’s largest sporting event: the Super Bowl.
According to Bloomberg, the 58-year-old “DJ D-Sol” will be the featured DJ at party tied to the Super Bowl that’s being hosted by Sports Illustrated.
No longer urging his clients to invest in “shitty deals” – as his predecessor Lloyd Blankfein infamously did – the 58 year old Solomon will be spinning “electronic dance music” at the party. And it won’t be Solomon’s first big gig: Last month he was spinning at an Amazon.com cloud conference.
Goldman Sachs has confirmed that Solomon – whose musical passion we profiled in this 2018 note – will be there. Two years ago we noted that the multi-millionaire moonlighted as a D.J. once a month and that his biography on Spotify — where he recently released his first single, a remix of the Fleetwood Mac tune “Don’t Stop” — says, “His personal mantra is to never lose sight of what you are passionate about.”
Tyler Durden
Wed, 01/22/2020 – 22:25 - Homeland Security Chief Warns Caravan Migrants Will Be Sent Home If They Reach US
Homeland Security Chief Warns Caravan Migrants Will Be Sent Home If They Reach US
Authored by Jack Phillips via The Epoch Times,
The head of the U.S. Department of Homeland Security (DHS), which oversees immigration enforcement, warned a new caravan of Central American migrants that they won’t be allowed into the United States.
“Being part of a large group, like a caravan, provides no special treatment or benefits to those who participate. Unfortunately, there have been acts of reported violence by some involved in this caravan,” acting DHS Secretary Chad Wolf said in a statement. “The Department is prioritizing the safety and security of our officers and the American people.”
“Should any members of the caravan reach the U.S.-Mexico border, they will be processed accordingly and quickly removed, returned, or repatriated,” he added.
His warning comes a day after Mexican police clashed with hundreds of migrantswho were attempting to enter Mexico from Guatemala, according to reports.
“Yesterday there was a group of some 1,000 who tried to enter the country by force. A tragedy was avoided, because there can always be a lot of problems, above all when there are children and women,” Foreign Minister Marcelo Ebrard told CNN.
“Despite the stones [National Guard personnel] were hit with, and a very tense situation, we can say that yesterday, if someone had the intention to provoke, they did not achieve that,” Ebrard said.
“If someone is looking for violence in Mexico, they are not going to find it on the part of authorities.”
As reported by NPR, the migrants are in Mexico and are being prevented from traveling through the country by Mexican National Guard members in riot gear.The Guatemalan government confirmed that around 4,000 migrants entered the country from Honduras.
One migrant told the news outlet:
“Our goal is to go to the United States. We aren’t turning around here.”
In his statement Wednesday, Wolf praised Mexican authorities’ measures to increase security at their southern border.
“I commend the government of Mexico for upholding their commitment to increased security and law enforcement at their southern border. The efforts by the Mexican National Guard and other officials have thus far been effective at maintaining the integrity of their border, despite outbreaks of violence and lawlessness by people who are attempting to illegally enter Mexico on their way to the United States,” Wolf said.
His agency is monitoring the caravan, adding that there are “dozens of personnel on the ground in Central America assisting local immigration and security officials, which have already led to hundreds of individuals being stopped, apprehended, and sent back to their home countries.”
Tyler Durden
Wed, 01/22/2020 – 22:05 - Starbucks Dairy-Shames Customers Into Skipping 'Environmentally Unfriendly' Whipped Cream
Starbucks Dairy-Shames Customers Into Skipping ‘Environmentally Unfriendly’ Whipped Cream
Starbucks released the results of its latest sweeping ‘sustainability’ audit and announced plans to become ‘resource positive’ late Tuesday, prompting analysts to ask: What, exactly, does that mean?
And although the company and many of its institutional shareholders have made a big deal about Starbucks’ sustainability rhetoric and celebrated its decision to phase out plastic straws to save the sea turtles, on Wednesday, investors shunned Starbucks shares (they were down more than 1%) as the company unveiled what Bloomberg described as its “ambitious goals” to reduce the environmental footprint that produces more waste every year to equal two Empire State buildings.
To wit, by 2030, the cafe chain is targeting 50% reductions in the amount of water it uses, the carbon it emits and trash it sends to landfills.
In “A Message From Starbucks’ CEO”, a blog post published Tuesday evening, CEO Kevin Johnson regaled readers with a history of Starbucks’ commitment to environmental responsibility, while rattling off a list of accomplishments.
But in the report, which was analyzed by Bloomberg, Starbucks’ hired environmental consultants warned customers that the best thing they could do to reduce the company’s harmful impact on the planet would be to buy cheaper drinks, and forego the milk.
That’s right: Instead of buying fancy frappucinos and indulgent espresso-based desserts, customers would do better to buy simple plain black espresso.
And if customers must have the frappucino, they should think about skipping the whipped cream.
Adding whipped cream to millions of Starbucks Corp. drinks emits 50 times as much greenhouse gas as the company’s private jet. Overall, dairy products are the biggest source of carbon dioxide emissions across the coffee giant’s operations and supply chain.
As far as what Starbucks corporate can accomplish, the task does seem daunting.
The task is immense: Starbucks in 2018 was responsible for emitting 16 million metric tons of greenhouse gases, using 1 billion cubic meters of water and dumping 868 metric kilotons – more than twice the weight of the Empire State Building – of coffee cups and other waste. The audit was conducted with sustainability consultant Quantis and the World Wildlife Fund.
