There are a multitude of false assumptions out there on what the collapse of a nation or “empire” looks like. Modern day Americans have never experienced this type of event, only peripheral crises and crashes. Thanks to Hollywood, many in the public are under the delusion that a collapse is an overnight affair. They think that such a thing is impossible in their lifetimes, and if it did happen, it would happen as it does in the movies – They would simply wake up one morning and find the world on fire. Historically speaking, this is not how it works. The collapse of an empire is a process, not an event.
This is not to say that there are not moments of shock and awe; there certainly are. As we witnessed during the Great Depression, or in 2008, the system can only be propped up artificially for so long before the bubble pops. In past instances of central bank intervention, the window for manipulation is around ten years between events, give or take a couple of years. For the average person, a decade might seem like a long time. For the banking elites behind the degradation of our society and economy, a decade is a blink of an eye.
In the meantime, danger signals abound as those analysts aware of the situation try to warn the populace of the underlying decay of the system and where it will inevitably lead. Economists like Ludwig Von Mises foresaw the collapse of the German Mark and predicted the Great Depression; almost no one listened until it was too late. Multiple alternative economists predicted the credit crisis and derivatives crash of 2008; and almost no one listened until it was too late. People refused to listen because their normalcy bias took control of their ability to reason and accept the facts in front of them.
There are a number factors that cause mass blindness to economic and social reality. First and foremost, establishment elites deliberately create the illusion of prosperity by rigging economic data to the upside. In almost every case of economic crisis or geopolitical disaster, the public is conditioned to believe they are in the midst of a financial “boom” or era of “peace”. They are encouraged to ignore fundamental warning signs in favor of foolish faith in the system. Those people that try to break the apathy and expose the truth are called “chicken little” and “doom monger”.
In the minds of the cheerful lemmings a “collapse” is something very obvious; they think they would know it when they saw it. It’s like trying to teach a blind person about colors; it’s not impossible, but it’s very difficult to get all these Helen Kellers to understand that what they perceive is not the whole reality. There’s a vast world hidden from them and they have no concept of how to observe it.
Crash events are like stages in the process of collapse; they create moments of clarity for the blind. However, they are also often engineered to benefit the establishment. There’s a reason why the elites put so much energy into hiding the real data on the state of the economy, and it’s not because they are trying to keep the system from faltering by using sheer public ignorance. Rather, a crash event is a tool, a means to an end. As Congressman Charles Lindbergh Sr. warned after the panic of 1920:
“Under the Federal Reserve Act, panics are scientifically created; the present panic is the first scientifically created one, worked out as we figure a mathematical problem…”
Central bankers and their cohorts manipulate economic data and promote the false notion of a boom before almost every major crash because they WANT to ambush the populace. They WANT to create panic, and then use it to their advantage as they rebuild and mutate the system into something unrecognizable only decades ago. Each consecutive crash contributes to the collapse of the whole, until eventually the society we once had is barely a distant memory.
This process can take decades, and the US has been subject to it for quite some time now. Once again in 2019 we are seeing the lie of an “economic boom” being perpetuated in the mainstream. The public was growing too aware of the danger and had to be subdued. More specifically, conservatives were growing too aware. The sad thing is that the boom propaganda is most prominent today among conservatives, who are desperately trying to ignore the fundamentals in an attempt to defend the Trump Administration.
The same people who were pointing out the economic bubble under Obama are now denying its existence under Trump. Trump himself argued that the markets were a dangerous economic fraud created by the Federal Reserve during his campaign, yet once he was in office he flip-flopped and started taking full credit for the bubble. What is mind boggling to me is that many people, even in the liberty movement, still choose to dismiss this behavior in favor of worshiping Trump as some kind of hero on a white horse.
This only reinforces my theory that the system is due for another major engineered crash event, and that the ongoing collapse of the US is soon to accelerate. Each case of economic calamity in modern history was preceded by peak delusional optimism and peak greed. When the people traditionally most vigilant against crisis suddenly capitulate and claim victory, this is when reality strikes hardest. This is when the establishment triggers yet another controlled demolition.
In order to determine how long an empire will last, one has to take into account the agenda of the elites that control its institutions. As long as they are in key positions of power within the system and as long as they can inject their own puppet politicians, they will have the ability to influence the collapse timeline of that system.
Can they prolong and stave off crisis? Yes, for a short while. However, once the machine of a crash has been set in motion the best they can do is slow down the Titanic; they cannot change its path towards the iceberg. And frankly, at this point why would they? I hear it argued often that the elites are going to “keep the plates spinning” on the economy and that they don’t want to lose their “golden goose” in the US economy. This reveals an naivety among skeptics of the true agenda.
Firstly, the elites have a highly useful political puppet in the form of Donald Trump; he is useful in that he inspires sharp national division, and, he is a self proclaimed conservative champion and nationalist. If the elites did not trigger a crash under Trump, then this would give the public the impression that conservative ideals and national sovereignty works. This is the opposite of what they want. Why would globalists that want the erasure of nation states and the creation of a centralized socialist “Utopia” seek to make conservatives and nationalists look good? Well, they wouldn’t.
The only concern of the banks is that they do not take the blame as their engineered collapse of the old world order hits the public with increasingly painful consequences. These consequences are already becoming visible.
The next major crash has begun in the form of plunging fundamentals, and far too many conservatives are placing their heads in the sand for the selfish sake of proving the political left wrong. Declines in US manufacturing, US freight, global exports and imports, mass closures in US retail, as well as all time highs in consumer debt, corporate debt and national debt are being shrugged off and rationalized as nothing more than “hiccups” in an otherwise booming economy. The Fed’s repo market purchases, barely keeping up with demand from liquidity starved corporations are also not being taken seriously.
Conservatives and analysts are going to have to forget about supporting Trump, a Rothschild owned proxy, and start acknowledging reality once again. The only question now is, will the elites allow the crash to spread further into mainstreet and strike markets before or after the 2020 election?
As noted above, to predict the timing of a collapse in a nation or empire, one has to examine the agendas of the elites that dominate its institutions. We can gain some sense of timing from the public admissions of globalist organizations like the IMF and the UN. Each has announced the year 2030 as a target date for the finalization of globalization, a cashless society and sustainability goals. This means that the elites have around ten years to create a crisis and then “solve” that crisis with globalism.
Ten years is a narrow window, and if the elites intend for conservatives to take the blame for the next crash, they will have to initiate it soon. They may not have a choice anyway, as the chain of dominoes was already been set in motion by the Fed in 2018 with its liquidity tightening policies.
We can also gauge timing of a collapse to a point by understanding the common tactics the establishment uses to hide what they are doing. Generally, when a collapse is about to accelerate the elites use crisis events as cover to distract the public and produce scapegoats. In my article ‘Globalists Only Need One More Major Event To Finish Sabotaging The Economy’, I outlined three potential distractions that could be used in the near term, and if any of these events took place, then people should watch for the collapse to move faster. Two of these events now appear imminent: The first being a war with Iran, and the second being a ‘No Deal’ Brexit.
Finally, we can take into account the globalist need for a scapegoat, and it appears that conservatives and nationalists are their target for blame. This leaves less than one year for a crisis event if Trump is intended to leave the White House in 2020, or less than four years if he is intended to stay in for a second term. Keep in mind that A LOT can happen in a single year, and a second Trump term is certainly not guaranteed yet.
But why create a collapse in the first place? Crash events allow the establishment to consolidate control over hard assets as poverty forces the population to sell what they have to survive. This poverty also creates fear, which makes the public malleable and easier to control. Each new crisis opens doors to political and social changes, changes which end in less freedom and more centralization. Collapse is a succession of crashes leading to a complete erasure of the original society. It’s not a Mad Max event, it’s a hidden and insidious cancer that takes over the national body and warps it into a wretched form. The collapse is complete when the nation either breaks apart, or is so damaged for so long that no one can remember what it used to look like.
What we are witnessing today is the beginning of a new crash, and the final phases of a collapse of our way of life. The economic boom narrative among conservatives is a farce designed to trick us into complacency. The bubble that we warned about under the Obama Administration has been popped under the Trump Administration. Nothing has changed in the ten years since the 2008 crash except that the motivation for keeping the crash hidden is quickly disappearing.
Crashes are inevitable, but collapse is only possible when the public remains unprepared. Our civilization and its values are under attack, but they can only be destroyed if we stay apathetic to the threat and refuse to prepare for their defense. We must adopt a philosophy of decentralization. We need localized and self sufficient economies, as well as a return to localized production. Beyond that, we have to prepare for the eventuality of a fight. The fate of the US economy has already been sealed, but the people who are destroying it can still be stopped before they use the collapse to force society into subservience. We have to offer security, we have to offer alternatives to the “new world order” and we have to remove the globalist threat permanently.
Make no mistake, we are living in the midst of an epoch moment; the outcome of collapse depends on us and our reactions. This is not the task of the next generation, it is a task for our generation. We do not have another couple of decades to take the danger seriously. The plates are not spinning, they have already dropped.
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2019 was a year that changed the face of migration on the U.S. Southwestern border. Not only did many more immigrants try to cross it, but a majority – almost 56 percent – arrived together with their families, fleeing violence in Central America. As a result of this fundamental change in who is seeking to immigrate to the United States, Non-Mexicans outnumbered Mexicans 4:1 at the Southern border in the fiscal year of 2019. These numbers are inferred from arrest records of Customs and Border Protection.
The number of undocumented immigrants reached its peak in May 2019, when more than 132,000 people were apprehended. In November 2019 (FY2020) was back down to approximately 33,500.
Because many of the new arrivals are applying for asylum, the Trump administration has overhauled its application process, making many asylum seekers wait in camps on the Mexican side without much assistance. These changes were implemented after another system overhaul – the separation of families in U.S. custody and the tendency to release fewer immigration detainees on bail – had caused chaotic scenes at detention centers and an international outcry.
Historically, Mexicans made up the largest share of undocumented immigrants to the U.S. but have been more successful at finding work in Mexico, where the economy is improving and workers are more sought after as the country’s population ages. As more asylum seekers and less work migrants arrive, the U.S. has also slashed the number of refugees it accepts annually to the historic low of 18,000 for 2020.
A remarkably non-propagandistic news-report, in the New York Times, by Eric Lipton, Maggie Haberman and Mark Mazzetti, included powerful evidence that the impeachment-effort against US President Donald Trump is motivated, in part if not totally, by a desire by US Senators and Representatives – as well as by career employees of the US Departments of Defense, State Department, and other agencies regarding national defense – to increase the sales-volumes of US-made weapons to foreign countries.
Whereas almost all of the contents of that article merely repeat what has already been reported, this article in the Times states repeatedly that boosting corporations such as Lockheed Martin, General Dynamics, Boeing, and Northrop-Grumman, has been a major — if not the very top — motivation driving US international relations, and that at least regarding Ukraine, Trump has not been supporting, but has instead been trying to block, those weapons-sales — and creating massive enemies in the US Government as a direct consequence.
In an Oval Office meeting on May 23, with Mr. Sondland, Mr. Mulvaney and Mr. Blair in attendance, Mr. Trump batted away assurances that [Ukraine’s current President] Mr. Zelensky was committed to confronting corruption. “They are all corrupt, they are all terrible people,” Mr. Trump said, according to testimony in the impeachment inquiry.
In other words, Trump, allegedly, said that he didn’t want “terrible people” to be buying, and to receive, US-made weapons (especially not as US aid — free of charge, a gift from America’s taxpayers).
The article simply assumes that Trump was wrong that “they are all terrible people.”
Indeed, Trump himself has sold hundreds of billions of dollars worth of US-made weapons to the Royal Saud family who own Saudi Arabia, and he refuses to back down about those sales on account of that family’s having been behind the widely-reported torture-murder of Washington Post journalist Jamal Khashoggi, and on account of their effort since 2015 to starve into submission — by bombing the food-supplies to — the Houthis in adjoining Yemen, and on account of their using US weapons in order to achieve that mass-murdering goal. Consequently, even if Trump is correct about Ukraine’s Government, he would still have a lot of explaining to do, in order to cancel congressionally authorized US weapons-sales to Ukraine but not to Saudi Arabia.
For the New York Times, in its ’news’-report — even this article that’s less prejudiced than most of mainstream US ’news’-reporting is — to simply presume that Trump had no valid reason for asserting what he did against Ukraine’s present (the Obama-installed) Government of Ukraine, constitutes merely anti-Trump (and pro-Obama) propaganda, on their part, and it would be more appropriate in an editorial or op-ed from them than in an alleged news-article, such as here. However, the actual news-value in that article is real. They quoted from “a piece in the conservative Washington Examiner saying that the Pentagon would pay for weapons and other military equipment for Ukraine, bringing American security aid to the country to $1.5 billion since 2014.” This was an anti-Democrat, pro-Republican, newspaper and article, saying:
Kurt Volker, the US special representative for Ukraine, told the Senate Foreign Relations Committee at a Tuesday hearing. “I think it’s also important that Ukraine reciprocate with foreign military purchases from us as well, and I know that they intend to do so.” The assistance comes at a pivotal moment for Ukraine’s newly minted president, Volodymyr Zelensky, a popular comedian who won a landslide victory in April. Zelensky has made ending the Russian-backed insurrection in Ukraine’s eastern Donbas region his top political priority.
The Times, in order to appear nonpartisan, was there citing, as authority, the anti-Trump appointee by Trump, Kurt Volker, who said “it’s also important that Ukraine reciprocate with foreign military purchases from us as well, and I know that they intend to do so.” In other words: Volker was saying that Ukraine’s Government would follow through with America’s war against Russia, next door to Ukraine, and that therefore, US taxpayers should pay for Ukraine’s purchases of US-made weapons, such as from Lockheed Martin and Raytheon. He was saying that milking US taxpayers to boost those US corporations’ profits is good, not bad. He was saying that Ukraine is on US taxpayers’ dole, as if the Obama-installed, rabidly anti-Russian, Ukrainian Government is a charity-case which is the US Government’s business (and not merely those private stockholders’ business), and that therefore, Trump should continue Obama’s policy toward Ukraine, of using Ukraine in order ultimately to place on Ukraine’s border with Russia, missiles against Moscow, right across that border. This is what the New York Times is presenting in a favorable light.
Then, the New York Times ‘news’-report said:
For a full month, the fact that Mr. Trump wanted to halt the aid remained confined primarily to a small group of officials.
That ended on July 18, when a group of top administration officials meeting on Ukraine policy — including some calling in from Kyiv — learned from a midlevel budget office official that the president had ordered the aid frozen.
“I and the others on the call sat in astonishment,” William B. Taylor Jr., the top United States diplomat in Ukraine, testified to House investigators. “In an instant, I realized that one of the key pillars of our strong support for Ukraine was threatened.”
In other words: the Times’s further attack against Trump’s intention not to provide this US taxpayer boondoggle to Lockheed Martin, Raytheon, United Technologies, and other US weapons-making corporations — a boondoggle so as to continue free supply to the Obama-installed Ukrainian regime of US-made weapons against Russia — is that career US national-security personnel support and want to continue Obama’s war against Russia.
Then, the Times reported further:
“This is in America’s interest,” Mr. Bolton argued, according to one official briefed on the gathering.
“This defense relationship, we have gotten some really good benefits from it,” Mr. Esper added, noting that most of the money was being spent on military equipment made in the United States.
America’s war against Russia is designed to enrich investors in US ‘Defense’-contractors.
Isn’t it clear, then, what was actually behind 9/11, and behind America’s invasion of (instead of merely Special-Forces operation regarding) Afghanistan in 2001, and invasions of Iraq in 2003, and of Libya in 2011, and of Syria in 2012-now, etc., and coup against Ukraine in 2014?
The Times article closes with this impeach-Trump line:
But then, just as suddenly as the hold was imposed, it was lifted. Mr. Trump, apparently unwilling to wage a public battle, told Mr. Portman he would let the money go.
White House aides rushed to notify their counterparts at the Pentagon and elsewhere. The freeze had been lifted. The money could be spent. Get it out the door, they were told.
The debate would now begin as to why the hold was lifted, with Democrats confident they knew the answer.
“I have no doubt about why the president allowed the assistance to go forward,” said Representative Eliot L. Engel, Democrat of New York and the chairman of the House Foreign Affairs Committee. “He got caught.”
In other words: Trump yielded to the threat of being impeached. Trump, the sales-person who had sold the Saud family hundreds of billions of dollars worth of US weaponry, recognized that unless Russia is going to be the main target of US weaponry, Trump’s own Presidency will be in jeopardy.
US foreign policies are a vast sales-promotion scheme, for America’s billionaires, who crave to control Russia, above all. Trump won’t buck them. Instead, he’s continuing Obama’s policy on Ukraine.
This Is The Top Job For Americans Hoping To Make Six Figures With No Experience
Given the insane cost of college in the US, who can blame prospective students for trying to game out which career paths have the highest short-term payouts immediately after graduation?
To that end, the two men behind the website theinterviewguys.com (h/t to MarketWatch’s Quentin Fottrell) analyzed some data from the BLS’s Occupational Requirements Survey to glean some insights on which jobs offer the highest salaries to those who are just starting their careers post-graduation.
They found that in 2019, the highest-paying job for college graduates that required no previous work experience was being a pharmacist.
Roughly 64% of pharmacist job postings required no previous work experience in the field, while also carrying a median starting salary of $126,000 a year, more than twice the average wage in the US. Next up was another position in the health-care field: Nurse practitioner. 60% of job postings for nurse practitioners required no prior work experience, while advertising a median salary of $114,000.
Of course, the high median salaries in these fields aren’t an accident, or some kind of happy coincidence. Rather, students face a difficult curriculum during their undergrad years, plus at least some grad school. Pharmacy students must obtain a doctoral degree in pharmacy just to be eligible to enter the workforce, and they must also pass the Pharmacy College Admission Test.
Looking further down the income distribution, the pair found that high school teachers and special education teachers most often required no previous work experience (According to their research, the interview guys found that more than 91% of postings in those fields stipulated that no prior experience in the field was necessary).
However, median salaries for these teaching jobs came in at just over $60,000. Police patrol officers also ranked high on the list of jobs requiring no prior experience in the field (something that the SJWs will surely latch on to as an example of the rank injustices permeating the law-enforcement community). The median salary for patrol officer jobs came in at just over $65,400.
For college graduates, jobs offering high starting salaries with little required experience fall into a category that the study’s authors have dubbed “the sweet spot.” After all, one of the most infuriating struggles that recent grads face is surmounting the ‘experience’ barrier. Every year, hundreds of thousands of American students embark on unpaid or for-credit internships in the hopes of gaining precious work experience.
Some employers, in turn, have been castigated for taking advantage of this situation by relying on unpaid interns or “perma-interns” who receive pay, but no other benefits, for their work.
In many professional-class fields, jobs with low starting wages often lead to higher-paying positions after three or four years in the workforce.
And more often than not, jobs with a low barrier to entry pay much less than other positions. But with unemployment at 50-year lows, some jobs that were traditionally seen as menial or blue-collar labor are seeing upward pressure on wages as jobs like long-haul trucker and fast-food cook become increasingly difficult to fill.
“Quantum” may possibly have been one of the most common words we’ve been reading, listening to, and even writing about last year – and there is a big reason for that… quantum is no longer the future, quantum is now.
Physicists have been able to demonstrate quantum teleportation between two computer chips for the first time.
A few years ago, we were just beginning to understand the main aspects of quantum physics. Even Albert Einstein died not agreeing with a lot of the theories enclosing this new world for physics because in some aspects it was not “matching” the special relativity theory (that’s one of the reasons why the “theory of everything,” explaining how everything was created in a physical perspective hasn’t been published yet).
But not understanding everything about quantum physics doesn’t mean we can’t take advantage of its amazing properties, one of them being entanglement. Entanglement describes how when a pair or group of particles is generated, interact, or share spatial proximity and the quantum state of each particle cannot be described independently, this is one of the fundamental contrasts between classical and quantum physics.
Scientists from the University of Bristol, in collaboration with the Technical University of Denmark (DTU), have successfully developed chip-scale devices that are able to exploit the application of quantum physics by generating and manipulating single particles of light within programmable nano-scale circuits.
These chips encode quantum information in light generated inside the circuits and can process information with high efficiency and extremely low noise. This could be translated into an ability to create more complex quantum circuits that nowadays are required in quantum computing and communications, that in the present, are the most powerful supercomputers that exist.
Quantum teleportation offers quantum state transfer of a quantum particle from one place to another by utilizing entanglement. Establishing this entangled communication in the lab was not easy stuff.
“We were able to demonstrate a high-quality entanglement link across two chips in the lab, where photons on either chip share a single quantum state,” Bristol Co-author Dan Llewellyn said.
“Each chip was then fully programmed to perform a range of demonstrations which utilize the entanglement… the flagship demonstration was a two-chip teleportation experiment, whereby the individual quantum state of a particle is transmitted across the two chips after a quantum measurement is performed. This measurement utilizes the strange behavior of quantum physics, which simultaneously collapses the entanglement link and transfers the particle state to another particle already on the receiver chip.”
“Based on our previous result of on-chip high-quality single-photon sources, we have built an even more complex circuit containing four sources… all of these sources are tested and found to be nearly identical emitting nearly identical photons, which is an essential criterion for the set of experiments we had performed, such as entanglement swapping.”
The results showed efficiency in the quantum teleportation of 91 percent and other important features such as entanglement swapping used for quantum repeaters and networks and four-photon GHZ states, required in quantum computing and quantum internet.
These developments are predicted to have immense impacts on modern society, quantum physics is here to stay.
Worse still, at least 25 percent of 12th grade students have tried nicotine vaping products, according to a poll conducted by New England Journal of Medicine, cited by the New York Times.
But now, the Trump administration on Thursday announced plans to bar sales of flavored e-cigarette cartridges, except for menthol and tobacco flavors.
“The United States has never seen an epidemic of substance use arise as quickly as our current epidemic of youth use of e-cigarettes,” Health and Human Services Secretary Alex Azar said in a statement about the change, which goes into effect in 30 days.
The FDA released its statement announcing the new policy on Thursday, saying the move was not a “ban” but an announcement prioritizing the agency’s law enforcement powers against tobacco products. The agency “has attempted to balance the public health concerns,” the statement said.
Will this ‘ban’ push smokers back to ‘real’ cigarettes?
While lighting up a cigarette was once considered a sign of class and sophistication or, at the very least, an act of coolness, smoking seems to have lost some of its spark in recent years. According to a new report published by the Federal Trade Commission, cigarette sales in the United States dropped to 216.9 billion in 2018, the lowest level since the FTC started tracking cigarette sales in 1967.
Over the same period, cigarette advertising and promotional spending increased from $1.2 billion in 1980 to $8.4 billion in 2018, most of which came in the form of price discounts for retailers and wholesalers.
Interestingly, the number of cigarette smokers in the United States, while also declining, has not dropped at a similar rate as cigarette sales over the past four decades. According to the Centers for Disease Control and Prevention (CDC), an estimated 34.2 million adults in the U.S. were smoking cigarettes in 2018, down 34 percent from 51.6 million in 1980.
When I wrote that the coup against President Trump had morphed into a Civil War, I wasn’t kidding. The sham impeachment created the perfect environment for the Democrats and Republicans to get something definitive from him by playing the House and the Senate off each other.
With the Senate Neocon Occupied Territory the escalation of belligerence since Speaker Nancy Pelosi pushed through the impeachment vote has been serious.
First, there was the rider to the NDAA which upped the sanctions on everyone willing to work on Nordstream 2. Then Lindsey Graham pushed the frankly insane DASKA bill through the Senate Foreign Relations Committee.
It is under these circumstances we should view the events in Iraq over the last week, especially the killing of IRGC Quds Forces Commander Qassem Solemaini.
Because I’ve warned from the beginning of this impeachment, Trump was just 17 votes in the Senate away from conviction. And failure on his part to respond to an attack on our troops now or our soil, the embassy in Baghdad, would have been enough to turn that many against him and install Mike Pence.
At the end of the day we are held captive by a minority of power-mad Trotskyites without any capacity for forgiveness or humility. They believe in societal order through the whip and the sword.
Truly Maoist in their thinking, the only political power that exists comes from the barrel of a gun. This is why there has been zero opportunities for diplomacy with Iran.
Iran is to be destroyed. If not today, tomorrow. If not then then the day after. It will not end.
And any potential diplomacy was sabotaged at every turn. Peace can only happen through subjugation. Demands placed on Iran after Trump’s disastrous decision to exit the JCPOA were nothing short of regime change, arch neocon Secretary of State Mike Pompeo saw to that.
A man like Solemaini would never submit to this. And yet, fighting a war against the Empire is always reduced to terrorism to sell it to the public.
Like it or not Trump executed the man most responsible for the systemic destruction of ISIS and neutering of Al-Qaeda in Syria and Iraq. He’s also a man, over the years, who has fought the U.S. to a standstill across the Middle East.
Those were his pertinent crimes.
The results of these fights were to empower Israel’s enemies in Lebanon, Syria and Iraq. Russia and China supported this in their own interests. Turkey came to realize it was being used.
There was no way around that. It was a direct consequence of winning the battle to preserve Syria from becoming a failed state.
And that is a goal any rational person should wish for.
This is the most dangerous escalation of Trump’s administration. Nothing he’s done to this point compares with killing Solemaini and taking immediate credit for it.
Nothing he’s done is more tone deaf or disproportionate to whatever crimes were the proximate cause. And nothing he could have done would be more galvanizing of resistance to U.S. occupation of Iraq and Syria.
Trump, to his credit, held back the neocons at critical junctures over the past couple of years. After the Russian ELINT plane was shot down, Putin negotiated a truce which would have seen Iranian forces in Syria pulled back from the Golan Heights as a start to changing the dynamic there.
Benjamin Netanyahu said no all Iranians out of Syria. The war between Israel and the Shia forces backed by Iran continued. The path to peace could have begun then if Trump had the moral courage to force that outcome.
But the neocons at home had him under suspicion of treason. His National Security staff wouldn’t allow that to happen. If he hadn’t pulled out of the JCPOA and left room to negotiate we wouldn’t be here today.
But he did. And we are downstream of this bad decision. It’s been one escalation after another and a series of increasingly dangerous confrontations. This doesn’t end with Iran going meekly to bed, folks.
They aren’t disobedient children but they aren’t animals either.
Killing Solemaini was presaged months ago with the U.S. designating the Quds Force a terrorist organization, which gives the U.S. unilateral legal cover to summary execution of anyone affiliated with them, especially if they are not on home soil.
But, at the same time, Trump assassinated (note the difference) members of the Iraqi Popular Mobilization Forces in the raid as well, since these are considered members of the Iraqi military and the attack occurred on Iraqi soil.
So, in simplistic and, I believe, legal terms Trump committed an Act of War against Iraq. Iran obviously considers killing Solemaini, legal definitions aside, such as well.
This is an act Trump cannot walk back. He can’t ask Iran to come to the negotiating table now or ever. It’s an act of overt war. Whether it leads directly to forces facing off in high level combat is debatable. It will certainly continue escalating from here.
Israel has been itching for the U.S. to attack and destroy Iran’s nuclear R&D facilities. The only way to achieve that was to get Trump to pull out of the JCPOA, forcing Iran back into enrichment and then using that as the casus belli.
Welcome to 2020.
And the sad truth is that it means more killing, more murder and more of everything bad. There is no Just War rationalization for this. While no one rational wants to see Iran with nuclear weapons the end result of the policy led us to that potential outcome.
No rational person should want anyone with nuclear weapons and yet Netanyahu sits on hundreds of warheads.
Beating people into submission doesn’t work. The neocons told Trump to smack Iran in the mouth, that’s the only lesson these animals understand.
By the way, they say that about everyone.
Solemaini may have been responsible for hundreds of American deaths, but Iran and the U.S. have been at war for forty years. At some point that has to be processed honestly.
Americans supporting this refuse to comprehend that we’re as much to blame as Iran is for the violence. We’re not the good guys and they aren’t the bad guys. Everyone sucks here. For every Iranian that shouts “Death to America” there are Americans who sing “Bomb, Bomb, Bomb Bomb, Bomb Iran.”
Trump was elected to end this belligerence but he’s incapable of separating strength from weakness. A mafiosi-type who uses violence indiscriminately, Trump is a weak man. This was indiscriminate in that Trump believes the political calculus is in his favor, so he can get away with it. He shores up his support in the Senate just long enough to beat the impeachment and can sail to re-election.
But, who he is was written on the bombs he threw at the Al Shairat airbase and the MOAB he dropped in Afghanistan in April 2017 to prove a point to Putin and Xi he wasn’t a wimp.
But he is a wimp. And a coward. And neither man was impressed by this. He hasn’t won a single negotiation of note in three years. Killing Solemaini was the result of having no capacity for diplomacy.
China’s won the trade war. Russia gets their pipelines. Syria will be returned to Syrians and Iraq will reject U.S. presence there. Venezuela won’t fall and North Korea has nukes. Nothing has changed and yet everything has.
A strong man admits his mistakes and makes concessions to those he’s harmed. He doesn’t hide behind how unfair it is the political machine is arrayed against him.
And, now, he’s a failed president no different than Obama who he despises.
The only thing more pathetic than Trump right now is the gaggle of jackals running against him. Weep for the future.
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“Dire Circumstances”: Aussie Wildfires Intensify After Killing Half A Billion Animals; Record Numbers Evacuate
The brushfires raging across Australia which have killed an estimated 480 million animals have intensified over the last 12 hours, according to NASA, causing a record number of residents evacuate as forecasters predict worsening conditions.
Authorities on Friday urged evacuations for Australians living in parts of New South Wales and Victoria to avoid brushfires which are expected to rage out of control over the weekend. Temperatures in the area topped 104 F across much of the state, and no end to the destruction is currently in sight. According to NSW Transport Minister Andrew Constance, this is “the largest evacuation of people out of the region ever.”
I would love some big creators to help raise awareness for our beautiful country. AUSTRALIA is on fire, and we need all the help we can get. 500m animals dead. Thousands stranded on beaches. Pls RT with link to @RedCrossAUpic.twitter.com/2CwHp4CqRi
“Conditions are set to mirror or even deteriorate beyond what we saw on New Year’s Eve,” said the Bureau of Meteorology’s Jonathan How, adding that strong and dry winds would pick up over the weekend.
Over 1,300 homes have been destroyed, while 17 deaths have been reported.
In a harbinger of the searing conditions expected, a number of fires burnt out of control in South Australia as temperatures topped 40 degrees C (104 F) across much of the state and strong winds fanned flames.
Victoria declared a state of disaster across areas home to about 100,000 people, with authorities urging people to evacuate before a deterioration expected on Saturday. –Reuters
“If they value their safety they must leave,” said police emergency responder Michael Grainger. “I’d suggest personal belongings are of very, very little value in these circumstances,” adding “These are dire circumstances, there is no doubt.“
In the southern seaside resort town of Mallacoota, over 4,000 people were forced to take refuge on the beach and in boats as an “apocalyptic” scene unfolded amid a dark orange sky.
The evacuation operation is now in full swing in Mallacoota. These people are being taken out on LARC-V army vessels @theheraldsun pic.twitter.com/ebvMF038tA
In today’s political discourse, the minimum wage is frequently mentioned by the more progressive members of Congress. On a basic level, raising the minimum wage appears to be a sympathetic policy for low-income wage earners. Often kept out of the conversation, however, are the downstream effects of this proposal. The consensus among economists has always been that a price floor on “low-skilled labor” leads to unemployment “among the very people minimum wage legislation allegedly helps.” Surely those who retain their employment will reap the higher hourly pay but not without consequence to the rest of the “low-skilled” labor market.
Government-mandated minimum wage increases directly result in a higher price floor for hourly labor. The more indirect consequences include reductions in hours worked, layoffs, automation, operational changes, and loss of opportunity. In Economics 101, students are taught about trade-offs. A trade-off, as defined by the Business Dictionary, is “a technique of reducing or forgoing one or more desirable outcomes in exchange for increasing or obtaining other desirable outcomes in order to maximize the total return.” We incur trade-offs every day, such as the decision to buy dinner from a restaurant for $10 or to eat our holiday leftovers. Businesses incur trade-offs as well.
For example, let’s consider your local grocery store. The grocer may employ ten people, including one manager and nine employees. The manager makes well over the current minimum wage, but six of the nine other employees make the current minimum wage. If the current minimum wage is increased from $7.25 to $12.50 per hour, the rate of increase is 72.4 percent. While this increase may sound reasonable from the perspective of some readers, this is a large increase given the relatively low profit margins in this industry. What are the downstream effects?
The employer may either reduce the hours worked for employees or lay off staff. Several things result:
Those who are not laid off will reap the benefits of a higher minimum wage, but they will have to work harder to make up for less staff.
Staff making a wage higher than the old minimum wage but lower than the new rate will also request that their wages be increased to distinguish them from their peers (those who retained their jobs at the higher minimum wage) and to compensate them for their skills.
Those who are laid off will be forced to find other employment.
There may be a lack of employment due to these employees being priced out of the market.
The Effects on Youth Employment
Meanwhile, rapid advancements in technology may result in fewer job opportunities when the cost of labor is higher. Think of your local Kroger’s self-checkout line or Chick-fil-A’s mobile-ordering application.
Not surprisingly, American Action Forum’s evidence indicates that minority youth may be the most negatively affected by wage price floors. Various studies have analyzed the impact of minimum wage increases, most of which have been gradual increases implemented over a period of years. In an EconTalkpodcast with Russ Roberts, Jacob Vigdor shared his main findings about Seattle’s minimum wage increase: “First of all, the minimum wage did appear to raise wages. … That’s what we expected to see. But when we looked at employment, we actually saw a reduction.” Vigdor further mentions that hours worked decreased as wages went up.
The study showed that the amount of money paid in the low-wage labor market declined overall, or in the aggregate. The results varied depending on the level of experience of the worker; those with the most work experience came out ahead. Vigdor’s study shows that on average their paychecks were twenty dollars higher per week. But the biggest loss “in terms of much lower pay would be amongst the workers who hadn’t even entered the labor market yet when the minimum wage started to increase, because they were finding it harder to find any work at all.”
The key takeaway from Vigdor’s study was the minimum wage’s effect on workers who had yet to enter the labor market. In effect, the higher minimum wage created a barrier to entering the hourly labor market for those without experience. Who tends to lack experience? Young individuals and immigrants.
As any young individual seeking an internship or their first job knows, the hardest thing about the search is having sufficient experience. Experience means that the individual needs less training and can be productive on the first day. Businesses understand that “on-the-job training is an investment, and at $15 an hour that investment doesn’t make sense from the business owner’s perspective.” This investment makes even less sense when it is understood that the teenager will only work for a few months and then leave, a dilemma that many employers face during summer and winter breaks.
The Employment Policies Institute addresses teen unemployment in an article titled “The Teen Unemployment Crisis: Questions and Answers.” It notes that one of the goals of the Fair Labor Standards Act (FLSA) is to “protect the educational opportunities of minors.” Problematically, increasing the cost of labor disincentivizes companies from hiring workers, especially those who require training. Additionally, as technology rapidly advances, easily automated functions may become obsolete for workers. Policymakers must consider the interests of ensuring a viable labor market for our nation’s youth while promoting policies that incentivize businesses to pay decent wages.
Although many teenagers may be predisposed to sympathize with progressive policies like minimum wage increases, they ought to understand the larger implications of such proposals. Markets can withstand gradual change, but they may be unable to adequately adjust to steep increases in the cost of labor. In New State Ice Co. v. Liebmann, US Supreme Court justice Louis Brandeis famously described how a “state may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country”; Justice Brandeis coined the phrase “laboratories of democracy.” Twnety-nine states and the District of Columbia, as of 2019, have experimented with minimum wage increases. But studies have demonstrated that these progressive “successes” do not come without unintended consequences.
Dem Senator Insists Iranian General “Most Significant Leader US Has Ever Assassinated”
Though it might sound hard to believe, Connecticut Sen. Chris Murphy insisted during what we imagine was a hastily-arranged appearance on “the Rachel Maddow Show” Thursday night that Iranian General Qasem Suleimani could be “the most significant foreign political leader the United States has ever assassinated.”
Murphy, a member of the Senate Foreign Relations Committee who has long had designs on joining the Democrats’ Congressional leadership, was likely invited to appear on the show by its producers after news of the assassination, which took place early Friday morning (local time) near the Baghdad International Airport.
A statement released by the Pentagon after news of the attack broke claimed Suleimani was “actively developing plans” to attack American diplomats and service members in Iraq when a two-car convoy that he was traveling in was targeted in a drone strike.
During his brief appearance via phone, Murphy told Maddow that “there’s no doubt that Qasim Suleimani was an enemy of the United States…the question tonight is whether Suleimani is a greater threat to the United States as the functional head of the Quds force, or as a maryr.”
He also warned about Iran’s ability to retaliate against US assets in the region.
“The danger here is of course that we are going to get into a conflict in the region that will ultimately accrue to the detriment of US national security interests no matter how we feel about the fact that Suleimani is dead this evening. They have the capability to launch assassination attempts right back at US political leaders, and their proxy forces can threaten US forces and Israel itself throughout the region.”
“They can end up spilling into a set of consequences that ultimately do a lot more damage to US national security interests than the assassination itself cures.”
“There are plenty of grave consequences for our relationship with Iraq, This is a very dangerous moment, this could be the most significant political leader that the US has ever assassinated.”
Murphy also threw in some criticisms, claiming “you can’t do this with Congressional authorization” (though it looks like President Trump just did) and some pundits have been discussing the possibility of the House using this as the basis for a third article of impeachment.
Murphy, of course, wasn’t the only Democratic power player to weigh in on the assassination. The four remaining top presidential contenders have all published comments essentially saying the same thing: That Qasem was a bad actor in the region, but that Trump’s decision to do something about it was still wrong.
Former Vice President Joe Biden’s statement got the most attention after he accused Trump of tossing “a stick of dynamite into a tinder box”.
Elizabeth Warren warned Soleimani was a “murder, responsible for the deaths of thousands, including hundreds of Americans” but added that his assassination will “increase the likelihood of more deaths and new Middle East conflict.”
Soleimani was a murderer, responsible for the deaths of thousands, including hundreds of Americans. But this reckless move escalates the situation with Iran and increases the likelihood of more deaths and new Middle East conflict. Our priority must be to avoid another costly war.
And Bernie Sanders accused Trump of breaking his promise to end America’s “forever wars.”
“Trump’s dangerous escalation brings us closer to another disastrous war in the Middle East that could cost countless lives and trillions more dollars. Trump promised to end endless wars, but this action puts us on the path to another one,” he said in a tweet, while also managing to bring up the fact that he voted against the War in Iraq.
When I voted against the war in Iraq in 2002, I feared it would lead to greater destabilization of the region. That fear unfortunately turned out to be true.
The U.S. has lost approximately 4,500 brave troops, tens of thousands have been wounded, and we’ve spent trillions.
As for Pete Buttigieg, he hadn’t yet tweeted a statement on the attack as of 8 am ET.
Fortunately, Murphy’s brief appearance on Maddow isn’t the only reason we’re talking about Murphy this morning.
In a hilarious example of Dems committing flagrant acts of hypocrisy while condemning the Trump Administration for carrying out such a bold and potentially “game changing” attack, conservatives are pointing out that Murphy – a Democratic Senator who is known for his hawkish foreign policy views – was practically begging for an attack like this just two days ago in a tweet that he and his social media team have somehow not yet deleted.
Two days apart. It really is sad what partisanship is doing to people.
First @ChrisMurphyCT complains that we are impotent and just praying for the bad guys to go away, then he declares it was wrong for us to take out the worst bad guy in the region.
In that mercifully quiet week between Christmas and New Years, I re-watched Ken Burns’ documentary of the first Civil War, in contemplation of a possible second. What an almighty bloodbath that was. Thousands butchered in minutes in one battle after another, heads and limbs flying, men turned inside-out, and horses, too. The blue and the gray were hostage to their battlefield tactics and didn’t seem to learn from the insane extravagance of souls wasted in massed assaults against massed artillery again and again and again. The population of the whole nation (Confederacy included) was 31 million in 1860 and the war killed two percent of that, almost entirely young men.
Another impression left by that documentary was the startling beauty of the countryside in that day, and of the little towns that dotted that landscape where all the carnage and horror played out. Not a strip-mall in the whole gorgeous panorama. The rolling fields neatly fenced in the stillness of a summer’s day. A peaceful tranquility we today cannot even imagine. Everything human-scaled and so many buildings graced with beauty deliberately made: pediments, steeples, cupolas, columns, and swags. Walt Disney could not have imagined a more tender and appealing place. The lyrical names of those towns are linked to rivers of blood: Shiloh, Spotsylvania, Missionary Ridge, Cold Harbor….