And Johnson admits that Starbucks can’t achieve its goals alone: It needs its customers to change their behavior as well.
“We know this journey will be challenging, we know we can’t do this alone, and we know this will require others to join us,” Chief Executive Officer Kevin Johnson said in an interview.
Using data from the Starbucks audit, Bloomberg broke down how each business segment contributes to the company’s overall carbon footprint.
During its last annual shareholders meeting, Starbucks shareholders nearly passed a resolution calling on the company to step up the use of sustainable packaging. The motion received the support of nearly half the shareholders present.
“While Starbucks has a long road ahead to achieve these goals, we’re encouraged that its priorities are rooted in transparent data and will be supplemented by first-of-its-kind market research,” said Allan Pearce, shareholder advocate at Trillium Asset Management.
With its goal of becoming ‘resource positive’, Starbucks, which has more than 31,000 outlets in more than 80 markets, has become just the latest American megacorp corporation to seemingly bull a glitzy-sounding climate buzzword out of a hat: Recently, Amazon vowed to be ‘carbon neutral’, and Microsoft promised to be ‘carbon negative’ – prompting critics to criticize their promises as a meaningless pr stunt.
Tyler Durden
Wed, 01/22/2020 – 21:45 - Bitcoin Is Quantitatively Tightening
Bitcoin Is Quantitatively Tightening
Authored by Peter Earle via The American Institute for Economic Research,
On May 2020, bitcoin (BTC) will see its next halving: the reduction of the reward for successfully mining a block. The Nakamoto white paper specifies that every 210,000 blocks, the reward for successfully mining a block is cut by half. But while these halvings occur roughly every four years (with the estimated reward dropping to one Satoshi on or around the year 2140), the Bitcoin Halvening of 2020 is particularly momentous.
At present, the reward for mining a block is 12.5 BTC; in May, the reward for successfully adding a block to the blockchain will drop to 6.25 BTC per block. The current annualized rate of “inflation” (some disambiguation regarding this later) is between 3.7 percent and 3.8 percent: an average of 144 blocks mined per day at 12.5 BTC each, yielding approximately 1,800 new BTC each day.
(A quick point of disambiguation: To describe the expansion in size of bitcoin’s outstanding number of coins as inflation — what might be called the “float” in equities or the “money stock” in more conventional currencies — is consistent with an older definition; in the same sense, new gold being mined is, with respect to the existing, above-ground gold stock, “inflationary.” But today, the term inflation is used to describe, and assumed to mean, an increase in general price levels within an economy. In fact, from the perspective that with increasing value one bitcoin buys more over time, it is indisputably deflationary.)
What’s noteworthy about this point is that, upon this particular halving, bitcoin “inflating” at a roughly 1.8 percent rate annually will nominally — and by then, quite possibly in real terms — be “inflating” at a rate lower than both the Federal Reserve target of 2 percent per year and current, CPI-based estimates of real U.S. inflation of 1.9 percent annually.
Testing on Human Beings; No Institutional Review Board Required
In light of the broader field of monetary policy worldwide, the upcoming Halvening will come at a particularly auspicious juncture. Despite considerable efforts over more than a decade, the Federal Reserve (and other central banks) has attempted and failed to engineer a rate of inflation (in the case of the Federal Reserve, of 2 percent) even after vastly expanding the size of the Federal Reserve’s balance sheet and undertaking numerous other expansionary programs.
Even casual observers of global central banking practice will note that the apparent inability of the Federal Reserve, the European Central Bank, the Bank of Japan, and other such institutions to manufacture inflation has not led to some newfound respect (let alone humility) in light of their demonstrated lack of understanding of so powerful a force. Even a cursory review of history reveals that inflation is second only to war where forces laying waste to civilizations are considered.
To the contrary: Legions of economists within these (usually) quasi-public entities have redoubled their efforts, embracing unconventional policy implementations, the most recent and well-known of which are sequential phases of quantitative easing. Whether Federal Reserve economists have forgotten or don’t care that billions of real human beings toil beneath their policy machinations is an exercise for the reader to consider.
Indeed, despite scores of warnings about the alleged dangers of low inflation, the drumbeat of statistics and other reports citing the deteriorating character of U.S. household finances leads one to question exactly what impact the Federal Reserve thinks that raising prices by several percentage points would have on tens of millions of families.
Contrarily, bitcoin’s limited supply has always been a draw for investors and spenders cognizant of the effects of inflation on purchasing power. With the rate of production of bitcoin via mining taking place at a rate less than the Federal Reserve’s stated target rate (and possibly less than the real rate of inflation), in May 2020, bitcoin may have economically incontestable reasons to become a legitimately competitive store of value versus most of the other world currencies. Part of that, of course, hinges critically upon price volatility.
Quantitative Easing versus Tightening
One may argue — I certainly am — that by algorithmically limiting the ultimate number of bitcoin that will ever exist, and further by making their origination (via mining) adhere to a predictable, transparent, and decrementing character, bitcoin (and more specifically the Hashcash proof-of-work protocol) closely approximates a monetary policy implementation known as qualitative tightening. That is to say, economically speaking, it is the diametric opposite of the qualitative-easing campaign that central banks are continuing to tinker with, at our peril.
This will undoubtedly add to its attractiveness and, barring the outbreak of extreme volatility, will likely increase its store-of-value characteristics. Many people believe that the Halvening of 2020 will spark a new uptrend in price, but that is far from certain.
Although the market for bitcoin (and cryptocurrencies, more generally) is more liquid and transparent now than it was at the last halving, much, if not all, of the effect may already be priced in. Sentiment surrounding bitcoin has cooled in the last 18 to 24 months, and the entire crypto complex has traded differently since BTC futures contracts were introduced on the Chicago Board Options Exchange and subsequently cancelled (although they continue to trade on the Chicago Mercantile Exchange).
The Bitcoin Halvening of 2020: Compelling Prospects
There are plenty of reasons for which the arrival of bitcoin (and cryptocurrencies broadly) as an asset class a bit over a decade ago has been a most fortuitous development, not least of which is the increasingly experimental bent of central banks around the world. Alongside that are political candidates endorsing central planning and, to accomplish them, stooping to embrace outlandish monetary theories.
Add to those reasons not only an algorithmically scheduled, predictable rate of inflation (again, in the antiquarian sense), but rates that are lower than both nominal and real rates of inflation, and bitcoin’s use case begins to look increasingly less speculative.
Tyler Durden
Wed, 01/22/2020 – 21:25 - US Troops Seen Blocking Russians From Syrian Oilfields In Series Of Dangerous Standoffs
US Troops Seen Blocking Russians From Syrian Oilfields In Series Of Dangerous Standoffs
Yet another dangerous incident has played out between American and Russian forces operating in Syria in what appears a series of standoffs near key oil installations since Saturday. “This is the third incident that occurred within a week,” one local reporter told VOA in an alarming report.
Image source: journalist Mohammed Hassan Days ago we reported on the first incident involving a US convoy blocking a Russian convoy on a highway near the town of Rmelan, after the Americans were apparently concerned the Russians were going to enter an oil field, which the US administration says it has “secured”.
But now Voice of America reports three total incidents, with the most recent ones happening Tuesday and Wednesday in al-Hasakah province, as newly detailed by the opposition outlet Syrian Observatory for Human Rights.
Image source: journalist Mohammed Hassan All of the incidents involved US forces blocking Russian military vehicles and forcing them to turn around as they neared sensitive oil installations held by the US-backed Kurdish SDF and American special forces in Syria’s northeast.
One eyewitness reporter on the ground described the following:
The incident on Tuesday is part of a series of similar incidents that happened in recent days between the two powers over their presence in Syria, local sources said.
“This is the third incident that occurred within a week,” said Nishan Mohammad, a local reporter who said he witnessed another recent standoff between U.S. and Russian troops in northeast Syria.
“I was there last weekend when U.S. soldiers stopped Russian military vehicles and forced them to head back to their base,” he told VOA in a phone interview Tuesday.
SOHR: US troops settle on M4 to intercept Russian patrols amid continued tension between the two sides in north-eastern Syria https://t.co/T79zNX1JA2 pic.twitter.com/ya28k4Otwi
— Mutlu Civiroglu (@mutludc) January 22, 2020
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While none of these close encounters between two major powers on disputed soil resulted in exchange of gunfire, it presents a potentially deadly situation which could set off spiraling escalation between two superpowers.
This is especially the case given the US and Russia now have small military installations dotting northern Syria in somewhat close proximity to one another.
#American_forces prevent #Russian_forces from heading east towards the #oil areas of #Remilan #NE_SYRIA # pic.twitter.com/7qhcUSAnS6
— MOHAMMED HASSAN (@MHJournalist) January 21, 2020
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Months ago US troops withdrew from some northernmost Syrian towns amid a Turkish military incursion.
In some instances Russian forces immediately came in and took over the same installations, such as the sizable Sirrin Air Base in the northern Aleppo area.
#BREAKING #NE_SYRIA #American_forces prevent #Russian_forces from heading east towards the #oil areas of #Remilan #NE_SYRIA pic.twitter.com/q1h0aGCMzb
— MOHAMMED HASSAN (@MHJournalist) January 21, 2020
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While it doesn’t appear Russia has any intent to “take the oil” like the White House has repeatedly pledged, Russian forces there do represent the interests of it’s ally Assad and the Syrian Army.
And as Trump continues talking up “securing the oil” — most recently at Davos — Assad has simultaneously promised to retake all of sovereign Syria, especially the oil-rich Deir Ezzor and Hasakah provinces.
President Trump said while addressing reporters on the sidelines of the World Economic Forum (WEF) on Wednesday: “But very importantly, as you know, we have the oil. And we left soldiers for the oil, because we take the oil and we’re working on that, and we have it very nicely secured.”
Tyler Durden
Wed, 01/22/2020 – 21:05 - Hunter Biden Ordered To Appear In Court Next Week For Contempt Hearing
Hunter Biden Ordered To Appear In Court Next Week For Contempt Hearing
Hunter Biden has been ordered to stand in front of an Arkansas judge next Tuedsay to explain why he shouldn’t be held in contempt of court for failing to produce a laundry list of financial and personal information in his ongoing child support dispute with stripper Lunden Alexis Roberts.
Roberts asked the court on Tuesday to hold Biden in contempt for failing to disclose financial information, contact information, and “a list of all companies he currently owns or in which he has an ownership interest,” as well as “all companies in which he has had an ownership interest in the past five years.“
Also sought are a copy of Biden’s 2017 and 2018 tax returns, deeds to properties he owns, and an executed copy of a financial records release Biden has been avoiding filing unless the court allows him to do so under seal.