And the last impression accumulated over each installment was that this we did it to ourselves, and couldn’t seem to stop, just as today various parties to current events can’t seem to stop their provocations to a new episode of national domestic violence. This time it is the very government at war with itself, and so far the war is merely legalistic, the battles of lawyers — of which, one senses, we have far too many for our own good. The Department of Justice in particular is at war with itself, one faction in it refusing to cooperate with the other, hiding documents, trafficking in political muck, kluging up the works with deceptions, and still at it in the yet-unresolved case of General Flynn, which should have been thrown out of court months ago based on obvious prosecutorial malice.
Likewise, The New York Times, NBC News, and many other companies can’t seem to give up on their mendacious retailing of obvious falsehoods, in league with rogue government agencies. Their readers and followers learned nothing from the stunning failure of Robert Mueller’s long investigation to find any crimes, and most don’t even understand that the purpose of it was simply to antagonize the president while trying desperately to come up with ammunition against him for the next election — using all the resources of federal machinery. In other words, it was just a government-sponsored elaboration of the “opposition research” conjured up by Hillary Clinton’s Fusion GPS hirelings in 2016.
The bigger picture of all this chicanery is right out there to see for anyone really paying attention.
Mr. Obama and Hillary hijacked the most pernicious instruments of government — the CIA and FBI — to win the election, and then to overthrow the actual winner. Slowly slowly, they were found out, despite all the smoke they were blowing and hiding in. Barr & Durham have hardly said a thing about their efforts to unwind the massive hairball of subterfuge and ass-covering that is their purview. Yet, the particulars of what went on, and who did what, are now pinned to the wall. We know exactly what Christopher Steele was and how that all worked. We know how John Brennan played it and how James Clapper and Jim Comey went along with it, and took it further and deeper, and where Rod Rosenstein and Andrew McCabe stepped in, and exactly how Mr. Mueller got roped in to front his operation — despite his mental incapacity. And we also know that Barack Obama approved of all that activity through 2016 into January 20, 2017.
When it comes into the courts some months from now, Brennan, Comey, and the rest will surely cop a plea that they were following Mr. Obama’s presidential instructions. The impeachment hysteria is an exact index of the rising fear of that coming finger-pointing. Mr. Obama has been drawn into the heart of this matter. His reputation will be destroyed — and with it, the Progressive agenda that he represented for two terms, and which still holds his party hostage as much as the battlefield tactics of 1864 held the armies of North and South hostage.
We have heard very little from Mr. Obama in recent months, and only a few squawks out of Hillary. The Lawfare shock troops are working feverishly in the background to invent new congressional chicanes to trap Mr. Trump, but their legal cleverness can’t overcome the weakness of their cause, just as the soldiering of Robert E. Lee and his generals could not overcome the tragic wrongfulness of fighting for slavery. A century and half from now, people in this land (whatever it is called by then) will say that coup against Mr. Trump was a valiant endeavor, just as people today will say that the Civil War of 1861 – 1865 was about some metaphysical truths above and beyond slavery.
Hillary is still on the loose and she still has many partisans in the ranks of government, and they are scheming desperately now to save their skins. I don’t believe that Mr. Obama actually commands any troops in this fight. He remains the mere symbol that he was from the very start, when the Democratic Party hoisted him out of obscurity as the grand prize for post-war liberalism. After the election, I think Mr. Trump was prepared to drop his wish to “lock her up.” But he has had three years to discover just how much malice was arrayed against him, and now he going to run her to ground.
Negative-Yield Bond Pool Declines As Hopes For Global Recovery Soar
Europe’s pool of negative-yielding government bonds declined in December to its smallest size since May, Tradeweb data showed on Thursday.
Trade optimism and the hopes central bankers can engineer a soft landing in the global economy in 1H20 have been some of the reasons behind the shrinking negative-yielding government bonds.
Eurozone government bonds quoted by Tradeweb showed negative yields fell to 4.14 trillion euros in December, which is about 52% of the total eight trillion-euro market. The latest figures are down from 57% in November.
In September, the negative-yielding government bonds surged to the highest level ever, at 5.63 trillion euros, or about 70% of all government bonds in Europe were negative.
As for the global pool of negative-yielding bonds, well, it peaked at around $15 trillion last year and has been estimated by Tradeweb to be around $12 trillion today.
And if the global recovery that markets have already priced in doesn’t materialize — then it’s likely that a mad-dash back into bonds could be seen, destined to increase the pool of negative-yielding government debt to new record levels. Perhaps that is what gold is expecting.
The threat posed by Iran-backed Hezbollah sleeper cells embedded in major American cities has once again come to the fore following the killing of Iran’s Quds Force General Qasem Soleimani.
Following last night’s assassination of the Iranian military leader, authorities in both New York and Los Angeles announced that they were ramping up security in readiness for possible revenge attacks on U.S. soil.
This is because Iran is known to have placed Hezbollah terrorist sleeper cells throughout not just Europe but the United States too.
Last year, the the criminal prosecution and conviction in New York of the Hezbollah operative Ali Kourani revealed that the terror outfit has already plotted to attack U.S. interests inside the country and is ready to activate if it considers the existence of either Hezbollah or Iran to be at stake.
Following the arrest of Kourani and another Hezbollah operative named Samer el-Debek, the U.S. intelligence community reversed its belief that Hezbollah was unlikely to attempt attacks within the U.S.
“It’s our assessment that Hezbollah is determined to give itself a potential homeland option as a critical component of its terrorism playbook,” said National Counterterrorism Center Director Nicholas Rasmussen.
Authorities in major U.S. cities are monitoring developments and ramping up security in preparation for any potential Iranian-backed terror attacks following the killing of Iran’s Quds Force General Qasem Soleimani.#WWIIIhttps://t.co/Mtf1HPQrmp
“We in the intelligence community do in fact see continued activity on behalf of Hezbollah here inside the homeland,” he added.
Hezbollah has never directly attacked the U.S. homeland, but Kourani, working for the Hezbollah-controlled Islamic Jihad Organization, was confirmed to have been conducting surveillance of FBI and U.S. Secret Service offices, as well as a U.S. Army armory and John F. Kennedy International Airport, all in New York City.
“While living in the United States, Kourani served as an operative of Hezbollah in order to help the foreign terrorist organization prepare for potential future attacks against the United States,” said U.S. Assistant Attorney General for National Security John Demers.
In casing both JFK and Toronto’s Pearson International Airport, “Kourani told the FBI that he provided Hezbollah with details about security procedures, the uniforms worn by security officers, and whether the officers were armed. His surveillance, Kourani told the FBI, focused on exit points, security checkpoints, camera locations, baggage claim procedures, and what questions airport screeners asked passengers,” reported ForeignPolicy.com.
With the world now waiting for Iran’s response to Soleimani’s killing, we can only hope that it doesn’t come in the form of a massive Hezbollah-backed terror attack targeting a major American city.
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“Creepy”, Mysterious, Unexplained Drones Are Flying In Precise Formations Over Colorado, Nebraska
Nobody knows where they are coming from, or why they are there.
Back on Christmas we wrote about large, non-governmental drones flying in mysterious patterns in Colorado. Since then, sightings have only increased, despite there being no explanation as to why.
Local sheriff’s departments in regions of Nebraska and Colorado have been “bombarded” with reports of large drones with “blinking lights and wingspans of up to 6 feet” flying over rural towns and open fields, according to MSN News. The drones have even prompted a federal investigation – yet no one has been able to explain them.
Missy Blackman, who saw three drones hovering over her farm outside Palisade, Neb said: “It’s creepy. I have a lot of questions of why and what are they, and nobody seems to have any answers.”
Sheriff James Brueggeman of Perkins County, Neb. saw the drones on patrol one night. He commented: “In terms of aircraft flying at night and not being identified, this is a first for me personally.”
He said he has heard rumblings of people wanting to shoot down a drone, but has urged residents to contact law enforcement instead.
Brueggeman said: “I think it’s kind of a joke, but you have to remember the part of the country we live in. People here don’t like their privacy to be invaded.”
Dawn George, who lives near Wray, Colo. said: “They’re high enough where you couldn’t shoot one anyway, but they’re low enough that they’re a nuisance.” She says her dogs bark at the drones when they fly over.
The drones are attracting attention at the same time the FAA proposed new regulations that would require most drones to be identifiable. A spokesman for the FAA, Ian Gregor, said the timing of the rule was coincidental, but also that the agency had opened an investigation into the “mystery” drone sightings.
Gregor said: “Multiple F.A.A. divisions and government agencies are investigating these reports.”
Meanwhile, the drones have been the talk of rural Colorado and Nebraska. Sighting are increasing and so are the inquiries of witnesses and those in the area. Some have suggested simple answers, like a mapping operation or land survey, but many ask why those tasks would be undertaken at night.
Senator Cory Gardner, Republican of Colorado said he would“closely monitor the situation.”
But regulations around drones are still fuzzy:
Unmanned drones, which have exploded into popular usage in recent years and can be used for everything from mapping to photography to farming, can be difficult to track. Operators of all but the smallest drones have been required to register with the federal government since 2015, but there is no straightforward, legal way for state and local officials to identify the owner of a particular drone or to track that drone’s location.
Reggie Govan, a former chief counsel to the F.A.A. who now teaches at the University of Pennsylvania Law School said: “Like in many other areas of drone regulation, the statutory and regulatory framework is lagging the technology. It’s just that simple.”
Govan says the government has tracking tools to figure out where the drones are coming from, but the vast distance they fly over could make it difficult. Limits in drone detection have allowed rogue operators to approach the White House without raising alarms and even deploy homemade bombs in a Pennsylvania neighborhood, in one case.
Michael Yowell, a sheriff’s captain in Lincoln County, Colo said: “Most people are very reasonable, and they say it could be somebody mapping or doing topography. But you can’t rule out what you don’t know.”
The sightings started in Northeast Colorado in mid December and have grown more widespread since then. Almost all sightings have occurred between sunset and 10PM, but they have occasionally been spotted during daylight hours. One witness said she looked at them through binoculars and saw no markings, just plain silver and white coloring. Captain Yowell tried to photograph the drones but couldn’t get a clear picture.
Yowell said: “We want to know, at around 10 o’clock, when we start to lose visuals of these, which direction are they homing? Which way are they heading? We hope that’s how we can contact somebody on the ground.”
Residents like Dawn George are worried they may never get answers: “All the sudden, it’s just going to stop and we’re not going to have answers. And that’s very unsettling to a lot of people. It’s the fear of the unknown.”
The IRS has just released new domestic migration data for both 2017 and 2018 and it shows Illinoisans left the state in record numbers. In both years, Illinois lost more people and more taxable income than in any past year reported by the IRS.
The IRS data complements the new Census Bureau data that shows near-record out-migration of Illinoisans in 2019.
Grim Numbers
Illinois lost more than 130,000 tax filers and their dependents in 2017 and another 88,000 in 2018. Illinois’ 2018 loss was the third worst in the country, with only California and New York losing more residents, 153,000 and 160,000, respectively.
Illinois lost $6.8 billion in Adjusted Gross Incomes to net out-migration in 2017 and $5.6 billion in 2018. Illinois’ 2018 loss was the third worst in the country, with only California and New York losing more AGI, $8.0 billion and $9.6 billion, respectively.
The three biggest gainers nationally in 2018 of residents and their incomes were Florida, Arizona and Texas. Florida was the biggest winner by far, gaining a net 115,000 people and $16 billion in AGI. Arizona gained 65,000 people and $3.5 billion in AGI. Texas gained 77,000 people and $3.4 billion in AGI.
When measured on per capita basis, only New York lost more AGI than Illinois in 2018. Illinois lost $435 in AGI per person while New York lost $484 per person.
The biggest per capita winners of AGI were Nevada, up $766 per person, Florida, up $762 per person, and Idaho, up $646 per person.
Illinois’ neighbors suffered far smaller AGI losses than Illinois in 2018, ranging from a loss of $145 per person in Iowa to just $52 per person in Missouri.
Domestic in-migrants to Illinois earned far less than the Illinois residents who left the state. The average AGI of those who left in 2018 was approximately $85,000, while those who entered the state had incomes of just $66,000.
The wealth gap between residents leaving and coming to Illinois has more than tripled since 2000. In 2000, those moving into Illinois earned on average $5,000 less than those leaving Illinois. In 2018, the gap is now nearly $19,000.
Illinois was a net loser of people to 43 states in 2018, while it netted gains from just six states. The total gain from those six states, however, was trivial – just 667 net residents. In contrast, Illinois netted losses of 88,664 people to the other 43 states.
Illinois’ biggest resident losses weren’t just to Florida and Texas, two of the nation’s biggest in-migration winners. Indiana and Wisconsin were the second and fourth largest net winners of Illinois’ residents.
All of Illinois’ neighbors netted gains vs. Illinois. Indiana gained nearly 26,000 Illinois residents but gave up just 15,000 of its own. That left Indiana with a net gain of nearly 11,000 residents vis-a-vis Illinois. Wisconsin ended up with a net gain of more than 7,000 residents vs. Illinois. Kentucky, Iowa, Michigan and Missouri all netted gains of 1,200 to 2,900 residents vs. the Prairie State.
Any way the data is sliced, Illinois is chronically losing its population and its tax base. It is a national outlier along with New York, New Jersey and Connecticut. For full information on Illinois’ demographic and out-migration losses, see Wirepoints: Out-migration.
The outflow is particularly alarming given the state’s pension shortfall, which is already the highest in the nation. As the state’s population and tax base continue to shrink, the risk of insolvency for the state continues to rise.
And more tax hikes will only exacerbate the situation – Illinoisans already face the highest total tax burden in the nation, according to Kiplinger and Wallethub.
Illinois’ legislature shows no signs of pursuing the spending and pension reforms needed to make Illinois competitive again. Until that changes, expect the Illinois exodus to only get worse.
We are moving to Southern Utah this year. Going house hunting in February (will rent for a year) and we will sell this one rather than trying to rent it.
Property taxes are too much of a killer to keep it (as in ~$15,000 a year on a ~$400K home).
Round Two: US Drone Airstrikes Kill Six Pro-Iran Militia Commanders
Whether he is eating ice cream or not, Trump appears to be on a rampage to recreate the end of The Godfather.
Less than 24 hours after a US drone shockingly killed the top Iranian military leader, Qasem Soleimani, resulting in equity markets groaning around the globe in fear over Iranian reprisals (and potentially, World War III), the US has gone for round two with Reuters and various other social media sources reporting that US air strikes targeting Iraq’s Popular Mobilization Units umbrella grouping of Iran-backed Shi’ite militias near camp Taji north of Baghdad, have killed six people and critically wounded three, an Iraqi army source said late on Friday.
Iraqi official media has also confirm that two vehicles were targeted north of Baghdad, carrying commanders of the pro-Iran militias in the PMUs.
Iraqi officials media now confirm that two vehicles were targeted north of Baghdad, carrying commanders of the pro-Iran militias in the PMUs. #iraq#QassemSuleimani
The strikes reportedly took place at 1:12 am local time.
Hezbollah’s Mayadeen confirms that an airstrike hit a moving target in Taji northern Iraqi capital of Baghdad.
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Mayadeen was first media outlet that confirmed the death of Soleimani and Muhandis last night.#Iraqhttps://t.co/cwebUoxlzAhttps://t.co/j5R73kZpyv
According to unconfirmed reports, a US MQ-9 Reaper drone targeted a convoy carrying several high ranking officials of PMU (Hashd al-Shaabi) in Taji, North of Baghdad. The casualties are said to be mostly among members of the IRGC-backed Asaib Ahl al-Haq. It is not known whether Qais al-Khazali is dead or alive.
#BREAKING: #USAF‘s MQ-9 Reaper drone targeted a convoy carrying several high ranking officials of #PMU (Hashd al-Shaabi) in #Taji, North of #Baghdad. Casualties are mostly among members of #IRGC backed Asaib Ahl al-Haq. It is not known whether Qais al-Khazali is dead or alive! pic.twitter.com/CGGebcLn0M
Separate reports claim that Shibl al-Zaidi, a commander of Kataib Imam Ali brigades, an Iranian-backed militia and the PMU’s 40th Brigade, is among those the six who were killed in the strike.
Not confirmed yet, but it is reported Shibl al-Zaydi, secretary general of #IRGC backed Kata’ib al-Imam Ali (#PMU‘s 40th Brigade) is among whom are targeted by the #USAF in this airstrike at #Taji, North of #Baghdad tonight! pic.twitter.com/SteN0vg5iB
That said there are conflicting reports, with some noting that a Twitter account allegedly belonging to al-Zaidi tweeted that he is alive after the attack.
The twitter account, who we presume is run by al-Zaydi, tweeted this out saying they aren’t dead: https://t.co/6Mh24mgjOO
I guess the de-escalation of last night’s air strike wasn’t enough to fully de-escalate and stop war, so today the US has ordered another airstrike at a top Iraqi militia commander to further de-escalate and stop even more war.
… to the objectively concerned, with some wondering how much further is Iraq going to let US operate freely in country before they decide to kick their assets out? These airstrikes really make the Iraqi government look weak like they can’t deal with their problems by themselves, which may or may not be true, but the point stands.”
How much further is #Iraq going to let US operate freely in country before they decide to kick their assets out? These airstrikes really make the Iraqi government look weak like they can’t deal with their problems by themselves, which may or may not be true, but the point stands.
Of course, the other point is when and how will Iran respond, as it is now clear that if Tehran does nothing it will only embolden the US to pick off its top generals one at a time, while any substantial escalation could ignite a regional war with even more dire consequences.
Former national security adviser Ben Rhodes, the architect of the Iran nuclear deal, purposely structured the JCPOA as a treaty that was not a treaty because he and his boss, President Obama, had no intention whatsoever of doing with the JCPOA what the Constitution mandates for all treaties, which is to obtain the approval of two-thirds of the Senate.
Rhodes and Obama simply rammed through what was in effect a treaty without seeking the approval of even one Senator.
Yet here is Rhodes after the strike that killed Qasem Soleimani, the commander of the secretive Iranian Quds force that sows mischief (and kills Americans, and ordered the attack on the U.S. embassy in Baghdad) outside Iran’s borders.
Congress has to assert itself and determine exactly what our Iran policy is. Did we mean to do this? Do we have any plan for what comes next? What is the legal basis for all this?
Rhodes’s tweet is incomprehensible unless one or both of the following two conditions applies:
1) Rhodes is very, very stupid;
2) Rhodes thinks one set of laws and principles applies to presidents he likes and another set applies to presidents he doesn’t like.
Congress gets to “assert itself” in the Trump Administration’s foreign policy? When Rhodes was in charge of President Obama’s foreign policy (a documentary showed him bossing around Secretary of State John Kerry), he not only didn’t solicit Congress’s opinion on Iran policy but took extraordinary action purposely to cut the Senate out of a matter of which it should have had oversight.
Moreover, as David French at The Dispatchpoints out this morning, the strike that killed Soleimani actually was authorized under the Constitution because (as Rhodes may or may not remember) Congress did approve of U.S. military actions in Iraq. Those actions were re-authorized by the Obama Administration.
Iranian-backed militias attacked U.S. troops lawfully present in a combat zone under valid legal authorities. Moreover, America’s military response isn’t limited to immediate self-defense or tit for tat. It can act to remove the threat. That threat includes enemy commanders. /4
Trump Jabs Dems Over Iran Reaction, Rages That ‘Killer’ Soleimani “Should Have Been Taken Out Years Ago!”
Update (0900ET): President Trump has expanded his comments this morning, switching focus to Soleimani’s terrible deeds…
“General Qassem Soleimani has killed or badly wounded thousands of Americans over an extended period of time, and was plotting to kill many more… but got caught!
He was directly and indirectly responsible for the death of millions of people, including the recent large number of PROTESTERS killed in Iran itself.
While Iran will never be able to properly admit it, Soleimani was both hated and feared within the country. They are not nearly as saddened as the leaders will let the outside world believe. He should have been taken out many years ago!“
* * *
Having tweeted a patriotic US flag last night following the actions to assassinate Soleimani…
President Trump’s first direct tweet (he has retweeted numerous comments from others) since the attack is a clear jab at the Democrats over their actions (or lack of them) on Iran’s death-dealers…
“Iran never won a war, but never lost a negotiation!”
Iran never won a war, but never lost a negotiation!
This follows leading Democrats comments speaking from both sides of their mouths unable to praise Trump’s actions while admitting Soleimani was a very bad guy…
Biden – who trump is clearly taking aim at – said the following…
“Soleimani was a murderer, responsible for the deaths of thousands, including hundreds of Americans.
But this reckless move escalates the situation with Iran and increases the likelihood of more deaths and new Middle East conflict. Our priority must be to avoid another costly war.”
Rail Traffic Continues To Plunge Amid Industrial Recession
US freight railroads have long been used as a barometer of the country’s economic health, continue to show declines in traffic, suggesting the industrial recession could persist into 2020.
The Association of American Railroads (AAR) published a new report that shows US weekly rail traffic for the week ending December 21 was down 10.5% to 507,589 carloads and intermodal units compared with the same week last year.
Total carloads for the week were 245,048 carloads, down 11.5% compared with the same week in 2018, while weekly intermodal volume was down 9.5% to 262,541 containers and trailers.
The AAR tracks ten carload commodity groups on a weekly basis — with Petroleum and Petroleum Products and Other segments showed marginal growth over the week as all other segments including Chemicals; Coal; Farm Products excl. Grain, and Food; Forest Products, Grain, Metallic Ores and Metals; Motor Vehicles and Parts; and Nonmetallic Minerals registered declines.
For the first 51 weeks of 2019, US rail traffic across all segments was 12,780,814 carloads, down 4.8% from the same period last year; and 13,550,432 intermodal units, down 5.1% from last year. Total rail traffic in the first 51 weeks was 26,331,246 carloads and intermodal units, a 5.9% drop over last year.
Canadian and Mexican railroads also reported traffic declines for the week and in the first 51 weeks as both countries are teetering if not already in a recession.
North American rail volume for the week was down 9.2% to 350,256 carloads over the same week last year, and 348,566 intermodal units, down 8.2 % over the previous year. Total combined weekly rail traffic in North America was 698,822 carloads and intermodal units, down 8.7%.
North American rail volume for the first 51 weeks of 2019 was 35,963,299 carloads and intermodal units, down 3.9% compared with 2018.
In a separate report, AAR described how 400,000 railcars currently sit in storage amid slumping rail demand.
But it’s not just rail traffic that is tumbling, class-8 truck orders collapsed last month, all of this is a symptom of an industrial recession that shows no signs of abating into 2020.
In the very early spring of this year, I gave a lecture to European military personnel interested in the Middle East. It was scarcely a year since Bashar al-Assad’s alleged use of chlorine gas against the civilian inhabitants of the Damascus suburb of Douma on 7 April 2018, in which 43 people were said to have been killed.
Few present had much doubt that the Organisation for the Prohibition of Chemical Weapons (OPCW), which represents 193 member states around the world, would soon confirm in a final report that Assad was guilty of a war crime which had been condemned by Donald Trump, Emmanuel Macron and Theresa May.
But at the end of my talk, a young Nato officer who specialises in chemical weapons – he was not British – sought me out for a private conversation.
“The OPCW are not going to admit all they know,” he said. “They’ve already censored their own documents.”
I could not extract any more from him. He smiled and walked away, leaving me to guess what he was talking about. If Nato had doubts about the OPCW, this was a very serious matter.
When it published its final report in March this year, the OPCW said that testimony, environmental and biomedical samples and toxicological and ballistic analyses provided “reasonable grounds” that “the use of a toxic chemical had taken place” in Douma which contained “reactive chlorine”.
The US, Britain and France, which launched missile attacks on Syrian military sites in retaliation for Douma – before any investigation had taken place – thought themselves justified. The OPCW’s report was splashed across headlines around the world – to the indignation of Russia, Assad’s principal military ally, which denied the validity of the publication.
Then, in mid-May 2019, came news of a confidential report by OPCW South African ballistics inspector Ian Henderson – a document which the organisation excluded from its final report – which took issue with the organisation’s conclusions. Canisters supposedly containing chlorine gas may not have been dropped by Syrian helicopters, it suggested, and could have been placed at the site of the attack by unknown hands.
Peter Hitchens of the Mail on Sunday reported in detail on the Henderson document. No other mainstream media followed up this story. The BBC, for example, had reported in full on the OPCW’s final report on the use of chlorine gas, but never mentioned the subsequent Henderson story.
And here I might myself have abandoned the trail had I not received a call on my Beirut phone shortly after the Henderson paper, from the Nato officer who had tipped me off about the OPCW’s apparent censorship of its own documents. “I wasn’t talking about the Henderson report,” he said abruptly. And immediately terminated our conversation. But now I understand what he must have been talking about.
For in the past few weeks, there has emerged deeply disturbing new evidence that the OPCW went far further than merely excluding one dissenting voice from its conclusions on the 2018 Douma attack.
The most recent information – published on WikiLeaks, in a report from Hitchens again and from Jonathan Steele, a former senior foreign correspondent for The Guardian –suggests that the OPCW suppressed or failed to publish, or simply preferred to ignore, the conclusions of up to 20 other members of its staff who became so upset at what they regarded as the misleading conclusions of the final report that they officially sought to have it changed in order to represent the truth. (The OPCW has said in a number of statements that it stands by its final report.)
At first, senior OPCW officials contented themselves by merely acknowledging the Henderson report’s existence a few days after it appeared without making any comment on its contents. When the far more damaging later reports emerged in early November, Fernando Arias, the OPCW’s director general, said that it was in “the nature of any thorough enquiry for individuals in a team to express subjective views. While some of the views continue to circulate in some public discussion forums, I would like to reiterate that I stand by the independent, professional conclusion [of the investigation].” The OPCW declined to respond to questions from Hitchens or Steele.
But the new details suggest that other evidence could have been left unpublished by the OPCW. These were not just from leaked emails, but given by an OPCW inspector – a colleague of Henderson – who was one of a team of eight to visit Douma and who appeared at a briefing in Brussels last month to explain his original findings to a group of disarmament, legal, medical and intelligence personnel.
As Steele reported afterwards, in a piece published by Counterpunch in mid-November 2019, the inspector – who gave his name to his audience, but asked to be called “Alex” – said he did not want to undermine the OPCW but stated that “most of the Douma team” felt the two reports on the incident (the OPCW had also published an interim report in 2018) were “scientifically impoverished, procedurally irregular and possibly fraudulent”. Alex said he sought, in vain, to have a subsequent OPCW conference to address these concerns and “demonstrate transparency, impartiality and independence”.
For example, Alex cited the OPCW report’s claim that “various chlorinated organic chemicals (COCs) were found” in Douma, but said that there were “huge internal arguments” in the OPCW even before its 2018 interim report was published. Findings comparing chlorine gas normally present in the atmosphere with evidence from the Douma site were, according to Alex, kept by the head of the Douma mission and not passed to the inspector who was drafting the interim report. Alex said that he subsequently discovered that the COCs in Douma were “no higher than you would expect in any household environment”, a point which he says was omitted from both OPCW reports. Alex told his Brussels audience that these omissions were “deliberate and irregular”.
Alex also said that a British diplomat who was OPCW’s chef de cabinet invited several members of the drafting team to his office, where they found three US officials who told them that the Syrian regime had conducted a gas attack and that two cylinders found in one building contained 170 kilograms of chlorine. The inspectors, Alex remarked, regarded this as unacceptable pressure and a violation of the OPCW’s principles of “independence and impartiality”.
Regarding the comments from Alex, the OPCW has pointed to the statement by Arias that the organisation stands by its final report.
Further emails continue to emerge from these discussions. This weekend, for example, WikiLeaks sent to The Independent an apparent account of a meeting held by OPCW toxicologists and pharmacists “all specialists in CW (Chemical Warfare)”, according to the document. The meeting is dated 6 June 2018 and says that “the experts were conclusive in their statements that there is no correlation between symptoms [of the victims] and chlorine exposure.”
In particular, they stated that “the onset of excessive frothing, as a result of pulmonary edema observed in photos and reported by witnesses would not occur in the short time period between the reported occurrence of the alleged incident and the time the videos were recorded”. When I asked for a response to this document, a spokesman for the OPCW headquarters in Holland said that my request would be “considered”. That was on Monday 23 December.
Any international organisation, of course, has a right to select the most quotable parts of its documentation on any investigation, or to set aside an individual’s dissenting report – although, in ordinary legal enquiries, dissenting voices are quite often acknowledged. Chemical warfare is not an exact science – chlorine gas does not carry a maker’s name or computer number in the same way that fragments of tank shells or bombs often do.
But the degree of unease within the OPCW’s staff surely cannot be concealed much longer. To the delight of the Russians and the despair of its supporters, an organisation whose prestige alone should frighten any potential war criminals is scarcely bothering to confront its own detractors. Military commanders may conceal their tactics from an enemy in time of war, but this provides no excuse for an important international organisation dedicated to the prohibition of chemical weapons to allow its antagonists to claim that it has “cooked the books” by permitting political pressure to take precedence over the facts. And that is what is happening today.
The deep concerns among some of the OPCW staff and the deletion of their evidence does not mean that gas has not been used in Syria by the government or even by the Russians or by Isis and its fellow Islamists. All stand guilty of war crimes in the Syrian conflict. The OPCW’s response to the evidence should not let war criminals off the hook. But it certainly helps them.
And what could be portrayed as acts of deceit by a supposedly authoritative body of international scientists can lead some to only one conclusion: that they must resort to those whom the west regards as “traitors” to security – WikiLeaks and others – if they wish to find out the story behind official reports. So far, the Russians and the Syrian regime have been the winners in the propaganda war. Such organisations as the OPCW need to work to make sure the truth can be revealed to everyone.
The World Of Wine: Visualizing An Industry Ripe For Disruption
Winemaking is often thought of as a symbol of transformation.
While the fermented drink dates back 9,000 years, Visual Capitalist’s Katie Jones points out that the wine market is now experiencing its own transformation due to technological innovation, and the introduction of new business models. Generating $370 billion in revenue in 2019, the global industry is expected to grow considerably over the next decade—but not as we know it.
Today’s infographic from Raconteur explores wine consumption by region, and looks at how changing tastes are driving a new era of the millennia-old staple.
Will the industry continue to get better with age, or will it join the countless other industries that have fallen victim to disruption?
The Wine Leaders of the World
To start, let’s take a look at the countries around the world that have the biggest economic footprints linked to the trade and consumption of wine:
Exports: Spain is the largest exporter of wine globally, producing 21 million hectoliters of volume in 2018, followed by Italy with 19.7 million hectoliters.
Imports: Germany leads on imports with 14.5 million hectoliters of volume in 2018, while the UK is the second-largest importer with 13.2 million hectoliters.
Consumption: The U.S. currently leads on wine consumption, with Americans drinking an average of 3.7 liters per person each year—generating almost $50 billion in revenue.
Currently, 80% of all wine consumed within China is produced domestically, and with a growing middle class, there is a huge potential for the Chinese industry to gain ground in comparison to other leading wine markets.
Rapidly Changing Tastes
While older generations prefer wine to other alcoholic beverages, spirits are the drink of choice for those aged 18 to 27. In fact, only 27% of this age group prefers wine to spirits or beer, meaning wine companies will need to adapt to these younger audiences and their differing values.
Marketing could create an opportunity to connect with this audience in a more meaningful way, with packaging having the most potential to sway their decision making process by providing a number of unique benefits:
Sustainability
Smaller serving sizes
Portability
Interestingly, canned wine is already a $70 million industry in the United States — and by 2025, it could make up 10% of total sales.
New Threats to the Industry
Along with changing expectations for packaging, millennials also crave new experiences, with more alternative options appealing to this age group, such as cannabis-infused beverages, craft beer, and whiskey.
Dealcoholized cannabis-infused wine is a new product innovation that could also appeal to this audience and have direct implications for the industry—but while cannabis companies have shown an interest in the category, collaboration with the tech industry is proving to be the most transformative.
When Two Valleys Collide
Technology is squeezing every opportunity it can get out of the wine industry, impacting different parts of the supply chain.
Winemaking
Drones are making farms and vineyards across the globe more efficient, while new technologies used to improve harvesting, sorting, and filtration during the winemaking process are also cropping up and providing new solutions to antiquated problems.
Consumption
Traditionally, decanting wine has been a slow and delicate process. Smart wine decanters however, can expedite that process.
These decanters use air filtration systems to remove impurities and enhance the aroma in just a few minutes—streamlining the decanting process, which typically takes around three hours.
Impact on the Environment
Industry experts predict that packaging such as edible bottles made from sugar substitutes, and compostable, non-plastic glass will replace glass bottles.
Meanwhile, QR codes have the potential to replace paper labels on wine bottles entirely, and a growing number of wine brands are already using augmented reality to deliver more immersive experiences to end consumers.
For an industry steeped in history and tradition, the future holds exciting potential for new innovations that will transform the way we look at wine forever.
In the year 2019 the world was marked with a number of emerging and developing crises.
The threat of terrorism, conflicts in the Middle East, expanding instability in South America, never-ending military, political and humanitarian crises in Africa and Asia, expansion of NATO, insecurity inside the European Union, sanction wars and sharpening conflicts between key international players. One more factor that shaped the international situation throughout the year was the further collapse of the existing system of international treaties. The most widely known examples of this tendency are the collapse of the INF and the US announcement of plans to withdraw from the New START. Meanwhile, the deterioration of diplomatic mechanisms between key regional and global actors is much wider than these two particular cases. It includes such fields as NATO-Russia relations, the US posture towards Israeli occupation of the Golan Heights, unsuccessful attempts to rescue vestiges of the Iran nuclear deal, as well as recent setbacks in the diplomatic formats created to de-escalate the Korean conflict.
One of the regions of greatest concern in the world, is the Middle East. The main destabilizing factors are the remaining terrorist threat from al-Qaeda and ISIS, the crises in Libya, Syria and Iraq, the ongoing Saudi invasion of Yemen, the deepening Israeli-Arab conflict, and a threat of open military confrontation involving the US and Iran in the Persian Gulf. These factors are further complicated by social and economic instability in several regional countries such as Jordan, Lebanon, Iraq, Saudi Arabia, and even Iran.
After the defeat of ISIS, the war in Syria entered a low intensity phase. However, it appears that the conflict is nowhere near its end and the country remains a point of instability in the region.
ISIS cells are still active in the country. The announced US troop withdrawal appeared to be only an ordinary PR stunt as US forces only changed their main areas of presence to the oil-rich areas in northeastern Syria. Washington exploits its control over Syrian resources and influence on the leadership of the Syrian Kurds in order to effect the course of the conflict. The Trump administration sees Syria as one of the battlegrounds in the fight against the so-called Iranian threat.
The province of Idlib and its surrounding areas remain the key stronghold of radical militant groups in Syria. Over the past years, anti-government armed groups suffered a series of defeats across the country and withdrew towards northwestern Syria. The decision of the Syrian Army to allow encircled militants to withdraw towards Idlib enabled the rescue of thousands of civilians, who were being used by them as human shields in such areas as Aleppo city and Eastern Ghouta. At the same time, this increased significantly the already high concentration of militants in Greater Idlib turning it into a hotbed of radicalism and terrorism. The ensuing attempts to separate the radicals from the so-called moderate opposition and then to neutralize them, which took place within the framework of the Astana format involving Turkey, Syria, Iran and Russia, made no progress.
The Summer-Fall advance of the Syrian Army in northern Hama and southern Idlib led to the liberation of a large area from the militants. Nevertheless, strategically, the situation is still the same. Hayat Tahrir al-Sham, formerly the official branch of al-Qaeda in Syria, controls most of the area. Turkish-backed ‘moderate militants’ act shoulder to shoulder with terrorist groups.
Turkey is keen to prevent any possible advances of the government forces in Idlib. Therefore it supports further diplomatic cooperation with Russia and Iran to promote a ‘non-military’ solution of the issue. However it does not seem to have enough influence with the Idlib militant groups, in particular HTS, to impose a ceasefire on them at the present time. Ankara could take control of the situation, but it would need a year or two that it does not have. Therefore, a new round of military escalation in the Idlib zone seems to be only a matter of time.
Syria’s northeast is also a source of tensions. Turkey seized a chunk of territory between Ras al-Ayn and Tell Abyad in the framework of its Operation Peace Spring. The large-scale Turkish advance on Kurdish armed groups was halted by the Turkish-Russian ‘safe zone’ agreement and now the Syrian Army and the Russian Military Police are working to separate Kurdish rebels from Turkish proxies and to stabilize Syria’s northeast. If this is successfully done and the Assad government reaches a political deal with Kurdish leaders, conditions for further peaceful settlement of the conflict in this part of the country will be created. It should be noted that Damascus has been contributing extraordinary efforts to restore the infrastructure in areas liberated from terrorists by force or returned under its control by diplomatic means. In the eyes of the local population, these actions have an obvious advantage over approaches of other actors controlling various parts of Syria.
Israel is another actor pursuing an active policy in the region. It seeks to influence processes which could affect, what the leadership sees as, interests of the state. Israel justifies aggressive actions in Syria by claiming to be surrounded by irreconcilable enemies, foremost Iran and Hezbollah, who try to destroy Israel or at least diminish its security. Tel Aviv makes all efforts to ensure that, in the immediate vicinity of its borders, there would be no force, non-state actors, or states whose international and informational activities or military actions might damage Israeli interests. This, according to the Israeli vision, should ensure the physical security of the entire territory currently under the control of Israel and its population.
The start of the Syrian war became a gift for Israel. It was strong enough to repel direct military aggression by any terrorist organization, but got a chance to use the chaos to propel its own interests. Nonetheless, the rigid stance of the Israeli leadership which became used to employing chaos and civil conflicts in the surrounding countries as the most effective strategy for ensuring the interests of the state, was delivered a blow. Israel missed the moment when it had a chance to intervene in the conflict as a kind of peacemaker, at least on the level of formal rhetoric, and, with US help, settle the conflict to protect its own interests. Instead, leaders of Israel and the Obama administration sabotaged all Russian peace efforts in the first years of the Russian military operation and by 2019, Tel Aviv had found itself excluded from the list of power brokers in the Syrian settlement. Hezbollah and Iran, on the other hand, strengthened their position in the country after they, in alliance with Damascus and Russia, won the war on the major part of Syrian territory, and Iran through the Astana format forged a tactical alliance with Turkey.
Iran and Hezbollah used the preliminary outcome of the conflict in Syria, and the war on ISIS in general, to defend their own security and to expand their influence across the region. The so-called Shia crescent turned from being a myth exploited by Western diplomats and mainstream media into a reality. Iran and Hezbollah appeared to be reliable partners for their regional allies even in the most complicated situations.
Russia’s strategic goal is the prevention of radical Islamists from coming to power. Russia showed itself ready to enter dialogue with the moderate part of the Syrian opposition. Its leadership even demonstrated that it is ready to accept the interests of other actors, the US, Israel, Kurdish groups, Turkey, Iran, and Hezbollah, if this would help in reaching a final deal to settle the conflict.
Summing up the developments of 2019, one might expect that the current low-intensity state of the Syrian conflict would continue for years. However, several factors and developments could instigate the renewal of full-fledged hostilities:
A sudden demise or forceful removal of President Bashar al-Assad could create a situation of uncertainty within the patriotic component of the Syrian leadership;
Changes within the Russian political system or issues inside Russia which could lead to full or partial withdrawal of support to the Syrian government and withdrawal of Russian forces from Syria;
A major war in the Middle East which would turn the entire region into a battlefield. In the current situation, such a war could only start by escalation between the US-Israeli-led bloc and Iran.
The Persian Gulf and the Saudi-Yemen battleground are also sources of regional instability. In the second half of 2019, the situation there was marked by increased chances of open military confrontation between the US-Israeli-Saudi bloc and Iran. Drone shoot-downs, oil tanker detentions, open military buildups, and wartime-like rhetoric became something common or at least not very surprising. The US, Saudi Arabia, and Israel point to Iran as the main instigator of tensions.
Iran and its allies deny responsibility for the escalation reasonably noting that their actions were a response to aggressive moves by the US-Israeli-Saudi axis. From this point of view, Iran’s decision to limit its commitments to the already collapsed Nuclear Deal, high level of military activity in the Persian Gulf, shoot down of the US Global Hawk spy drone, and increased support to regional Shia groups are logical steps to deter US—led aggression and to solidify its own position in the region. Iran’s main goal is to demonstrate that an open military conflict with it will have a devastating impact to the states which decide to attack it, as well as to the global economy.