“The defendant continues to act as though he has no respect for this Court, its orders, the legal process in this state, or the needs of his child for support,” reads the filing, which adds “This is but another example of the defendant’s unnecessary actions to frustrate prompt adjudication of this matter and increase the plaintiff’s litigation costs.“
Circuit Court Judge Holly Meyer agreed, ordering Biden to appear in person to explain his failure to produce the requested information which was due in August, 2019.
In November, a DNA test revealed Hunter to be the father of the unnamed child with Roberts. In order to determine what Biden can cough up, Roberts has sought extensive financial records for periods which include his time on the board of a Ukrainian energy company while his father was the Obama administration’s point-man on Ukraine.
Hunter served on Burisma’s board from 2014 through 2018, while his father openly bragged about getting a prosecutor fired who was investigating the company’s founder for a variety of white-collar crimes.
Hunter Biden did not receive any direct compensation from Burisma — rather, the Ukrainian company wired funds to Rosemont Seneca Bohai (RSB), an American firm controlled by Hunter Biden’s longtime business partner Devon Archer. Between June 2014 and October 2015, RSB wired a total of $708,302 to Hunter Biden for undisclosed purposes while RSB was receiving funds from Burisma.
The IRS placed a tax lien on Hunter Biden for $112,805 in unpaid taxes from 2015, the Daily Caller News Foundation previously reported. –Daily Caller
While Congressional Democrats insist the entire affair was above board, and “debunked,” it is apparently too radioactive for lawmakers to delve into, despite the fact that it’s at the center of impeachment proceedings against President Donald Trump – who withheld almost $400 million in US military aid to Ukraine while he was pushing for an investigation into the Bidens.
Tyler Durden
Wed, 01/22/2020 – 20:45 - China Slashes 2020 GDP Growth For Provinces As Widespread Slowdown Persists
China Slashes 2020 GDP Growth For Provinces As Widespread Slowdown Persists
With phase-one talks signed last week, China’s GDP growth in 2019 plunged to a 29-year low amid massive credit stimulus that has widely been ineffective to boost growth but has somewhat stabilized the economy.
China’s largest utility company State Grid has warned that the rate of economic growth in the country is expected to slide to 4% in the next four years.
There was even a report on Tuesday showing China has already blamed the 2020 economic slowdown on the coronavirus epidemic that has already killed nine with at least 440 people infected in the country and spreading across the region, along with a new case in the U.S.
The Communist Party of China has been quick to blame the slowdown on external factors, such as the trade war and other protectionist policies of President Trump, rather than their failures of amassing more than $40 trillion of debt, nearly 304% of GDP.
Coronavirus cases have been found in other places out of Wuhan, Hubei Province, indicating the epidemic is expanding. Concerns are mounting. It is inevitable that people will cut their trips during Spring Festival and holiday consumption will be hit.
— Hu Xijin 胡锡进 (@HuXijin_GT) January 21, 2020
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Now we’re starting to get more local data, on a provincial level, that shows many regions and municipalities have cut their 2020 growth targets over the prior year, reported Reuters.
About 22 provinces have slashed growth targets this year, including Beijing, Guangdong, Zhejiang, Henan, Hainan, and Fujian.
Beijing, Shanghai, and Guangdong have all cut their target of 6.5% to 6% growth to about 6% in 2020, in line with the national goal of 6%.
Local government data shows at least 11 provinces have missed their 2019 growth targets and are expected to underperform this year.
The northeastern province of Heilongjiang will range around 5% growth for this year, with the Tibet Autonomous Region to see about 9%.
Policy sources within China told Reuters that provinces would ramp up infrastructure spending to offset the slowdown.
“Much of the national slowdown last year was driven by exports which will have weighed on the south and east more,” said Julian Evans-Pritchard, senior China Economist at Capital Economics, in an email to Reuters.
China’s GDP data is often skewed – and for more color on the country’s economic activity — Fathom Consulting’s China Momentum Indicator 3.0 (CMI 3.0) shows GDP growth well under 6% and stagnating.
Tyler Durden
Wed, 01/22/2020 – 20:25 - The College Degree Of The Richest Person In Every Country
The College Degree Of The Richest Person In Every Country
Money and education don’t always go hand-in-hand, but it doesn’t hurt to sway the odds in your favor by studying hard at college. However, sometimes choosing the most appropriate degree is the hardest part. It can be helpful to look for inspiration from people who have already become a success in your chosen industry.
A few months back, we showed you the College Degree of the Top‑earning CEO in Every State. Now we’ve researched and compiled a list of the college degree taken by the richest person in every country around the world.
The map we’ve created focuses on the undergraduate degrees that the world’s richest people have attained. There are instances where some of these people have attained qualifications without an undergraduate degree (e.g. Graeme Hart of New Zealand completed an MBA but has no undergrad degree, so is marked as ‘no undergrad degree’), but all people marked as ‘no degree’ have no higher-education qualifications at all. Some people also failed to complete their degree, they have been labelled as ‘incomplete’. There are also instances where a family is classed as a country’s ‘richest person’ and so we have labelled them according to their family’s cumulative qualifications (e.g. Croatia is marked as ‘multiple degrees’). In all instances we’ve tried to make the labelling as clear as possible, but for a more in-depth look check out our research here.