The US sanctions war, public diplomatic support of rioters, and the Trump administration’s commitment to flexing military muscle only strengthen Tehran’s confidence that this approach is right.
As to Yemen’s Houthis, who demonstrated an unexpected success in delivering retaliatory strikes to Saudi Arabia, they would continue to pursue their main goal – achieving a victory in the conflict with Saudi Arabia or forcing the Kingdom to accept the peace deal on favorable terms. To achieve this, they need to deliver maximum damage to Saudi Arabia’s economy through strikes on its key military and infrastructure objects. In this case, surprising missile and drone strikes on different targets across Saudi Arabia have already demonstrated their effectiveness.
The September 14 strike on Saudi oil infrastructure that put out of commission half of the Saudi oil output became only the first sign of future challenges that Riyadh may face in case of further military confrontation.
The unsuccessful invasion of Yemen and the confrontation with Iran are not the only problems for Saudi Arabia. The interests and vision of the UAE and Saudi Arabia in the Middle East have been in conflict for a long time. Nonetheless, this tendency became especially obvious in 2019. The decline of influence of the House of Saud in the region and inside Saudi Arabia itself led to logical attempts of other regional players to gain a leading position in the Arabian Peninsula. The main challenger is the UAE and the House of Maktoum.
Contradictions between Saudi Arabia and the UAE turned into an open military confrontation between their proxies in Yemen. Since August 29th, Saudi Arabia has provided no symmetric answer to the UAE military action against its proxies. It seems that the Saudi leadership has no will or distinct political vision of how it should react in this situation. Additionally, the Saudi military is bogged down in a bloody conflict in Yemen and struggles to defend its own borders from Houthi attacks.
The UAE already gained an upper hand in the standoff with Saudi Arabia in the economic field. This provided motivation for further actions towards expanding its influence in the region.
During the year, Turkey, under the leadership of President Recep Erdogan, continued strengthening its regional positions. It expanded its own influence in Libya and Syria, strengthened its ties with Iran, Qatar, and Russia, obtained the S-400, entered a final phase in the TurkStream project, and even increased controversial drilling activity in the Eastern Mediterranean. Simultaneously, Ankara defended its national interests -repelling pressure from the United States and getting off with removal from the F-35 program only. Meanwhile, Turkish actions should not be seen as a some tectonic shift in its foreign policy or a signal of ‘great friendship’ with Russia or Iran.
Turkish foreign policy demonstrates that Ankara is not seeking to make ‘friends’ with other regional and global powers. Turkey’s foreign policy is mobile and variable, and always designed to defend the interests of Turkey as a regional leader and the key state of the Turkic world.
Developments in Libya were marked by the strengthening of the Libyan National Army (LNA) led by Field Marshal Khalifa Haftar and backed by the UAE, Egypt, and to some extent Russia. The LNA consolidated control of most of the country and launched an advance on its capital of Tripoli, controlled by the Government of National Accord. The LNA describes its main goal as the creation of the unified government and the defeat of terrorism. In its own turn, the Government of National Accord is backed by Turkey, Qatar, the USA and some European states. It controls a small part of the country, and, in terms of military force, relies on various militias and even radical armed groups linked with al-Qaeda. Ankara signed with the Tripoli government a memorandum on maritime boundaries in the Mediterranean Sea. Thus, it sees the GNA survival as a factor which would allow it to justify its further economic and security expansion in the region. This clash of interests sets conditions for an escalation of the Libyan conflict in 2020.
Egypt was mostly stable. The country’s army and security forces contained the terrorism threat on the Sinai Peninsula and successfully prevented attempts of radical groups to destabilize the country.
By the end of the year, the Greater Middle East had appeared in a twilight zone lying before a new loop of the seemingly never-ending Great Game.The next round of the geopolitical standoff will likely take place in a larger region including the Middle East, the Caucasus, and Central Asia.
Consistently, the stakes will grow involving more resources of states and nations in geopolitical roulette.
The threat that faces Central Asia is particularly severe since the two sets of actors have asymmetrical objectives. Russia and China are rather interested in the political stability and economic success of the region which they view as essential to their own political and security objectives. It is not in the interest of either country to have half a dozen failed states in their immediate political neighborhood, riven by political, economic, and religious conflicts threatening to spread to their own territories. In addition to being a massive security burden to Russia and China, it would threaten the development of their joint Eurasian integration projects and, moreover, attract so much political attention that the foreign policy objectives of both countries would be hamstrung. The effect would be comparable to that of the wars in Afghanistan and Iraq on the US political and military establishment. The monetary price of these wars, the sheer political distraction, wear and demoralization of the armed forces, and the unfortunately frequent killings of civilians amount to a non-tenable cost to the warring party, not to mention damage to US international “soft power” wrought by scandals associated with Guantanamo, Abu Ghraib, and “black sites”. Even now, shock-waves in the US military hierarchy continue to be felt regarding the court-martialed senior-ranking US Navy “SEAL” commando charged for the wanton killing of civilians in Northern Iraq during the US military’s anti-ISIS operations.
By contrast, this dismal scenario would be enough to satisfy the US foreign policy establishment which, at the moment, is wholly dominated by “hawks” determined to assure the continuation of US hegemony. Preventing the emergence of a multi-polar international system by weakening China and Russia is their desire. This sets the stage for another round of great power rivalry in Central Asia. While the pattern is roughly the same as during the 19th and late 20th centuries—one or more Anglo-Saxon powers seeking to diminish the power of Russia and/or China—the geography of the battlefield is considerably larger for it encompasses the entirety of post-Soviet Central Asian republics. Also included is China’s province of Xinjiang which has suddenly attracted considerable Western attention, manifested, as usual, by concern for “human rights” in the region. Historically, such “concern” usually precedes some form of aggressive action. Therefore the two sets of great power actors—the US and other interested Western powers on the one hand, with Russia and China on the other—are locked in a standoff in the region.
The key security problem is militancy and the spread of terrorism. The US and its NATO partners remain unable to achieve a military victory over the Taliban in Afghanistan. The Taliban reached a level of influence in the region, turning it into a rightful party to any negotiations involving the United States. Nonetheless, it is unlikely that a fully-fledged peace deal can be reached between the sides. The Taliban’s main demand is the withdrawal of all foreign troops from the country. For Washington, conceding to this would amount to public humiliation and a forceful need to admit that the superpower lost a war to the Taliban. Washington can achieve a military victory in Afghanistan only by drastically increasing its forces in the country. This will go contrary to Trump’s publicly declared goal – to limit US participation in conflicts all around the world. Therefore, the stalemate will continue with the Taliban and the US sitting at the negotiating table in Qatar, while Taliban forces slowly take control of more and more territory in Afghanistan.
Besides fighting the US-backed government, in some parts of the country, the Taliban even conducts operations against ISIS in order to prevent this group from spreading further. Despite this, around 5,000 ISIS militants operate in Afghanistan’s north, near the border with Tajikistan. Member states of the Collective Security Treaty Organization are concerned that ISIS militants are preparing to shift their focus to Kazakhstan, Uzbekistan, Tajikistan, Kyrgyzstan, Armenia, and Russia. The terrorists are infiltrating CIS states, incorporating with organized crime, creating clandestine cells, brainwashing and recruiting new supporters, chiefly the socially handicapped youth and migrants, [and] training them to carry out terrorist activities. The worsening situation in Central Asia contributes to the spread of radical ideas. Now the main threat of destabilization of the entire Central Asian region comes from Tajikistan. This state is the main target of militants deployed in northern Afghanistan.
Destabilization of Central Asia and the rise of ISIS both contribute to achievement of US geopolitical goals. The scenario could devastate Russia’s influence in the region, undermine security of key Russian regional ally, Kazakhstan, and damage the interests of China. The Chinese, Kazakh, and Russian political leadership understand these risks and engage in joint efforts to prevent this scenario.
In the event of further destabilization of Central Asia, ISIS sleeper cells across the region could be activated and a new ISIS self-proclaimed Caliphate could appear on the territory of northern Afghanistan and southern Tajikistan. Russia and China would not benefit from such a development. In the case of China, such instability could expand to its Xinjiang Uygur Autonomous Region, while in Russia the main targets could be the Northern Caucasus and large cities with high numbers of migrant laborers from Central Asian states.
Armenia now together with Georgia became the center of a US soft power campaign to instigate anti-Russian hysteria in the Caucasus. Ethnic groups in this region are traditionally addicted to US mainstream propaganda. On the other hand, the importance of the South Caucasus for Russia decreased notably because of the strong foothold it gained in the Middle East. 2020 is looking to be another economically complicated year for Georgia and Armenia.
Throughout 2019, China consolidated its position as a global power and the main challenger of the United States. From the military point of view, China successfully turned the South China Sea into an anti-access and area-denial zone controlled by its own military and moved forward with its ambitious modernization program which includes the expansion of China’s maritime, airlift, and amphibious capabilities. The balance of power in the Asia-Pacific has in fact shifted and the Chinese Armed Forces are now the main power-broker in the region. China appeared strong enough to fight back against US economic and diplomatic pressure and to repel the Trump Administration’s attempts to impose Washington’s will upon Beijing. Despite economic war with the United States, China’s GDP growth in 2019 is expected to be about 6%, while the yuan exchange rate and the SSE Composite Index demonstrate stability. The United States also tried to pressure China through supporting instability in Hong Kong and by boosting defense aid to Taiwan. However, in both cases, the situation appears to still be within Beijing’s comfort zone.
An interesting consequence of US-led pressure on China is that Washington’s actions provided an impetus for development of Chinese-Russian cooperation. In 2019, Moscow and Beijing further strengthened their ties and cooperation in the economic and military spheres and demonstrated notable unity in their actions on the international scene as in Africa and in the Arctic for example.
As to Russia itself, during the year, it achieved several foreign policy victories.
The de-facto diplomatic victory in Syria;
Resumption of dialogue with the new Ukrainian regime and the reanimation of the Normandy format negotiations;
Improvement of relations with some large European players, like France, Italy, and even Germany;
Implementation of the Nord Stream 2 project despite opposition from the US-led bloc;
Implementation of the Turkish Stream project with Turkey;
Strengthening of the Russian economy in comparison with previous years and the rubble’s stability despite pressure from sanctions. Growth of the Russian GDP for 2019 is expected to be 1.2%, while the Russia Trading System Index demonstrated notable growth from around 1,100 points at the start of the year to around 1,500 by year’s end.
The salient accomplishment of the Russian authorities is that no large terrorist attack took place in the country. At the same time, the internal situation was marked by some negative tendencies. There was an apparent political, media, and social campaign to undermine Chinese-Russian cooperation. This campaign, run by pro-Western and liberal media, became an indicator of the progress in Chinese-Russian relations. Additionally, Russia was rocked by a series of emergencies, corruption scandals linked with law enforcement, the plundering of government funding allocated to the settlement of emergency situations, the space industry, and other similar cases. A number of Russian mid-level officials made statements revealing their real, rent-seeking stance towards the Russian population. Another problem was the deepening social stratification of the population. Most of the citizens experienced a decrease in their real disposable income, while elites continued concentrating margin funds gained through Russia’s successful actions in the economy and on the international level. These factors, as well as fatigue with the stubborn resistance of entrenched elites to being dislodged, caused conditions for political instability in big cities. Liberal and pro-Western media and pro-Western organizations exploited this in an attempt to destabilize the country.
Militarization of Japan has given the US a foothold in its campaign against China, Russia, and North Korea. The Japan Self-Defense Forces were turned into a fully-fledged military a long time ago. Japanese diplomatic rhetoric demonstrates that official Tokyo is preparing for a possible new conflict in the region and that it will fight to further expand its zone of influence. The Japanese stance on the Kuril Islands territorial dispute with Russia is an example of this approach. Tokyo rejected a Russian proposal for joint economic management of four islands and nearby waters, while formally the islands will remain within Russian jurisdiction -at least for the coming years. Japan demands the full transfer of islands a term which is unacceptable to Russia from a military and political point of view. The social and economic situation in Japan was in a relatively stable, but guarded state.
Denuclearization talks between the United States and North Korea reached a stalemate after the North Korean leadership claimed that Washington was in no hurry to provide Pyongyang with acceptable terms and conditions of a possible nuclear deal. The example of the US unilateral withdrawal from the nuclear deal with Iran also played a role. The positive point is that tensions on the Korean Peninsula de-escalated anyway because the sides sat down at the negotiation table. Chances of the open military conflict involving North Korea and the United States remain low.
In February 2019, the Indian-Pakistani conflict over the disputed region of Jammu and Kashmir put the greater region on the brink of a large war with potential for the use of nuclear weapons. However, both India and Pakistan demonstrated reasonable restraint and prevented further escalation despite an open confrontation between their militaries which took place at the same moment. Meanwhile, the February escalation demonstrated the growing power of Pakistan. In the coming years, look to Jammu and Kashmir as a point of constant instability and military tensions, with very little chance that the sides will find a comprehensive political solution to their differences.
The threat of terrorism is another destabilizing factor in the region. In 2019, ISIS cells made several attempts to strengthen and expand their presence in such countries as Malaysia and Indonesia. Law enforcement agencies of both countries are well aware of this threat and contribute constant and active efforts to combat this terrorism and radicalism. It should be noted that Malaysia is in conflict with the Euro-Atlantic elites because of its independent foreign policy course. For example, its government repeatedly questioned the mainstream MH17 narrative and officially slammed the JIT investigation as politicized and nontransparent. So, the leadership of the country is forced to be in a state of permanent readiness to repel clandestine and public attempts to bring it into line with the mainstream agenda.
While the European Union is, theoretically, the world’s biggest economy using the world’s second most popular currency in international transactions, it remains to be seen whether, in the future, it will evolve into a genuine component of a multi-polar international system or become a satellite in someone else’s—most likely US—orbit. There still remain many obstacles toward achieving a certain “critical mass” of power and unity. While individual EU member states, most notably Germany and France, are capable of independent action in the international system, individually they are too weak to influence the actions of the United States, China, or even Russia. In the past, individual European powers relied on overseas colonial empires to achieve great power status. In the 21st century, European greatness can only be achieved through eliminating not just economic but also political barriers on the continent. At present, European leaders are presented with both incentives and obstacles to such integration, though one may readily discern a number of potential future paths toward future integration.
Continued European integration would demand an agreement on how to transfer national sovereignty to some as yet undefined and untested set of European political institutions which would not only guarantee individual rights but, more importantly from the point of view of national elites, preserve the relative influence of individual EU member states even after they forfeited their sovereignty. Even if the Euro-skeptics were not such a powerful presence in EU’s politics, it would still be an insurmountable task for even the most visionary and driven group of political leaders. Such a leap is only possible if the number of EU states making it is small, and their level of mutual integration is already high.
The post-2008 Euro zone crisis does appear to have communicated the non-sustainability of the current EU integration approach, hence the recent appearance of “two-speeds Europe” concept which actually originated as a warning against the threat of EU bifurcation into well integrated “core“ and a less integrated “periphery”. In practical terms it would mean “core” countries, definitely including Germany, France, and possibly the Benelux Union, would abandon the current policy of throwing money at the less well developed EU member states and, instead, focus on forging “a more perfect Union” consisting of this far more homogeneous and smaller set of countries occupying territories that, over a thousand years ago, formed what used to be known as the Carolingian Empire. Like US territories of the 19th century, EU states outside of the core would have to “pull themselves up by their bootstraps” to earn membership in the core, which would require them to adopt, wholesale, the core’s political institutions.
The deepening disproportion of EU member state economies, and therefore sharpening economic disputes, are the main factor of instability in Europe. The long-delayed withdrawal of the United Kingdom from the union, which is finally expected to take place in 2020, might trigger an escalation of internal tensions over economic issues which might blow up the EU from the inside. Other cornerstones of European instability are the extraordinary growth of organized crime, street crime, radicalism, and terrorism, most of which were caused by uncontrolled illegal migration and the inability of the European bureaucracy to cut off the flows of illegal migrants, integrate non-radicalized people into European society, and detect all radicals and terrorists that infiltrate Europe with migrants.
The situation is further complicated by the conflict in Ukraine and the destruction of international security treaties, such as the US withdrawal from the Intermediate-Range Nuclear Forces Treaty and its planned withdrawal from the New START (Strategic Arms Reduction Treaty). These developments go amid constant military and political hysteria of micro-states and Poland instigated by the Euro-Atlantic elites. The EU bureaucracy is using this state of hysteria and ramping up speculations about a supposed military threat from Russia and an economic and political threat from China to distract the public and draw attention away from the real problems.
The return of Russia as the diplomatic and military great power to Africa marked a new round of the geo-economic standoff in the region. The apparent Russian-Chinese cooperation is steadily pushing French and British out of what they describe as their traditional sphere of influence. While, in terms of economic strength, Russia cannot compete with China, it does have a wide range of military and diplomatic means and measures with which to influence the region. So, Beijing and Moscow seem to have reached a non-public deal on a “division of labor”. China focuses on implementation of its economic projects, while Russia contributes military and diplomatic efforts to stabilize the security situation, obtaining revenue for its military and security assistance. Moscow plays a second violin role in getting these guaranteed zones of influence. Terrorism is one of the main threats to the region. The Chinese-Russian cooperation did not go without a response from their Western counterparts that justified their propaganda and diplomatic opposition to Beijing-Moscow cooperation by describing Chinese investments as “debt-traps” and the Russian military presence as “destabilizing”. In 2019, Africa entered into a new round of great powers rivalry.
The intensification of US “soft power” and meddling efforts, social, economic tensions, activities of non-state actors, and organized criminal networks became the main factors of instability in South America. Venezuela and Bolivia were targeted by US-backed coups. While the Venezuelan government, with help from China and Russia, succeeded in repelling the coup attempt, Bolivia was plunged into a violent civil conflict after the pro-US government seized power. Chile remained in a state of social economic crisis which repeatedly triggered wide-scale anti-government riots. Its pro-US government remained in power, mainly, because there was no foreign ‘democratic superpower’ to instigate the regime change campaign. Actions of the government of Colombia, one of the key US regional allies, undermined the existing peace deal with the Revolutionary Armed Forces of Colombia (FARC) and forced at least a part of the former FARC members to take up arms once again. If repressions, killings, and clandestine operations aimed at the FARC members committed to the peace continue, they may lead to a resumption of FARC-led guerrilla warfare against the central government. The crisis developing in Mexico is a result of the growth of the drug cartels-related violence and economic tensions with the United States. The right-wing Bolsonaro government put Brazil on track with the US foreign policy course to the extent that, the country worked with Washington against Venezuela, claiming that it should not turn into ‘another Cuba’. A deep economic crisis in Argentina opened the road to power for a new left-centric president, Alberto Fernandez. Washington considers South America as its own geopolitical backyard and sees any non pro-US, or just national-oriented government, as a threat to its vital interests. In 2020, the US meddling campaign will likely escalate and expand, throwing the region into a new round of instability and triggering an expected resistance from South American states. An example of this is the situation in Bolivia. Regardless of the actions of ousted President Evo Morales, the situation in the country will continue escalating. The inability of the pro-US government to deliver positive changes and its simultaneous actions to destroy all the economic achievements of the Morales period might cause Bolivia to descend into poverty and chaos causing unrest and possibly, a civil war.
During 2019, the world superpower, led by the administration of President Donald Trump, provided a consistent policy designed to defend the interests of US domestic industry and the United States as a national state by any means possible. This included economic and diplomatic pressure campaigns against both US geopolitical competitors and allies. The most widely known Trump administration move of this kind was the tariff war with China. However, at the same time, Washington contributed notable efforts in almost all regions around the globe. For example, the United States opposed Chinese economic projects in Africa, Russia’s Nord Stream 2 gas pipeline in Europe, tried to limit exports of the Russian defense industry, pressured NATO member states who did not want to spend enough on defense, and proposed that US allies pay more for the honor and privilege of provided “protection”. Additionally, Trump pressured the Federal Reserve Board of Governors into lowering interest rates and announced plans to lower interest rates even further to weaken the dollar in order to boost national industry and increase its product availability on the global market. These plans caused strong resistance from international corporations and global capitalists because this move may undermine the current global financial system based upon a strong US dollar. This straightforward approach demonstrated that Trump and his team were ready to do everything needed to protect US security and economic interests as they see them. Meanwhile, it alienated some “traditional allies”, as in the case of Turkey which decided to acquire Russian S-400s, and escalated the conflict between the Trump Administration and the globalists. The expected US GDP growth in 2019 is 2.2%. The expected production growth of 3.9% reflects the policy aimed at supporting the real sector. In terms of foreign policy, the White House attempted to rationalize US military presence in conflict zones around the world. Despite this, the unprecedented level of support to Israel, confrontation with Iran, China, and Russia, militarization of Europe, coups and meddling into the internal affairs of sovereign states remain as the main markers of US foreign policy. Nevertheless, the main threat to United States stability originates not from Iranians, Russians, or Chinese, but rather from internal issues. The constant hysteria in mainstream media, the attempt to impeach Donald Trump, and the radicalization of different social and political groups contributes to destabilization of the country ahead of the 2020 presidential election.
The year 2019 was marked by a number of dangerous developments. In spite of this, it could have been much more dangerous and violent. Political leadership by key actors demonstrated their conditional wisdom by avoiding a number of open military conflicts, all of which had chances to erupt in the Middle East, South Asia, East Asia, South America, and even Europe. A new war in the Persian Gulf, US military conflict with North Korea, an India-Pakistan war -none of these were started. A peaceful transfer of power from Petro Poroshenko to Volodymyr Zelensky in Ukraine allowed for the avoidance of a military escalation in eastern Europe. China and the United States showed their restraint despite tensions in the Asia-Pacific, including the Hong Kong issue. A new global economic crisis, expected for some time by many experts, did not happen. The lack of global economic shocks or new regional wars in 2019 does not mean that knots straining relations among leading world powers were loosened or solved. These knots will remain a constant source of tension on the international level until they are removed within the framework of diplomatic mechanisms or cut as a result of a large military conflict or a series of smaller military conflicts.
Chances seem high that 2020 will become the year when a match will be set to the wick of the international powder keg, or that it will be the last relatively calm year in the first quarter of the 21st century. The collapse of international defense treaties and de-escalation mechanisms, as well as accumulating contradictions and conflicts among world nations give rise to an especial concern.
While the California fires of 2018 have long been put out and the Amazon fires have been reduced at least, Australia is only in the middle of its fire season. Ongoing heat and drought are expected to fan the flames further. This week, shocking pictures of bright orange skies in Queensland and flames ripping through towns captured the world’s attention.
The bushfires grew more severe amidst a heatwave that saw Australia record its hottest day and simultaneously driest spring on record,according to The New York Times. New South Wales has been affected disproportionately, plunging Sydney into dark smoke in mid-December. Around 10 of the 12 million burned acres are located in the state.
Bushfires frequently occur in Australia, with some years bringing more severe destruction that others. Scientists are claiming that in connection to climate change, fires will become more frequent and more severe when they happen.
Many of you probably have heard of the second amendment sanctuary movement, which consists of municipalities and counties across the U.S. passing resolutions pledging not to enforce additional gun control measures infringing upon the right to bear arms.
The current movement traces its origins back to Effingham County in southern Illinois, which passed a resolution in April 2018 calling the county a second amendment “sanctuary”, essentially a vow to ignore gun control legislation proposed by Illinois state lawmakers. This particular tactic gained traction not just within Illinois, where 67 of 102 counties have now passed similar resolutions, but throughout the country.
The movement started gaining more attention over the past couple of months following the blistering momentum it found in Virginia after Democrats won the state legislature in November. As of this writing, 87 out of Virginia’s 95 counties have passed such resolutions and it’s important to note that virtually all of them were passed in the two months since the election. In other words, this is happening at a very rapid pace.
Before discussing the significance of all this, let’s address some thoughtful criticism of the movement from Michael Boldin of the Tenth Amendment Center. His primary point of contention is that the resolutions these municipalities and counties are passing — unlike immigration sanctuary ordinances passed in places such as San Francisco — carry no weight of the law.
Specifically, they’re not passing ordinances, but rather resolutions, which Michael describes as “non-binding political statements.” In other words, it’s all just talk at this stage and he’s frustrated that much of the media coverage makes it seem what’s being passed is more concrete than it actually is. Although I disagree with his overall assessment of the importance of what’s happening, he makes many good points and puts some much needed meat on the bone of this issue for those getting up to speed. He published an instructive video on the topic, which I recommend checking out.
Despite his legitimate criticisms, I believe the second amendment sanctuary movement is meaningful in the bigger picture of the nation’s emergent social and political evolution. Although it is indeed mostly just talk at this point, there’s nothing wrong with that. If you’re going to build a movement you need to start by talking and establishing some sort of consensus amongst your peers. More concrete steps can follow in the future. Don’t forget this is a learning process for many of the people involved, and many of those coming out to these city and county meetings likely never engaged politically in such a manner before in their lives.
Moreover, if the goal from the start had been to pass ordinances that carry the weight of the law, the movement wouldn’t have spread nearly as fast. It wouldn’t have catapulted into the consciousness of so many across the country and I probably wouldn’t be writing about it right now. The fact that it’s largely just talk via county and city resolutions allowed the movement go viral in a short period of time, which is a fine strategy when it comes to something like this.
That said, it’s important to note when it comes to something as serious as this — municipalities and counties vowing to refuse to enforce state and federal laws — the only thing that really matters in the end is how the public actually responds when and if the rubber meets the road. Are people willing to make major sacrifices like go to jail? That’s ultimately the most important variable in the end. What sort of fortitude do these local communities really posses on this issue, and how many are willing to engage in genuine acts of civil disobedience and sacrifice if push comes to shove. We simply don’t know.
Even bigger picture, the second amendment sanctuary movement should be seen as a manifestation of a core trend I except to grow considerably in the decade to come: localism. The people driving this movement aren’t petitioning Washington D.C. or even their state house, instead they’re looking to their friends and neighbors and taking a unified stand at the local level. Simply put, they’re attempting to take matters into their own hands as opposed to begging distant authority figures. This is in large part why their actions seem disorganized and unsophisticated; these are just regular people saying enough is enough, and in this case the line in the sand happens to be firearms.
This goes against everything we’re taught. We’re led to believe we have representatives in D.C. that actually represent us and we just need to elect the right people to have our voices heard. This sounds good, but we all know by now it’s a lie. These largely rural Americans are finally starting to give up on this lie and are looking to local solutions because they have no other choice. It’s hard overstate how important this is. It demonstrates a new degree of political realism in the face of disconnected and unresponsive governments far removed from where they live. It’s people finally realizing they’re much better off connecting and working within their own communities to change things rather than groveling to self-interested, professional political crooks.
Importantly, this is how it should be. If we’re going to crawl out of the mess we’re in it seems clear we need a different approach. Pretending all we need to do is “elect good people” to Congress or the Presidency is a slave mentality. The system itself is so completely corrupt and so explicitly rewards criminal and evil behavior, we need to start thinking and acting differently, which means focusing on what’s closest to home. Get your own house in order before trying to save the world.
As stated earlier, the fact the second amendment sanctuary movement is grounded at the local governmental level (municipalities and counties), as opposed to the state or federal level, is extremely significant.
I wrote on this topic earlier this year. While I disagree with Bookchin on all sorts of issues, I completely agree with his conclusion that politics should be centered around the municipality. Localism is the only way you can truly have self-government.https://t.co/eoSQkvvZeE
It’s also crucial to see this in a much larger context. As the populace (across ideological lines), grows increasingly disillusioned with their complete lack of agency within our imperial oligarchy, engaged citizens will naturally shift focus toward the local level in pursuit of alternative avenues for change. Firearms is just one issue, but there are many more and the list is seemingly endless.
In general, we need to stop believing in the fantasy that topdown change from Washington D.C. will magically fix the problems of such a geographically and politically diverse nation. It’s lazy, unrealistic, and more often than not dangerous. Change needs to start at home, and people will turn to localism out of necessity.
More in Part 2…
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Even More Colleges Are Now Taking Equity Stakes In Their Students As Tuition
The trend of colleges foregoing traditional tuition in favor of now taking an “equity stake” in their graduates looks like it is catching on.
The idea was first floated by Milton Friedman back in 1955, who suggested an incoming sharing agreement between the universities and the graduates once they enter the work force and begin to earn a regular salary. This obviously shifts much of the liability to make “workforce ready” graduates to the institution.
The Wall Street Journal recently profiled 27 year old Alex Ross, who took advantage of General Assembly coding school’s $14,700 design boot camp. She hasn’t been able to find work yet, but that’s not bothering her, as she took advantage of General Assembly’s income-share-agreement program, which requires her to make monthly payments of 10% of her paycheck for 48 months – but only after she lands a job paying $40,000 per year or more.
No matter how much she earns, her payback won’t exceed a $22,000 cap.
Ross said: “I considered taking out a loan, but didn’t want to start making payments right away. I didn’t want the pressure before I was employed full-time.”
Tonio DeSorrento, co-founder and CEO of Vemo Education, a company that helps schools design and implement income sharing programs, said: “It’s not the best thing for everyone, every time. But the fact that the school stands behind its product serves as proof it offers value.”
There’s now more than 60 universities that offer ISAs nationwide, including Purdue and the University of Utah. In the New York City metropolitan area, there is the Flatiron School and Holberton School, in addition to General Assembly.
Why might this process be working out so well, aside from its “free market” thinking? There’s been no federal laws defining or regulating ISAs, and terms vary widely. A typical university takes 2% to 10% of a graduate’s income for the first 5 to 10 years after graduation, starting as soon as the graduate lands a job paying at least $20,000 to $30,000.
Total payback is often capped at 110% to 120% of the amount borrowed.
Coding boot camps, like the one attended by Ross, mostly offer accelerated terms.
…a graduate typically pays 10% to 15% of their income for the first three to five years after graduating, starting as soon as the person lands a job paying at least $40,000 to $50,000. Total payments are typically capped at 1.5 to 2 times the amount fronted.
Whether an ISA costs more than a traditional student loan depends on how much the graduate earns.
For example:
…a student graduating with a traditional 10-year, $10,000 student loan with a 7.5% interest rate would make monthly payments of $117 until he or she paid off the loan. The payments would total $14,090.
Graduates with an ISA for the same amount could wind up paying back anything from $0—if they never land a good-paying job—to $20,000 if they obtain a job earning $100,000 a year.
“The lowest earners pay the least. It’s very progressive that way,” Mr. DeSorrento said. <!–[if IE 9]><![endif]–>
And there have already been success stories, like Jane Zhu. Five months into a 10 month program from Pursuit coding school, she was applying to jobs. After finishing the program, she had a “near six figure job” already lined up as a junior software engineer. She pays back $900 a month and, while it’s a “squeeze” with two kids, she says it’s manageable and it’s “only for 3 years”.
Recall, we first wrote about this trend back in April 2019. Shortly after we wrote about an online software engineering school that was allowing students to pay their tuition by forfeiting 17% of their income after they graduated, we wrote about how the new method for funding college was starting to make its way to the mainstream.
Oh and, by the way – paging Neel Kashkari and Paul Krugman – if Friedman is right about this tuition model – what else do you think he could have been right about?
OK, I’m game. Let’s write some plausible science fiction, with a tinge of horror story.
#1 Demographics
First, it’s good to remember that demographics have a life of their own. That’s not good from the point of view of those of us of European descent. We’re only 10% of world population and falling rapidly. Worse, it seems we’re responsible for all the world’s problems and therefore aren’t very popular.
In Europe, I expect the ’20s will have a lot of mass migration, the largest in scale since the barbarian invasions of the fifth century. This time there will be millions, then tens of millions, of Africans coming across the Mediterranean, looking for a higher standard of living—like all migrants.
In the United States there will be hundreds of thousands coming up from Central America. A Reconquista movement will develop, to make the Southwest Hispanic again. And young Chicanos and cholos won’t be interested in paying 50% of their incomes to support old white broads on Social Security in New England.
Meanwhile, lots of Mohammedans from Central Asia will migrate north to Russia.
Millions of Chinese will migrate to Africa. The reason for this is that the Chinese have lent scores of billions of dollars to Africans to build seaports, airports, roads, railroads, mines, and other infrastructure as part of their One Belt, One Road Initiative. They’re repossessing these assets and bringing in their own people in order to run them profitably—as well as disperse excess population.
All of these things will be massively destabilizing.
#2 The Greater Depression
The consequence of scores of trillions of new currency units being printed around the world in response to the crisis that began in 2007 will be a catastrophic Greater Depression. Made worse by negative interest rates. Expect massive unemployment, high retail inflation, a collapse of the bond market, and a much lower stock market. Most important, expect a lower standard of living for the average American.
#3 The Election of a Left-Wing Democrat
One consequence of the Greater Depression will be the election of a left-wing Democrat, if not in 2020, then definitely in 2024. The US has been undergoing what amounts to a cultural revolution, because the universities, media, and entertainment have been captured by the memes of cultural Marxism. The last cultural revolution was in the ’60s. This one will be much more serious, with broader participation. In fact, the US is on the ragged edge of a civil war between the Red counties and the Blue counties. They don’t like each other and don’t share the same values. The best solution is separation.
#4 China Implodes
China is on its way to dominating the world this century. The changes in China over the last 30 years are both real and unparalleled in world history. But in the meantime, its financial system—starting with its banks—will implode. Mrs. Wong will be very, very unhappy to find that 50% of her savings has disappeared.
#5 The United States Starts a Major War
The US is likely to provoke a major war, partly in an attempt to unite a culturally divided country. But not just a sport war such as we’ve had in Iraq, Syria, and Afghanistan. Probably with China, possibly Russia or Iran. Perhaps with all three. The US won’t do well, since it will find that its aircraft carriers, F-35s, and the like are equivalent to cavalry before WW1 and battleships before WW2.
#6 US Dollar Loses Its Top Status
The US dollar will lose its preeminence and will be treated like a hot potato by foreigners. Trillions will flood back to the US in exchange for whatever is available: land, companies, what have you. This will help take domestic inflation to unprecedented levels. Meanwhile, China, Russia, and numerous other countries want to discard the dollar. It makes no sense to use the currency of your adversary—or enemy. Especially when all dollar transactions have to clear through New York.
Foreign governments have been buying gold in anticipation of this. And the gold price will go considerably higher.
#7 The Singularity
But enough doom and gloom. On the bright side, we’ll approach the Singularity. Many technologies—including artificial intelligence, robotics, space exploration, biotech, genetic engineering, and nanotechnology—are advancing at the rate of Moore’s Law.
As these new technologies come into their own over this decade, the changes they create will be on par with electrification, the automobile, the airplane, and the computer during the 20th century. But all this will happen in a decade or so. These things have the potential to transform the very nature of reality.
I suggest three simple actions. Diversify politically and geographically. Buy lots of gold and silver. Have a nice piece of productive land in a reasonably secure jurisdiction.
And get yourself a nice widescreen to watch it all happen. You might as well be entertained…
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The decade ahead is likely to be an increasingly volatile time. More governments are putting their money printing on overdrive. Negative interests are becoming the rule instead of the exception to it. One thing is for sure, there will be a great deal of change taking place in the years ahead especially for retirees, savers, and investors.
Judge Exempts 70,000 Truckers From California ‘Gig Worker’ Law
A federal judge in San Diego has temporarily blocked California’s new ‘gig worker’ labor law from impacting some 70,000 independent truckers, ruling they would suffer ‘irreparable harm’ if their employers are forced to classify them as salaried employees.
US District Judge Roger Benitez on Tuesday granted a temporary restraining order requested by the California Trucking Association while he decides on whether to issue a permanent injunction – noting that the association is likely to eventually prevail on its argument that California’s law runs afoul of federal law, according to CBS News. Benitez added that the injunction is in the public interest.
The public focus of the law has largely involved ride-share companies such as Uber and Lyft and food delivery companies like DoorDash and Postmates, which have vowed their own challenges in court and at the ballot box. There are about 400,000 workers in California doing such “gig” work, according to various estimates. However, an additional 1.5 million workers in California, doing jobs such as cleaning, construction, building maintenance and trucking, are likely to feel its effects.
The trucking association’s lawsuit, filed in November, said many truckers would have to abandon $150,000 investments in clean trucks and the right to set their own schedules in order for companies to comply with AB5, which the group says illegally infringes on interstate commerce. –CBS News
Opposing the trucking association is Democratic Assemblywoman Lorena Gonzalez of San Diego, who says the state will continue to fight “to return jobs in the trucking industry to good, middle class careers.”
“For decades, trucking companies have profited from misclassifying drivers as independent contractors, taking away rights such as meal and rest periods and fair pay,” she added.
Meanwhile, freelance writers and photographers filed a lawsuit last month to block the law, arguing that it’s an unconstitutional violation of free speech and the media.
On Tuesday, the American Society of Journalists and Authors and the National Press Photographers Association asked a federal judge to grant them a temporary restraining order while he considers a more permanent injunction in March. However, no date was immediately set for a hearing or decision by U.S. District Judge Philip Gutierrez in Los Angeles. –CBS News
Uber claims the law doesn’t apply to its drivers, filing a Monday lawsuit along with Postmates to challenge the legislation.
Hong Kong and Taiwan are on high alert following a notice from Chinese authorities on Dec. 31 that 27 people contracted an “unknown viral pneumonia” in the central city of Wuhan.
With some netizens likening the epidemic to the deadly outbreak of the severe acute respiratory syndrome (SARS) virus that killed almost 800 people in 2002-2003 after being covered up by Chinese authorities, the Hong Kong and Taiwan government have called for faster genetic testing after Chinese authorities said they were yet to confirm the cause of the outbreak.
As China has the technology to identify viruses within 48 hours, the authority’s slow response has led many to be suspicious as to why the disease has yet to be identified.
Emergency Notice for New Outbreak
On Dec. 30, Wuhan city Health Commission released an “Emergency Notice About Unknown Pneumonia.” The notice said that several Wuhan hospitals had received pneumonia patients with similar symptoms and that no further details were available.
The notice was soon spread by Chinese netizens via different social media platforms. Although the government soon censored this information, the notice was broadly spread among overseas Chinese communities.
On Dec. 31, state-run media confirmed the outbreak but also did not have any information about the cause of the infections.
The report said patients’ symptoms included fever, having difficulty breathing and invasive lesions in both lungs. 27 people from Wuhan had fallen ill, with seven of them in serious condition.
Most of the patients were sellers at the Huanan Seafood Market located close to Hankou Railway Station in the city’s Jianghan district. That same market was linked to all SARS cases seen in Wuhan in 2003. The market is not limited to selling seafood, netizens said, but also sees various animals including cats, snakes, and marmots.
The notice added that hospitals were planning to release two of the 27 infected people in the next few days after some more treatment, while 18 other patients are in a stable condition.
The state-run People’s Daily reported on the afternoon of Dec. 31 that the initial investigating team didn’t find an obvious human-to-human transmission, and that so far, no medical staff have been infected.
“The cause of the disease is not clear,” the newspaper said on the popular social media platform Weibo, citing unnamed hospital officials.
“We cannot confirm it is what’s being spread online, that it is SARS virus. Other severe pneumonia is more likely.”
The Chinese National Health Commission, a cabinet-level executive department for sanitation and health, said it has sent a group of experts to Wuhan on Dec. 31 to lead more tests and another investigation.
Meanwhile, Hong Kong and Taiwan have stepped up border screening and hospitals are on alert.
Hong Kong
Every day, there are four trains that run between Hong Kong and Wuhan. As a result, the presence of the disease in Wuhan has Hongkongers worried.
David Hui Shu-cheong, a professor of respiratory medicine at the Chinese University of Hong Kong, told local media on Dec. 31 that the critical situation of Wuhan’s viral pneumonia reminded him of what Hong Kong faced with SARS in 2003.
Hui pointed out that in 2003, one out of four SARS patients was in serious condition. He said mainland authorities should arrange virus tests as soon as possible. Meanwhile, people should wear a facial mask and wash their hands frequently if they plan to go to Wuhan, he added.
Yuen Kwok-yung, microbiology professor at Hong Kong University, tried to calm down the public after acknowledging that the outbreak had similarities to the 1997 outbreak of bird flu and the 2003 outbreak of SARS.
He said at a government-organized press conference on Dec. 31:
“Now in Hong Kong and the mainland, the protection is better than 2003 … So I think people shouldn’t panic but must be alert, must follow the instructions from Hong Kong’s Department of Health and Hospital Authority.”
Taiwan
Fears about the disease has been a topic of great concern in Taiwan. People are worried that with the Chinese New Year holiday on Jan. 25, there is a heightened risk that the virus may be spread by Taiwanese businessmen returning from China.
Taiwan’s Centers for Disease Control (CDC) organized a press conference on the afternoon of Dec. 31. Lo Yi-Chun, the CDC’s deputy director, gave a briefing on the situation and said the agency had sent an inquiry email to China requesting information.
Lo said that once the Wuhan side has confirmed the type of virus, the Taiwanese government will set up an emergency working team to coordinate departments reacting to possible infections.
On Jan. 2, Taiwan News reported that a 6-year-old child who arrived in Taiwan on Dec. 31 after passing through Wuhan has developed a fever and is being closely monitored. However, the child was allowed to go home as they had not been traveling in Wuhan and had not been in contact with animals.
Since the first SARS epidemic, no additional cases of the virus have been reported so far worldwide.
The virus was first discovered in China’s Guangdong province in 2002, after which it spread to Hong Kong and other cities. At least 1,755 Hongkongers became infected with the SARS virus, of which 299 died. In neighboring Taiwan, 307 people contracted the virus, of which 47 died.
Globally, a total of 8,096 people from 31 countries contracted SARS, including Singapore, the United States, the United Kingdom, Germany, Australia, and the Philippines.
Oil & Gold Spike, Stocks Slip On Reports Iran’s Top Military Commander Killed
Following reports that Iran’s most senior elite military commander, IRGC Quds Force chief Qasem Suleimani, has been killed (reportedly assassinated by a US airstrike), global markets are starting to react.
Oil prices are spiking (but we suspect have a lot more to go)…markets are just waking up to the consequences of this action!
Commercial And Industrial Loan Growth Stalls Amid Manufacturing Recession
New Federal Reserve data shows commercial and industrial loan growth weakened in 2H19, an indication the industrial recession continues to plague the overall US economy.
C&I loans rose 1.6% in Dec. to $2.4 trillion, with most of the growth seen in the first half of the year. As for 2H19, no “green shoots” have yet materialized in industrials.
The Financial Times said commercial real estate lending marginally increased at smaller to mid-sized banks but dipped at larger ones.
Decelerating C&I loan growth in 2019 is a direct result of an industrial recession that has been deepening in the back half of the year.
Jennifer Piepszak, JPMorgan Chase’s CFO, said business confidence has perked up since a temporary trade war resolution was found in the fall, but uncertainty in an economic rebound remains.
“Trade would, of course, top the list there, but the elections in the US will contribute to an uncertain environment in 2020,” Piepszak said.
Refinitiv data shows that in 4Q19, capital expenditure by S&P 500 firms rose 1%, far from the 12% increase seen a year earlier – a clear sign that President Trump’s tax cut to boost the economy has been exhausted.
CapEx is the primary driver of C&I loans. Still, with massive uncertainty in the global economy and a domestic slowdown that has resulted in an industrial recession, C-suite executives chose to buy back their stock rather than build factories.
Brian Klock, a bank analyst at Keefe, Bruyette & Woods, said, “we’re just not seeing that big CapEx coming through,” and it could remain depressed in 2020.
So far this year, C&I loan growth at the largest 25 US banks has been underwhelming.
Brian Foran of Autonomous Research blamed the slowdown on the trade war.
Foran also said low demand for credit in the oil and gas space was another significant contributor to the slowdown.
With CapEx spending unlikely to significantly turn higher in the near term, forcing C&I loan growth lower amid an industrial recession — the damage to the US economy has likely been seen. It could result in a low growth period in 2020.
Equity market booms are far from alike, and their symptoms and causes differ as well. In the past two decades there have been two fundamentally different types of equity market booms that resulted in the market valuation of US companies relative to Nominal GDP soaring to equivalent record highs.
Yet, during the dot.com boom monetary policy “leaned against the wind” whereas during the current equity market boom monetary policy has opted to “go with the wind.”
Easy money policy can extend the life cycle of an equity boom, but at the risk of greater financial instability at some point for the simple reason easy money can trigger speculation and over-valued assets since it does not increase the economy’s long-term growth rate or the profitability of companies.
Two Equity Market Booms
The US equity markets soared in 2019, with broad stock averages posting gains of 25% to 30%, extending a long advance in equity prices. The surge in equity prices lifted the market valuation of domestic companies by estimated record $9 trillion over the course of 2019, pushing the total valuation to approximately $40 trillion at the end of 2019.
Measured in relation to Nominal GDP – a well-known metric to assess the over-or-under valuation of the overall stock market – the market valuation of domestic companies stood at 1.85X at the end of 2019, near the upper end of its long run average.
A similar level of the market valuation of domestic companies to Nominal GDP occurred at the end of the dot.com boom. Fueled by speculation that a new business model (internet) would result in large gains in future profits investors’ poured huge sums of money into new start-ups driving 20% to 30% gains in the broad equity markets for five consecutive years. At the peak of the tech boom in Q1 2000 the market valuation of domestic companies to Nominal GDP stood at a record high of 1.86x – a level that appears to be reached again at the end of 2019.
The dot.com equity boom of the late 1990s and the current equity market boom have little in common. To be fair, powerful common elements of liquidity and optimism about future profits are key factors in both cycles, but the dot.com liquidity engine was not sourced by easy money, whereas the current equity cycle is.
Two Policy Paths
During the dot.com boom the target of the federal funds rate averaged 5.5%, with a range of 4.75% to 6.5%, running 250 to 300 basis points over underlying inflation. Compare that to the zero to 2% target of fed funds for the past several years, and a fed funds rate that consistently ran below underlying inflation.
And, most importantly, the different monetary policy regimes are most extreme at the highest points of the relative market valuations. To be sure, at the peak valuation of the dot.com equity boom in 2000 policymakers were raising official rates, or “leaning against the wind” trying to dampen the wealth effect in the economy. Compare that to 2019 when policymakers faced with similar jobless and underlying inflation stats of 2000, decided to lower official rates, or in other words, “go with the wind”.
In reality, monetary policy can contribute to an equity market boom by holding rates low, or cutting them as what occurred in 2019, causing investors to demand less compensation for risk, inflating the prices of assets in the process. Yet, historical evidence is unambiguous that easy money contributes nothing to long-term economic growth or operating profits of companies, but can and has triggered financial instability.
Presiding over one stock market boom (and bust) that was not fueled by easy money could be seen as bad luck. But presiding over a second one that is fueled by easy money smacks of negligence since one of the mandates of monetary policy is to ensure financial stability.
Policymakers appear to be in no rush to reverse the policy actions of 2019 so the current equity bull market will continue to run. Yet, the odds of a policy mistake are rising and the safety valve of easy money for the equity market is limited as well. And if history proves to be a reliable guide the equity market peak will occur in Q1 2020.
Baltic Index Has Worst Day In Six Years – Vessel Demand Sinks As Front-Loading Ends
The Baltic Dry Index (BDI), a composite of the Capesize, Panamax and Supramax time charter averages, recorded its most significant one-day percentage drop in six years, reported Reuters.
BDI was pressured 10.5% on Thursday thanks to waning demand for dry bulk vessels. It was the most significant one-day percentage drop since January 2014. The index fell 114 points to 976 points, the lowest print since May 2019.
“Some of it represents the fact that it is the first quoting for almost a week now. We expect a bit more softness to come around and we see … China as the main locomotive behind this,” Peter Sand, the chief shipping analyst at BIMCO, told Reuters.
It wasn;t just the headline Baltic Dry Index (h/t @JHannisdahl):
Capesize -16.47% to $11,976
Panamax -13.76% to $7,695
Supramax 58k tons -9.11% to $7,539
Handysize -9.21% to $6,410
“The market as such is not strong in a fundamental way,” Sand said, adding that the global economy will continue to weaken into 2020.
Slowing demand for bulk carriers could be due to the decline in firms’ front-loading goods ahead of tariff deadlines as trade resolutions have been found between the US and China.
Chinese firms and US importers rushed to ship goods to the US through 1Q19 to Septemeber as the US and China were engaged in a tit-for-tat trade war. The implementation of tariffs by both countries on billions of dollars in goods forced importers and exporters to increase outbound and inbound delivers before tariff deadlines went into effect.
As a result of trade policy change, demand for bulk carriers increased throughout the year, raising the Baltic index +318% from January to Septemeber. With a possible trade resolution and the need to front-load has subsided, the dry bulk index topped out in September and has plunged 61% in the last three months.
Plunging shipping rates and waning global manufacturing data signals the world has entered a period of low-growth, and the probability of a massive economic rebound in early 2020 is unlikely.
Iran’s Top Military Commander, Qasem Suleimani, Assassinated In US Airstrike
LIVE FEED:
Update 3: The Pentagon has confirmed that Soleimani was killed at the direction of President Trump in what it termed a “defensive action” as per the following statement:
Update 2: It’s official — unbelievable as it is — first Iraqi state TV, and then Iran TV too, announced the death of Iran’s most senior elite military commander, IRGC Quds Force chief Qasem Suleimani:
BREAKING: #IRAQ OFFICIAL TV ANNOUNCES #IRAN IRGC LEADER QASSEM SULEIMANI IS ASSASSINATED.
This is the spark that could set the whole region on fire, given Suleimani is Iran’s most important, visible and powerful military leader.
#BREAKING: Abu Mahdi al-Muhandis, Deputy Commander of Hashd al-Shaabi and Qassem Solaimi Commander of IRGC killed in Baghdad — Hezbollah’s Mayadeen says. pic.twitter.com/RjPMiZH7F9
Journalists are circulating graphic photos of the blast aftermath, seeking on the ground confirmation of Suleimani’s identity:
Is it the same ring or similar? Asking for expert opinion #Iraq , this is Qassim Sulaimani the Iranian leader of Quds force #Baghdadpic.twitter.com/Xe4viCWKXY
It appears Iranian officials have begun circulating condolences, acknowledging his death.
At the beginning of the last decade, when Gen. Suleimani began becoming a more visible and powerful face of influence in Iran and across the Middle East, one former CIA officer cited in a New Yorker biographical piece on him referred to the IRGC commander as the “most powerful operative in the Middle East today.”
As leader of the Revolutionary Guards’ most elite Quds force, he directed all unconventional warfare and intelligence activities abroad. For that reason Washington and Tel Aviv had long considered him threat #1 within the Iranian military command structure.
Source in #Iran tells me:
Senior Iranian diplomats are sharing Gen. Qasem Sulaimani’s photo along w/death prayers for him. #Iraq
update: It appears the ‘mystery’ strike which took out vehicles along the perimeter of Baghdad International Airport in the early morning hours of Friday was actually a US targeted assassination.
Reports – An “American” drone strike just killed the #PMU’s “Head of Protocol,” Mohammed Reda al-Jabri, along with 2 aides & 3 “guests” (i.e. #IRGC) on their exit from #Baghdad Airport.
There are even significant but as yet completely unconfirmed rumors, some coming from of a well-known BBC Iran reporter and other regional sources, that Iran’s most senior military commander, the IRGC’s Quds Force chief Qasem Suleimani was taken out in the hit, which appears to have been an airstrike.
An early-morning strike hit the Baghdad International Airport perimeter, near the air cargo terminal, the Iraqi government said Friday.
The attack, which set two cars ablaze, apparently occurred at about 1 a.m. Social media users posted hearing the explosions, then the sounds of military aircraft.
The Iraqi defense ministry’s security information cell confirmed the strike about 45 minutes later, posting photos of the burning vehicles on its Facebook page and attributing the damage to a rocket attack.
Later, security sources told local media a strike hit two vehicles, killing Mohammed Redha, a senior member of Iraq’s Popular Mobilization Units — an umbrella group that includes Iran-backed Shiite militias with close ties to Iran and other militias that have fought the Islamic State group since 2014. Other PMU members and “guests” were also killed, the PMU said.
Just who those “guests” were remains the major question as huge rumors of Qasem Suleimani’s death continue to spread, however unlikely.
It true this could be the spark that ignites WWIII in the region, given Suleimani is Iran’s most important and powerful military leader.
Sources at the #Baghdad international airport tell me that “the main targets were #PMF leader Abu Mahdi Mohandis & #Iran‘s Qassem Soleimani as they were at the airport tonight”
They weren’t sure if these two got in the convoy or not.#Iraq
Can’t still confirm it 100%
At a moment tensions are on edge after pro-Iran militia protesters attacked and set fire to the outside of the US embassy compound in Baghdad’s Green Zone earlier this week, another major incident is developing overnight.
Reuters and Al Jazeera are reporting that at least three missiles struck on or near a base that houses American and Iraqi counter-terrorism forces in the early Friday morning hours at Baghdad International Airport.
All civilian flights have been canceled as US military helicopters were also seen patrolling the skies in the immediate aftermath.
Al Jazeera has cited Iraqi security sources to say that though the rocket attacks appeared to have targeted a joint US-Iraqi training base within the sprawling airport perimeter. At lease one of the projectiles landed near a passenger terminal, causing an immediate shutdown of the civilian side of the airport.
It is the second such rocket attack on the airport in under a month, after on Dec.9 four projectiles were launched on the facility, targeting the US-Iraqi base on the property.
Vehicles at the airport were filmed exploding as a result of the attack, and there are conflicting reports of possible civilian casualties.
Kurdistan24 journalist Barzan Sadiq has said at least one civilian was killed in the attack with more injured, as well as multiple Iraqi military personnel among the wounded.
3 Katyusha rockets in the vicinity of Baghdad International Airport near the sleeve of advisory units of the International Alliance, which is located in the vicinity of Baghdad Airport.
Civilians burn cars pic.twitter.com/GruQFI1Rva
While details are as yet unclear and unconfirmed at this point, Reuters did confirm the following per local security authorities:
Three Katyusha rockets fell on Baghdad International Airport, the military-run Security Media Cell said in a statement on early Friday.
The rockets landed near the air cargo terminal, burning two vehicles and injuring several citizens, Security Media Cell added.
Earlier in the day Defense Secretary Mark Esper put Iran and its proxies on notice, saying the US is prepared to launch “pre-emptive action” if American troops and interests come under threat.
Here, in no particular order, are 24 of the most absurdly politically correct moments of the decade:
1. A college diversity-training course taught that it was culturally insensitive to expect people to be on time.
A Clemson University training course taught its attendees that it is offensive to expect people to be on time, because “time may be considered fluid” in other cultures.-
2. The phrase “trigger warning” was deemed a trigger.
According to a piece in Everyday Feminism, “trigger warning” is actually in itself a trigger — because it could “be re-traumatizing for folks who have suffered military, police, and other forms of violence.” (The piece recommended using “content warning” instead.)
3. A professor was accused of sexual harassment for saying that effort is 10 percent of the grade.
A Brooklyn College of City University of New York professor says he was forced to change his syllabus after he was accused of “sexual harrassment” for stating that effort was 10 percent of the grade.
4. A campus survey included a trigger warning to caution college students that it may contain “anatomical names of body parts.”
The survey was distributed at several major universities — because, apparently, college students just might not be able to handle the kinds of words that most kids hear in their middle-school biology classes.
5. University researchers demanded that we accept people who “identify as real vampires.”
Apparently, it’s the least we can do to prevent anti-vampire discrimination.
6. A Seattle-area councilman was concerned about the city hosing poop off of its sidewalks because he thought that it might seem too racially insensitive.
The area in question reportedly stank like “urine and excrement” — but one councilman was worried that hosing it down could be a microaggression.
7. A bathing-suit advertisement was criticized for being “sexist” because it depicted a woman in a bathing suit.
I thought it was normal for product advertisements to depict the product that they’re selling — but apparently, I was wrong.
8. Some feminists decided that “pussyhats” were both racist and transphobic.
Why? Well, because not all women have vaginas, and not all vaginas are pink, of course.
9. A professor claimed that the small chairs in preschools are sexist, “disempowering,” and “problematic.”
Apparently, it makes no difference that preschoolers are small people.
10. College students decided against bringing a camel to school for a “Hump Day” event, due to concerns about racism.
Students at the University of St. Thomas in Minnesota were worried that the presence of a camel might offend Middle Eastern students.
11. A school in Seattle reportedly insisted that Easter eggs be called “spring spheres.”
Maybe calling them, simply, “eggs” would still have been too religious? Hard to say.
12. A group of Berkeley students insisted that they could not take their in-class exam due to their lack of privilege.
Apparently, test-taking was just too emotionally taxing for some University of Berkeley students to be able to handle.
13. The phrase “long time, no see” was reportedly declared to be “derogatory” toward Asians.
A student at Colorado State University said she was told that she shouldn’t use the phrase — despite the fact that even NPR admits that “it is so widespread as a greeting that there’s nothing to indicate the term’s origins, be they Native American or Mandarin Chinese.”
14. A college newspaper changed its name from “The Bullet” because its editors were concerned that that name was too dangerous.
The University of Mary Washington changed its newspaper’s name from “The Bullet” to “The Blue and GrayPress” — because its editors were worried that the old name “propagated violence.”
15. Lecturers were warned that capital letters might scare students and that they should avoid using them.
Journalism lecturers at Leeds Trinity University were instructed to avoid using all caps when communicating with students, because it might make them too afraid to do the assignment.
16. A campus-wide email told white students to stop wearing hooped earrings, because doing so was cultural appropriation.
A resident assistant at Pitzer College sent an email to her entire school claiming that white girls wearing hooped earrings was offensive to “the black and brown bodies who typically wear hooped earrings.”
17. A campus Christian club was found guilty of discrimination for requiring its leaders to be Christians.
Apparently, the Chico State University club’s rules violated a 2011 executive order.
18. Oxford University law students were told that they didn’t have to learn about rape or violence law if they found it too triggering.
Undergraduate law students were reportedly allowed to leave during any lessons about such material if they felt uncomfortable.
19. The word “too” was declared sexist.
According to a piece in the Huffington Post, the adverb has “deprived” “most women” “of self-satisfaction and appreciation.”
20. A liberal author demanded that “normal people” avoid wearing any kind of red hat, because all red hats can be too scary.
21. Skinny eyebrows were declared “cultural appropriation.”
Apparently, it is offensive to tweeze your eyebrows a lot if you’re not Latina. (Note: Thick eyebrow styles were called “cultural appropriation” during the 2010s, too.)
22. Evergreen State University told professors to take student protesters’ feelings into account when grading them.
Apparently, their “emotional commitment” to protesting should be taken into account when evaluating their academic work. (Apparently, grading classwork based on, you know, classwork would be too insensitive.)
23. A lot of college kids were upset about The Vagina Monologues.
Several colleges and universities either canceled or adapted performances of The Vagina Monologues over concerns about excluding women without vaginas. One school, Southwestern University in Texas, canceled theirs for another reason: because a white lady wrote it.
“Their Day Is Coming, I Promise You”: Durham Probe To Contain “Very Problematic Findings”, Meadows Warns
Rep. Mark Meadows (R-NC) sat down with Steve Bannon on Thursday’s War Room: Impeachment, where he suggested that US Attorney John Durham will uncover “very problematic findings” with the FBI’s counterintelligence operation against the Trump campaign – both before and after the 2016 US election.
“When we look at the investigation that is going on now with Mr. Durham, he is finding things that will be very problematic,” said Meadows – who will not be seeking reelection in 2020.
“And where they’re problematic is not just in the initial investigation, it is after January of 2017 before the president is actually sworn into office, they’re still operating on trying to take him down when they know they had no case,” Meadows added.
Durham, appointed by Attorney General Bill Bar to examine the origins of the Russia investigation, has reportedly been focusing on former CIA Director John Brennan’s communications in regards to the January 2017 Intelligence Community Assessment which concluded that Vladimir Putin meddled in the last election to help President Trump.
Barr, who has been directly involved in the investigation, reportedly traveled to London over the summer to discuss matters with UK intelligence officials – telling NBC that he was there “to introduce Durham to the appropriate people and set up a channel through which he could work with these countries.”
Meadows told Bannon that impeachment is about power dynamics between the establishment’s approach to foreign policy vs. President Trump’s agenda:
“It’s a policy and power debate. I want to emphasize the power. This is all about are we going to let the American people along with their representatives and the President of the United States establish foreign policy or are we going to let the intel and national security apparatus continue to do whatever they’ve done for years which is not effective. That’s the reason why there was such a big pushback with Brennan and Clapper.“
He notes: “Their day is coming. I promise you. Their day is coming.” -War Room: Impeachment
Bernie Sanders loves baseball. He loves it so much, that when he learned of Major League Baseball’s decision to phase out 42 of their 160 minor league teams, he called for the government to pressure the MLB to keep the teams, protecting the jobs of minor league players while raising their annual salaries. He has suggested using the government subsidies to professional sports stadiums to compel the League to submit to his demands. But his goal is not to reduce corporate welfare (is it ever?) — he merely wants a business to maintain its unprofitable branches.
It should be absurd enough — even to people who subscribe to Sanders’s socialist ideas — to say that the government needs to protect the jobs of people who play games for a living. Sports entertainment is certainly a valid economic good, but the most faithful apostles of state omnipotence should be able to recognize that salaried professionals for games is a remarkable luxury that few people can realistically expect to enjoy in any economy. Sanders also cites the community value of minor league baseball teams — romantically referencing his own personal memories — failing to realize that profits from attendance are the signal of how much a community values the franchise. It is as if Sanders is a better judge of what communities value than the citizens themselves.
These obvious objections aside, Sanders thinks he is working to save baseball, but if he gets his way, his plan is actually likely to accelerate baseball’s decline (unless the government beefs up its subsidies for professional sports, which Sanders would undoubtedly support). The reality is that the minor league system is a relic of a society that consumed sports very differently from the way modern spectators do, and the decision to phase out minor league teams reflects these changes.
Two American Pastimes
Baseball’s popularity steadily grew throughout the late nineteenth century, leading to the development of several professional leagues. Athletic competition waged within each respective league, and economic competition waged between them. At the turn of the century, the two dominant leagues — the American and National Leagues — came to an agreement that allowed them to maintain some independence but brought the economic and athletic competition together. The leagues would continue to compete athletically in isolation, and the annual champions of each league would play each other in the World Series (the mid-season All-Star game was added in 1933, but interleague play in the regular season did not begin until 1997). Other leagues who failed to match National and American on the economic front survived as farm teams — the minor league feeder system for the majors.
Although baseball continued to grow in the first two decades of the twentieth century, popularity exploded after rule changes shifted the dominance from the pitcher to the hitter, leading to power hitters such as Babe Ruth, who drew fans hoping to see him knock the ball out of the park. But fans had no way of witnessing these feats from home. If you wanted to watch the game, you had to buy a ticket and travel to the stadium — a significant barrier even for those participating in the automobile boom that was already underway. The best teams naturally made their homes in America’s largest cities where fans could walk to the stadium, and minor league franchises found a market in smaller cities whose populations still enjoyed baseball but were not large enough to support a major league team. Attendance was crucial to making the sport economically viable.
The earlier football leagues attempted to follow baseball’s model, some even enjoying the backing of the MLB. But unlike with baseball, the market was tight. Contrary to popular conception, it was not so much that Americans had no taste for the sport, but that the dependency on ticket revenues limited leagues’ expansion. Football players were far more likely to sustain injuries during a game, and even when they didn’t, the sport was more taxing, so it was impossible to play one hundred forty games in a season, as baseball teams did in the early twentieth century. Playing a fraction of the games, football teams could not be profitable from home-game ticket sales, so leagues were small and geographically constrained to allow competing teams to share a field.
However, while professional football was limited by these economic barriers, the sport was perfect for students. Universities are not unlike small cities, giving college sports teams an association to develop a fan base around. Baseball fans saw their team as representing their city; college football teams did the same for universities. The growth of college football mirrored that of baseball much more closely than professional football did, if on a smaller scale. The limitation here, of course, was that, prior to World War II, few Americans attended college. Football was by default a sport for economic elites while baseball was the populist pastime.
In the 1950s, economic changes disrupted this trend. In the postwar economic boom, millions of middle-class Americans bought mass-produced homes outside of major cities, giving rise to the suburbs as a type of community that did not fully resemble the city or the country. Although the proliferation of automobiles made trips to the city more accessible, baseball had fewer fans in walking distance of their stadiums. For major league teams, of course, this was a less pronounced problem — more people were willing to make the trip to see a major league game, but minor league teams felt the change more dramatically.
Television, though, most helped launch football to the top of the sports hierarchy in the United States. Football may not have been the most economically viable sport when revenues had depended primarily on live attendance, but the sport was perfect for television, whose revenue came from advertisements. Suburbanization and home television ownership grew in tandem. In 1950, Bob Levitt — a pioneer suburban developer — started advertising his $7,995 homes as including not only a refrigerator and a washing machine, but also a personal television. In 1948, less than two hundred thousand television sets were sold. In 1950, the number had grown to five million.
By 1958, forty-two million households had a television set. This year proved pivotal for football’s popularity, as the championship game between the Baltimore Colts and the New York Giants — played in Yankee Stadium, indicating baseball’s surviving dominance — ended in sudden-death overtime, following an exciting eighty-yard drive to the winning touchdown for the Colts. The game earned the enduring title “The Greatest Game Ever Played,” and it did for football what Babe Ruth had done for baseball in 1919.
Minor Leagues, Major Waste
Baseball certainly benefited from the new medium as well, but it had developed in a way that made it comparatively less suitable for televised sports. Minor league teams were financially viable when live attendance was the only way for most people to enjoy a game, but televisions made it too easy for audiences to watch only the best athletes. The (modern) 162-game season also meant that fans were saturated with games, analogous to taking a popular Broadway show and televising it on repeat. Baseball’s live-attendance model was not built with the expectation that the same fans would attend every game. But TV made this possible. Television, combined with the high number of games in the baseball season, made it easy for fans to virtually ignore minor league baseball.
The minors, of course, still served as a necessary nursery system, preparing players for the major leagues. Football, however, having grown predominantly through college sports, had a natural feeder system that required no financial support from the National Football League. The growing university system evolved as a de facto nursery that still enjoyed the live-audience support from students and local fans, and because both college and professional football played fewer games, each could attract a marketable television audience.
By the 1980s, when college baseball started to enjoy its own rapid rise in popularity — even earning modest television coverage — minor league baseball began to look increasingly unnecessary. In fact, as Sanders himself inadvertently hints, government subsidies (including, significantly, support from municipal governments) have helped prop up both major and minor league franchises. Sanders fails to recognize that the necessity of these subsidies undermines his claim about the community value of the sports teams — if communities value them, they’ll buy tickets to the games.
Apparently, what people really value is the ability to watch the greatest athletes from the comfort of their homes for free instead of paying to watch second-tier athletes live.
The MLB is merely responding to customer demand by phasing out minor league franchises, and if Bernie gets his way — short of doling out more government largesse to franchise owners — his plan will not save baseball; it will help kill it.
From Full House To The Big House? Lori Loughlin Learning Martial Arts As Trial Looms
“Aunt Becky” from Full House is preparing for the possibility of doing hard time over the college admissions scandal, hiring a prison coach to train her on fighting and ‘prison lingo,’ according to RadarOnline.
“She’s knuckling down, learning the lingo and practicing martial arts to give off the impression she’s tough and to ward off potential bullies,” an insider told Radar, adding that the 55-year old Laughlin “knows there will be plenty of them in federal prison.”
Loughlin and her 56-year-old husband Mossimo Giannulli have been accused of paying $500,000 in bribes to get their daughters into the University of Southern California. They contend they are not guilty, and that federal prosecutors have intentionally withheld evidence in their case.
They have been charged with conspiracy to commit mail and wire fraud, honest services fraud, money laundering and federal programs bribery.
“Prison is going to be sink or swim and Lori doesn’t intend to sit back and take the abuse without a fight,” the insider added.
“Besides the physical training she’s getting lots of advice from prison professors on how to earn one’s keep behind bars … It’s a sure sign she knows deep down she’s facing an inevitable stretch and will need to be prepared.”
Loughlin faces up to 45 years in prison if convicted on all charges – though the chances of this actually happening fall somewhere between slim and none based on the short sentences handed out to other offenders in the scandal. Loughlin faced two years under a plea deal she declined, according to TMZ.
The Full House star isn’t the only parent who though to prepare for the potential of prison life. As we noted last April, parents have been seeking advice from a former convicted felon, Justin Paperny, who now works as a “prison consultant”. He told CBS that he had been hired by one parent charged in the scheme, while he is “in talks” with others.
The claim that Russia somehow interfered with the 2016 American Presidential election (and was thereby responsible for the ascent of Donald Trump) has been parroted incessantly by both the mainstream media and leading Democrats, including of course Hillary Clinton. While many people believe this claim, Mrs Clinton doesn’t simply blame Russia for her election loss but the world and his dog, as can be seen from the above cartoon.
Though we are now in 2020, many leading Democrats and a substantial tranche of the American media are still replaying the 2016 election, and if their attention has switched to Ukraine, their pronouncements contain the same inference, namely that Trump is being assisted by foreigners, and should he triumph again in November, his Presidency will still be illegitimate. What though is the evidence for Russian interference, and how was this interference carried out?
The evidence, such as it is, is that a company/organisation called the Internet Research Agency paid for a number of advertisements on social media. This evidence is compelling, although anyone who has seen these advertisements can only wonder how they were supposed to have influenced the election to Trump’s benefit. Lee Camp has argued that the Internet Research Agency is nothing more than a troll farm that was generating memes in order to attract clients. In view of the puerile nature of some of these advertisements, it is difficult to disagree with him.
In an earlier age, both the cinema and the Western press portrayed Russia agents as sinister and deadly men and women who would kill without conscience. They travelled on professionally forged documents, used sophisticated weapons, and were totally loyal to the Kremlin. Are we now to believe James Bond’s deadliest enemy is a troll who sits behind a keyboard all day long hoping to dissuade people from voting Democrat by posting cartoons augmented by subtle propaganda? Apparently so.
There is also the little matter of the hacked e-mails, but these were not hacked from a US Government network, rather they were from John Podesta’s Gmail account, and one of Hillary Clinton’s accounts hosted by her (illegal) private server. The hack of Podesta’s account was effected by a phisher. If you use e-mail a lot you’ll quite likely receive many such fake e-mails every week, although you may not notice those that are sent directly to your spam folder. Mrs Clinton’s account was hacked by someone in China, possibly an agency of the Chinese Government, though it would be just as unfair to point the finger directly at Xi Jiping as at Vladimir Putin.
The other alleged hack was shown by William Binney to have been not a hack but a leak of information. The probable culprit was Seth Rich, who was murdered July 10, 2016 in strange circumstances. Although claims about his murder have been dismissed as a conspiracy theory, any such theory is a lot more plausible than most of the garbage that has been peddled about Trump and the Kremlin.
Is it then possible that Russia or any other outside agent could have interfered with the elections in a more direct manner, and could perhaps do so again? The only way to do this would be to tamper with the vote count electronically. It remains to be seen how this could be done, but as far as votes are tampered with at all, this appears to be a purely Democratic pastime. In June last year, under pressure from Judicial Watch, California began a purge of up to a million and a half “inactive” voters from its rolls. Why did it take a court action to compel this? Clearly because the people running this particular area – Los Angeles County – felt an unpurged roll was preferable to a purged one. Kevin McCarthy is the Republican Congressman for Los Angeles County; all the others are Democrats. Including Adam Schiff! Only two of the Districts fourteen senators are Republicans.
While Russian interference with voting sounds and is extremely improbable, the actual hacking of American Government websites and those of commercial organisations is something that is done routinely by all manner of actors, not all of them hostile but clearly all of them unwelcome (with one exception).
Here are a few examples:
In March 1995, a Russian by the name of Vladimir Levin rather than Vladimir Putin was arrested at Stansted Airport on suspicion of hacking into Citibank and stealing money, a massive financial fraud. He was eventually extradited to the United States where after a plea bargain he was sentenced to three years behind bars and ordered to pay restitution.
Scotsman Gary McKinnon hacked into no fewer than 97 US military and NASA computers over a thirteen month period in 2001–2002. He said he was looking for evidence of UFOs and other fringe subjects. His was said to have been the biggest military hack of all time.
In October 2012, the South Carolina Department Of Revenue was hacked; this affected over three and a half million accounts.
In August 2013, hackers targeted Yahoo. Although based in the US, this Internet giant has branches worldwide. According to a report by National Public Radio four years later, it was likely that every Yahoo! account in existence at the time had been hacked.
Also in 2013, the social network site Tumblr was hacked, which led to the compromise of over 65 million passwords.
In May 2014, eBay was hacked, and 145 million users had their data compromised.
Navinder Singh Sarao was said to have helped trigger a multibillion dollar Wall Street crash. The so-called Hound Of Hounslow was living with his parents at the time of his arrest in April 2015. Although not a hacker, he made (and apparently lost) millions by manipulating markets with a sophisticated computer program of his own design.
In October 2018, digitaltrends dot com reported that a hack of the Pentagon had compromised the personal information of over thirty thousand staff. Has Rachel Maddow even mentioned this?
Finally, the Pentagon is so aware of its vulnerability to hackers that in 2016 it invited people to hack into it – the one exception alluded to above. The winner of the Hack The Pentagon Bounty Program was a teenager; David Dworken received a share of $75,000 prize money.
All this tends to undermine the ludicrous claims of Rachel Maddow and her fellow cranks that Russia and Russia alone is any sort of threat to America cyber security.
From afar, South Koreans might appear to be blessed among East Asians.
Citizens of a prosperous democracy that has birthed a hero-to-zero national success story, world-beating corporate brands, a futuristic infrastructure and the glitzy K-pop universe that is beloved across the region, they boast enviable looks, lifestyles and quality of life.
Up close, things look different. According to a recent survey of 5,000 persons, 75% of 19-34 year old natives of the world’s 11th richest nation want out.
The shock finding, reported in the popular Hankyoreh newspaper on December 29, was revealed at Korea Women’s Development Institute’s 119th Gender Equality Policy Forum, in a presentation titled “Diagnosis of Gender Conflicts from a Youth Standpoint and Suggested Policy Responses for an Inclusive State: A Gender Analysis of Fairness Perceptions.”
The survey found that 79.1% of young women and 72.1% of young men want to leave Korea, that 83.1% of young women and 78.4% of young men consider Korea “hell” and that 29.8% of young women and 34.1% of young men consider themselves “losers.”
Beyond gender differences, the survey suggests massive popular dissatisfaction with local life.
But does it demand that Seoul’s elite sit down and seriously ponder the Korean Dream? Or does it merely reflect superficial talk among youth who live decent lives and have no real intention of leaving?
‘Hell Joseon’
A catchphrase has become current among young Koreans in recent years to describe their country: “Hell Joseon” – “Joseon” being the name of a long-dead Korean kingdom. That phrase is being superseded by a new term, “Tal-Jo” – a pormanteau comprising “leave” and “Joseon,” which, vernacularly, might be best be translated as “Escape Hell.”
“As a joke, we call Korea ‘Hell Joseon,’ but there is another term called ‘Tal-Jo’ which we use a lot more than ‘Hell Joseon’ nowadays,” Park Ji-na, a 20-something Seoul undergraduate, told Asia Times. “Me and my friends just use this in conversation as joke, but if I had a good opportunity to go abroad and work, I would.”
Some say it is far from unique to Korea. “I think there is a middle class crisis in all wealthy countries,” Pae Hee-kyung, who runs an educational institute near Seoul, told Asia Times.
Across the developed, post-industrial world, middle classes are under perceived siege from falling living standards, evaporating opportunities and rising wealth inequality. These trends have arisen against the backdrop of a globalizing world that distributes capital and jobs away from customary centers of investment, manufacturing and related prosperities.
Some pundits posit that these issues explain Brexit in the UK, the election of Donald Trump in the US and the protests of young Hong Kongers.
Are South Koreans different?
For Korea, the transition from poverty to prosperity and the rise of the bourgeoisie has been shockingly fast: The country morphed from little-known agricultural backwater to global industrial powerhouse in just three decades. While Koreans from the mid-1960s to the mid-1990s could anticipate decent jobs and rising standards of living as growth rates surged, this is no longer the case.
“Here, if you look at your father’s generation, they had less in material terms but they had hopes that, every year, they would be paid more, that they could buy an apartment, and that the price would go up and they would feel a sense of achievement and wealth,” Daniel Tudor, author of Korea: The Impossible Country, told Asia Times.
That is no longer the case for two reasons.
Firstly, the South Korean economy has matured and growth has slowed from the high double digits to the low single digits. Secondly, the national growth locomotives – family-run conglomerates, such as Samsung, Hyundai and LG – have gone global and off-shored. With South Korea’s population now at a national high of 51 million persons, there are insufficient full-time, white-collar positions to absorb a highly educated populace.
Yet Korea’s unemployment statistics are hardly calamitous. According to World Bank data, between 1995 and 2017, unemployment only rose above 4% for three years – 1999, 2000 and 2001 ( in the wake of the Asia financial crisis). It stood at over 4% for the first eight months of 2019, but fell to 3.6% in November, according to data provider CEIC. The youth unemployment rate in South Korea averaged 7.19% from 1982 until 2019, according to Statistics Korea, but despite hitting a high of 11.7% in April this year, had dropped to 7.1% in October.
A related issue is property. Koreans have traditionally not invested in securities or financial products, preferring to sink their savings into homes – a trend exacerbated by the low-interest-rate era. The result: soaring house prices. Combine this with half the national population – some 24 million persons – living in and around the Seoul metropolitan area, and it is easy to understand why young Koreans think they will never be able to afford a home.
And there is one area where young Koreans sense a distinctly local injustice. In this neo-Confucian, fast-growth economy, education provides the key to success. The college entrance system, despite methodological criticisms, was widely assessed as being fair. Now, questions hang over that.
In recent years, the children of two prominent figures – Choi Soon-sil, the confidante of jailed ex-President Park Geun-hye, and Cho Kuk, a short-lived justice minister under the current Moon Jae-in administration – have been revealed to have enjoyed privileged access to top colleges. The cases have emerged from both sides of the political spectrum, suggesting a broad culture of elite entitlement.
Many feel a resultant bitterness.
Such privileged people “have a lot of money and are using that money to go to universities and their lives are very ensured,” said Park. “But however hard we work, we don’t even know if we will be able to buy a house – I don’t know how we can live in the future!”
Real concern or youth talk?
Clearly, the study’s findings reflect the talk of youth. How should they be analyzed?
According to the World Bank’s GINI co-efficient data, South Korea is a reasonable 31.6, compared with Japan at 32.1, the UK at 33.2 and the US at 41.5 – the higher the number, the graver the inequality – but author Tudor believes that Korea’s fast-track development trajectory has engendered acute sensitivities.
“I don’t think Korea is particularly unequal – it is quite middle class compared to other wealthy countries – but if you go back one or two generations, things were very equal: everyone had nothing.” he said. “When everyone has nothing you don’t feel poor, but now, even if you have quite a decent standard of living, you look at others around and you may feel, ‘Oh my god!’”
Pae, the educator, opines that the current young are not as badly served by their systems as they believe.
“In the Korean education system, there are lots of chances for scholarships; Korean higher education is a lot cheaper than abroad; and there are plenty of chances of working holidays – so there are lots of opportunities,” she said. “But millennials want to get out of this cycle.”
Another issue is a very notable national tendency to raise emotive voices.
“Since I have been living in Korea, people complain all the time,” said Tudor. “The president is terrible – whoever he or she is – and the economy is terrible or on the brink of a crisis – however good it may be.”
Even Park, the student, admits that she and her friends are not actually planning moves.
“I and my friends talk about leaving Korea, but in order for us to get jobs abroad we should at least have a doctor’s degree, or have certain qualifications like nurse or UX designer,” she said. “Me and my friends, who study liberal arts or business, though we say ‘Tal Jo’ – we can’t.”
“I’m Not Recommending Anyone Use It”: First 5G Rollout Fails To Live Up To The Hype
When Apple stock closed last year at an all time high after doubling from its January 2019 lows, there were many confused looks among the trader community: after all any attempts to justify the move through the company’s future earnings – which haven’t budged in the past year – would only provoke laughter.
Instead, there were two other explanations being suggested: the company’s record stock buybacks, which helped to drastically expand AAPL’s PE multiple, and the looming “paradigm shift” that is 5G and Apple’s launch of 5G-compatible phones.
Well, for those who bet the farm on the latter, there may be a slight problem, because while 5G has yet to be made available in most countries, one nation has already had a 5G offering for 8 months: South Korea, and early adopters here have been anything but excited about the “5G revolution.”
when 5G services were launched there in April, Jang Dong-gil was among the first wave of South Koreans to sign up. Now eight months in, Jang, a 30-year-old tech company worker, has a chilling review for the next-generation technology: 5G hasn’t lived up to the hype.
“I don’t feel the difference,” Jang, who has been using a 5G-enabled Samsung handset, told the WSJ. In fact, on many days he switches off his 5G service altogether because his connection often drops as his phone pingpongs between 5G and the existing 4G LTE network.