If you’re hoping your higher education is to be a stepping stone on the route to your first billion dollars, then check out the map below and see what undergrad degree is necessary to become one of the world’s richest people.
1. North America
The richest man in the United States is also the richest man in the world, but Jeff Bezos had a lean 2019. The Amazon boss’s divorce settlement made ex-wife MacKenzie one of the richest five women in America and the world, allowing Bill Gates to briefly topple Jeff from the top spot. Jeff studied Electrical Engineering and Computer Science at Princeton, and MacKenzie studied English at the same institution a few years later.
The tiny islands of Saint Kitts and Nevis boast USANA founder, Myron Wentz, as their richest person. However, he was born in the US and switched his citizenship for the tax haven of St. Kitts in the 1990s. This is a marked difference from the likes of Bill Gates, who once said, “I’ve paid more taxes, over $10 billion, than anyone else, but the government should require people in my position to pay significantly higher taxes.”
2. Europe
Albania’s richest person, Samir Mane, didn’t make much use of his college degree when building his fortune. He began studying geology in Vienna in 1991 but quit during his first year. He later said, “basically I learned German there.” However, the language and cultural skills he picked up proved useful, as he built his business exporting cheap TVs and VCRs from Austria to his home country.
Bulgaria’s richest person, Vasil Bojkov, has an interesting education. He attended Bulgaria’s National High School of Mathematics and used degrees in Applied Mathematics and Labor Economics to power-up his trading, insurance, and gambling businesses. But he also has a degree in History of Art from Universidad de Buenos Aires. Bojkov’s patronage of the arts is renowned, and his enjoyment of beauty and creativity is evident in his famed antique collection because an education isn’t all about getting rich!
3. Africa
Africa is a continent of vast contrasts. Economically, South Africa is the most unequal country in the world. In Nigeria, the five wealthiest people have a combined fortune that outweighs the national budget, while six out of ten people live on less than $1.25 per day. This disparity can be traced between different countries, too. For example, Nigeria’s richest man, Aliko Dangote, has a US$8.8 billion fortune against Liberia’s Benoni Urey, who has ‘just’ $32 million.
Both made a lot of money selling things everybody needs. Dangote took Business Studies and Administration, but got his first business lessons in the playground: “I can remember when I was in primary school, I would go and buy cartons of sweets [candy] and I would start selling them just to make money,” he says. His company now supplies 70% of Nigeria’s sugar. Urey studied General Science, and his business interests include housing and Liberia’s biggest cellphone network.
4. Asia
The richest person in almost every Asian country is of the ‘billionaire’ variety. The overall number one is India’s Mukesh Ambani, boss of his late father’s gas and oil company. Ambani’s education is on the science side of things rather than business: he studied chemical engineering. But that doesn’t mean he is afraid to branch out, and the company recently launched a 4G service. “Anything and everything that can go digital is going digital,” says Ambani. “India cannot afford to be left behind.”
Taiwan, Thailand, China, and Brunei are among nations whose top billionaires have no degree at all. In some cases, wealth is inherited by royalty. But Li Ka-shing, China’s richest man and the 30th richest in the world, is a self-made plastics magnate who started his business with loans of just $6,500 when he was 21. He is known for his philanthropic work and recently pledged HK$1 billion ($127 million) to support businesses affected by the protests in Hong Kong.
5. South America
Iris Fontbona inherited husband Andrónico Luksic’s mining and beverage empire in 2005. But the world’s richest Latina has capitalized on the opportunity by driving the family business to ever-greater success. Fontbana has no degree but has significantly expanded the mines and brewery business as well as buying majority shares in the TV channel, Canal 13.
The richest person in South America (with $24.6 billion) is another brewer. Brazil’s Jorge Paulo Lemann has controlling shares in Anheuser-Busch InBev, the world’s largest brewer, which in turn owns Pilsner Urquell and Foster’s Lager. But he originated his fortune as founder of investment firm 3G Capital. His degree is in Economics from Harvard, which must make it easier to count all that money.
6. Oceania
Oceania’s richest person, the Australian Gina Rinehart, began studying economics at the University of Sydney but dropped out to get a hands-on education at her father’s iron ore mining business. She learned well from what she saw. When her father died, leaving behind a bankrupt estate, Rinehart turned around the family business’s fortunes, transforming it into one of Australia’s leading mining concerns.
New Zealand’s Graeme Hart has earned an MBA from the University of Otago’s business school. Hart was admitted to the school without attaining an undergraduate degree and so in our map is marked as having ‘no degree’.
There aren’t many teachers on our list of the richest people list. But Papua New Guinea’s richest person – former prime minister Michael Somare – used his teaching qualification to inspire young minds at several primary and secondary schools before going into politics.
When it comes to developing your career, your degree isn’t just about what you know – it’s about how your education makes you think. Sometimes the wisest choice is to pick a subject that will broaden your understanding of the world and to get your industry knowledge through work experience. How does your choice of degree relate to your choice of career?
Sources
To see the research behind this project visit bit.ly/RichestPeoplesDegrees
Methodology
We began by researching the ‘richest person in X country,’ ‘wealthiest person in X’ and variations in French and Spanish, then sifted the first three pages of Google results. In all instances where articles existed that responded to the search term, there was a very clear consensus across the sources. The only divergence showed up between changes in the list over time (e.g., a list of the wealthiest people from 2017 versus a list from 2019). To find a back-up source, we’d search for ‘richest person in X’ followed by the name our initial search had thrown up.
No distinction has been made between people from a country but resident elsewhere and people both from the country and resident there. We allowed both to qualify. To insist on determining individuals’ citizenship or residency would undoubtedly have increased the number of ‘No data’ entries, not least as the super-wealthy are rarely tied to one country.
Note that the issue of wealth is a secretive one. Sometimes we could only find a small number of sources, and on occasion, footnotes for these sources were broken. In some other cases, sources claimed that a person was the richest (or made a claim as to their college degree), but the original source was not consistently backed up with a citation.
Concerning the qualifications our research focussed on undergraduate degrees. We have not included information on master’s degrees, doctorates or any other type of post-graduate degree. There were several instances where we could find evidence of a person gaining a degree but could not find what the degree was in. These cases are marked as unknown. In some instances individuals have attained qualifications without an undergraduate degree. For example, Graeme Hart of New Zealand completed an MBA but has no undergrad degree. In this case we have labelled him as having ‘no degree’.
There were also instances where families are considered the ‘richest people’ in their country. For the sake of simplicity we have formatted these families in the same way we have formatted individuals.
Tyler Durden
Wed, 01/22/2020 – 20:05 - New IRGC Quds Force #2 Is Iran's 'Missile Mastermind' In Lebanon
New IRGC Quds Force #2 Is Iran’s ‘Missile Mastermind’ In Lebanon
Lebanon has a new Hezbollah-dominated and backed government after three months of protests have gripped the country, which no doubt has raised alarm for both Israel and the United States, especially given West-backed political parties were largely sidelined in the forming of Michel Aoun’s new handpicked cabinet, especially when it comes to Hezbollah’s top candidate for prime minister, newly sworn in (as of Tuesday) Hassan Diab.
To make matters worse for Tel Aviv, Iran’s Islamic Revolutionary Guards Quds Force has now named a #2 under Gen. Esmail Qaani — who himself had served as now slain Soleimani’s deputy for more than a decade. The new Quds deputy commander alongside top Quds chief Qaani is Mohammed Hejazi, according to The Jerusalem Post, who crucially is considered a longtime “central figure in Iran’s operations in Lebanon”.
Brigadier General Mohammad Hejazi, appointed as Acting Commander of Quds Force on January 20. Image via Radio Farda/Tasnim Last August a statement by the Israeli Defense Forces (IDF) named Hejazi as among three top IRGC commanders working to fast establish Hezbollah missile factories which can produce precision guided missiles, in preparation for the next major conflict with the Jewish state.
Israeli media reports suggest that before entering the Quds force, which is the elite covert foreign arm of the IRGC, Mohammed Hejazi was a key enforcer helping Tehran put down protests, such as the 2009 presidential election mass demonstrations.
These 3 Iranian commanders are working on a secret¹ project with Hezbollah to manufacture precision guided missiles to attack Israel.
—
¹not so secret anymore. pic.twitter.com/ZLFsOr9yLz— Israel Defense Forces (@IDF) August 29, 2019
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According to a profile in The Jerusalem Post, his career outside the country has been focused in bolstering Hezbollah’s weapons capabilities inside Lebanon:
He faded from public view in 2014, and seems to have been in Lebanon during that time, helping Hezbollah stockpile and improve its estimated 150,000 missiles. Al-Ain media reports that he was Hezbollah’s key man linking them to the IRGC. He likely grew into this role after the death of Imad Mughniyeh who was assassinated in 2008.
He helped supply arms to Hezbollah and help it with its precision guided missile programs. These programs have been spotlighted as a key threat to the region and Israel. Hezbollah wants to create local manufacturing bases for the precision guidance that would make its arsenal more dangerous. In March 2019 Israel said Hezbollah was seeking to set up an advanced missile plant in the Beka’a valley.
The US administration has lately sought to pressure the Lebanese government into ensuring no domestic missile manufacturing is established under the aegis of Hezbollah.
Washington has long seen the Shia paramilitary group — which also has seats in parliament and a huge following in the country — as but a foreign arm of Iran and the Ayatollah; however, many Lebanese and people across the region see Hezbollah as a legitimate homegrown ‘resistance’ movement giving the historically oppressed Shia of south Lebanon a political voice.
Starting last August into September, Israel dramatically stepped up its so-called anti-Iranian expansion campaign inside Lebanon which involved a series of attacks and assassination attempts in south Beirut and the Lebanese countryside using IDF drones.
Tel Aviv officials have repeatedly warned that Hezbollah missile manufacturing plants are a ‘red line’ against which the Israeli military would act.
Tyler Durden
Wed, 01/22/2020 – 19:45 - Hard Data Defies Confidence Consensus – The Slowdown Ain't Over
Hard Data Defies Confidence Consensus – The Slowdown Ain’t Over
Via Economic Cycle Research Institute (ECRI),
The consensus is that the U.S. consumer is still strong enough to propel the economy forward even though the manufacturing sector has weakened. This view underpins expectations for improved corporate earnings in 2020. But the hard economic data strikes a discordant note.
In particular, growth in industrial production on a year-over-year basis remains in a decisive downturn, sliding deeper into negative territory. Indeed, the production actually declined in 2019 amid losses in manufacturing job in recent months, fueling talk of a recession in that part of the economy.