With the rest of the world eagerly awaiting its own 5G rollout, all eyes were on South Korea, which for most of 2019 was home to the vast majority of the world’s 5G users, offering the broadest lessons in what the next-generation network has to offer. Yet where any hope that Apple’s will merely jump to a $2 billion (or higher) valuation could crash and burn is that although it is still early in the global rollout, 5G service in South Korea has proved more of a future promise than a technological breakthrough.
Of course, it’s not just phones: 5G launched during the past year promising to help power a future of autonomous “everything”: from cars, to virtual reality and telesurgery, thanks to its theoretical speeds of up to 100 times faster than today’s 4G networks. In fact, the next-generation network’s potential has been at the forefront of the technological war between the US and China, setting off a technological arms race – and associated trade war – between Beijing and Washington, which has pressured allies to avoid adopting equipment made by China’s Huawei over national-security and other concerns.
For better or worse, it is now seen – if only symbolically – that the company, and the nation, behind the infrastructure that allows global adoption of 5G will be the world’s next technological superpower. As such, many countries are scrambling to deploy the superfast network, hoping homegrown companies can enjoy an early advantage providing new, popular services like those from Uber, Instagram and Netflix that flourished during the 4G era. Currently, few, if any, 5G apps have emerged that would justify an upgrade by consumers.
And while 5G is now operational in Korea (we hope we don’t have to clarify that we are talking about the South version), larger countries are now also beginning the transition. In the U.S., 5G services have been rolled out in select cities—though adoption remains modest, requiring consumers to buy a new phone and, in some cases, subscribe to a top-tier, unlimited data plan.
In China, the rollout is far more aggressive: the government has prioritized expanding access to 5G since its launch in November, and by the end of 2020, China’s 5G subscribers are estimated to hit 120 million, said Chris Lane, an analyst at Bernstein Research. But initial 5G showcases have been limited to tests such as remote telesurgery procedures or streaming a dance performance in a remote village.
Predictably, South Korea is much further along and is expected to end 2019 with more than 4.5 million subscribers among its population of 51 million, according to telecom analysts polled by the WSJ.
In April, the country’s top three carriers – KT Corp, SK Telecom and LG Uplus – launched 5G service on the same day Verizon Communications debuted in two U.S. cities. From the very start, about half of South Korea’s population could have access to 5G service after buying a network-enabled device.
On their 5G phones, South Korean users – who have traditionally had access to all the latest and greatest cell phone technology first – can live-stream sports with a 360-degree view of the action, watching from any angle and in slow motion. Visitors to a Seoul park can summon a giant cat on their phone’s screen as they take in the scenery using augmented reality. Another app lets people gather in virtual-reality rooms to watch baseball games or concerts together.
However, such 5G “flourishes” are still merely attention-grabbing gimmicks which have yet to draw a large audience: “There’s no killer 5G app,” said Woody Oh, a Seoul-based analyst at Strategy Analytics.
“As far as adoption goes, we’re still at the very start,” said Julian Gorman, head of Asia-Pacific for GSMA, a trade association for mobile carriers. We’re eight months into a cycle that’s going to be many years in length,” he said.
Or perhaps 5G is merely an extremely conveient service in search of a spark, and only Apple can provide it. After all, 3G networks, which enabled data transfers among device users and launched in 2001, didn’t fully kick off until Apple’s first iPhone came out in 2007. It took years for its successor, 4G, to bring in ride-sharing platforms like Uber and Grab Holdings since it launched in 2011.
Where does 5G come in? For now, 5G’s main visible benefit lies in transferring large amounts of data extremely quickly, such as downloading movies faster and streaming high-resolution content seamlessly. That could be handy – after all, some 70% of data traffic carried from mobile devices to an operator comes from video content, compared with less than 25% five years ago. That figure is expected to rise further with 5G.
Yet is it truly revolutionary that one will be able to download a pirated version of the latest Star Wars movie on their cell phone in seconds instead of minutes? Indeed, telecom experts say 5G’s advantages are hard for consumers to experience with smartphones. Instead, the bigger leap will be felt with self-driving cars or smart cities, they say.
For current users, though, a key challenge is simply staying connected to 5G.
Take Yun Seung-yeol, a 27-year-old architectural designer in South Korea, who was given a big enticement to sign up for the new service: he got subsidies from his telecom provider to shave about two-thirds off the roughly $1,000 price tag for a 5G-enabled Galaxy Note 10 device.
He said he notices a difference on the superfast network only when downloading files or images on his phone. Besides that it’s a nuisance. Yun, who has an hour-long commute to his Seoul office, said he has turned off the 5G feature on his device for the past month because he kept losing connection when he left Seoul for his home in a neighboring city. He is considering switching back to a 4G data plan if the situation doesn’t improve.
“For now, I’m not recommending anyone to use 5G,” Yun said, uttering the scariest words for anyone who bought AAPL stock near its all time highs on expectations that the stock will continue to soar in 2020 just because of the relentless 5G hype…
In order to understand the great impeachment charade, it’s important to keep three facts about the strange bird known as the United States uppermost in mind.
The first is that the US is the ultimate law-based society, one whose structure derives entirely from a single four-thousand-word document created in 1787.
The second is that while Americans think of the Constitution as the greatest plan of government known to man, it’s actually the opposite: a grotesque pre-modern relic that grows more unrepresentative and unresponsive with each passing year. A pro-rural Electoral College that has overridden the popular vote in two of the last five presidential elections; a lopsided Senate that allows the majority in ten urban states to be outvoted four-to-one by the minority in the other forty; lifetime Supreme Court justices who can veto any law at variance with an ancient constitution that only they understand – it’s a broken-down old rattletrap in need of a top-to-bottom overhaul. Yet it’s so thoroughly frozen that structural reform is all but unthinkable.
The third thing to keep in mind is that as the constitutional system grows more and more undemocratic, the two-party system that grew out of it in the nineteenth century grows more undemocratic as well. The result is a bipartisan race to the right. Sometimes, the Republicans seem to be in the lead as Trump imprisons thousands of immigrants fleeing murderous conditions in Central America that the US war on drugs helped create. Other times it’s the Democrats as they beat the drums for imperialist war against Russia.
Take all these factors – xenophobia, mindless obeisance to ancient law, a president imposed against the popular will, etc. – mix thoroughly, place in a super-hot oven due to a growing imperial crisis, and impeachment is what pops out. The process itself is very old, a by-product of fourteenth-century Anglo-Norman law. (Impeachment derives from the Old French empeechier, meaning to ensnare or entrap.)The British abandoned it in the late eighteenth century when Edmund Burke wasted seven years impeaching an Indian colonial governor named Warren Hastings on grounds of corruption. (The House of Lords finally acquitted him in 1795). But then the Americans took it up and now, two centuries later, are immersed in the same brainless exercise.
The results were all too evident in mid-December when one Democrat after another took to the House floor to denounced Donald Trump for violating the ancient constitution by withholding lethal military aid from the neo-Nazis of the Ukraine’s Azov Battalion.
“We used to stand up to Putin and Russia – I know the party of Ronald Reagan used to,” declared Adam Schiff, the Democratic point man on impeachment, his voice quivering with emotion. The fight to defend the Ukraine is “about more than Ukraine. It’s about us. It’s about our national security. Their fight is our fight. Their defense is our defense…. And when the President sacrifices our interests, our national security for his election, he is sacrificing our country for his personal gain.”
This was the Democratic line in a nutshell. In order to safeguard the ancient republic at home, the US must pay foreign satraps to defend its imperial interests abroad.
Since no patriotic American could possibly disagree, any and all problems must stem from meddling by the evil dictator Vladimir Putin and his traitorous puppet in the Oval Office. Americans must therefore fulfill the ancient law by impeaching him just as the “founding fathers” would have wanted. Only then will peace and freedom return to the land of the free and the home of the brave.
It’s all quite ridiculous, but what’s even more bonkers is that millions of Americans think it’s true. Trump is meanwhile in his element. Now that Democrats have voted to impeach him in the House, he’d like nothing more than a lengthy trial in the Senate because (a) acquittal in the upper house is a certainty and (b) it will allow the Republican majority to put the torturers to the rack by subpoenaing everyone from Joe and Hunter Biden to Adam Schiff himself and declaring them in contempt of Congress if they refuse to testify. Senator Majority Leader Mitch McConnell has described an all-out Senate war as “mutual assured destruction,” and he’s right since, once unleashed, the ancient constitutional machinery will grind everything to dust in its path.
American politics will grow only more farcical. If Putin looms larger and larger on the world stage; if “the moment has come,” as the Times Literary Supplement recently announced, “for even the most hardened skeptics to admit that he is one of the most successful world leaders of our era”; if the US at the same time staggers from one imperial disaster to another even while descending into civil war – then it’s not because the Russian leader is particularly clever, but because the US is locked in an ancient mindset that is increasingly divorced from reality. It’s lost in a constitutional labyrinth of its own making, and impeachment is leading it deeper and deeper into the maze.
Obama’s NSC Holdovers Finally Booted After Three Years Of Non-Stop Leaks
The White House National Security Council is sharply downsizing ‘in a bid to improve efficiency’ by consolidating positions and cutting staff, according to theWashington Times – which adds that a secondary, unspoken objective (i.e. the entire reason) for the cuts is to address nonstop leaks that have plagued the Trump administration for nearly three years.
President Trump and new National Security Adviser Robert O’Brien
Leaks of President Trump’s conversations with foreign leaders and other damaging disclosures likely originated with anti-Trump officials in the White House who stayed over from the Obama administration, according to several current and former White House officials. –Washington Times
The reform is being led by National Security Adviser Robert C. O’Brien, who told the Times that 40-45 NSC staff officials had been sent back to their home-agencies, and more are likely to be moved out.
“We remain on track to meeting the right-sizing goal Ambassador O’Brien outlined in October, and in fact may exceed that target by drawing down even more positions,” said NSC spokesman John Ullyot.
Under Obama, the NSC ballooned to as many as 450 people – and officials wielded ‘enormous power’ according to the report, directly telephoning commanders in Afghanistan and other locations in the Middle East to give them direct orders in violation of the military’s strict chain of command.
Meanwhile, the so-called second-hand ‘whistleblower’ at the heart of President Trump’s impeachment was widely reported to be a NSC staffer on detail from the CIA, Eric Ciaramella, who took umbrage with Trump asking Ukrainian President Volodomyr Zelensky to investigate former VP Joe Biden – who Ciaramella worked with.
After O’Brien is done, less than 120 policy officials will remain after the next several months.
The downsizing will be carried out by consolidating positions and returning officials to agencies and departments such as the CIA, the State and Defense departments and the military.
Mr. O’Brien noted that the NSC had a policymaking staff of 12 in 1962 when President Kennedy faced down the Soviet Union during the Cuban missile crisis. During the 2000s and the George W. Bush administration, the number of NSC staff members increased sharply to support the three-front conflict in Iraq, Afghanistan and the war on terrorism.
However, it was during the Obama administration that the NSC was transformed into a major policymaking agency seeking to duplicate the functions of the State and Defense departments within the White House. –Washington Times
“The NSC staff became bloated during the prior administration,” said O’Brien. “The NSC is a coordinating body. I am trying to get us back to a lean and efficient staff that can get the job done, can coordinate with our interagency partners, and make sure the president receives the best advice he needs to make the decisions necessary to keep the American people safe.”
“I just don’t think that we need the numbers of people that it expanded to under the last administration to do this job right,” he added.
Obama-era NSC officials are suspected of leaking classified details of President Trump’s phone conversations with foreign counterparts.
After Mr. Trump’s election in November 2016 and continuing through the spring of 2017, a series of unauthorized disclosures to news outlets appeared to come from within the White House. Several of the leaks involved publication of sensitive transcripts of the president’s conversations with foreign leaders.
Rep. Devin Nunes, California Republican and former chairman of the House Permanent Select Committee on Intelligence, said this year that he sent the Justice Department eight criminal referrals related to the leaks, including those related to Mr. Trump’s conversations with the leaders of Mexico and Australia.
Former White House strategist Steve Bannon said efforts to weed out the Obama holdovers was a priority early in the administration.
“The NSC had gotten so big there were over 450 billets,” said Mr. Bannon, adding that he and others tried to remove the Obama detailees from the White House.
“We wanted them out,” he said. “And I think we would have avoided a lot of the problems we got today if they had been sent back to their agencies.”-Washington Times
In addition to Ciaramella, Lt. Col. Alexander Vimdman (likely Ciaramella’s source) testified against President Trump during the House Impeachment investigations – telling the Democratic-led House Intelligence Committee that he was “concerned” by what he heard on Trump’s call with Zelensky.
NSC official Tim Morrison, meanwhile, testified that Vindman was suspected of leaking sensitive information to the press, a claim Vindman denied.
English-speaking DISARMAMENT, DEMOBILIZATION, AND REINTEGRATION OFFICERS.
This job was posted the day after Christmas. So for all the folks who have been saying “nobody is trying to take your guns” you might want to read this job listing and reconsider your opinion.
You may recall that citizens of Virginia have become outraged recently by new laws that are likely to pass this month, effectively banning all semi-automatic weapons. Sanctuary counties, cities, and municipalities now cover all but the most urban parts of the state. These sanctuaries have vowed to support the Second Amendment and are refusing to enforce unconstitutional gun laws.
Despite the AG’s opinion and threats from the state government, Virginians appear to have no plans to give up their guns or register them. Many members of law enforcement entities and the National Guard have said that they will not act on unconstitutional orders.
One has to wonder if this is why the UN is hiring “disarmament officers?”
What is the job description?
Here are the responsibilities for the new hires, as per the United Nations job listing.
Within delegated authority, the Disarmament, Demobilization and Reintegration Officer will be responsible for the following duties:
Acts as a Focal Point for Disarmament, Demobilization and Reintegration (DDR) components for two to three missions, responsible for planning, support to implementation and evaluation;
Participates in DPO and Integrated Task Force planning meetings for the establishment of a new peacekeeping mission with a potential DDR component;
Provides technical assistance to peace negotiations;
Participates in technical assessment missions;
Advises, develops and reviews (as appropriate) initial DDR functional strategy and concept of operations for further development into a full programme by the DDR component and the National DDR Commission;
Drafts and reviews DDR inputs to SG report, code cables, and talking points;
Develops initial result-based framework and budget for new DDR components in new mission;
Liaises with UNDP and donor community to raise voluntary contributions for DDR programmes;
Presents and/or defends new and subsequent DDR budgetary requirements in the ACABQ and the 5th Committee of the General Assembly;
Develops staffing structure and terms of reference for a DDR component, including terms of integration with other UN agencies, funds and programmes;
Provides technical clearance for applicants to DDR units in new and ongoing missions;
Provides Headquarters support in planning the civilian and military logistics support for DDR;
Continually reviews DDR programme strategy and implementation through relevant documents, reports and code cables;
Conducts field missions to assess implementation of established DDR programmes;
Identifies potential problems and issues to be addressed and suggests remedies to DDR units in the field;
Liaises with Member States, UN actors and other DDR interested partners to represent the mission’s DDR component at the Headquarters level;
Establishes and maintains an outreach network with CSOs and IGOs active in the area of DDR.
Supports the doctrine development work in the area of DDR in the department, with the Inter-Agency Working Group (IAWG) on DDR and other relevant national and international actors working on DDR issues;
Contributes to Department-level or Policy Committee-level policy development work on DDR and related issues;
Maintains and further develops the Integrated DDR Standards – a set of inter-agency policies, guidelines and procedures on DDR;
On behalf of the Chief of the DDR Section, co-chairs the IAWG on DDR, contributes to bringing coherence to the interaction of the UN system and its partners on DDR;
Supervises the Associate Expert (Junior Professional Officer) in the development and maintenance of the web-based United Nations DDR Resource Centre;
Liaises with others (UN, regional organisations and Member States) providing DDR.
Also notable is the required language fluency – English – and the desired experience.
Seven years of relevant experience in disarmament affairs, political analysis or in national military or paramilitary service, preferably related to the design, implementation or review of DDR. (source)
Employees would answer to the Secretary-General of the United Nations.
As per the UN, here are some specifics about this job description. Of special note:
Disarmament is the collection, documentation, control and disposal of small arms, ammunition, explosives and light and heavy weapons of combatants and often also of the civilian population. Disarmament also includes the development of responsible arms management programmes. (source)
As well, the UN especially wants women to apply for this job, citing gender equality. But is it possible they think that a gun owner might have more ethical difficulty firing on a woman trying to take their weapons than a man?
The US is no longer part of the UN Arms Trade Treaty.
You may recall back in 2013, the United Nations convinced then-Secretary of State John Kerry to sign a treaty that “unequivocally bans arms transfers that are in violation of a U.N. arms embargo or that exporters have reason to know will be used to commit genocide and other grievous war crimes.”
NHTSA’s Special Crash Investigations Unit To Review Fatal Tesla Crash In Los Angeles
The National Highway Traffic Safety Administration (NHTSA) has opened an investigation into the Dec. 29 crash of a Tesla Model S in Southern California that killed two people, reported Bloomberg.
NHTSA’s Communications Director Sean Rushton wouldn’t comment on the specifics of the crash and didn’t say if the Model S was on Autopilot during the incident.
A speeding black Tesla ran a red light and plowed into a Honda Civic Sunday, instantly killing two occupants in that car.
The Los Angeles Police Department, at the time of the accident, said two occupants in the Tesla suffered non-life threatening injuries.
NHTSA’s inquiry into the crash will be headed by the agency’s Special Crash Investigations unit. It has already investigated 13 Tesla crashes where Autopilot was suspected of malfunctioning.
Earlier last month, NHTSA announced that it would open an investigation into a crash in Connecticut where a Tesla hit a parked police cruiser while on Autopilot.
NHTSA criticized Autopilot’s lack of safeguards after it probed a 2018 crash in Sept.
Tesla and NHTSA have advised drivers that their hands must be on the steering wheel at all times while engaging Autopilot. Still, some drivers disobey the rules and take their hands off the steering wheel as it’s their belief the vehicle is fully autonomous.
IRRELEVANT:
Tesla claims sleeping at the wheel Autopilot videos are faked
RELEVANT:
Reaction time in an accident encouraged by Elon Musk’s illegal off-label hands-free promotion on @60Minutes@NHTSAgov reported $TSLA to @FTC for ‘misleading’ statements.$TSLAQ
August 2019 pic.twitter.com/DaOSpq7eW3
U.S. Senator Ed Markey recently said Tesla should suspend Autopilot to its customers until new safety mechanisms are put in place to avoid future crashes.
While a decade is just an arbitrary measure of time, people often attribute certain emotional and cultural characteristics to it, such as the “roaring 20s” of the 20th century.
The 20s of the 21st century are promising to mark a defining period in world History, particularly for the West, as vital trends that have been developing for years are expected to accelerate and reach a tipping point. “Roaring” might not be the best description by the end of it.
Consider that at the very start of the decade the UK will no longer be part of the EU, itself a monumental change with deep social, economic and geopolitical consequences. The US and other major economies will face even more profound developments this decade.
The dominant context behind all this is what British historian C. Northcote Parkinson defined in the early 1960s as the great dynamo of History – the passing of the baton of global preeminence between East and West since historical records began.
Nobody knows what will happen 6 months from now, much less a decade, but recognizing the ascendancy of the East as a whole – and the evident decline of the West – can help pinpoint important trends and cycles that are likely to materialize in the near future. That ascendancy has started decades ago and will solidify in the short years ahead.
This is a humble “back of the envelope” attempt by the author to read some through important tea leaves, colored (as a disclaimer from the outset) by his rather pessimistic view of the prospects of his native West and by his admiration of the resilience of the East:
The productivity of debt in most major economies is already below 1, meaning that it takes several dollars in new debt to create a dollar of GDP. This is particularly the case with government debt, and consequently in order to sustain even meager economic growth debt loads as percentage of GDP will continue to growing strongly, following Japan’s path;
This in turn means that interest rates can never be normalized, otherwise such debt loads would become immediately unsustainable. Financial repression will thus continue, likely even be expanded. Central banks will continue to monetize debts at unprecedented levels and even take on the role of steering industrial policy, a good example being the “green economy”;
These actions by central banks have enabled Eurozone banks over the last decade to become liquid but not necessarily solvent, a situation exacerbated by negative interest rates and the flaws of and structural imbalances generated by the Euro. A quick look at the share price of Deutsche Bank, Germany’s largest bank, clearly shows this;
Birth rates across the West will continue to fall further given a confluence of social and economic problems. Many Eastern countries are are wrestling with this problem, but the way Western elites are dealing with it are transforming its cyclical nature into a structural one, with deep generational consequences;
Related to that, the pension crisis will come to the forefront, with more Baby Boomers retiring (where possible) into pension plans that for the most part are underfunded, in many cases severely, despite record high asset prices;
Modern agriculture has been very successful in delivering calories, basically by converting copious amounts of fossil fuels into food, but rather less so in delivering nutrients. This is because it exhausts top soil and organic matter, critical to produce nutrient-dense foods. As such the health crisis will become worse as a depleted nutrition acts as a catalyst to major diseases;
All these factors will add more pressure for governments to take action, meaning that all those contingent liabilities will finally start materializing in budgets over the course of the decade – with a vengeance;
This situation is particularly serious in the US, where it is very possible that the government will lose control of its budget deficit at some point (if it hasn’t already), especially given zero political will and capability to address this. One look at the Congressional Budget Office decadal projections should raise alarm, especially as no recession is expected, but no party seems to care;
Mass migration into the Western world will continue unabated driven by massive demographic imbalances between developed and developing countries, and Western elites seeking to maintain control by “dividing and conquering” their societies and absorbing the spoils into supranational compacts that they control;
Another thing which is unlikely to change is the US’ foreign entanglements. Like with immigration and the budget deficit, no party has the will to do anything about it. Three dynamics make highly likely the emergence of a new, bigger conflict where the US will once again become involved this decade: (i) the military being spread all over the planet, raising the chances of some fire exchange with someone, even by accident, (ii) enormous military spending, already larger than several major countries combined, that keeps on growing, and (iii) America’s enemies becoming more entrenched and determined in their quest to develop capabilities to seriously challenge its dominance (like Iran developing medium-range nukes this decade, along with others);
Automation, the replacement of humans with machines, will accelerate and start replacing enough jobs to generate even more income inequality between workers and capital owners, already a sensitive topic thanks to the monetary and fiscal policy imbalances of the last decade;
It is therefore inevitable that populism will continue to increase, both on the right and the left of the political spectrum. The hollowing out of the moderate center, tied to a neo-liberal model that is seriously sputtering, will prompt a major political and social polarization in many Western societies not seen since the 1930s;
The trend towards globalization will be impaired, despite the best efforts of supranational organizations like the UN to maintain the status quo. Major exporting economies like Germany will be disproportionately impacted, creating more tensions inside an already frail EU;
The political landscape will massively change in the US. The fragmentation of political views and aspirations already means that a two party-system is incapable of dealing with differing objectives inside their respective electorates. However, the emergence of new parties is severely limited by lack of access to funding necessary to win at the federal level, which means that democracy will suffer;
This loss of democracy is even more likely given the profound demographic change taking place in the US, where immigrants tend to vote overwhelmingly for the Democratic Party. As a result Texas and other states will likely swing Blue by the end of the decade, meaning that Republicans will be locked out of power for a generation+. Once again California led the way for the rest of the country, with an entrenched Democrat super-majority there. As democracy recedes, societal and ethnic conflict will gradually become mainstream;
What this really means is the beginning of the end for the great American experiment this decade, as its traditional institutions – including its Constitution – can no longer properly function under such conditions. This is hugely consequential for the world in terms of prosperity and freedoms;
One feature of diverse societies is that they are inherently unstable, meaning there’s a far greater need for a government to mediate the interests and conflicts between different groups. Politicians will increasingly tighten their grip on society, aided by technology that will become even more intrusive. Silicon Valley and Washington DC will thus become even more intertwined;
Societal fragmentation will not be limited to the US, far from it. French President François Hollande warned in 2016 (after he left office, of course) that his country would eventually break apart. This may become a de facto reality in the 2020s as multiple societal, demographic and economic factors converge in French society. In fact the new decade was inaugurated with dozens of cars set on fire in Paris. These factors will also impact other European countries in similar ways, including Sweden, Belgium, even Germany;
The EU will become increasingly authoritarian to prevent more BREXITs and keep that political project going. Any dissent of its main guiding policies, from the environment to immigration, is already being stamped out under the guise of “hate speech”. It will only get worse from here. A draconian social credit system similar to what China is developing might be in place by the end of the decade. It seems inevitable that the political make-up of the EU and several of its members will be radically different by the end of the decade compared to today;
BREXIT might have been a fantastic idea given all that is happening in the EU, but the timing will prove to be off. First, we are close to a global recession, which absent very vigorous central bank action might become serious, thus curtailing any initial enthusiasm. Second, Boris Johnson will be pursuing free trade deals when the globalization tide is turning against him. Third, because in order to ensure the City of London’s preeminent access to global capital markets he will have to offer a bargaining chip, and that is what’s left of British industry – meaning the working class seats the Conservatives were able to impressively flip from Labour on the back of BREXIT. Perhaps the UK as well might not escape the coming fragmentation;
Working and middle classes across the West, including the UK and especially the US (if one looks objectively at the results of three years of “America First” policies under Donald Trump), will finally realize that they have no real political representation. The real political fault line is not between right and left, rich and poor, liberal and conservative, but rather globalism versus nationalism. There is no money in the latter, beyond extracting taxes to pay for that burgeoning government (that will inevitably oppress them) and elite pet projects, like solving “climate change” and the “migrant crisis”;
The West thrived when its working and middle classes thrived. These are the people who consume, who largely maintain the national traditions, who fight their wars. Financially and demographically they are in a very tough spot, with birth rates far below replacement levels and life expectancy plunging due to drugs and health problems. Half of Americans can’t cut a $400 check for an emergency. As things stand this rot will likely accelerate as the decade progresses;
All this does not mean that it will be smooth sailing for the East, far from it, as those economies still depend a great deal on Western markets. Still, they have a highly motivated, educated and productive workforce, comparatively low debt levels (ex-Japan), high savings and very little contingent liabilities. They are also very safe to live in. Attracting top talent from the US and Europe, in addition to their own, should not be too difficult, further cementing their competitiveness. In a sense these economies are merely reverting to the global place they used to occupy before that baton swung to the West;
Russia is an interesting case as it was always between East and West, given its vast cultural, ethnic and geographical components. Thanks to incredible short-sightedness and (frankly speaking) stupidity from the NeoCons in Washington DC it will now embrace its Eastern future. The 2020s will consolidate the emergence of Eurasia as a super economic block towards the end of the century, independent from any US interference;
That sets up different scenarios for the coming fracturing of the EU by mid-century, if not sooner. Eastern European countries should gradually gravitate towards Eurasia, including Germany – the worst case scenario for US hegemony. The center West of Europe will become more culturally and demographically aligned with Africa, and so might pursue its future there. And Portugal and Spain, if they had any sense, should seek close ties with their cultural peers in Latin America and Africa;
Africa could be the one bright spot in the middle of all the turmoil elsewhere, especially given that it has a lot of development potential and a vast supply of all sorts of natural resources. China (i.e. the East) is spending vast sums to unlock this potential and is now the continent’s largest trading partner. Unfortunately, the constraints holding Africa back are all too familiar: corruption, loss of their most enterprising people to mass migration, weak institutions incapable of addressing the aspirations of its very young populations and increasing social and ethnic conflicts, exacerbated by a resurgence of political Islam – another quintessential Eastern ideology that gains force whenever the West declines. This decade will indicate which way it will eventually go the rest of the century;
Energy prices should remain very volatile, as demand is pressured by a weakening of the economic cycle and supply by a coming peak in US crude oil production this decade. The explosive situation across the Middle East, from Libya to Pakistan, will add much greater uncertainty as the decade unfolds. The West faced serious oil shocks in the 1970s as the US could no longer ramp up its production to counter supply embargoes from the Middle East; it is vulnerable to a repeat of that by the end of the decade. Sustained crude oil price rallies above $100/bbl would very likely put a nail in the coffin of the financial house of cards concocted by Western central banks;
Commodities markets in general should perform better on a relative basis this decade, especially when compared to US stock markets, which have been on an absolute tear since the end of the financial crisis in 2009. The longest bull market in the context of the weakest capital expenditures cycle since WW2 suggests that significant productive capacity might be taken offline at some point this decade. Mean reversion is a real thing in capital markets;
Aging farming populations worldwide, quite severe in some cases, will finally put significant pressure on food supplies by mid-decade, if not sooner. And the young, so far, are not replacing them. As a result, record food supplies globally at the start of the decade may turn into food deficits by the end, especially given strong population growth projections (including in the West via mass migration);
And the US dollar? Its cycles typically last around a decade, and if that is the case we might be nearing the end of is bull run, certainly this decade. Adding to this cyclical outlook is the fundamental deterioration of the US fiscal position outlined above. That deficit will have to be financed somehow, and some pretty juicy yields might have to be offered especially if the dollar starts weakening. While it may still remain the world’s reserve currency given lack of competitors, cryptocurrencies might increasingly offer an alternative. StableCoins, a variant, in particular offer governments a monetary alternative to generate growth within the constraints of the Euro, for instance;
Gold should remain part of any investor’s portfolio (in physical form), although nobody can say for sure whether prices will be higher in dollar terms by the end of the decade. Trillions of dollars in debt issued in the last decade will become due and together with weak economic growth the risk of a deflationary shock remains significant;
The wildcard in predicting financial outcomes is as Western societies profoundly change so will the rules of the investment game. It’s not inconceivable that capital controls will be in place before the end of the decade. The more Europe and the US sink into deep fiscal and economic issues, the bigger that wildcard will be;
Investors’ focus will gradually shift from speculation to wealth preservation, given the dearth of fairly valued opportunities at the start of the decade and a far more uncertain global environment.
Summing up, this decade will very likely be remembered for the end of the world order that had been in place since WW2.
Yes, there is a positive drift on societies across the world emanating from relentless technological progress, but it is highly unlikely that this will do anything to stop the profound demographic, financial and cultural changes that have accelerated this past decade.
Adam Smith noted that a nation can take a lot of ruin. For decades Westerners have been doing their best to figure out how much. Not only that, but a progressive cultural revolution starting in the 1960s has upended all Western traditional values and morals, and so the present generations are ill-prepared to cope with the massive challenges that lie ahead.
If there is a silver lining in all this is that young people are starting to acknowledge the failure and dead-end of the current economic, moral and governance models, and are gradually returning to tradition, family life and communities. Localism, as opposed to globalism, will gain traction.
Building resilience should be the motto of the coming decade.
And with that, wish you a very hopeful, positive and healthy 2020.
So Many People Have Fled California The State May Lose Multiple Seats In Congress
California is poised to lose multiple congressional seats after the 2020 census for the first time in the state’s history, thanks to an exodus of more than 200,000 people between 2018 and 2019, according to the Los Angeles Times. Top destinations include Texas, Arizona, Nevada, Oregon, Washington and Colorado.
“It’s got a lot to do with dispersion from California to the rest of the west,” said senior Brookings fellow, William Frey. “Arizona, Texas and Colorado are all big destinations for California migrants, and they all are gaining seats.”
About 203,000 people left California in that period, a result of the state’s shifting migration patterns and economic strains that are making it harder to afford living here. New York, Illinois, New Jersey, Massachusetts and Louisiana also saw large losses to other states.
California’s potential loss in reapportionment, which will be determined by next year’s census count, would drop the state’s number of seats in the U.S. House of Representatives from 53 to 52, said William Frey, a senior fellow at the Brookings Institution. –LA Times
According to a relocation survey by Texas Realtors, 63,175 Californians moved to Texas in 2017, while almost 41,000 Texans moved to the Golden State. And while California may lose a seat in the House, Texas is likely to gain three seats after the 2020 census. Arizona, Colorado and Oregon may gain one seat apiece.
A state’s population includes all residents – citizens and non-citizens, along with overseas federal employees and their dependents from whatever state they claim as home, according to the US Census Bureau.
That said, if illegal immigrants fail to participate or fail to give honest household figures, California could lose multiple seats according to state redistricting analyst Paul Mitchell,
“If, as many fear, non-citizen populations and the state’s heavily Latino population either fails to participate or participates without providing full household counts, then California could lose more than one seat,” said Mitchell.
The House of Representatives, meanwhile, is limited to 435 members thanks to a 1929 federal law which lawmakers and the president could change if they wanted to.
Exactly where California would lose a seat in the House depends on which communities are larger or smaller compared to census numbers from 2010. The state’s Citizens Redistricting Commission, whose members will be selected in coming months, will hold public hearings in 2021 to determine how to redraw congressional maps.
Paul Mitchell, one of the state’s leading analysts of the redistricting process, said that two places could dominate the discussion: the communities sitting at the intersection of Los Angeles, Orange and San Bernardino counties and the suburbs to the east of San Francisco. –LA Times
The most obvious political impact is that incumbent House members would need to run against each other or leave office. The Times notes that in 2012, “Rep. Brad Sherman (D-Northridge) defeated former Rep. Howard Berman in a bitter contest brought on by the new lines drawn in Los Angeles County.”
Losing a House seat would be a “massive rewrite of the Central Valley congressional districts,” said Mitchell.
State census workers, community organizations and local politicians started outreach efforts as early as April to ensure an accurate tally in next year’s count. In addition to reapportionment, nearly $800 billion in federal tax dollars and political redistricting are at stake. –LA Times
Officials say Los Angeles county will be the hardest to accurately tally because of its high concentrations of renters, homeless people, and immigrants who may not participate due to language barriers or fear of being targeted by federal immigration authorities.
Meanwhile, the US growth rate has declined steadily over the past decade – with California leading the charge according to Frey, with about 400,000 people under the age of 18.
“This is a symptom of an aging population,” Frey said, adding “and in states like California, an out-migration of younger families with children.”
“Revolutionary Changes In Public Opinion” – Gallup’s Decade in Review: 2010-2019
Authored by Justin McCarthy, a journalist and analyst at Gallup,
A review of Gallup analyses over the past decade reveals that the years from 2010 to 2019 bore witness to key revolutionary changes in public opinion, along with some persistent trends and concerns, as well as striking moments and lasting effects.
Here are the changes, issues and moments in public opinion that Gallup editors think will long be associated with the 2010s:
Revolutionary Changes
Same-Sex Marriage: When the decade began, only a handful of states had legalized gay marriage and most Americans opposed it. But in 2011, Gallup recorded majority support for same-sex marriage for the first time. Americans continued to warm to gay marriage as the decade progressed, with support reaching the 60% mark just before the Supreme Court’s 2015 Obergefell v. Hodges decision made gay marriage legal nationwide.
In the final years of the decade, support has ranged between 61% and 67%. The wholesale change in public attitudes about gay marriage over such a short time span represents one of Gallup’s most compelling public opinion trends.
Marijuana: Much like the issue of same-sex marriage, Americans’ views on legalizing marijuana have vastly changed, with the sharpest shift in support for legalization occurring in the past 10 years.
The U.S. Economy: That two in three Americans say it is a good time to find a quality job in the U.S. at the conclusion of 2019 shows how far U.S. consumers have come from the economic despair Gallup found as the decade began.
In January 2010, just 9% of Americans said it was a good time to find a quality job. And for the better part of the decade, Gallup’s Economic Confidence Index was in negative territory as Americans continued to reel from the effects of the global economic crisis and the U.S. recession. President Donald Trump’s inauguration in 2017 marked an important turning point as Americans again became net-positive about the economy and jobs in particular. But Gallup has consistently found that most Americans view the country’s current and future economic health through a political lens.
Political Polarization: Republicans and Democrats have become more polarized in their views on issues and evaluations of politicians. This polarizing trend is not unique to the end of the decade, but it’s one that has accelerated over the past 10 years.
Religion: Religious faith is prominent in the U.S., but much less so than in previous decades. Church membership and attendance — as well as frequency of attendance — are all down to record lows. Americans have become less likely to believe in God. Meanwhile, more than one in five Americans (21%) now describe themselves as having no religion, a sizable jump from 14% in 2010 and 8% in 1999.
Gun Violence: Many of the deadliest mass shootings in U.S. history have occurred during the past decade, and Americans have often reacted to these events with alarm. In 2012, U.S. parents worries’ about their children’s safety rose after the tragic shooting at Sandy Hook Elementary School in Newtown, Connecticut, which marked one of the least happy days in 2012, according to Americans’ self-reports of their emotions. In March 2018, less than a month after the Parkland, Florida, school shooting, Americans’ mentions of guns as the nation’s top problem spiked to a record high. But much like the cyclical political conversations on gun control, these fears typically decline until the next event drives them back up again.
Terrorism: Americans’ worries about terrorism in the 2010s were somewhat of a holdover from the prior decade, which was largely defined and shaped by the attacks that took place on Sept. 11, 2001. Much like gun violence, Americans’ worries about terrorism ebb and flow in reaction to terrorism in the U.S. and abroad. The 2013 Boston Marathon bombings prompted a double-digit increase in the percentage of Americans who believed another terrorist attack was coming. After the 2015 terrorist attacks in Paris, Americans’ concerns about the possibility of future terrorist attacks rose the most among a list of 15 problems facing the U.S.
Osama bin Laden: Al-Qaeda founder Osama bin Laden had been “Public Enemy No. 1” even before the attacks on 9/11. His eluding capture had dogged then-President George W. Bush, who was in the first year of his presidency when the U.S. experienced the deadliest terrorist attack in its history.
Government Shutdowns: The federal government shut down three times over the decade. While one was relatively brief (Jan. 20-22, 2018), the other two lasted weeks — with the most recent shutdown that ended in January 2019 being the longest in U.S. history. Gallup has found that these events affected Americans’ views of the country in various ways.
The Tea Party: The seeds of the Tea Party movement took root in 2009 and early 2010 when fiscal conservatives opposed “excessive” federal spending and government bailouts — and later, when conservative Republicans were outraged over various proposals from the new Democratic-controlled Congress and White House, particularly the Affordable Care Act.
But the movement bore fruit in 2010, when 87 Republicans were newly elected to Congress, many under the umbrella of the Tea Party movement — representing one of the GOP’s greatest electoral victories in generations. In 2010, Gallup found that more than a quarter of Americans (28%) and about half of Republicans (49%) were supporters of the Tea Party movement, with strong support among whites and conservatives. Support for the movement waned after peaking at 32% following its successes in the 2010 elections. By 2015 — the last time Gallup posed the question — support was about half that level (17%).
Occupy Wall Street: Not long after the Tea Party movement’s successes in 2010, the Occupy Wall Street movement was born when protesters in New York City’s Zuccotti Park remained there for two months in the fall of 2011. This prompted national and international re-creations of the protest and ignited larger conversations about wealth inequality in the U.S., particularly the top 1% of income earners.
The Affordable Care Act (ACA): One of the decade’s most significant pieces of legislation was passed at its beginning. Signed by Obama in March 2010, the ACA successfully reduced the percentage of uninsured Americans. The bill, which became widely known as “Obamacare,” was controversial, with 45% of Americans supporting it and 48% opposing just weeks before its passage.
Since then, public opinion has continued to tilt against the law, averaging 46% approval and 49% disapproval since 2012, based on annual averages. Americans were most negative about the ACA as the ACA exchanges opened in late 2013 and the individual mandate took effect in early 2014. The ACA enjoyed majority approval in only two polls, both conducted in 2017, amid Republican attempts to repeal it. Twin polls in 2019 found the law just as divisive today as it was at the start, with 50% approving of the ACA and 48% disapproving.
Though Americans skew negative in their views of socialism, their views are more nuanced when asked about specific aspects of government responsibility. With more political leaders, namely Democrats, adopting socialist messages, the coming decade will tell whether Americans become more positive in their views of socialism or whether they will remain as negative about it as they were in the 2010s.
Former US Attorney Joe diGenova told OANN‘s John Hines that former FBI Director James Comey and former CIA Director John Brennan were “coup leaders” in an attempt to reverse the outcome of the 2016 US election.
DiGenova says the Obama Justice Department was corrupted under Attorneys General Eric Holder and Loretta Lynch, “with the authority and knowledge of then-president” Obama, and that a ‘stupid and arrogant’ Susan Rice was dumb enough to document his knowledge in a January 20th, 2017 email.
“And you’ll never forget, I’m sure, that famous Susan Rice email on inauguration day of Donald Trump, where she sends an email to the file memorializing that there had been a meeting on January 5th with the president of the United States, all senior law enforcement and intelligence officials, where they reviewed the status of Crossfire Hurricane and the president announced – President Obama – that he was sure that everything had been done by the book.
I want to thank Susan Rice for being so stupid and so arrogant to write that email on January 20th because that’s exhibit A for Barack Obama – who knew all about this from start to finish, and was more than happy to have the civil rights of a massive number of Americans violated so he could get Donald Trump.” -Joe diGenova
Moreover, diGenova says that after “all this stuff involving Trump and Page and Papadopoulos and Michael Flynn,” anyone who couldn’t see that the “corrupt investigative process of the FBI and DOJ was basically being used to conduct a coup d’état” is an idiot.
“This was not hard. If you’re a good prosecutor you look at the facts in the Trump case, and the Page case, the Flynn case. There’s only one conclusion you can come to; none of this makes any sense. None of these people were evil. None of them. They were framed, and the whole process was playing out, and you knew it on July 5th 2016, when James Comey announced – usurping the functions of the Attorney General, that no reasonable prosecutor would bring a case against Hillary Clinton. That was ludicrous! She destroyed 30,000 emails that were under subpoena. If you or I did that, we would be in prison today. She got a break because she was Hillary Clinton, and James Comey was trying to kiss her fanny because he wanted something from her when she became president of the United States.
All of these people who watched that news conference and didn’t think that it was a disgrace for the FBI. And then subsequently, watched all this stuff involving Trump and Page and Papadopoulos and Michael Flynn – and couldn’t see that the corrupt investigative process of the FBI and the DOJ was basically being used to conduct a coup d’état. I mean you have to be an idiot. Any first year assistant US attorney would look at all these facts and say ‘there’s a coup underway. There’s a conspiracy.’
But for those of us thought that, the Washington Post, the New York Times. We were ‘conspiracy theorists.’ You know what? Pretty damn good theory, it appears today.
“To what extent is the CIA involved in this?” asked Hines.
“Well there’s no doubt that John Brennan was the primogenitor of the entire counterintelligence investigation,” replied diGenova. “It was John Brennan who went to James Comey and basically pummeled him into starting a counterintelligence investigation against Trump. Brennan’s at the heart of this. He went around the world. He enlisted the help of foreign intelligence services. He’s responsible for Joseph Mifsud and other people.”
“People do not have even the beginning of an understanding of the role that John Brennan played in this. He is a monstrously important person, and I underscore monstrously important person. He has done more damage to the Central Intelligence Agency – it’s equal to what James Comey has done to the FBI. It’s pretty clear that James Comey will go down in history as the single worst FBI director in history, regardless of how Mr. Durham treats him.”
“He precipitated it. He caused it. He encouraged it, and he is responsible for it at a minimum. He and John Brennan are the coup leaders.”
The U.S. economy has experienced its slowest recovery from a recession in the post-World War II era, and the longer it lasts the more evidence there is that normal cyclical patterns are missing. And their absence means market participants shouldn’t rely on them to divine the economy’s future.
Consider the myriad developments that are atypical, or even the reverse of normal economic and financial market behavior. The Federal Reserve shifted from easing credit to tightening following past downturns, with its target federal funds rate normally raised within a year or so of the recession’s trough, eventually precipitating the next economic contraction. This time, the central bank kept its policy rate at the recessionary low of essentially zero until Dec. 2015, 78 months into the recovery. And then, after nine quarter-percentage point increases, it reversed course early this year with three rate cuts.
Far from the Fed’s normal worries about an overheating economy and inflation, the central bank frets that low and even declining consumer prices will spawn deflationary expectations. Buyers will hold off in anticipation of lower prices. Inventories and excess capacity will mount, forcing prices down. The price cuts confirm suspicions and purchases are delayed even further, sparking a deflationary spiral. The glaring example is Japan, with deflation in most years in the past two decades and tiny real GDP annual growth of 1.1%.
Also, despite the plunge in 30-year fixed mortgage rates from 6.8% in July 2006 to the current 3.7%, rate-sensitive single-family housing starts have been muted. They fell from a 1.8 million annual rate in January 2006 to 350,000 in March 2009 as the subprime mortgage market collapsed, but have only recovered to 940,000.
Mortgage lending criteria have tightened and prime-age first-time homebuyers don’t have the necessary downpayments. The net worth of households headed by 18-to-34-year-olds dropped from $120,000 in 2001 to $90,000 in 2016, a 44% decline adjusted for inflation. Also, they learned from the last recession that for the first time since the 1930s, house prices nationwide can fall.
In past business recoveries, the U.S. household saving rate fell as consumer spending grew faster than incomes. In this expansion, it’s the reverse, leaping from 4.9% to 7.9% in November, retarding spending.
Past postwar recessions spawned financial problems, but nothing like the 2008 crisis. The government’s reaction was equally severe with the enactment of the 2010 Dodd-Frank Act and other stringent regulations for financial institutions that are only now being slowly relaxed.
In earlier business upswings, a drop in the unemployment rate of anything like the plunge from 10% in October 2009 to the current 3.5% would have spawned massive wage inflation. This time, real wages are barely growing.
Globalization transported many high-paid manufacturing jobs to China. With the growing “on demand” economy—think Uber Technologies Inc. —many people trade flexibility in working hours for low pay. The payroll jobs that are being created are mostly in low-wage sectors such as retailing and leisure & hospitality.
For years, foreign policy was bipartisan and expanding trade was considered highly desirable. Now, globalists have been overcome by protectionists, spurred by voters upset over stagnant purchasing power and rising income and asset inequality in G-7 countries. Trump’s 2016 election along with the U.K.’s “Brexit” from the European Union are among the results. Then there’s also the demise of global trade deals, which are being replaced by bilateral agreements or no pacts at all.
The U.S.-China trade dispute will no doubt persist because China, with a declining labor force as a result of its earlier one child-per-couple policy, needs Western technologies to grow and achieve its worldwide leadership ambitions. But the U.S. is opposed to the technology transfers China wants.
The dollar’s slide from 1985 until 2007 encouraged U.S. exports, curbed imports and gave U.S. multinationals currency-related boosts to profits. Since then, the dollar index has rallied 33% amid a global demand for haven assets. And it should continue to, given the relatively faster growth of the U.S. economy, its huge, free and open financial markets and the lack of meaningful substitutes for the greenback.
Disinflation has reigned since 1980, but real interest rates were positive until the last decade. But for 10 years now, real 10-year Treasury note yields have been flat at zero (see my Nov. 19, 2018 column, “Zero Real Yields Are Tripping Up Investors”). This and the flat yield curve have pushed state pension funds and other investors far out on the risk curve in search of real returns, bidding up stocks to vulnerable levels.
Earlier, the Fed was run by Ph.D. economists who clung to widely-held theories even though they didn’t work. Fed Chairman Jerome Powell is proving to be much more practical, backing away from rigid Fed policies such as the 2% inflation target and a zero-bound policy rate as well as unsuccessful forward guidance.
In this different economic climate, it’s hard to time the end of the current recovery. Still, it will end, due either to Fed overtightening or a financial crisis, like the 2000 dot-com blow-off or the 2007-2009 subprime mortgage collapse. In the current excess supply-savings glut-deflationary world, it’s likely a recession will unfold due to a shock before the Fed overtightens.
No financial crises are in sight, but there are possibilities such as excess debt in China and among U.S. businesses, a trade war escalation, consumer retrenchment resulting in widespread deflation, and disappointing corporate profits measured against sky-high stock prices. Watch for specific imbalances, not typical past patterns.
A Third Of 18-34 Year Olds Live With Their Parents And Other 2019 Housing Market Highlights, In Charts
As Goldman housing strategist Marty Young writes in his “year in review” housing and mortgage market summary, 2019 was characterized by sharply falling mortgage rates and a strengthening housing market:
120bp: 30-year mortgage rates fell by 120bp between 2018Q4 and 2019Q4.
+17%: single family housing starts increased by 17% from November 2018 to November 2019.
+3.2%: the Case-Shiller US house price index has grown by 3.2% over the past 12 months.
50%: 50% of outstanding conventional 30-year mortgage borrowers have a 50bp or larger refinance incentive as of 2019Q4 (up from 6% as of 2018Q4).
5bp: agency MBS spreads widened by 5bp in 2019 (vs. 60bp of tightening of IG corporate bond spreads).
$230bn: Federal Reserve agency MBS holdings declined by $230bn over the past year.
$25bn: non-QM RMBS issuance has reached $25bn in 2019 year-to-date (vs. $11bn in 2018
One remarkable observation: roughly a third of young Americans aged 18-34 now live with their parents: up from 27% before the crisis. Depending on how one looks at this data, it means that either household formation is about to soar, or an entire generation now has doubts it will ever be able to own its own house.
Earlier this month I graduated with a bachelor’s degree in political science from the University of North Carolina at Charlotte.
As I look back on my time on campus, I can honestly say I am thankful for both the professors who challenged me intellectually and were open to my conservative views — as well as the professors who tried to indoctrinate me, belittled my principles, or allowed me to be verbally bullied by classmates.
That’s because both types of experiences taught me how to better defend my beliefs as I enter the next stage in my life: real life.
As I consider law school, I know that my potential future career as an attorney would be built upon defending my stances with wisdom and logic. With that, I appreciate the tutelage the intellectual sparring on campus gave me. It toughened me up, taught me how to argue the facts.
That’s not to say that I support professors who shut down their students’ thoughts and opinions. Nor did I enjoy being condescended to as an undergrad.
But looking back, in hindsight, it did help me grow.
Prior to my university experience, I was home-schooled from first grade through twelfth grade. I felt this non-traditional start to my educational journey might put me at a disadvantage, or at least at a different starting point, than some of my classmates. What I came to discover after some time in the classroom was that I was well-prepared to defend my beliefs.
Often I was the only conservative student to speak up in class, and I did have my fair share of leftist professors who badgered me over my opinions on abortion, immigration and economics.
For example, one professor my sophomore year labeled me “anti-choice” in front of the class when I expressed that the government should have a Constitutional responsibility to protect pre-born children.
But there’s another side to this story, too. I also had some professors who heard me out when I questioned their political views.
I can still recall the time I challenged one of my professor’s anti-capitalism opinions during a lecture. After class he walked up to me, and my stomach was gripped with tension of the unknown. Yet to my pleasant surprise, he offered me an extra credit opportunity to write an essay on why I believe capitalism is the best economic system.
This teaching opportunity strengthened my ability to articulate my opinions and gave me a chance to practice my writing skills.
I am grateful to say I had other professors who, although they disagreed with me, did not shut me down or insult me because of it. These select few professors were the highlight of my college experience, educators who prioritized teaching over indoctrination. They are a powerful reminder that some scholars still allow the Socratic method in their classrooms. They offer a chance for their students — both conservative and liberal — to grow as individuals and intellectuals.
Let me speak for my peers when I say “thank you” to all those professors out there who honor their call to educate. You help make our experiences on campus not only tolerable, but enjoyable.
Students in the university system in America shouldn’t be afraid to express their different views. They should be encouraged to express dissent and be taught how to defend their ideas and build arguments using reason and logic.
Unfortunately, far too often, leftist indoctrination is the lesson of the day. And not all students take it well, namely conservative freshmen who were not taught by their parents or high school teachers counter-arguments to liberal tropes. I’ve seen it happen first hand. They know capitalism is the only system that has lifted the most out of poverty, but they stumble on citing specifics. All too often they get devoured by their left-leaning professors and peers, and end up feeling bullied and belittled. They then go silent, or even worse, buy into the progressive dogma that socialism is the solution to all of the world’s evils.
I’m glad that wasn’t me. As I look back on my experience at the University of North Carolina at Charlotte, I recall professors who challenged my beliefs through bullying tactics and intimidation, as well as professors who challenged me in order to strengthen my arguments and promote my academic success. I grew from both learning experiences.
The professors who tried to silence me taught me the importance of standing up for myself and for those who are voiceless in the face of unreason and unkindness. The professors who challenged my beliefs and encouraged me to work on articulating them in order to build a stronger argument gave me the tools I need to succeed in the decades to come.
Like me, conservative students who have fought bias throughout their education can step into the real world having already faced adversity by surviving a campus where about 80 percent of your peers and nearly 100 percent of your professors disagree with your political views.
While it is disappointing and disheartening that the once-great university system in America is so blatantly biased, and discourages differing viewpoints of students, there is hope in the strong level-headed and determined conservative students who are being shaped by this academic hazing into the future conservative leaders of America.
The annual death toll has only hit 342 on two other occasions, onetime in 2017 and another in 2015. Breaching the 342 level to 347 is uncharted territory and suggests the situation will get worse in 2019.
This is the 5th year the city has recorded murders over 300, due mostly to the Ferguson effect post-2015 riots and socio-economic deterioration in the town.
The highest ever per-capita homicide rate and an out of control opioid epidemic comes as the total population in the city crashes to a 100-year low, many are fleeing the city for the suburbs as the local economy continues to dive deeper into a depression, never recovered since 2008.
Baltimore City Mayor Bernard “Jack” Young held an end-of-year news conference on public safety Monday. Young said, “Our residents deserve to live without the fear of violence and it is my obligation and duty to leverage every resource and tool available to stop the cycle of violence that is crippling our city.”
He added, “We cannot stop violent crime through policing alone. We must use both community-based interventions and an integrated crime-fighting strategy.”
Young also wrote an op-ed in The Baltimore Sun on Tuesday about his new strategy to turn Baltimore City around will focus on identifying and charging gun crimes and holding weekly case reviews with the police department and the State’s Attorney’s Office.
Baltimore City Police Commissioner Michael Harrison said the number of people killed in the city this year is “deeply disturbing.”
“That level of violence simply cannot be tolerated in a civil society, much less in a great city like Baltimore,” Harrison said.
He said the department would start treating the “actual disease” of violence, instead of what he characterized as the symptoms.
“[W]hen we only treat symptoms and never deal with root cause issues, violence, like a disease, builds resistance. It gets stronger and becomes more difficult to eradicate,” Harrison said.
Bitcoin easily succeeds over other cryptocurrencies in multiple key areas, which all but guarantee its future as the standard, noted academic Konrad S. Graf has concluded.
In the second installment of a two-part interview with Eurasia Review published Jan. 1, Graf highlighted a plethora of “competitive advantages” inherent to Bitcoin.
Graf has sought to gain exposure for Bitcoin through academic essays, which expand beyond its mechanism of action to situate it within the broader economic system.
Scarcity
Bitcoin wins out over other forms of money — including other cryptocurrencies — largely due to its fixed supply.
“Bitcoin’s top competitive advantage… is its ability (to) restrict new issuance, the relative reliability of its methods for controlling unit production,” Graf summarizes.
Specifically, Bitcoin’s supply cannot be manipulated, nor can its maximum issuance — 21 million units — ever change to dilute it.
No entity, no matter how powerful in terms of computing power active on the network, can diminish the value of the existing BTC held by savers by increasing the supply. This is in direct contrast to cryptocurrencies with a mutable supply, such as Ethereum (ETH) and XRP, as well as all fiat currencies.
Apolitical value transfer
The above characteristic thus makes Bitcoin particularly useful for settlements from anyone to anyone, as a financial protocol immune to the trappings of fiat.
Here, Graf touches on Saifedean Ammous’ popular book, “The Bitcoin Standard,” which extensively examines Bitcoin’s advantages over fiat. Ammous likewise devotes space to how Bitcoin could function as a settlement currency without the need for middlemen.
“Ammous argues that it is in the — for most people quite arcane — field of settlements that Bitcoin could find some of its most competitive applications. It could become not only an in-common non-political money unit, but also a direct competitor to the SWIFT system and any other existing or emerging rivals to it,” Graf explains.
He continues:
“In a world where conventional systems are also politicized, Bitcoin has an advantage of being “neutral” in the sense that it is controlled by none of the competing power blocks, which means that any and all could potentially participate.”
Technical prowess
Against major altcoins, Bitcoin’s technical prowess means its position as a market leader has been obvious for years, says Graf.
As Cointelegraph has also frequently reported, hash rate alone has achieved an order of magnitude better progress than Ethereum or similar market incumbents.
“BTC currently has 97 exahashes protecting its network to BCH’s 2.5 exahashes, giving BTC a hash rate 39 times higher than that of even its next closest digital-cash competitor,” he continues.
Bitcoin network hash rate vs. Bitcoin Cash, Bitcoin SV. Source: Coin.dance
That attribute also differentiates Bitcoin from imitators with very similar characteristics — the principle may be the same, but hash rate distribution, or centralization, and activity on those other networks pale by comparison.
It’s not an entity
On the topic of centralization, a final advantage Bitcoin has over “corporate” blockchains is its lack of weak points political actors can target.
That benefit has become all the more apparent in 2019, the year in which Facebook unveiled and subsequently faced a global backlash over its digital currency protocol, Libra.
CEO Mark Zuckerberg appeared before U.S. lawmakers alone several times, amid criticisms Facebook was attempting to remove government monopolies over the proposed stablecoin currency.
“There is no CEO to summon to Washington for interrogation,” Graf concludes about Bitcoin.
Giuliani Says Ukraine Corruption Came From ‘Highest Levels Of Obama Administration’; Wants To Testify, Try Case
Rudy Giuliani is not only willing to testify in President Trump’s Senate impeachment trial, he wants to “do demonstrations” in order to outline what he described as a “series of criminal acts” involving “the highest levels of the Obama administration,“ adding that Democrats Adam Schiff and House Speaker Nancy Pelosi will go down in history like Joe McCarthy when people “calm down and watch this carefully.”
“What I learned is the corruption in Ukraine is vast, it’s extensive, it highly involves the Democratic party – not just in 2016 but for many years,” the former New York City mayor said at Trump’s New Year’s Eve party at Mar-a-Lago in Florida.
“When the full scope of what happens in Ukraine comes out, there are going to be a lot of Americans who participated in the corruption,” adding “The Bidens took millions of dollars laundered out of Ukraine, and the only reason they’re getting away with it is because you and the press protect them…”
When asked what he discovered, Rudy replied “I’m not going to tell you what I found out until I have a proper forum… butit’s devastating,” adding “We will figure out the right forum.”
“This is expanding, it will turn out to be a series of criminal acts. It will involve the highest levels of the Obama administration. It’s the reason the Democratic party is in panic.”
“I would testify, I would do demonstrations, I’d give lectures, I’d give summations. Or, I do what I do best, I try the case,” adding, with a smile, “I’d love to try the case.”
“If you give me the case, I will prosecute it as a racketeering case. Which I kind of invented anyway.”
Now, the company may finally start getting its due as an official film studio, too, thanks to its memorable 2019, according to Bloomberg. It started the year by joining the Motion Picture Association of America and then went on to release memorable film hits like “The Irishman” and “Marriage Story”.
The year also included Eddie Murphy’s “Dolemite Is My Name,” which helped lead to Netflix doubling or tripling the output of most conventional Hollywood studios. Netflix executives are also now saying that the company’s financial targets rely on how well its movies do.
Scott Stuber, Netflix’s film chief said: “This fall was a nice culmination. I’m very proud of this slate. I can look you in the eye and say we’ve made as good movies this fall as anybody.”
Stuber joined Netflix after working in film for more than 20 years. He was asked to “build a movie studio from scratch” by Netflix’s Chief Content Officer, and that’s exactly what he did.
Prior to 2019, the company’s slate of films, including names like “The Ridiculous 6”, was mostly forgettable.
Its one critically acclaimed movie, “Beasts of No Nation”, from 2016, earned no nominations at the Academy Awards. Stuber said: “It was a company built on television — that was first and foremost.”
Now his past collaborators, including Dwayne “The Rock” Johnson and director Peter Berg are working with him at Netflix.
At his direction, Netflix has turned into the largest film studio in Hollywood – and it plans on continuing to release 50 to 60 films a year. “Bird Box” and “Murder Mystery” were two other hits, amassing more than 70 million views in their first month on the service. “Six of the 10 most-watched new titles on the service in the U.S. in 2019 were original films,” Bloomberg notes.
The studio has found a niche in films that Hollywood has abandoned, like adult dramas, romantic comedies and action movies without superheroes. And classic cinema buffs – like Martin Scorsese – have finally embraced Netflix.
The last piece of the puzzle for Netflix is the Oscars. Last year, Netflix saw 15 nominations, including for best picture, best director, best actress and best screenplay. The Best Picture Oscar eluded the studio.
But John Sloss, who produced “Green Book,” last year’s winner for best picture, admitted last year to Netflix’s Ted Sarandos that the hard part was over. This means in 2020, Netflix could be read for its first Best Picture Oscar.
“You did it. You got over the hump,” Sloss told Sarandos.
That some memories tend to be stronger than others?
What sort of things do you remember?
You remember events in your life that had a lot of feelings associated with them.
You remember the death of your pet like it was yesterday. All the nights spent sitting on the couch watching Wheel Of Fortune—it’s just a blur.
Researchers have studied this in rats. They found that rats remembered things better if they experienced a rush of adrenaline.
In those moments with strong memories, it feels like time slows down. Time doesn’t actually slow down—time is linear. But human beings experience time as flexible. Time also speeds up when things are boring.
I’m fond of saying that all of finance, or at least the interesting part, is about human behavior. I find the daily fluctuations of stocks and credit spreads less interesting the older I get. And I think finance is more depraved the older I get. But the human behavior part fascinates me.
The fact that time stretches and compresses isn’t news to anyone who’s traded options.
In the world of options, time and volatility work in opposite directions. As time passes, options decay. As volatility increases, options increase in value. All stuff you learned in class.
But if you think about it, volatility increasing is another way of saying that there’s a lot of s— going on. Things are crazy. Options increase in value—which is really like saying that time is slowing down.
Which is exactly how we experience it. Of all my days trading on Wall Street, what are the times that I remember most? The financial crisis, naturally. There was a lot of adrenaline associated with that.
We all have strong memories of it. And while we experienced it, it seemed like time was slowing down—which was reflected in options prices. They were the highest in recorded history.
If I think back over the last 10 years, what do I remember?
The European crisis
The US debt downgrade
The Ebola scare
The yuan devaluation
The vol-splosion
All the crazy times. Nobody remembers the stuff in between. Old-timers like me remember all the way back to 1997 and 1998, with the Asian Financial Crisis and LTCM and the Russian debt default. It’s the accidents that help us mark our time in the markets.
Perspective
We all perceive things differently. As I just demonstrated, we all perceive time differently.
We also might perceive color differently—we just don’t know. There is no way to know that the red I see is the red you see.
We all have different perspectives, especially when it comes to financial markets. I might find a stock attractive that you find unattractive. Happens all the time.
A lot of financial analysis is searching for some objective truth in the markets. This is what the value people try to do. They try to identify the correct value of a security and then buy it if it’s underpriced.
But there really is no objective truth in finance—just a set of ever-changing perspectives. Some examples:
People have created several models to explain stock market behavior. Keynes’s beauty pageant is at the top of the list. I will always catch a beauty pageant if it’s on TV. The goal isn’t picking the most attractive contestant. It’s picking the contestant that the judges will find most attractive. It’s a great exercise.
But I don’t think that’s the right model.
I came up with my own model and gave it to the world on the Bloomberg Opinion page. You can read about it here. But I feel like it’s incomplete, too.
Sentiment also plays a role—big turning points are always at sentiment extremes.
I’m not sure what the answer is—or if there even is an answer. I think about it all the time. People smarter than me spend even more time thinking about it.
Maybe there is no Grand Unified Theory—maybe there are regimes in the financial markets, and sometimes some things work and sometimes other things work.
Maybe the rules change all the time and there is nothing we can do about it.
I am not even sure buy-and-hold and dollar-cost averaging will work going forward.
And that’s what you learn when you have 20 years of experience—that you actually know nothing.
That said, one thing I do know is that the adrenaline rush reckless traders get throwing money at “hot stocks” is not something to aspire to. It’s much better to even out your odds with a diversified, balanced portfolio and a long-term view.
* * *
Jared Dillian is an investment strategist at Mauldin Economics and the editor of The 10 th Man, a free contrarian investment newsletter. From 2001 to 2008, Jared worked at Lehman Brothers—first as an index arbitrage trader and then as head of the ETF trading desk. During this time, he routinely traded over $1 billion a day in volume.
de Blasio’s New York: Former Rikers Inmates Using Taxpayer-Funded Debit Cards To Buy Liquor, Tobacco
Today in “why Democrats simply should never be allowed to allocate government capital” news, it it being reported that former inmates at Riker’s Island are now using their government-issued debit cards to buy booze and Juul pods.
The news comes just days after we reported that inmates were receiving training on how to become Starbucks baristas for “job security” purposes once they are released.
The debit cards were part of a “soft on crime city initiative” by beta male bleeding heart Mayor Bill de Blasio that provided ex-inmates with two $25 gift cards, according to the NY Post.
JR, an employee at a liquor store near Riker’s Island, has said that her store was refusing to sell to the cardholders.
The liquor store employee said: “We’ve had more people coming in with the visa things. No, we don’t take that, no gift cards, none of that. People come in here always trying to find a way to pay without really paying.”
City Sliquors, another liquor store along the Riker’s Island bus route, said ex-inmates “didn’t seem to understand why their payment wasn’t accepted”.
The store’s owner commented: “Usually we don’t accept it because we don’t know where it came from with no chip, it may bounce.”
And even while booze has been difficult to get, tobacco and Juul pods have been easier for the ex-inmates to ascertain.
Ahmed, a worker at the Plaza Deli Grocery, said: “Yet to see one person use it to buy food.”
Seeing the rampant success of this program, the city is also planning on setting up ex-inmates with Metrocards and burner phones upon their release. The move comes as a result of de Blasio’s new bail reform law, which is supposed to incentivize inmates to show up for their court appearances. Other incentives being offered – we swear we are not making this up – are winter coats, Steve Madden shoes and Mets tickets.
The programs are being run by city-funded non-profits and will cost about $500,000.
One law enforcement source concluded: “It’s a sad state of affairs when the city bends over backward to reward criminals instead of protecting the victims of their crimes. What’s next? Free limo service back home?”
Political demagoguery is a valuable and effective weapon in the arsenal of the establishment elites. As long as there is a wide ideological division between groups in society, biases and desires can be tapped and manipulated. This allows those in power to direct vast portions of the public down one path or another. When fear of an enemy and the drive to “win” become more important than truth and evidence, the population has tied its own puppet strings and handed them over to the spin doctors.
This is why the false Left/Right paradigm has been so useful to the establishment for so long. Anytime the public starts to wake up to the web of control, all the elites have to do is push one or both sides of the political spectrum towards extremism and let the people rage at each other instead of picking up their torches and pitchforks and tearing down the oligarchy. This method of division and diversion keeps the masses occupied and feeling as though they are accomplishing something while actually accomplishing nothing.
As Carroll Quigley, globalist insider and mentor to Bill Clinton, admitted in his book ‘Tragedy And Hope’:
“The argument that the two parties should represent opposed ideals and policies, one, perhaps, of the Right and the other of the Left, is a foolish idea acceptable only to doctrinaire and academic thinkers. Instead, the two parties should be almost identical, so that the American people can “throw the rascals out” at any election without leading to any profound or extensive shifts in policy….Then it should be possible to replace it, every four years if necessary, by the other party which will be none of these things but will still pursue, with new vigor, approximately the same basic policies.”
The false Left/Right tactic has become more and more exposed in the past decade to the wider public, and so the elites had to change their methods to adapt to the growing awareness. Conservatives in particular have started to leave the plantation, and something had to be done to drag them back. The liberty movement has become a force in western life with tens of millions of members. It is an unpredictable element that the establishment needs to lock down and redirect if they ever hope to achieve their goal of a “new world order”.
The elites have used two tandem strategies in this effort:
First, they pushed leftist indoctrination towards full bore cultism.
Second, they have attempted to co-opt the leadership of conservatives and the liberty movement using a political puppet figure in order to bottleneck our energy and momentum.
Leftist culture has become increasingly erratic and unhinged (even more so than usual), informed by elements of a new social justice fanaticism; a kind of religious fervor where faith in ideological gatekeepers is more important than facts. The majority of the left, while not necessarily part of this “woke” religion, is still influenced by SJW rhetoric. Delusional notions of “patriarchy” and “inherent racism” and “inherent sexism” are woven into the Democrat mindset today. They see oppression everywhere, and victim group status has become the social currency they use to acclimate to a fantasy world where big government and entitlements are the solutions to all the world’s ills.
The conservative side of civilization doesn’t participate in the oppression fantasies of the left. We don’t even speak the same language, as the left’s very vocabulary has shifted into an academic babble-language they simply made up to describe social dynamics that don’t exist and gender politics that are biologically and scientifically absurd. Reconciling with leftists in any meaningful way has become nearly impossible, and fear of their fanaticism is causing conservatives to assume that whatever these people hate, must be good.
Enter Donald Trump, a kind of artificially created focal point machine, a figure that is designed to absorb liberty movement talking points and then regurgitate them in an alphabet soup puddle on Twitter. This rhetoric is relatively effective in that many conservatives recognize parts of the soup and find comfort that Trump “must be on their side”.
I have outlined in numerous articles Trump’s dubious background and behavior. To summarize, we often hear lip service from Trump on anti-globalism and anti-elitism, even though it is an undeniable fact that he has saturated his cabinet with globalists and elitists.
We heard anti-banker talking points from Trump during his campaign, even though Trump has a longstanding relationship to the Rothschild family and works side-by-side with Rothschild and Goldman Sachs bankers in the White House. We heard lots of anti-Federal Reserve discussion from Trump and observations that the current economy is an explosive bubble engineered by them; yet he now openly demands that the Fed inflate the bubble further while he takes full credit for the fake stock market rally. We also heard many promises that US troops would be coming home and the long wars in the Middle East would end for America; this has not happened and likely will not happen as tensions with Iran continue to grow.
In other words, Trump is a skin job. A robot. A false conservative and false prophet of the liberty movement. He tells us what we want to hear while his actions say something entirely different. Yet, a lot of conservatives still listen to him, because they despise the collectivist religion of the left, they desperately want mainstream recognition and representation, and because they want to believe that there is a white knight out there in Washington defending their interests and their future.
The establishment understands these desires and exploits them. They understand that the more extreme the left becomes, the more tempted conservatives will be to jump blindly on the Trump bandwagon.
Mainstream media outlets like CNN have taken to referring to Trump’s base as a “cult” recently, which of course is the pot calling the kettle black; but it does not mean that the accusation is wrong. Trump’s base is indeed acting more and more like a cult, but primarily in reaction to the cultism of leftists. The crazier the left gets, the more Trump becomes a folk hero to the right. The more the media promotes fabricated Russiagate nonsense or Ukrainian conspiracy narratives, the more conservatives assume that the establishment is “trying to take down” Trump.
It is rather rudimentary reverse psychology – If the establishment media attacks Trump, then he must be “anti-establishment”. If the leftists hate Trump, then he must be good for conservatives. Nothing could be further from the truth, but if anyone points this out they will be immediately attacked as disinformation agents and purveyors of CNN talking points.
A common argument in defense of Trump is to ignore his associations and behavior entirely and focus on the prevailing circus surrounding him instead. People state indignantly that:
“Trump is under attack! They are trying to impeach him! How can he be working with the globalists if they are trying to get rid of him…?”
I would point out that there is a usefulness to political theater that goes far beyond trying to remove a president from office. Again, the media viciously attacked Trump during his election campaign, but if one understands that public trust in the mainstream media has collapsed in the past ten years, then one also understands that media attacks on Trump would only cause more people to like him and vote for him. The question then needs to be asked: Does the establishment understand this inverse relationship in public psychology? Or, did they completely overlook it?
I seriously doubt they are overlooking it.
If this is the case, then the frothing leftist rage against Trump, while partially real, is also 4th Generation warfare designed to trick conservatives into developing their own cult-like fantasy that Trump is our fearless leader fighting the good fight even though his presidency is tightly intertwined with global elitists. The impeachment itself comes at a time when a large portion of the liberty movement is waking up to the Trump con game and is questioning many of his activities and associations.
The establishment has put a lot of effort into creating the Trump versus Leftist circus, and they really hate the idea that a number of people are refusing to pick a side. For them, there is nothing worse than free thinkers who organize their own side separate from the false paradigm.
The impeachment, like Russiagate, is not designed to get Trump out of office. It is a Hail Mary attempt to pull liberty minded conservatives back into the Trump fold; to keep us predictable and under control. It is also designed to keep leftists feeling justified in their insanity. Remember, the crazier the left acts, the more fearful and malleable conservatives become.
The establishment likes Trump right where he is, and he will not be going anywhere, at least not until he has completely served his purpose. Whether that will be in the next year, or in another four years, it’s hard to say at this time. Obviously, the elites have to keep the left/right sideshow going at full volume until they are done using Trump as a distraction. They will “attack” him as often as needed to create the illusion that he is anti-establishment, and Trump will continue to play along to please his masters, many of them standing over his shoulder everyday in the White House.
The Leftist Cult and the Trump Cult are similar in their refusal to accept facts and reality, as well as their ability to double and triple down on delusions that are consistently debunked.
I have witnessed people on the Trump-train dismiss every blatant piece of evidence of Trump’s collusion with globalists on the basis that he is “keeping his enemies close”. I have seen them ignore his support for Red Flag gun laws, his refusal to pull US forces out of Syria, Iraq, Afghanistan and Yemen, his hostility towards Iran, his support for totalitarian governments like Saudi Arabia, etc. They call it “4D chess” and simply move on. I have seen them shrug off endless data showing economic decline and proclaim instead an “economic boom”. I have seen them completely absorbed and distracted by the trade war and China while forgetting all about the banking elites that engineer most of the calamity in our society.
They act this way because they are afraid. The political left frightens them, they are searching for a hero to save them, and they are willing to overlook almost any skeleton in Trump’s closet in order to make their fantasy version of him real. But, the leftists are nothing more than a symptom – They are useful idiots, not the source of the disease. And, Trump is not the hero conservatives are looking for anyway. In terms of the liberty movement, Trump is irrelevant. He’s a footnote. The real work is being done by millions of activists breaking through decades of propaganda and exposing the truth.
The difference between the Leftist Cult and the Trump Cult is mostly intent: Leftists double and triple down on their lies because they are infatuated with collective power and they see the truth as an obstacle to the “greater good”. The Trump cult ignores facts and evidence on Trump because they are hyperfocused on collective defense. Leftists are seeking to micromanage the thoughts and behavior of the world while conservatives are seeking to solidify enough political protection to ensure they are left alone. The Leftist Cult wants to burn everything to the ground, erase history and rebuild the world in their image. The Trump Cult is trying to keep the last structures of American heritage alive; they have simply put their faith in the wrong champion.
The sad reality is, leftists and conservatives are likely far too alien to each other now to ever come to a diplomatic solution. The division in society is very real; it’s the division at the top that’s Kabuki theater. The liberty movement is the key to everything, as we are the constant target of establishment 4th Gen propaganda. If we didn’t matter, then the elites would not be spending so much time, money and energy trying to keep us in line. They need us to buy into the theater, otherwise we become an unknown element, a third party, a time bomb that could explode unexpectedly on them at any given moment.
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As the decade draws to a close, it’s time to look back at some of the things the past ten years have brought us. To think that people clinking their glasses on New Year Year’s Eve 2009 had no idea what an iPad was and couldn’t post a picture of the fireworks on Instagram.
While the 2000s will always be remembered as the eve of the smartphone era, the past decade brought us some of the world’s most beloved social media apps as well as several gadgets we wouldn’t want to miss today.
The PlayStation 4, launched in November 2013, went on to become the second best-selling video game console of all time. The Apple Watch (2015) helped wearables reach mainstream adoption and Amazon’s Echo rang in the smart speaker boom in 2014.
As for the next decade, we have no idea what to expect. 5G will surely be a big topic for the early 2020s and rumors suggest that augmented reality headsets could become a thing. With several technology companies among the world’s most valuable (not to mention most resourceful) corporations right now, it seems safe to say that the next decade won’t disappoint from a technological point of view.
Many of the critical tools employed in the coup to paint Donald Trump as a tool of the Russians and to manufacture a pretext for removing him from office, were created more than twenty years ago.
I am talking about the surveillance state that the American electorate has ignorantly accepted as necessary in order to keep us safe from terrorists.
Despite previous warning from whistleblowers like Russ Tice, Bill Binney, Ed Loomis and Kird Wiebe, no action to rein in the surveillance monster was taken until Edward Snowden absconded with the documents exposing the vast amount spying that the U.S. Government is doing to its own citizens. But even those weak efforts to supposedly rein in the NSA proved to be nothing more than mere window dressing.
The spying got worse. Just ask Donald Trump and the members of his campaign that were targeted first by the CIA and NSA and then by the FBI. Fundamental civil rights were trampled.
The real irony in all of this is that Barack Obama, as President, took credit for helping revise the laws in order to prevent the spying exposed by Edward Snowden. But under the Obama Administration, spying on political opponents–both real and perceived–escalated. We know for a fact that journalists, such as James Rosen and Sheryl Atkinson, were targets and their communications and computers attacked by the U.S. Government.
We know, thanks to a memo released by Judge Rosemary Collyer, that “FBI consultants” were making illegal searches of NSA material using the names of Donald Trump, his family and members of his campaign staff.
Some of this NSA material came courtesy of the Brits and their collection on U.S. targets. Some of this material came from the NSA’s own collection and storage of all electronic communications and was obtained using a nifty NSA tool called XKEYSCORE. Listen to Ed Snowden’s description. Also, take time to appreciate the irony that CNN and other journalists were actually trying to report real news. Now they are full blown apologists for the abuse of the intelligence collection tools.
Six years ago, former NSA Technical Director for Military and Geopolitical Issues, Bill Binney, and Russ Tice, a former NSA analyst, appeared on the PBS News Hour. Once again, they make very clear the enormous nature to the threat to our civil liberties.
Too bad Donald Trump did not listen to their warning.
Given the robust, wide ranging ability of the NSA to probe all communications by any person in the United States, it is remarkable that no real dirt on Donald Trump was ever uncovered. Had such information existed, it would be in the NSA’s storage vaults in Utah and crooked CIA analysts under Brennan’s direction would have found it and used it. But that did not happed. The best the intel folks could fabricate were the salacious claims attributed to reports ostensibly created by former British spy, Christopher Steele. Turns out that the titillating account that Trump hired hookers to perform coprophilia (could of been worse, coprophagia) was nothing more than idle bar talk.
What has happened to Donald Trump can happen to any of us. It is time to take this threat seriously and put the intel agencies back into a properly monitored corral. Otherwise, we will lose this Republic.
For 2020, Americans are making the resolution to adopt healthy habits – concerning their finances as well as their bodies. A survey by Ipsos for Urban Plates has found that out of all participants who said they were making one or several new year’s resolutions, 51 percent wanted to manage their finances better and an equal amount wanted to adopt healthier eating habits.
As Statista’s Katharina Bucxhholz notes, more popular resolutions for the upcoming year also circled around improving one’s health, with a more active lifestyle and weight loss being favorite answers.
38 percent of participants wanted to improve their mental well-being or practice mindfulness, a sign of a growing awareness for these aspects of mental health. Despite environmental protection being an equally popular topic at the moment, only 22 percent of survey participants said they wanted to be more eco-friendly in 2020.
18 percent of Americans said they were making only one resolution, while an additional 20 percent said they would make more than one. The percentage of resolution-makers was highest among Hispanics. A total of 56 percent in that group said they were making one or more resolutions.
If a recent article published by the Modern War Institute at West Point, “Don’t Let Kabul 2020 Look Like Saigon 1975: The Dangers of a Precipitous Afghanistan Withdrawal,” represents the prevailing American views on military strategy, then it goes a long way to explain why the United States lost the Afghanistan War.
The authors did get the premise right concerning the dangers associated with a precipitous withdrawal, but by getting all the basics wrong, they offer all the wrong solutions.
The article begins with a whopper, that “a US/NATO military withdrawal must be managed responsibly to conserve the hard-earned gains on issues like civil liberties and women’s rights made over the past eighteen years.”
No. Anyone who has spent any time in Afghanistan beyond the confines of a headquarters or a walled-in facility would know that is a not a valid reason to maintain a military presence in Afghanistan because it is simply not something within our capability either to establish or sustain.
A proper exit strategy is a process of burden shifting in a manner that protects vital US interests, while preventing US adversaries from unduly benefitting from a withdrawal.
Just like military leaders and policymakers over nearly two decades and through multiple administrations, the authors fail to address or even identify the true nature of the war in Afghanistan.
From that omission arises all the misinterpretations of the present situation and the mistaken prescriptions for the future—most notably, the recommendation for continued nation building.
The time is long overdue for a reality check.
First, the conflict in Afghanistan is not an insurgency. It is a proxy war being waged by Pakistan against Afghanistan and the United States. It is similar to Pakistan’s use of terrorist proxies against India in Kashmir.