The undeniable weakness in manufacturing has caused the consensus to trumpet the strength of the consumer. Yet, the consumer, while reportedly confident, is not spending hand over fist. Rather, weakening sales trends [which we flagged ahead of the holiday season] underscore a sustained slowdown in consumer spending.
Real retail sales growth fell to a six-month low of 1.25% in November on a year-over-year basis, dropping from 3.75% two years earlier. Yes, there was a big rebound in December, but that was mostly due to a highly favorable comparison to the disastrous December 2018 plunge in retail sales. Plus, that doesn’t negate the fact that spending growth has been tailing off even though surveys report a confident consumer and the stock market is at record highs.
So, what gives? The lifeblood of the average consumer is job growth, not stock prices. So it’s important to recognize that year-over-year growth in nonfarm payrolls has dropped to its lowest level in 2.25 years. Not only that, but growth in total hours worked – which reflects growth in both jobs and the length of the workweek – hasn’t been this weak since 2010, dropping to 0.9% in December from just over 2% a year earlier.
Worse still, growth in total pay has fallen even faster over the past year or so than growth in hours worked, slowing to a 3.8% pace from almost 5.5%. As a result, the year-over-year growth in average hourly earnings – the ratio of total pay to total hours worked – has fallen to 1.1% from 1.6%. This is the math behind the worrisome downturn in wage growth even in the face of a very low 3.5% jobless rate that has furrowed the brows of many economists.
For the average American, that sharp slowdown in the growth of total pay limits spending growth. No matter how confident consumers might feel, there’s only so much fresh debt they can realistically incur to support even more spending. The hard data shows growth in jobs, total pay and total hours worked are stuck in cyclical downswings. It also shows weakening trends in consumer spending and industrial production growth.
So while financial markets buoyed by increasingly accommodative central banks may be supportive of higher-income consumers, the average American is under considerable strain. Despite low yields on U.S. Treasury securities, average credit card rates have climbed inexorably in the last five years, surging above 15% in 2019. Meanwhile, one third of those buying new vehicles have negative equity in the used ones they are trading in, up from about one quarter before the financial crisis. And farm debt has topped $400 billion, up almost 40% since 2012.
All this is why the boost to the economy from the Federal Reserve’s dovish pivot a year ago has primarily aided relatively narrow parts of the economy, such as financial services, residential construction and affluent consumers. But it has not helped business investment or average consumers, making it difficult to ignite an acceleration in overall economic growth.
Regardless of the consensus view that the consumer is “strong,” there’s actually little indication that the deceleration in economic growth is over. As long as that’s the case, the risk of a recession – while not a clear and present danger – can’t be taken off the table for 2020.
* * *
Wall Street has prematurely gone all-in on the “strong” consumer narrative at a time when a manufacturing recession has triggered an employment slowdown that could start weighing on consumer spending.
Money managers and leverage funds have front-run a V-shape economic rebound thanks to an abundance of Federal Reserve liquidity.
With the economy continuing to decelerate and no signs of a significant upturn – and the threat the consumer could start weakening – the stock market’s most important support – buybacks – are rapidly declining.
If Fed liquidity shrinks, buybacks continue to decline, and a manufacturing recession transmits weakness into consumers — it seems that a blow-off top similar to the Dot Com era could be nearing.
Tyler Durden
Wed, 01/22/2020 – 19:25 - Twitter Blue-Checks Blast "Private Equity Mutants" For Bankrupting Their Favorite Grocery Chain
Twitter Blue-Checks Blast “Private Equity Mutants” For Bankrupting Their Favorite Grocery Chain
The rose-emoji-loving twitter blue checkmarks love complaining about esoteric financial concepts that they don’t understand. But as the old saying goes, even a broken clock is right twice a day, and once in a while, even they get it right.
As the coronavirus spreads around the world and the Davos billionaire circle-jerk enters its second day, the professional outrage mob has instead chosen the bankruptcy as obscure NYC supermarket chain Fairway as the trending topic du jour.
David Roth, a former Deadspin writer who used his platform to mewl about the ‘evil’ Trump administration in a series of whiny diatribes, lamented that Americans haven’t already risen up and dismantled the private equity industry. Especially considering that the PE business model relies on buying companies and then dismantling, or bankrupting, them for a profit (though only a handful of private equity firms are truly that ruthless).
To be sure, Roth admits that the only reason he cares about Fairway going under is because it directly affects him, and all the other NYC media denizens who relied on the grocery chain.
It’s one thing that private equity destroyed my workplace and my job. Fair play, it happens. But private equity forcing Fairway into bankruptcy is really going to fuck my life up. This I cannot accept.
— David Roth (@david_j_roth) January 22, 2020
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It sucks how housebroken and Stockholm Syndrome’d American culture is at this moment, but just accepting that every now and then profitable businesses are driven into bankruptcy by private equity mutants, quite legally and quite profitably for them, might be the worst of all.
— David Roth (@david_j_roth) January 22, 2020
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Others made a slightly more nuanced point: The failure of Fairway isn’t so much an indictment of the private equity industry as a whole, but rather of the greed and incompetence of managers who drive a thriving business into bankruptcy.
In quiet awe of the private equity guys who managed to turn a handful of beloved and heavily trafficked supermarkets in the richest parts of the richest city on earth and somehow make them bankrupt and 175 million dollars in debt https://t.co/9HZrNH5NsG
— Tom Gara (@tomgara) January 22, 2020
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Though bankruptcy can help firms cut their losses, and often allow them to escape with profits while sticking lenders with the bill, few would argue that turning a private business profitable and then either selling it to Amazon or taking it public would have been a more profitable strategy.