Pakistan has always viewed Afghanistan as a client state and a security buffer against what it considers potential Indian encirclement and as a springboard to extend its own influence into the resource-rich areas of Central Asia.
The American counterinsurgency strategy was never winnable as long as Pakistan largely controlled the supply of our troops in landlocked Afghanistan and regulated the operational tempo through its proxy army, the Taliban, which has maintained an extensive recruiting, training, and financial support infrastructure inside Pakistan, all of which has been immune to attack.
Second, Pakistan has never been an ally of the United States, but a duplicitous partner, pursuing its own interests in coordination with its true ally, China, while being generously funded by us.
Nowhere have Chinese ambitions been more clearly and publicly articulated than in a June 2018 China Daily article by former Pakistani diplomat, Zamir Ahmed Awan, who works for the Beijing-controlled Center for China and Globalization [comments added].
New [Chinese] initiatives for peace in Afghanistan are welcome, and may change the scenario in the whole region. . . . I believe, American think tanks and leadership, especially military leadership has already realized that this war cannot be won. The only option is withdrawal, the sooner the better.
Pakistan can play a vital role in a sustainable solution to the Afghan conflict [controlling Afghanistan as a client state]. Complete withdrawal and an Afghan-led [Taliban-led] solution is the only permanent way out. Pakistan can facilitate an honorable and safe passage for US withdrawal.
Peace in Afghanistan will allow economic activity between Central Asia, Russia, China, and the Arabian Sea. . . . It can change the fate of the whole region. Chinese projects like the Belt and Road Initiative and the objectives of the Shanghai Cooperation Organization [SCO]. . . . At the recent SCO summit, the Afghanistan president was invited as a guest and observer. Hopefully, the country will soon join SCO. The China-Pakistan Economic Corridor may also be extended to benefit Afghanistan in the near future if there is peace.
Since that article was published, China has offered to extend CPEC to Afghanistan; China will build a military facility in and deploy Chinese troops to Afghanistan; Afghan military personnel will be trained in China; and members of the Afghan Parliament have recommended that the Bilateral Security Agreement between the United States and Afghanistan be canceled, presumably to be replaced closer security ties with by China.
Ultimately, America’s most formidable adversary in South Asia will be China, on which future US strategic planning should focus.
China seeks global domination. One vehicle to achieve it is the Belt and Road Initiative (BRI), a collection of infrastructure projects and a network of commercial agreements in 152 countries designed to link the entire world directly to the Chinese economy through interconnected land-based and maritime routes.
One element of BRI is the China-Pakistan Economic Corridor (CPEC), an infrastructure and development project, the backbone of which is a transportation network connecting China to the Pakistani seaports of Gwadar and Karachi located on the Arabian Sea
The guarantor of that soft power approach is the hard power of Chinese military expansion.
China plans to establish a naval and air bases on the Arabian Sea within easy reach of the strategically important Strait of Hormuz at the mouth of the Persian Gulf. That military facility will complement China’s already operational naval base in Djibouti, located at another strategic chokepoint, the entrance to the Red Sea and the Suez Canal.
With or without US approval or participation, China intends to incorporate Afghanistan into CPEC and exploit the estimated $3 trillion in untapped Afghan mineral resources.
The wild card in that scenario is Islamist extremism, of which Pakistan, not Afghanistan, is the true epicentre.
Islamist militancy has long been an element of Pakistan’s foreign and domestic policies. Any threat by these groups to Pakistan’s nuclear arsenal is, therefore, largely self-created.
As early as the 1950s, Pakistan began inserting Islamists associated with its Jamaat-e-Islami party into Afghanistan.
In 1974, then Prime Minister Zulfiqar Ali Bhutto set up a cell within Pakistan’s Inter-Services Intelligence Directorate (ISI) to begin managing dissident Islamists in Afghanistan.
Under President Zia ul-Haq (1977–1988), Pakistan pursued a policy of aggressive “Islamization” with the proliferation of religious schools and religious political parties, resulting in a society that became ever more extreme and intolerant. Ethnic separatism was suppressed and Islamist fighters were found to be useful proxies for the Pakistani military.
One source of America’s current dilemma in Afghanistan was a failure by the Reagan administration in allowing the Central Intelligence Agency to blindly outsource mujahideen funding to Pakistan’s ISI, which funneled American money and arms not to Afghan nationalists like Ahmad Shah Massoud, but to pro-Pakistani Islamists such as Gulbuddin Hekmatyar and Jalaluddin Haqqani.
It is an undisputed fact that the Taliban were created by the ISI, beginning in 1994, as a means of intervening in the Afghan civil war to influence the outcome in favor of Pakistani national interests.
Since its founding, the ISI and the Pakistani military have never stopped providing financial, logistical, and military support to the Taliban. The subterfuge underlying Pakistani policy was already apparent in the early days of the Afghanistan war.
The tens of thousands of madrasas, many unofficial, have offered a fertile recruiting source, not just for the Taliban, but for other Pakistan-based militant groups, such as Jaish-e-Mohammed and Lashkar-e-Taiba, responsible for attacks against India.
Contrary to the suggestion by the authors, it would be foolhardy to pump ever more international financial support into the region, funding largely supplied by the United States, an approach that would only benefit our adversaries.
Quite the opposite is needed. Financial pressure should be brought to bear on Pakistan for its continued support of terrorism and steps should be taken to thwart Chinese economic and military expansion in the region, including closer cooperation with India.
The only bargaining chip the United States has in peace negotiations is our presence in Afghanistan. The “presence” argument is clearly unsustainable. Between now and the beginning of a withdrawal, the United States should be identifying new forms of leverage, in the short term, to bolster our negotiating position, and, in the long term, as a basis of a new South Asian strategy.
California's Woke Legislation For 2020: Students Can't Be Suspended
Among the dumbest of the state of California’s new ‘woke’ legislation for 2020 is that it’s set to ban all public and charter schools from suspending students for ‘willful defiance’ in this upcoming year:
A California bill that passed the Legislature would prohibit schools, including charter schools, from suspending students for willful defiance.
That means if a student is acting up in class, teachers and school officials will not be able to suspend them from school.
As if California public schools weren’t already woefully behind national education standards, despite the state pouring $90 billion into the system this year alone, schools will now be forced to keep kids on campus no matter their level of constant defiance and disruption to the educational process of others.
Under the law, SB 419, the only exception for which a student could still be suspended suspended will be for bringing a weapon or illegal drugs to school.
And what’s the rationale? Because of course, racism.
The bill by Sen. Nancy Skinner, D-Berkeley, would ban the suspension of students in grades K-8 for refusing to obey a teacher or administrator, a practice known as willful defiance.
“I’ve dealt with a lot of these cases,” said Berry Accius, founder of Voice of the Youth, a nonprofit mentoring program in Sacramento. “Unfortunately, I’ve had kids that have been suspended for sometimes three months.”
Accius said school suspensions are used disproportionately against students of color.
“African American males and females, they are suspended at a higher rate — especially the African American males,” Accius said.
No doubt the jobs of California school teachers and administrators just got immensely harder. It will take effect starting July 1, 2020.
Commenting at The American Conservative, Rod Dreher skewers the initiative and predicts the following outcome: “Now state legislators, in their wisdom, have condemned elementary school teachers and the well-behaved students — black, white, Latino, Asian, whatever — to the tyranny of brats.”
And more: “Progressives are dismantling the ability of a basic social institution — the school — to defend itself, and to maintain order sufficient to fulfill its function.” Further, Dreher notes the inevitability that “when the parents who can afford to get their kids out of the public schools do so, progressives will call them racist.”
Political correctness recently took a dangerous turn in the United Kingdom when the North Bristol National Health Service Trust announced that hospital patients who use offensive, racist, or sexist language will cease receiving medical care as soon as it is safe to end their treatment.
The condition that treatment will not be withdrawn until doing so is safe seems to imply that no one will actually suffer from this policy. However, health-care providers have great discretion to determine when it is “safe” to withhold treatment. So, patients could be left with chronic pain or be denied certain procedures that could improve their health but are not necessary to make them “safe.” Patients accused of racism or sexism could also find themselves at the bottom of the NHS’s infamous “waiting lists,” unable to receive treatment until it truly is a matter of life and death.
Since many people define racism and sexism as “anything I disagree with,” the new policy will no doubt lead to people being denied medical care for statements that most reasonable people would consider unobjectionable.
This is not the first time NHS has withheld treatment because of an individual’s behavior. A couple years ago, another local health committee announced it would withhold routine or nonemergency surgeries from smokers and the obese. Since reducing smoking and obesity benefits both individual patients and the health care system as a whole, this policy may appear defensible. But denying or delaying care violates medical ethics and sets a dangerous precedent. If treatment could be denied to smokers and the obese, then it could also be denied to those who engage in promiscuous sex, drive over the speed limit, don’t get the “proper” number of vaccinations for themselves and their children, or have “dangerous” political views.
Government bureaucrats denying care to individuals for arbitrary reasons is the inevitable result of government interference in the health-care market. Government intervention is supposed to ensure quality and affordable (or free) care for all. But, government intervention artificially lowers the costs of health care to patients while increasing costs to providers. As demand rises and supply falls, government imposes rationing to address the shortages and other problems caused by prior government interference.
Rationing has been part of American health care at least since the passage of the Health Maintenance Organization Act of 1973. Every plan to expand government’s role in health care contains some form of rationing.
Advocates for government intervention in health care will counter complaints about rationing by saying the related health-care decisions are being made to benefit people’s quality of life. But, claiming government officials know how medical treatment can best enhance quality of life is as absurd as claiming that government officials know the correct prices of automobiles.
The only way to reverse the slide into national health care and rationing is for those who understand the economic and moral case for liberty to keep pushing to replace Obamacare and all other government intrusions into health care. Government-controlled health care must be replaced by free-market health care that empowers individuals to determine for themselves what does and does not enhance their quality of life.
After Woman Killed By Falling Debris On Seventh Ave., New York Revamps Facade Inspections
220 buildings in New York must now take protective measures after a woman was killed by a piece of a facade that fell off a 17 story building near Times Square earlier this month.
According to the Wall Street Journal, building owners must install sidewalk sheds and the city is doubling the number of its facade inspectors to 22. It’s also increasing the frequency of facade inspections for buildings taller than six stories.
After 60 year old architect and philanthropist Erica Tishman was killed on December 17, building department workers went on an inspection spree, checking 1,331 buildings that had outstanding violations. About one in six of those buildings lacked proper safeguards and owners were issued summonses on Monday.
Tishman was hit by debris walking past 729 Seventh Ave. The building’s owner had already been issued a violation in April for failing to maintain the facade. In September, the owner challenged the violation in a city administrative court where a judge downgraded the violation to state that it didn’t pose an “immediate danger”.
After the hearing, the building’s owner was issued a permit to put up a sidewalk shed and repair the facade, but no work took place prior to the incident. The building is owned by a limited liability company controlled by commercial real-estate firm Himmel + Meringoff Properties.
The company said the work had been delayed because a neighboring building owner wouldn’t give it access to perform the work. A spokeswoman for Himmel + Meringoff said: “The safety of our buildings, and our tenants, remains our highest priority, and we will continue to do everything to ensure the safety of the public in and around our properties.”
On Monday, city officials said that under new rules the city will reinspect a building within 60 days of it being found to have an unsafe facade, in order to ensure that safety measures are taken. Officials also said that if owners fail to install protection for pedestrians, city contractors will do it at the owner’s expense. Facade inspectors will now also conduct follow up inspections every 90 days until repairs are completed.
Manhattan Borough President Gale Brewer said: “The tragic death of Erica Tishman was preventable, and while these new facade enforcement efforts cannot bring her back to life, they can help avoid another tragedy.”
Even though the cryptocurrency industry is not new to ups and downs, 2019 has turned out to be the year with the most surprising reveals. The long-lasting bear market of 2018 moved market analysts to call it the year of regulatory reckoning, leaving many jurisdictions uncertain about how to treat cryptocurrencies.
However, 2019 also turned out to be the year of the comeback, as big tech giants like Facebook moved from banning crypto to embracing it.
Escalating global events such as the trade war between the United States and China have shifted investors’ point of view on the utility of cryptocurrencies like Bitcoin, but there is still a lot to be done even as the U.S. Securities and Exchange Commission continues to turn down every other Bitcoin ETF proposal.
As the year comes to a close, here is a look at the companies, individuals and various crypto projects that managed to come out on top in 2019, as well as those that failed to mark the year as a positive in their books.
The winners
Bitcoin’s double growth
This year, Bitcoin and the entire blockchain and cryptocurrency industry celebrated its tenth anniversary as proof of the resilience of Satoshi Nakamoto’s creation. However, at the beginning of 2019, the cryptocurrency industry was just recovering from the so-called crypto winter of 2018.
Fortunately, Bitcoin kicked off the year with a bullish trend that resulted in an approximate price increase of 11% higher by the end of the first quarter. Anthony Pompliano, the co-founder of Morgan Creek Digital asset management firm, shared his view with Cointelegraph:
“Bitcoin’s price is up significantly in 2019 [as there are] more buyers than sellers on a net basis this year.”
As the trading volume and market capitalization increased throughout the second quarter of the year, Bitcoin led the market with a 165% gain as its price surged from $4,103 to $10,888. Furthermore, Bitcoin’s market dominance increased from 54.6% to 65%.
Among the reasons that have promoted Bitcoin’s continued growth despite a struggling market is the view that the digital currency can act as a hedge in the wake of increasing global uncertainty. This year, the U.S.–China trade war saw most investors look to Bitcoin and gold as hedges. Pompliano also told Cointelegraph that there were other contributing factors:
“The biggest moments probably revolve around the announcement of Libra and the subsequent reactions, both positive and negative, from various folks across the traditional and cryptocurrency markets.”
However, it was not all sunshine for Bitcoin in 2019. Over the third quarter of the year, a bearish outlook emerged as Bitcoin’s price decreased significantly as 100 billion in market capitalization was lost. Fortunately, even as the market struggled to gain ground against the bears, Bitcoin not only closed the quarter with the least amount of loss but also increased its market dominance by 5.4%. Ultimately, of all cryptocurrencies, Bitcoin’s performance has been the best so far.
Compared to assets from other markets, Bitcoin’s performance throughout the year is still far from tenuous. For instance, even though gold is regarded as a reliable store of value, its price has only increased by 17% since January. Even the S&P 500 Index, although with an excellent performance of +21%, is still dwarfed by Bitcoin’s growth throughout the year. Beyond price, Bobby Lee, CEO of the Ballet crypto wallet, told Cointelegraph that Bitcoin has benefited from several major technological developments:
“2019 was a great year for Bitcoin bulls because of the advances in the open-source ecosystem. Lightning Network is increasing Bitcoin’s transaction capacity, wallets with built-in, user-friendly features (Wasabi, Samourai) are improving privacy.”
Gods Unchained’s rise to popularity
According to reports, Gods Unchained, a blockchain-based virtual card game built on Ethereum, emerged as one of the highest-grossing and most popular blockchain games in 2019. This came about after the platform completely sold out its Genesis Card Pack to the tune of about $6.2 million. This came about after Blizzard, the creators of Hearthstone (a digital trading card game) banned Hearthstone player Chung Ng Wai (also known as Blitzchung) for expressing support for the Hong Kong protests. The Hearthstone game developer also stripped Blitzchung of his winnings.
In addition to the backlash received from the gaming community, Blizzard’s actions were criticized in a tweet by Gods Unchained that claimed Blizzard “care[s] about money more than freedom.” Gods Unchained also promised to compensate Blitzchung for his lost winnings while offering him an invitation to their $500,000 tournament.
The tweet by Gods Unchained was retweeted over 10,000 times, and Google searches for the game have since surged. Unlike Hearthstone, Gods Unchained is decentralized and uses blockchain to ensure that players truly own in-game items and have the freedom to trade them at will.
In a move to give online game players long-term incentives, James Ferguson, CEO of Gods Unchained said that the game is “leveling up the outdated practices of the gaming industry.”
Coinbase’s continued expansion
In the past, Coinbase maintained a reputation for employing a rather selective strategy for adding coins to its exchange. As one of the big league exchanges in the crypto space, Coinbase is also known for having significantly fewer large-scale hacks. In a year that saw other major exchanges like Binance fall victim to large scale security breaches, leading to the loss of thousands of Bitcoin, Coinbase stands out as a reliable and safe platform.
However, the company was heavily scrutinized by Twitter users this year over its acquisition of Neutrino, a startup that collects cryptocurrency transactional data using the blockchain. For most Twitter users, this move seems to facilitate the exchange’s spying on its customers.
However, Coinbase’s move to acquire Neutrino is, according to a Coinbase blog post, part of its goal to support all assets while complying with applicable laws. In addition to acquiring Neutrino, Coinbase has doubled the number of listed cryptocurrencies on its exchange since 2018. Coinbase’s aggressive listing approach has seen the addition of coins such as Dash, Cosmos and Waves, to mention just a few.
The company has almost constantly been making news throughout the year, from making acquisitions to denying them, as well as securing multiple patents along the way. Meanwhile, Coinbases’s Visa debit card solution has also seen exponential growth this year, now available for use in even more countries.
In May 2019, the company also expanded its reach to more than 100 countries while making its USDC stable coin — previously only available in the U.S. — available in 85 of those supported countries. In comparison, Coinbase was only available in about 32 countries last year. Its aggressive expansion appears to be in direct competition to other global players like Binance.
Binance ventures further
Ask any market analyst and they will admit that initial exchange offerings have grown into a big business in 2019. Reports have revealed a high demand for IEOs right from Q1 2019 to Q3, not to mention the fact that they collectively raised over $1.5 billion in the first half of 2019 alone. Unlike initial coin offerings, the biggest determining factor for a successful IEO is the availability of liquidity, and what better way to access liquidity than launching an IEO on a popular exchange.
That is why Binance and its native cryptocurrency BNB have had one of the best years yet. As one of the biggest marketplaces for digital assets, Binance enjoys a significant share of the trading volume. The exchange’s performance has been so exceptional that the Binance Coin has gained value by 150% over the year. When taking everything into account and considering year-on-year growth, Binance Coin has even slightly outperformed Bitcoin.
Also, Binance expanded its reach with the launch of a fully independent U.S. arm of its trading platform. Despite heavy regulatory pressure that keeps the Binance exchange in the U.S. from operating in states such as New York, the company’s partnership with BAM, a registered money service in the U.S., has so far given the exchange some leeway.
The losers
Facebook’s uncertain Libra launch in 2020
Facebook’s announcement of its Libra cryptocurrency has been one of the major events of 2019. However, on the unveiling of Libra as a stablecoin backed by a select number of national currencies, U.S. lawmakers reacted with skepticism, summoning Facebook CEO Mark Zuckerberg to multiple hearings.
At its core, Libra is a stablecoin backed by real money and lets users buy, sell and send money at nearly zero fees across borders. According to the project’s white paper, Libra’s overall mission is “to enable a simple global currency and financial infrastructure that empowers millions of people.”
Libra’s white paper further claims that it will use “a new decentralized blockchain, a low volatility cryptocurrency, and a smart contract platform” to empower about 1.7 billion unbanked people. This will be achieved through the use of Facebook’s WhatsApp, Messenger and Calibra, which is a digital wallet designed for Libra users.
Despite Libra’s ambitious plan to empower the unbanked, the Libra project has not only come under heavy scrutiny from lawmakers but also faced internal problems of its own. While sharing his thoughts with Cointelegraph, Ballet wallet’s Lee expressed optimism about Libra, saying that although “legislators and regulators in the United States and Europe understand that non-government currencies are a threat to their power, government opposition will diminish over time.” Lee further explained:
“Governments will change their stance because they will come to understand that they can’t control or stop Bitcoin, and they will prefer to have their citizens use centralized corporate coins that can easily be regulated, monitored, and pegged to fiat currency.”
Despite Libra’s ambitious plan to empower the unbaked, the Libra project has not only come under heavy scrutiny from lawmakers but also faced internal problems of its own.
The U.S. Congress has asked Facebook to pause further development of the Libra projects, and cynics now believe that the project will not get out of the starting blocks without the government’s approval. Multiple European countries have also spoken out against the proposed cryptocurrency, while China announced that it will soon launch its own stablecoin, a national central bank digital currency, likely as a retaliatory measure. Furthermore, in the wake of increased scrutiny from government regulators, some of Libra’s high profile backers like Visa, eBay, MasterCard and PayPal have abandoned the project.
A rocky year for Circle
In October 2018, Circle, a cryptocurrency firm based in Boston and backed by Goldman Sachs teamed up with Coinbase to launch the Centre consortium. Counting on its reputation as one of the most well-funded crypto startups, the two companies aimed to help accelerate adoption of cryptocurrencies. Through the Centre consortium, Coinbase and Circle would increase liquidity to the crypto industry through the issue of a stable coin called the USD Coin.
In July this year, Coinbase and Circle broadened participation into their consortium in a move that will allow other financial entities interested in the project to issue the USD Coin. In the announcement, the Centre network mentioned that “a natural next step is to imagine a new global digital currency” that would include a basket of tokens backed by a variety of stablecoins. Simply put, Centre’s plan is to go with a Facebook-like approach to create a global currency.
However, Circle has had a rocky experience throughout 2019. Even though the USD Coin has received a positive reception, with Centre claiming that the stablecoin has been used to clear on-chain transfers worth over $11 billion, Circle closed its mobile app, reduced its fundraising goal by 40%, and laid off 10% of its staff between May and June this year. Just recently, the company let go of 10 more of its employees, citing efforts to streamline its services.
The latest news of layoffs from Circle comes after the recent transition of the company’s co-founder Sean Neville from his position as CEO to a seat at the company’s board of directors. However, a representative of Circle has denied any connections between the recent layoffs and Sean’s transition, telling Cointelegraph that:
“None of this is related to Sean transitioning out of the co-CEO role. Sean will continue to serve on Circle’s board.”
Craig Wright’s court battles
When Australian-born technologist Craig Wright claimed to be Satoshi Nakamoto back in 2015, most people in the crypto community were skeptical and thought nothing of it.
Most people expected that the Satoshi Nakamoto impersonator would have scurried back into obscurity by now. However, Wright and his claims have continued to headline the news throughout 2019. Wright claims that he invented Bitcoin a decade ago and mined over 1 million BTC along with his late business partner Dave Kleiman. After Kleiman’s death in 2013, Wright claims that he put the mined Bitcoin in the “Tulip Trust.”
However, the Australian entrepreneur and computer scientist was sued by Kleiman’s estate in 2018 for allegedly stealing up to 1 million Bitcoin. In the past, it is said that Wright and Kleiman worked together on mining and developing Bitcoin. According to Kleiman’s family, Wright stole between 550,000 to 1 million Bitcoin — worth about $10 billion.
The ongoing case led to Magistrate Judge Bruce’s ruling that ordered Wright to turn over half of his Bitcoin holdings and intellectual property from before 2014 to Kleiman’s estate, presuming he is indeed Nakamoto. On Oct. 31, the trials re-emerged after Wright pulled out of the settlement agreement to forfeit half his Bitcoin and intellectual property.
In addition to his court battles, Wright was scrutinized by the crypto community after presenting what was considered forged documents as evidence of him being Nakamoto in another case of Wright against Peter McCormack. Wright’s case against McCormack is based on the fact that McCormack’s repeated statement that Wright is not Satoshi is harmful to Wright’s reputation. Most recently, Wright presented another document that allegedly proves how he came up with the Satoshi Nakamoto pseudonym.
Bitcoin ETF’s continual rejection by the SEC
Even though U.S. regulators have always left a window for the possibility of approving Bitcoin exchange-traded funds in the future, up until now, every single attempt to license a Bitcoin ETF has been met with failure. In October this year, an ETF proposal filed by Bitwise Asset Management in conjunction with NYSE Arca was rejected by the Securities and Exchange Commission for failing to meet legal requirements that prevent illicit market manipulation.
In fact, all Bitcoin ETF proposals presented to the SEC have been rejected on concerns about fraudulent activities and market manipulation. One of the main criteria for approving an ETF is establishing the underlying market of a new commodity-based ETF.
If the underlying market is resistant to manipulation, regulators can give the ETF the go-ahead. Given the complexities of the Bitcoin market, it seems approval from the SEC is unlikely. Despite the earlier rejection of Bitwise’s application, the SEC later announced that it would review Bitwise’s proposal once again.
While speaking to Cointelegraph on the realistic timeline of the first Bitcoin ETF approval, Charles Lu, the CEO of the Findora fintech toolkit provider said, “For a Bitcoin ETF proposal to gain SEC approval, the sponsor will need to prove that real price discovery is happening as opposed to market manipulations.” In Lu’s opinion, this will not happen anywhere soon, since the SEC would require “surveillance sharing agreements” with the big exchanges.
2019 and 2020
Overall, the crypto industry has shown some significant growth over the past year. Although volatile, Bitcoin is showing significant signs of growth. More institutional investors are looking into the industry to find more ways to invest as well. Even though there is a downtrend in market cap and trading volumes, prominent traders believe that a turn of fate might just be around the corner, especially for Bitcoin holders.
Out of all the winners and losers of 2019, perhaps Facebook Libra is one that stands to be most impactful in 2020. For most onlookers, it will be interesting to see whether Facebook’s Libra project will turn a new leaf and launch successfully in 2020. If it does, there is a high likelihood that big changes will take place throughout the entire industry.
Judge In Hunter Biden Paternity Case Mysteriously Recuses Hours After New Allegations Filed
The judge in Hunter Biden’s paternity case suddenly recused himself from the case on Tuesday, following a string of third-party court filings accusing Biden of financial crimes.
“…the undersigned Judge recuses from said case pursuant to the Administrative Plan of the Sixteenth Judicial Circuit,” reads a brief note by Independence County Judge Don McSpadden, who offered no explanation for the move.
The recusal came two hours after ‘defrauded investor’ Joel Caplan filed to become a party in the case, which included a witness statement from ex-Ukrainian prosecutor Viktor Shokin, who says he was fired for investigating a Ukrainian gas company which Biden worked for.
That said, Caplan’s claims are so bizarre that if one had enough tin foil, they might conclude that the recent string of filings in the case are being done to muddy the waters with absurdity.
The latest claim is that Biden was involved in a ‘multi-billion dollar stock scheme known as the China Hustle.‘
Shokin’s witness statement was submitted to the court as part of Joel Caplan’s motion this week to try and become a party in Roberts’ paternity case with Biden.
He claimed in Monday’s filing that he wanted in on the case so he could get his hands on Biden’s bank account records in order to prove he allegedly received $1.5 billion from Chinese companies that ‘hustled Americans out of their life savings’.
Caplan told Judge Don McSpadden to ‘follow the money’ and in a 30-page filing, lays out how he was allegedly swindled out of 10 years of his life savings in a ‘multi-billion dollar stock scheme known as the China Hustle.’
Caplan, who filed papers from Jerusalem, Israel, claims many Chinese nationals made fortunes from the ploy, which involved presenting fake company documents and claiming they were genuine investments when they were actual frauds. –Daily Mail
Caplan referenced President Trump’s October claim that Biden received a $1.5 billion payout from a Chinese private equity fund – a claim Biden has denied. Caplan has sought bank records in an attempt to regain his lost savings, and for ‘justice.’
Last week private investigator Dominic Casey also attempted to enter the case, claiming Biden was involved in a $150 million ‘counterfeiting scheme’. Hours after it was filed, Judge Casey tossed the motion on a technicality for being improperly filed.
On Friday, Dominic Casey (pictured) filed papers to Independence County on Friday, claiming he had provided Lunden Roberts with ‘electronic access’ to Biden’s bank account records, which are ‘subject of known felonies including fraud and counterfeiting’
Casey heads up D&A Investigations, which is based near Orlando, Florida, and he is known for pursuing right-wing conspiracy theories. During the Casey Anthony trial he claimed a psychic told him where to find Caylee’s body.
Casey claimed Biden was involved in a ‘counterfeiting scheme’ in Ukraine that accumulated a $150 million fortune. Judge Don McSpadden tossed out Casey’s original motion six hours after it was filed.
In Casey’s Friday motion, he gives his consent for Roberts’ legal team to use Biden’s bank account records in their court case, claiming that he has them.
Biden’s lawyer Brett Langdon called Casey’s filing “a scheme by a non-party simply to make scandalous allegations in the pending suit to gain some quick media attention.”
1000s Stranded On Beach Encircled By Flames As Bushfires Blaze Through Australia
Thousands of tourists and locals were left stranded on a beach in southeast Australia on Tuesday as bushfires ravaged a popular tourist area, leaving no escape by land.
The Epoch Times’ Katabella Roberts reports, up to 4,000 people are trapped on the foreshore of the encircled seaside town of Mallacoota, in the East Gippsland region of Victoria, where authorities said nearby fires were manifesting extreme self-generating thunderstorms and “ember attacks.”
On Monday, Victoria’s Emergency Management Commissioner, Andrew Crisp, told residents and holidaymakers to leave the area by 9 a.m. or risk being stranded. However, in a later update he said it was now “too late” to get out of the area safely.
The crew from Fire and Rescue NSW Station 509 Wyoming recorded this video showing the moment their truck was overrun by the bushfire burning South of Nowra. The crew was forced to shelter in their truck as the fire front passed through. #NSWFires#ProtectTheIrreplaceablepic.twitter.com/Hb0yVrefi9
Firefighters were deployed to protect those stranded on the beach, and preparations are underway for a sea or airborne evacuation if needed.
“We’ve got three strike teams in Mallacoota that will be looking after 4,000 people down on the beach there. We’re naturally very concerned about communities that have become isolated,” he added.
Hundreds of people have taken to social media to share apocalyptic images of the area, which is currently blanketed in a thick cloud of red haze.
Community radio in #Mallacoota: “The power is cut. We are isolated. It’s a holocaust, basically. Some have been sent to the hall, some to the lake, others have to stay in their homes. There’s a lot of thunder. The fires are creating their own weather.”
It comes after authorities warned up to 30,000 tourists currently visiting the area to leave as strong winds pushed an emergency-level bushfire towards the town.
The fire moving towards Mallacoota began at Wingan River on Sunday and spread rapidly towards the coast, RNZ reported.
“There are a number of people who remain unaccounted for—four people, and of course we have fears for their safety,” Andrews said.
“We cannot confirm their whereabouts, but as soon as we can bring any further information to you, then, of course, we will do that.”
Andrews also asked Prime Minister Scott Morrison for military assistance amid the raging fires, suggesting naval vessels help get supplies to isolated communities or heavy-lift aircraft to work alongside the state’s air fleet.
However, no decisions regarding military assistance have been finalized as of yet.
Francesca Winterson is in a building on the main street of #Mallacoota and describes the wind, darkness and falling embers as fires burn about 500 metres away.
She says it’s too late to leave and fire crews are on hand to offer as much protection as they can. pic.twitter.com/6Tjfb4nyUR
On Monday, around 100,000 people were urged to flee five Melbourne suburbs. The swirling bushfires killed a volunteer firefighter who was battling a separate blaze in the countryside.
Another volunteer firefighter from the New South Wales Rural Fire Service also died on Monday when the truck he was traveling in was overturned by strong winds and crashed at Jingellic, about 110 kilometers (68 miles) east of Albury.
Authorities named him as 28-year-old Samuel McPaul, who was reportedly expecting his first child in May with his wife, Megan, whom he married last year.
Two of his male colleagues, aged 39 and 52, also suffered burns in the incident but are said to be in a stable condition.
Another eight people have been killed so far this fire season, while more than 1,000 homes have been destroyed, according to local reports.
"OH MY GOD" – Tesla Driver On Autopilot Films Own Crash
Tesla Autopilot seems to give some drivers a sense of invincibility while traveling the roads as they place their lives in the hands of artificial intelligence.
This was the case with YouTuber Dougal Vlogs, who uploaded a video on Dec. 30, showing a Model 3 presumably engaged in “Autopilot” (as per the video’s headline) traveling at a high rate of speed (over 70 mph) during a rainstorm.
The video is short, about 15 seconds, the vlogger is seen speeding down a two-lane highway traveling at 70-75mph while using Autopilot.
The vlogger is holding a camera about to talk about the Model 3, and an alarm sound starts blaring. Next thing you know, the Model 3 hydroplanes and crashes into the shoulder of the road, all caught on camera!
The vlogger was heard several times during the incident yelling “OH MOY GOD” — and at the end of the video tells his audience he just crashed.
With-in 24 hours, the video has been viewed 70k times and with over 250 comments. The vlogger was mostly ridiculed in the comment section of the video.
One YouTube said, “Let’s try out AutoPilot. Oh, yeah did I mention during a typhoon?”
Another said, “You should be cited for driving too fast for the weather conditions, reckless driving for not having your hands on the wheel, and distracted driving for being stupid enough to film in a rainstorm. Sadly you’re going to get a bunch of clicks and lots of attention for this piece of amazing stupidity. I am glad you are OK, but I am more glad that you didn’t kill some innocent person who might’ve been stuck on the side of the road or unfortunate enough to be driving next to you while you were pulling this kind of stupid nonsense.”
Someone said, “His license should be taken away. He’s a danger to all drivers and pedestrians on the road.”
Another said, “Elon Musk: “Mate! We can fix this with a firmware update.” LOL”
It remains to be seen if it was the driver’s fault or if Autopilot malfunctioned.
DNC – Democrats Nominate Clintons. A secret and nefarious body within Democratic Party that Makes Sure that only Clintons and their Clones get Nominations. The prominence of DNC is linked the futile attempts to slow down the demise of Neoliberalism.
White Helmets – a new form of birth control. It prevents members of the mainstream press from getting impregnated by truth. Any reporter travelling to the Middle East, Russia, Europe, or China is required to wear one all the time.
International News – A collection of urban legends and old wife-tales. Any news reported from Russia or China should be presumed a lie, unless proven otherwise. Under no circumstances should a proof come from the Atlantic Council, Wikipedia, Snopes, or any other propaganda outfit that calls itself “fact checker.”
Impeachment– a transgender incubus that visits nightly US Democrats in their sleep. The touch of Impeachment is so enticing, that those affected can’t think of anything else even during their waking hours.
Whoever gets visited by this incubus more than two times – be it an academic, politician, diplomat, military personnel, or security specialist – turns into a script-reading zombie, as has been recently witnessed during Impeachment Hearings.
Greta– A naïve character from Brothers Grimm’s Fairy Tale. In this tale, Greta leads her brother along with thousands of trusting adults deep into dark woods, where the evil Witch, called Climate Change, inflicts endless suffering upon her victims. These sufferings include floods, droughts, locusts, boils, plagues, death of livestock, and listening to the NPR all the time. The specter of Greta continues to haunt Europe to this very day.
Ukraine– an illegitimate child of the secret love affair between the Clintons, Biden, Obama, Merkel, and assorted Polish and Swedish Blonds. The child – instead of becoming an angelic baby with blond curls – grew up into a modern Frankenstein who eats its own parts and infects anyone who touches it with hatred and paranoia.
The country named in honor of this child has become a place where rich Democrats send their children to learn looting, before they can come back and start looting their own country. It is also a place where they feel the need to celebrate Nazi collaborators by turning them into national heroes. Even Poland does not do that.
Brexit– an evil uncle of Boris Johnson. When Boris’ ambitions to fill the shoes of great British Prime Ministers, like Disraeli or Churchill, has failed to realize, in comes Brexit, and relying on his network of old Etonians and angry proletarians, he helps Boris to achieve his goals.
Steele Dossier – the collection of adult cartoons that describes – in the most grotesque and ridiculous details – the sexapades of the presidential candidate, Donald Trump. The collection is so grotesque and unrealistic that only the most sordid porn-watchers and the most valiant agents of alphabet agencies find it plausible.
Quid Pro Quo – one of the most sordid stories in Steele dossier, that depicts Donald Trump sleeping with fifty-five concubines of the Ukrainian Ruler in one night; the reported feat outdoes therefore the record set by Heracles, known to have slept with fifty daughters of a Greek King in one night.
Russians– a mysterious group of people – who, similar to the demons of ancient times, the witches of the Middle Ages, and the Jews of the Modern Period — was created by the western mind for the purposes of scapegoating. Russians combine all possible contradictions: they can be simultaneously weak and strong; socialist, yet greedy and rapacious; conniving, yet very sloppy; they can pull a very sophisticated stunt, yet leave all the traces and clues that lead back to them. They can’t do anything without cheating; yet, they are always caught in their lies. General public in the west is convinced that the only way to defeat Russians is to vote for the candidate who can say “Russians” faster than his rivals.
Whataboutism – An incantation that one pronounces to dismiss legitimate concerns of one’s opponent. It is the modern day version of “catch the thief,” when a thief, to avoid being caught, starts chasing an innocent person while screaming “catch the thief.” Used primarily by the propagandists of NATO countries to deflect scrutiny of their own violent and illegal behavior.
According to Yonhap news, reporting on a KCNA report, North Korea will continue building up its nuclear deterrent to counter US aggression, but the degree to which it expands its weapons program will depend on the US’ attitude.
Calling out US insincerity regarding discussions about the partial lifting of sanctions, Kim blasted Washington’s “gangster-like demands”as the reason no agreement had yet been reached between the two countries.
The more the US stalls for time, Kim said, the more it will find itself “helpless in the face of North Korean power.”
Finally, Kim warned that North Korea has a “new strategic weapon” up its sleeve, and time was running out before his government would be moved to take “shocking actual action.”
…and a happy new year to you too!
Notably, as BNO points out, all of the current news alerts are based on a KCNA report regarding yesterday’s plenary meetings. Kim has not delivered his speech yet.
Mike Bloomberg's Secretive Election Tech Firm Lied About DNC Relationship To Lure New Recruits
A secretive digital marketing firm founded by Mike Bloomberg to help him win he 2020 election lured new recruits by falsely claiming that it would be the “primary platform” for the Democratic National Committee, according to CNBC.
The company, Hawkfish, was created “with the intention of overpowering the formidable data operation assembled by the Republican National Committee and Trump’s cash-flush campaign,” according to a previous CNBC report.
Yet to attract top talent – a roster which now includes former Facebook Chief Marketing Officer Gary Briggs and former CEO of location-tracking firm Foursquare – Hawkfish told prospective new hires that they are “currently working with the Bloomberg campaign and will be the primary platform used by the DNC throughout 2020.”
Bloomberg has placed the blame on the headhunter they used to find talent, Andiamo Partners, who they say mistakenly believed the company had a contract with the DNC.
Several potential hires received notices through LinkedIn in which they were informed that Hawkfish was working for both the Bloomberg campaign and the DNC. It wasn’t immediately clear how many recruiting targets received the erroneous pitch.
“The recruiting company mistook support for Democratic causes as Hawkfish working under contract with the DNC, which isn’t the case,” said Frazier, the Bloomberg aide. –CNBC
According to the report, on Nov. 27, just three days after Bloomberg officially launched his campaign, the DNC fired off a notice to Hawkfish that their pitches were misleading, according to DNC spokesman Daniel Wessel.
“We had previously alerted Hawkfish that the recruiting emails were incorrect and misleading,” Wessel told CNBC.
Hawkfish, meanwhile, conceded to the DNC that the script wasn’t accurate – correcting it on December 2nd, according to Bloomberg campaign spokesman Michael Frazier.
The company says it’s done work for Democratic groups in state races in Virginia and Kentucky, but would not elaborate on who their clients were. Notably, Democrats won control of the Virginia statehouse for the first time in over two decades, while GOP candidate Matt Bevin was narrowly defeated by Democratic candidate Andy Beshear – which CNBC implies Hawkfish may have had something to do with.
Meanwhile, despite spending over $100 million on TV ads across the country and $20 million on digital Facebook and Google ads, Mike Bloomberg is polling in fifth place in the Democratic primary, behind Biden, Sanders, Warren and Buttigieg, according to Real Clear Politics.
After an “everything is awesome, nothing will go down” 2019, Mark Orsley – Head of Macro Strategy for Prism, is out with a review of his 2020 “Costanza Trades,” while offering his comprehensive thoughts for next year.
* * *
Long time readers will know that The Macro Scan takes a twist at year end to present next year’s “Costanza Trades” or the “Not Top 10 Trades of 2020.” A kind push back against all the bank “year ahead” pieces that tend to be consensus.
For those of you not familiar with George Costanza, his character on the sitcom Seinfeld could do no right when it came to employment, dating, or life in general. In one episode, George realizes over lunch at the diner with Jerry that if every instinct he has is wrong; then doing the opposite must be right. George resolves to start doing the complete opposite of what he would do normally. He orders the opposite of his normal lunch, and he introduces himself to a beautiful woman that he normally would never have the nerve to talk to: “my name is George,” he says, “I’m unemployed, and I live with my parents.” To his surprise, she is impressed with his honesty and agrees to date him! Doing the opposite was the right thing. Watershed!