However, in an unexpected twist, Fairway issued a statement hours after the New York Post reported the bankruptcy disputing that it plans to file for Chapter 7 and liquidate its stores.
New —> FAIRWAY, the iconic NYC supermarket, says it has NO intention of filing for bankruptcy or closing stores.
Disputing today’s report in the NYPost. pic.twitter.com/lTpgXS4Q2l— Clifford Levy (@cliffordlevy) January 22, 2020
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Instead, the company said it soon plans to announce a “value-maximizing transaction” that will allow for the “ongoing operation” of all 14 of its stores.
New —> FAIRWAY, the iconic NYC supermarket, says it has NO intention of filing for bankruptcy or closing stores.
Disputing today’s report in the NYPost. pic.twitter.com/lTpgXS4Q2l— Clifford Levy (@cliffordlevy) January 22, 2020
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But one reporter pointed out that Fairway has a strong incentive to vehemently deny the report, since warnings about an imminent move to liquidate might spook the company’s vendors, prompting them to aggressively tighten credit restrictions.
the Fairway bankruptcy report & rebuttal is an interesting situation for a couple of different reasons
obviously there’s the PE thing
But also, these types of reports can actually precipitate (or speed up) a bankruptcy filing
— Alexandra Scaggs (@alexandrascaggs) January 22, 2020
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The Post did hedge its reporting by claiming that rumors of a Fairway bankruptcy were circulating even amid “ongoing interest” in the Fairway brand by a potential rival. Any potential buyers are probably approaching with trepidation given Fairway’s massive $174 million debt load and its expensive leases, including a $6 million rent obligation for its flagship store.
If the company does move ahead with plans to enter restructuring, this would be Fairway’s second trip through bankruptcy, which is how the private equity firms gained control of the company in the first place.
So maybe those private equity guys aren’t so stupid after all. Either way, we suspect we will know soon enough, because even if Fairway does make it to liquidation, a more competent rival would likely end up buying all the assets and reopening the stores.
Tyler Durden
Wed, 01/22/2020 – 19:05 - CNN Can't Fathom It: Sanders Leading In Their Own National Poll
CNN Can’t Fathom It: Sanders Leading In Their Own National Poll
Authored by Eoin Higgins via CommonDreams.org,
Sen. Bernie Sanders on Wednesday for the first time has a lead in CNN polling of primary contenders for the 2020 Democratic nomination — but you wouldn’t know that from how the network framed their coverage.
Sanders supporters took issue with the fact that despite the Vermont senator’s three point advantage over former Vice President Joe Biden, 27% to 24%, CNN in its headline declares that “Bernie Sanders surges to join Biden atop Democratic presidential pack” rather than acknowledging the lead. The network adds in the article that Sanders and Biden are “in a two-person top tier above the rest of the field.”
Democratic presidential candidate Sen. Bernie Sanders leads a new CNN poll. (Photo: Mandel Ngan/AFP/Getty Images) The disconnect between the Sanders lead — which is just within the 3.4 point margin of error — and the framing of CNN’s piece on the poll was noticed by progressives and journalists.
“The title of the article makes it sound like it’s a tie,” said Sanders surrogate Shaun King. “It isn’t.”
Law and Crime reporter Colin Kalchember also took aim at CNN for not declaring Sanders in the lead. “CNN still cannot fathom stating the obvious here: Sanders is leading in their own national poll,” said Kalchember. “Self parody.”
CNN still cannot fathom stating the obvious here: Sanders is leading in their own national poll. Self-parody. https://t.co/T2iPRcfhMf
— Colin Kalmbacher (@colinkalmbacher) January 22, 2020
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The polling revealed other interesting data points, including that Sanders leads fellow progressive Sen. Elizabeth Warren (D-Mass.) over liberal Democrats by 33% to 19% and leads Biden with voters of color by 30% to 27%.
“Gotta love those Bernie bros!” tweeted The Hill journalist Krystal Ball.
Sanders also leads a new poll out Wednesday from crucial Super Tuesday state California, besting Biden by 28% to 24%, and gained on the former vice president in Morning Consult’s weekly early-state polling.
As CNN’s Ryan Struyk pointed out on Twitter, polling over the last few months shows a definite trend downward for Biden and upward for Sanders.
Support for Biden in @CNN polling:
Oct: 34%
Nov: 28%
Dec: 26%
Now: 24%Support for Sanders in @CNN polling:
Oct: 16%
Nov: 17%
Dec: 20%
Jan: 27%— Ryan Struyk (@ryanstruyk) January 22, 2020
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Rep. Pramila Jayapal (D-Wash.), the co-chair of the Progressive Caucus who recently endorsed Sanders, celebrated the polling showing the Vermont senator pulling into the lead and urged the campaign’s supporters to use the momentum as a motivator to keep working toward a primary election victory.
“Great news, but we are not letting up!” said Jayapal. “#TeamBernie is winning because of Bernie Sanders’ bold ideas, steadfastness, and clarity on how we turn this country around.”
* * *
Wow, watch @krystalball destroy on CNN this morning 🔥🔥🔥pic.twitter.com/byasf3uTqI
— Eric Blanc (@_ericblanc) January 22, 2020
Tyler Durden
Wed, 01/22/2020 – 18:45
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