Employing the Costanza method to trading is an interesting exercise. Ask yourself what are the trades that make complete rational sense and all your instincts say are right…now consider the opposite. Basically what you end up constructing is an out of consensus portfolio. If you can back those out of consensus views with fundamental and technical justification; there is potentially a high amount alpha in these trades.
It was another successful year for Costanza (though not his best) who fought the idea the world was coming to an end after the December 2018 risk asset massacre. The winners far outpaced the losers.
2019 Costanza Trades:
1) Long FANGs -> + 41%
2) Receive credit protection in IG and HY -> IG 45bps tighter, HY +7.75pts
3) Long Eurodollar spreads (EDZ9/EDZ0) -> -16bps
4) Long Bunds -> German yields 45bps lower
5) Short Gold -> -18%
6) Long WTI crude -> +37%
7) Long AUD/USD -> -0.77%
8) Short EM -> +16% (although in fairness it wildly underperformed the US)
9) Long Bitcoin -> +103%
Costanza Track Record (% of views that were correct):
2015 70% correct
2016 70% correct
2017 83% correct
2018 71% correct
2019 55% correct
This year is the polar opposite of 2018 which saw massive risk off. Now in December 2019; trade progress between China and the US has developed, risks of a hard Brexit have been reduced, central banks have cut rates and injected liquidity, and fiscal stimulus is being instituted around the world. It’s now full risk on and everything is merry and bright.
That setup makes this year’s Costanza portfolio easy to construct. Costanza is going all in on the idea that reflation is a farce, growth concerns can reemerge, central banks will NOT be on hold in 2020, ranges will be broken, and volatility is too low.
2020 Costanza Trades (in no particular order):
1) Short Rest of World equities vs. long US equities
2) Short US 2s10s steepener (aka: the flattener)
3) Long “green” Euribors
4) Short US 10yr breakevens
5) Long vol: a. “White” Eurodollars b. VIX c. EUR/USD FX
6) Short Gold
7) Short Copper
8) Short Oil
9) Long $Mex
10) Long Bitcoin Bonus: Long initial jobless claims/short the US consumer
As you can see, Costanza thinks the world is NOT reflating as much as the big banks are leading us to believe (recall most of the big banks were calling for 3 HIKES in 2019), and that growth risks still exist in a year with major political uncertainty. Let’s go through each trade and assess the likelihood of Costanza once again beating the street.
1) Short Rest of World equities vs. long US equities
Global growth has bounced on the back of the Fed’s liquidity injection, Phase 1 progress, fiscal stimulus around the world, “yada yada.” That bounce has led to the consensus view across the street to move out of the US equity market (a safer play when global growth is slowing) and into the rest of the world (RoW –higher beta to growth) which has lagged US indices and thus have more upside if growth is picking up again.
When looking at the ratio of US vs. EM, the street is really telling you to fade a multi-year up trend. However, the ratio has gotten quite extended to its trend line so a reversion similar to 2016/2017 is not out of the question…
Instinct: Fed liquidity injection stimulates global growth as it improves global trade which benefits RoW, countries outside the US are stimulating their economies via fiscal while the US loses its fiscal impulse in 2020, the tariff risk has peaked – therefore the RoW will bounce more than the US from here
Costanza: tariffs have been cut not eliminated, Phase 2 trade talks will be much more difficult, Trump will institute tariffs on the Eurozone, the Fed will end its liquidity injections in 2020 as funding issues calm down past year end, EM growth (led by China) continues to slow – all will keep the trend intact for the US to outperform EM and RoW
Estimated probability of Costanza being right: 35%
Recall the mid-Oct recommendation to buy ESH0 3300/3400 call spread for 5pts which is now worth 33pts (6.5x return). The point is to not pat ourselves on the back but realize it has moved a lot and very fast. Therefore, the crowd is not crazy to sell US and play the catch up trade via RoW longs. I would throw in the risk of margin compressions on US earnings as wages will likely rise more in 2020 as the Fed attempts to further tighten the labor market.
Additionally, the big risk will be the US election which could be the catalyst of US underperformance. The election will be another close call and that could lead to major uncertainty as the policy difference between the Dems and GOP is so vastly different.
Conversely, as long as the Fed keeps pumping Dollars into the global system, that will be positive for RoW growth as Dollars are needed for global trade. Unlike Costanza, we don’t see that spigot getting turned off and in fact we expect that the Fed will eventually move to coupon purchases next year, possibly as early as March. That will be positive for risk assets and accelerate the higher beta plays like EM.
In terms of geopolitical risks, the amount of progress made on the US/China trade talks has been impressive including two major sticking points (IP theft and enforcement). So the surprise in 2020 could be a Phase 2 deal. Further on geopol, it would be shocking if Trump went after Europe during the election cycle (isn’t he incentivize to keep the economy going?). So trade war fears should further abate in 2020.
Speaking of progress, the Germans keep inching their way to stimulus with an ever growing acceptance of running a fiscal deficit, something that very few market participants believe will happen. That means EZ equities could be an outperformer next year and prove Costanza wrong.
Overall, Costanza wants to be in low beta, defensive trades in 2020 which makes sense given how much equities have rallied this year and that the street has now fully bought into reflation. The pushbacks to Costanza would be that the best of times are past for the US (especially politically) and the Fed will have to keep injecting liquidity which benefits the RoW. Therefore, we should all consider that perhaps the US is not the best “hiding place” any more, and all that capital flow into the US the past couple years could reverse in 2020. Meaning if there is big risk off, the US could be the worse place to be.
2) Short US 2s10s steepener (aka: the flattener)
The steepener was one of the most popular macro trades this year. The view in the beginning of the year was that the economy was slowing, the Fed would cut, and that back end would sell off on the prospects of future growth due to the Fed easing. That would be a classic end of cycle bull steepener. The prospects for the steepener was further emboldened by the tourist in the equity community who viewed it as a good hedge for equity longs.
But ironically, the 2s10s curve really started to steepen once growth bottomed, fiscal stimulus around the globe began being floated, and the Fed injected liquidity which led to the bear steepener. The bear steepener is a classic reflation trade and as we know from above; the reflation theme makes George very upset!
Instinct: The Fed is on hold in 2020 and has indicated it is “not planning to raise rates for a long time” which will keep front end rates contained whereas the long end can sell off on reflation prospects and coming supply due to fiscal spending around the world.
Costanza: growth will continue to slow (see economic surprise index) which will cause the long end to re-rally and flatten the curve back as the Fed keeps front end rates steady for a least a few meetings. Additionally, per Brainard if growth slows materially, the Fed “might turn to targeting slightly longer-term interest rates” which will certainly flatten the curve. Lastly, George likes carry (+4bps 12m roll down).
Estimated probability of Costanza being right: 50%
hHis could very well be a case where Costanza is wrong at first and right later, thus the 50% assigned probability. The prospects for further bear steepening on the back of reflation looks valid, at least in the near term.
Besides the above mentioned reasons, keep in mind that the beta to foreign curves could also steepen the US curve as central banks like the BOJ and ECB attempt to steepen their curves to aid their banking sector.
Conversely, Costanza isn’t crazy either as if growth fears reemerge, you likely get a period of flattening before the bull steepener as the Fed will be on hold for as long as possible which means the long end will rally more. Further, if the economy really destabilizes, you could then get the Brainard play book where the Fed attempts to bring the entire curve to lower yield levels – thus flattening all curves to essentially zero.
The ironic thing about playing the reflation idea in the steepener is that if the US reflates enough, the Fed could start talking hikes again. The market, who generally does not believe growth is strong enough for hikes, will no doubt bear flatten the curve. This may not be a 2020 story yet but note Evans comments (non-voter in 2020, voter in 2021) from last week where he said he is “quite comfortable with raising rates once in 2021 and again in 2022.” (Insert slapping head emoji – have these guys not learned their lesson yet!)
The technicals jibe with the idea of the curve should continue to steepen over the next couple months as the reflation narrative plays out.
US 2s10s curve have formed a picture perfect inverse head and shoulder pattern. The target is 55bps…
Long Euribors were one of the best trending trades of the year up until the ECB meeting on Sept 12th when we first caught wind that further rate cuts were going to be less likely.
ERH2 broke its uptrend on Sept 12th , now trending to the downside, and just broke pivot support…
Since then, we have gotten further clarification that not only are ECB cuts are becoming less likely, but there is a growing ambition to perhaps move out of negative rates, Riksbank style. ECB officials are now roundly talking about the adverse impact of negative rates, how they are starting to see improved growth prospects, and will consider a monetary policy path.
ECB’s De Guindos: side effects of monetary policy is becoming more evident
ECB’s de Cos: No conclusive evidence that sub-zero rates were hurting lending but could not rule any negative impact on banking sector
ECB’s Holzmann: noted he hopes to see the end of negative interest rates by the time his 6-year term ends – local press
ECB’s Holzmann: stated that he saw possible ECB rate changes if the inflation trough passed during 2020
ECB Lagarde: downside risks to growth “slightly less pronounced”
ECB’s Guindos: low rates create strains on bank profitability
ECB’s Knot: In time need to reassess our monetary policy; cannot rule out worrying prospect of current low interest rates lasting another
Additionally, as we spoke about in trade #1, the prospects of German fiscal stimulus are inching their way along and that will keep Euribors under pressure.
Instinct: growth bottoming, the ECB is done cutting and considering moving out of negative rates, prospects for German fiscal stimulus
Costanza: European growth will remain lackluster due to structural reasons, cutting rates further is one of the ECB’s only levers to pull when growth slows, moving rates out of negative will cause the Euro to appreciate which will collapse growth, generally the world has learned that rising rates eventually hurts economic growth and breaks risk assets (due to debt deluge)
Estimated probability of Costanza being right: 60%
The ECB is in a tough spot. It has become en vogue for ECB members to warn about the effects of negative rates but do any of us believe the generally unimpressive growth in Eurozone will be able to sustain rate hikes and an appreciating currency? It’s a tall order.
With the Euribor curve now pricing in hikes in the “greens,” Costanza is buying the dip and playing that at the very least; the ECB will be on perma-hold.
4) Short US 10yr breakevens
You don’t get reflation without the “flation.” This one is another bet against the conventional wisdom of reflation which by definition sees rising inflation.
It has been a good run recently for “breaks” which are now ~30bps off the lows but note that it just failed at a key resistance level, and its Elliott Wave count suggests the recent rally was simply an ABC correction. That at least puts some probability that the reflation narrative is a head fake.
Also note that at 2.1% headline CPI, 10yr breakevens tend to sit in the 1.70%-1.75% range (ie: right here).
10yr breakevens failed at pivot resistance which completes its ABC correction off the 5-wave count down. That would suggest the rally is complete and note that at 2020 consensus forecast of 2.1% CPI, 10yr breaks are “fair” here…
The one big macro positive for inflation was the Fed effectively capping the Dollar this fall with its three rate cuts, but more importantly with the repo operation/liquidity injection/Not QE. Since then, the Dollar has depreciated and that will act as a tailwind for inflation.
However, there are a few macro negatives:
The fact that tariffs will get cut in half means the feed through to prices will be negative for inflation.
China is still exporting deflation as we can see with its -1.4% PPI
No inflation impulse emanating from Europe or Japan
Trump is making it his mission to cut prescription drugs prices by increasing competition which will be very negative for medical prices (but good for the economy btw)
Oil is potentially topping (see trade #8 below)
Instinct: global growth is picking up, the Fed has eased and provided liquidity, oil has rallied, fiscal stimulus is being instituted around the world – all should feed into higher inflation
Costanza: reflation is a temporary pop that the inflation market already priced in, China is still deflating, oil will cap out soon, the Fed will end its liquidity injection next year which will cause the Dollar to rise again
Estimated probability of Costanza being right: 60%
The potential for higher inflation certainly is viable in the near term as reflation plays out a bit more. The problem is that higher inflation would lead to higher nominal yields. As we saw in 2018, higher yields ultimately tip the economy back towards the downside as the debt overhang, and the rising cost to service that debt with higher yields, will become problematic thus breaking the economy and markets once again. That would send breakevens back down.
Let’s also not forget about the aging demographics problem in the US which will structurally compress inflation over the next decade. Therefore, once the green shoots of reflation fades; Costanza will likely be proven right.
5) Long vol: “white Eurodollar”, VIX, Euro FX
The environment is goldilocks: growth is picking up, the Fed is on hold, the ECB is on hold. What could go wrong?!?!
Since the Fed’s last insurance cut + repo op, fixed income vol has been annihilated. From Costanza’s perspective, it has rarely been cheaper in the past year to bet against the market consensus that the Fed will be on hold. This could mean buying calls, puts, strangles or straddles depending on your view. Point is to own optionality that 2020 won’t be a range.
Using Prism’s constant maturity data, EDU0 at-the-money normal implied vol is back near the 1-year lows…
In other words, if you are playing the range theme in fixed income on the idea that the Fed is on hold in 2020, you are essentially selling vol at the lows. Full pass for Costanza.
Similar story in equity vol. Obviously with S&P’s making higher highs, VIX has returned to its base where you normally don’t see the index drift any lower. So do you want to sell equity vol here?
Instinct: absolutely nothing will happen in 2020 (which is what current vol levels are implying)
Costanza: the Fed generally does not make accurate calls on its policy direction so why believe they will remain on hold, the Fed shifts less hawkish/more dovish in 2020, there are still growth concerns, still trade talk uncertainty, US election uncertainty –buy volatility at the lows
Estimated probability of Costanza being right: 99.99%
This idea is made for Costanza. Most commentators right now are talking up a Fed on hold + reflation. You have to be concerned how consensus this is and the building of short vol positions in Q4.
The odds of nothing happening in 2020 and not getting a disturbance in the force is slim to none. Has anyone noticed that US growth has been disappointing recently? Has Phase 1 actually been signed? Is Phase 2 done? Is there a US election this year where policy is so binary its impossible for businesses to make investment decisions? Anyone notice nominal yields are rising to a point compared to growth where risk asset vols tend picks up?
The point is the market is priced for near perfection so playing ranges and selling vol at these levels has become dicey.
Costanza will be proven right in his highest conviction trade of the year. He would much rather buy cheapening tails than sell ATM vol. Ideally, play for higher rates now which breaks the economy/risk assets and then for Fed cuts later.
6) Short Gold
Against his long vol position, Costanza wants to sell Gold. Gold has become a widely popular macro trade as central banks are expanding their balance sheets once again, the Dollar has been falling, and the Fed is working to keep real rates low. Therefore, the Gold long is completely intuitive and is breaking out.
Gold is breaking out of its bull flag pattern. The target is 1700…
Instinct: Fed capped the Dollar and is compressing real rates, good insurance policy for an equity market melt down
Costanza: positioning is very crowded long, Fed will end its liquidity injection in 2020 which will allow the Dollar to rise again, the Fed will indicate rate hikes are once again on the horizon
Estimated probability of Costanza being right: 20%
The gold market at some point will need a positioning cleanse but the bull case is strong and the bear case is weak at best. The consensus will likely be proven right (for once).
7) Short Copper
Shorting Dr. Copper is a simple play that reflation will be temporary and that trade talks could deteriorate once again.
Costanza will be concerned about the supply issues in Chile which has also provided a bid to copper this year. Longer term, copper demand should remain robust as the US moves to more electronic vehicles of which copper is a major component of.
Instinct: the trade wars are cooling which will be good for global growth and China, supply disruptions, EV demand
Costanza: the breakout has been mostly uninspiring which could be a signal that reflation is not real, Chilean supply issues could be fixed in 2020, the EV demand theme is very long term and may not be a 2020 story
Estimated probability of Costanza being right: 50%
This is really a pure call on global growth and as stated above in some of the other trades, its likely reflation works for Q1 or so and then fades later in 2H. Therefore, with copper mostly beaten down due to trade wars, its prudent to position long here especially if you think the progress on China-US trade talks are genuine. Compared to some of the other reflation trades, this has a better entry point.
8) Short Oil
Costanza is really beating a dead horse now. Many factors drive crude oil prices but more than anything, global growth concerns kept WTI under $60 for most of the year. With the growth picture more robust, WTI has recaptured $60.
Besides the possible reemergence of growth concerns, Costanza will hang his hat on US production continuing to grow. What’s been impressive this year is US production has risen from 11.5m barrels/day to almost 13m barrels/day despite rig counts declining all year (mostly due to DUC’s being completed). But note that the rig count is starting to turn higher again which is typical when prices start to rise and producing oil becomes economically attractive again. That could keep supply pressures going.
US total crude production (black) vs. rig counts (purple)…
The bull case rests on the idea that US production will start to fall as production issues have reemerged (wells producing less oil than expected), capex has been low, and funding has become more difficult. Additionally, OPEC has made it clear they will keep prices firm with output cuts for the time being.
It’s also time to see if IMO 2020 (curtailing sulfur output on cargo ships which requires a heavy blend of crude) will cause a price spike or not as shippers could stockpile the necessary crude to turn it into product that would lower their sulfur emissions.
Costanza knows that WTI, at the end of the day, generally maintains a range around its “fair value.” In this case, over the past 5 years, WTI has an average price of $53. You can see from the below chart, 72% of the time, it stays within 1 standard deviation of that average (there has only been two periods where it traveled outside that zone). Therefore, better to fade at the top of the range than chase…
Instinct: growth is picking up, IMO 2020 rules take effect now, US production will slow due to well issues
Costanza: global growth concerns still exist, shippers can use scrubbers to manage the new IMO 2020 rules, rig count is picking up which will mean US production will keep rising, DUC’s are being completed which will bring new supply with or without increasing rig count, OPEC+ ends or reduces the supply cuts now that Aramco has IPO’d (note recent Russian comments that cuts are not indefinite), getting to the top of its normal range
Estimated probability of Costanza being right: 65%
In The Macro Scan on September 30th, we discussed how oil would bottom out in the low $50s with a target range of $60-$65. That micro call played out and here we are back at the top end of the range. Statistically speaking, Costanza looks wise to play that range with the market betting on reflation.
9) Long USD/MXN (Long US Dollar vs. short Mexican Peso)
Costanza’s call here has a few different drivers:
A play that global growth convergence will not occur in 2020 (see trade #1)
A play that the USMCA deal will not spur the Mexican economy which has seen two consecutive quarters of negative GDP growth
A play that the Fed will not continue its repo operations well into 2020 which is working to suppress the USD, or will re-lose control over funding markets bringing back the Dollar shortage theme
A play against all those trying to collect carry, short vol, etc. (Mex is the highest yielding major currency)
So this encompasses many of Costanza’s view of short risk assets, short EM, short nothing is going to happen, and long Dollar.
Instinct: growth is recovering, Fed is on hold for 2020, Fed is injecting liquidity, Mexico will benefit from USMCA deal, long EM and collect carry
Costanza: global growth is still murky and the Mexican economy has slowed hard (-0.3% GDP YoY), Banxico will have to cut rates further hurting its currency carry, the Fed will end the liquidity injections in 2020, risk asset vol will emerge which will hurt carry trades
Estimated probability of Costanza being right: 60%
This is a popular street idea and when EM trades get crowded, Costanza gets worried. It appears to him that the Mexican economic slowdown will outweigh the benefits of USMCA passage. Probably another example of not working first but bouncing in 2H.
Correction down to its long-term trend line with a 2H rally?
Since adding Bitcoin to his repertoire two years ago, Costanza is two for two in his Bitcoin calls (short vol in 2018, outright long Bitcoin in 2019). Luckily enough the long trade in 2019 worked brilliantly in 1H but has since given up much of those games. Thus entering the decade, the sentiment has flipped bearish mainly due to:
1) As trade war fears abate, the demand from the Chinese to move wealth offshore via Bitcoin decreases. And with the common belief that tariffs have peaked, there will be less demand for Bitcoin going forward.
2) Government sponsored cryptocurrencies which will lower Bitcoin demand. China is expanding is blockchain study and Japan is pushing for an international network of cryptocurrency payments as examples.
3) Libra/Stablecoins – full of controversy, but Facebook intends to move ahead with plans to bring a stable medium of currency exchange to 1.7b “unbanked” people to allow money to more easily flow around the world.
As you can see, there has been plenty of fundamental reasons to sell Bitcoin in 2H, but Costanza is betting there is still a store of value price that the market will place on it. His bet is that store of value price is around 6k. Notice the fractals that have formed since July which are “W” shaped corrections. All those “W’s” have worked to fill the various “gaps” that formed during the 1H rally. There is one last gap to fill down at 6078. Note that coincides with the all-important pivot support around 6,000. Also take notice that the MACD (bottom graph) is starting to make higher lows which is an indication that momentum is starting to turn higher…
Instinct: improved China-US trade talks means less demand from the Chinese, governments continue to work to introduce legitimate crypto, the private sector as well is attempting to bring a more stable form of crypto
Costanza: there will always be demand for a non-legitimate crypto, spec traders will buy just above 6,000 once the last 1H gap is filled and at key pivot support
Estimated probability of Costanza being right: 75%
Whether you believe Bitcoin is the IPhone or the Treo of cryptocurrencies is neither here nor there going into 2020. It remains the most liquid way to transfer money globally without real government supervision.
Further, it is still the best speculative asset in the macro landscape due to its high volatility which simply does not exist in the developed markets due to central banks compressing volatility. Those specs will take their shots at long in 2020, and Costanza has to imagine the whales come in just ahead of 6k.
Bonus: Long Initial Jobless Claims (higher claims), short the consumer
Record low unemployment and strong consumer. That has been the story in 2019 despite an economic slowdown and three Fed rate cuts. The street widely expects claims and UER to remain low in 2020.
The labor market is tight and the Fed intends on “letting it run hot” as per Kaplan’s comments that “inflation is not running away from us, so we might have the luxury of trying to do more to get more people into this workforce on a sustainable basis.”
The problem is tight labor markets can end a cycle. Wages rise which compresses margins which then leads to layoffs as companies cut costs to improve profitability (at a time when corp. earnings are now negative on a YoY basis).
That puts wages in a tough spot entering 2020. Either they rise to an unsustainable level which would end the cycle, or wages fall telling us the cycle has already ended. The only “goldilocks” scenario from Costanza’s estimation would be a stable 3% average hourly earnings (i.e.: right here, no big movements). While claims are still low on an absolute basis, the scene “under the hood” is less robust. The 4-week moving average has moved from 212k three months ago to 228k now. Not exactly troublesome yet by any means but ticking higher nonetheless. Additionally, when looking at a heat map of claims on a state-to-state basis, you can see that the rate of change is worsening more than the headline number suggests. 6m change of claims by state…
Notice how in the beginning of the year, there were only five states in the red (seeing rising claims). Now 50% of states are in the red (seeing rising claims compared to 6m ago).
If claims breakout, that would kill the other consensus economic thought of a strong consumer. Not to say this would send the US into a deep recession (it won’t because consumers have savings right now), but this would reinvigorate the US slowdown theme and cause many of Costanza’s theme to play out and squash the reflation narrative.
Summary:
Costanza’s view is straight forward once again this year: fade the reflation narrative and the idea that nothing will happen in 2020 which has led the crowd to play the range and sell vol. Costanza wants to own vol, own tails for range breaks, and generally be short reflation assets.
What are some of the potential, reasonable catalyst for Costanza to be profitable?
US growth slowdown (its already been disappointing) led by a weakening labor market that hurts the “strong consumer” narrative forcing the Fed back into a cutting cycle (thus lifting fixed income vol)
Central banks start talking rate hikes and/or market pricing for hikes increase which leads to higher rates which once again cracks risk assets
US election cycle turns 2016 Charlottesville ugly in addition to policies being so uncertain that business retrench which will hurt consumer and business sentiment
Inability for China-US to complete a Phase 2 deal which disproves the “peak tariff” idea
EM growth continues to weaken due to supply chain disruptions and still enacted tariffs
US oil production breaks above 13m barrels/day which brings down oil prices serving as not only a poor reflation signal but hurts energy equities (now becoming a popular long) and breakeven/inflation expectations
What are the glaring issues that could lead to Costanza being more wrong than right for the first time in history?
The prospects for German fiscal stimulus continues to improve
The Fed, having learned their lesson in 2018, continues to talk down rate hikes (they better censor Evans then), especially with the 2020 Fed becoming less hawkish/more dovish
The Fed continues to inject liquidity in order to control funding markets with the potential to shift purchases out the curve (i.e.: into coupons)
Companies begin to restock inventories lifting manufacturing PMI’s and, as per prior history, service PMI’s bounce 6-months later
A Biden vs. Trump outcome would reduce political risks as policies are less binary
IMO 2020 causes a demand spike for heavy crude lifting oil prices at the same time as spurring economically positive drilling activity that helps the economy
Wishing everyone a very Happy New Year and a successful 2020!
Thank you for your continued support, and I look forward to many thought-provoking market discussions in 2020. I doubt it will be a dull year.
The Dollar ended 2019 at the same level it started – but stocks, bonds, and gold all rallied on the heels of an unprecedented surge in global liquidity…
The Dollar tumbled into year-end, erasing its gains against a broad trade-weighted basket of fiat malarkey…And the three legs lower all started as the “Phased One” deal with China was ‘completed’…
And while the dollar’s slide is accelerating into year-end against global fiat currencies, it has a long way to catch down to its weakness against hard assets…
‘Twas the Night before Xmas
Stock markets at record highs
Tech sector breaking into new territory
Brushing off trade war & recession cries
But what a year 2019 was,
Let’s rewind back to last December
The world was looking a little different
One last hike the Fed would rather not remember
Only took 7 months to reverse course
“A mid cycle adjustment” Powell mumbled
followed by two step September and October cuts
“Where did I find this guy” the President grumbled
But of course there was another battle front
The China US trade war raged on
In April a deal was “about 90% done”
Took another 8 months to get to Phase One
Tariffs went up on both sides
a terrible year for manufacturing and trade
PMIs slumped into contractionary territory
“95% Republican approval rating, I get top grades!”
The President tweeted, with one eye on the election
“It’s all one big witch hunt, am fully exonerated”
Not everyone agreed, as Democrats pressed on
“The evidence suggests, he is NOT fully exculpated”
Meanwhile, we sat glued watching the House of Commons,
an equally tumultuous year back in the UK
“Order Order” no one really understood the amendments
But could the bill with the Irish Backstop pass? Three times Nay..
After multiple cabinet resignations and brexit deadlock
The writing was clearly etched on the wall,
Prime Minister May , resigned in May,
and of course Tory Euroskpetics were enthralled.
Then commenced the Tory leadership contest
Ten eager contenders, to be whittled down to one
Never mind trust issues,
“Let’s get Brexit done”
But first PM Johnson had a cunning plan ,
proroguing Parliament and giving unlawful advice to the queen
“Don’t worry its a do or die Brexit,
We will be out by Halloween!”
Back from Brussels, brandishing a deal
Deadlock in Parliament persisted,
“Time for a General Election” all parties squealed
Even Jeremy Corbyn who had resisted
And so it was on December 12th
The Conservative party secured its biggest majority in 30 years
The withdrawal bill now passed with flying colours
Brexit on January 31st with no free trade deal yet… Cheers.
2020 will also see a new BOE governor
Andrew Bailey confirmed in the seat,
Will the Bank hike or cut we wonder,
Managing brexit will be no easy feat
But in all of this let’s not forget about Europe,
Caught in a brexit quagmire and manufacturing slump
“Europe treats us worse than China”
Perpetual threat of tariffs being dangled by Trump
Trouble in paradise with the German coalition:
new SPD leadership want to re-negotiate the terms
“while we poll low, we want rules of our volition”
As CDU’s fiscal campaign made us all squirm
And oh the Italians kept us on our toes
The 5-Star Lega coalition fell apart
Another political crisis as the economy slows?
PD theatrically swept in with 5 Star : “it’s a new start”
What about NATO the transatlantic alliance
“Braindead” declared French President Macron
“This isn’t just a spending partnership but a political one”
We shook our heads, where did this all go wrong
Meanwhile OPEC+ continued with production cuts
Oil apparently too oversupplied
“we want full compliance this time: no if , no buts”
Aramco went for a local listing, not quite $2T (but they tried)
And of course the central banks, still standing firm,
The ECB unleashed its latest round of easing
A month before the end of Draghi’s term
Now it’s up to Lagarde to do the hawks appeasing
“We will do whatever it takes” Draghi’s words
Echoing forever in the annals of history
“I am neither a dove nor a hawk
but an owl” Lagarde said fervently
Another memorable speech at the UN
“How dare you, you stole my dreams”
Green warrior Greta Thunberg
Warning of climate change in its extreme
A 2019 that was hectic to say the least:
The US President impeached
Hong Kong riots in the East
Codes of civility breached
While we don’t know what 2020 has in store
Perhaps one of less uncertainty
Happy New Year to you all
and thank you for watching CNBC! – Jou
"A Nation Dying" – Opioid Deaths Linked To Auto Plant Closures, Study Says
A new study has found the link between automobile manufacturing plant closures and a community’s struggle with opioid overdose deaths.
The study, published Monday in JAMA Internal Medicine, titled “Association Between Automotive Assembly Plant Closures and Opioid Overdose Mortality in the United States,” shows how US adults are more likely to die from opioid overdoses if they live near a manufacturing plant that closed in the last five years.
“Our findings illustrate the importance of declining economic opportunity as an underlying factor associated with the opioid overdose crisis,” researchers from the Perelman School of Medicine at the University of Pennsylvania wrote in the study.
Researchers examined opioid death rates in 112 manufacturing counties across the US that had at least one manufacturing plant close since 1999. A majority of the counties were in the South and Midwest regions of the country.
From 1999 to 2016, plant closures affected 29 counties. Those counties saw 85% higher opioid overdose deaths than counties without closures.
Researchers noted that white working-age men were mostly affected.
“The current opioid overdose crisis may be associated in part with the same structural changes to the US economy that have been responsible for worsening overall mortality among less-educated adults since the 1980s,” researchers said.
As we’ve noted before, the opioid crisis in the last several decades has unfolded in three waves: The first wave of prescription pills started right before the Dot Com bust and ended around the 2008 financial crisis. The second wave began in 2009 and was associated with a significant increase in heroin-related deaths. The third wave started in 2015, which involved the proliferation of synthetic opioids, such as fentanyl. Each wave saw a greater number of overdose deaths. In total, more than 400,000 people died from 1999 to 2017.
The link between auto plant closures and the rise in opioid-related deaths suggests the nation is dying.
Students who touted conservative, Republican, Constitutional or pro-life opinions on college campuses over the last 12 months were often met with extreme resistance.
Throughout 2019, leftists were wildly triggered by opinions they disagreed with, prompting them to vandalize or destroy displays, disrupt events, shout down speakers, scream at the top of their lungs — and even physically assault their right-of-center peers.
Many of these examples were caught on camera.
Here is a look back at some of the most extreme examples The College Fix has reported on over the last year.
Turkey, since 2011, has been waging a pro-Sunni proxy war in Syria, in the hope of one day establishing in Damascus a pro-Turkey, Islamist regime. This ambition has failed, costing President Recep Tayyip Erdoğan’s Turkey violent political turmoil on both sides of Turkey’s 911-km border with Syria and billions of dollars spent on more than 4 million Syrian refugees scattered across the Turkish soil.
In Egypt, in 2011-2012, Erdoğan aggressively supported the failed Muslim Brotherhood government and deeply antagonized the incumbent — then-general but now president — Abdel Fattah al-Sisi. Since Erdoğan’s efforts in Syria and Egypt failed, his Sunni Islamist ambitions have found a new proxy-war theater: Libya.
On December 10, Erdoğan said he could deploy troops in Libya if the UN-backed Government of National Accord (GNA) in Tripoli (which Turkey supports) requested it. Erdoğan’s talks with GNA’s head, Fayez al-Sarraj, who is fighting a war against the Libyan National Army (LNA) of General Khalifa Haftar, produced two ostensibly strategic agreements: a memorandum of understanding on providing the GNA with arms, military training and personnel; and a maritime agreement delineating exclusive economic zones in the Mediterranean waters.
Greece and Egypt protested immediately while the European Council unequivocally condemned the controversial accords. Meanwhile, the deals apparently escalated a proxy competition between Turkey’s old (Greece) and new (Egypt and the United Arab Emirates) rivals.
With the al-Sarraj handshake, Erdoğan is apparently aiming to:
minimize Turkey’s isolation in the Mediterranean, one which has gradually worsened since 2010, following one diplomatic crisis after another with Israel;
counter strategic cooperation between Cyprus, Greece, Egypt and Israel, including joint diplomatic, energy and military initiatives;
cut into the emerging Cypriot-Greek-Egyptian-Israeli maritime bloc;
push back against Arab (Egyptian and UAE) pressure on al-Sarraj;
fill the European vacuum in Libya; and
emerge as a deal-breaker in the Mediterranean rather than a deal-maker.
All that ambition requires military hardware as well as diplomatic software. Since 2011, a year after the Mavi Marmara incident ruptured relations with Israel, Turkey has been investing billions of dollars in naval technologies, in an apparent effort to build up the hardware it would one day require.
In the eight years since then, Turkey has built four Ada-class corvettes; two Landing Ship Tank (LST) vessels; eight fast Landing Craft Tank (LCT) vessels; 16 military patrol ships; two deep-sea rescue ships; one submarine rescue ship; and four assault boats.
The jewel in the naval treasury box is a $1 billion Landing Platform Dock (LPD), now being built under license from Spain’s Navantia shipyards, to be operational in 2021. The TCG Anadolu, Turkey’s first amphibious assault ship, will carry a battalion-sized unit of 1,200 troops and personnel, eight utility helicopters and three unmanned aerial vehicles; it also will transport 150 vehicles, including battle tanks. It also may be able to deploy short takeoff and vertical landing STOVL F-35 fighter jets. Turkey will be the third operator in the world of this ship type, after Spain and Australia.
Erdoğan’s naval ambitions, however, are not limited just to an emerging fleet of conventional vessels. In 2016, he said that the LPD program would hopefully be the first step toward producing a “most elite” aircraft carrier. He also said he “sees it as a major deficiency that we still do not have a nuclear vessel.”
On December 22, Turkey’s first Type 214 class submarine, the TCG Piri Reis, hit the seas with a ceremony attended by Erdoğan. “Today,” he said, “we gathered here for the docking of Piri Reis. As of 2020, a submarine will go into service each year. By 2027, all six of our submarines will be at our seas for service.”
Unsurprisingly the docking ceremony reminded Erdoğan of his Libyan gambit: “We will evaluate every opportunity in land, sea and air. If needed, we will increase military support in Libya.”
Erdoğan seems to think that his best defense in the Mediterranean power game is an offense. On December 15, Turkish Naval Forces intercepted an Israeli research ship, the Bat Galim, in Cypriot waters and escorted it away, as tension over natural resource exploration continued to rise in the region.
On December 16, Turkey dispatched a surveillance and reconnaissance drone to the Turkish-controlled north of the divided island of Cyprus. A week before the drone deployment, Turkish Foreign Minister Mevlüt Çavuşoğlu said that Ankara could use its military forces to halt gas drilling in waters off Cyprus that it claims as its own.
Libya is another risky proxy war theater for Turkey. Its deals with the al-Sarraj government over troop deployment and maritime borders will become null and void if the Libyan civil war, begun in 2014, ends with Gen. Haftar’s victory. The chief of staff of the LNA, Farag Al-Mahdawi, announced that his forces would sink any Turkish ship approaching the Libyan coast. “I have an order; as soon as the Turkish research vessels arrive, I will have a solution. I will sink them myself,” Al-Mahdawi warned, noting that the order was coming from Haftar. On December 21, Haftar’s forces seized a Grenada-flagged ship with Turkish crew aboard, on the suspicion that it was carrying arms. The ship was later released.
The European Union is another factor why Erdoğan, once again, is probably betting on the wrong horse. Technically speaking, Turkey is a candidate for full EU membership, but it is an open secret that accession talks have not moved an inch during the past several years, and with no prospects of progress in sight. Making membership prospects even gloomier, EU foreign ministers in November agreed on economic sanctions for Ankara for violating Cyprus’ maritime economic zone by drilling off the island.
The Mediterranean chess game leaves Turkey in alliance with the breakaway Turkish Cypriot statelet and one of the warring factions in Libya, versus a strategic grouping of Greece, Cyprus, Egypt (and the UAE), Israel, and the other warring Libyan group.
One emerging power in Libya, however, is not a Western state actor. After controlling Syria in favor of President Bashar al-Assad and establishing permanent military bases inside and off the coast of the country, Russia has the potential to step into the Libyan theater with a bigger proxy and direct force, to establish its second permanent Mediterranean military presence. As in Syria, where divergent interests did not stop Turkey from becoming a remote-controlled Russian player, Moscow can once again make use of the Turkish card to undermine Western interests in Libya.
Also as in Syria, Turkey’s Islamist agenda will probably fail in Libya, but by the time Erdoğan understands that, it might be too late to get out of Moscow’s orbit.
“The people have the power, all we have to do is awaken that power in the people. The people are unaware. They’re not educated to realize that they have power. The system is so geared that everyone believes the government will fix everything. We are the government.” – John Lennon
Twenty years into the 21st century, and what do we have to show for it?
Government corruption, tyranny and abuse have propelled us at warp speed towards a full-blown police state in which egregious surveillance, roadside strip searches, police shootings of unarmed citizens, censorship, retaliatory arrests, the criminalization of lawful activities, warmongering, indefinite detentions, SWAT team raids, asset forfeiture, police brutality, profit-driven prisons, and pay-to-play politicians have become the new normal.
Here’s just a small sampling of the laundry list of abuses—cruel, brutal, immoral, unconstitutional and unacceptable—that have been heaped upon us by the government over the past two decades.
The government failed to protect our lives, liberty and happiness. The predators of the police state wreaked havoc on our freedoms, our communities, and our lives. The government didn’t listen to the citizenry, refused to abide by the Constitution, and treated the citizenry as a source of funding and little else. Police officers shot unarmed citizens and their household pets. Government agents—including local police—were armed to the teeth and encouraged to act like soldiers on a battlefield. Bloated government agencies were allowed to fleece taxpayers. Government technicians spied on our emails and phone calls. And government contractors made a killing by waging endless wars abroad.
The American President became more imperial. Although the Constitution invests the President with very specific, limited powers, in recent years, American presidents (Trump, Obama, Bush, Clinton, etc.) claimed the power to completely and almost unilaterally alter the landscape of this country for good or for ill. The powers that have been amassed by each successive president through the negligence of Congress and the courts—powers which add up to a toolbox of terror for an imperial ruler—empower whomever occupies the Oval Office to act as a dictator, above the law and beyond any real accountability. The presidency itself has become an imperial one with permanent powers.
Militarized police became a power unto themselves, 911 calls turned deadly, and traffic stops took a turn for the worse. Lacking in transparency and accountability, protected by the courts and legislators, and rife with misconduct, America’s police forces became a growing menace to the citizenry and the rule of law. Despite concerns about the government’s steady transformation of local police into a standing military army, local police agencies acquired even more weaponry, training and equipment suited for the battlefield. Police officers were also given free range to pull anyone over for a variety of reasons and subject them to forced cavity searches, forced colonoscopies, forced blood draws, forced breath-alcohol tests, forced DNA extractions, forced eye scans, forced inclusion in biometric databases.
The courts failed to uphold justice. With every ruling handed down, it becomes more apparent that we live in an age of hollow justice, with government courts more concerned with protecting government agents than upholding the rights of “we the people.” This is true at all levels of the judiciary, but especially so in the highest court of the land, the U.S. Supreme Court, which is seemingly more concerned with establishing order and protecting government agents than with upholding the rights enshrined in the Constitution. A review of critical court rulings over the past two decades, including some ominous ones by the U.S. Supreme Court, reveals a startling and steady trend towards pro-police state rulings by an institution concerned more with establishing order and protecting the ruling class and government agents than with upholding the rights enshrined in the Constitution.
The Surveillance State rendered Americans vulnerable to threats from government spies, police, hackers and power failures. Thanks to the government’s ongoing efforts to build massive databases using emerging surveillance, DNA and biometrics technologies, Americans have become sitting ducks for hackers and government spies alike. Billions of people have been affected by data breaches and cyberattacks. On a daily basis, Americans have been made to relinquish the most intimate details of who we are—our biological makeup, our genetic blueprints, and our biometrics (facial characteristics and structure, fingerprints, iris scans, etc.)—in order to navigate an increasingly technologically-enabled world.
Mass shootings claimed more lives. Mass shootings have taken place in virtually every venue, including at churches, in nightclubs, on college campuses, on military bases, in elementary schools, in government offices, and at concerts. However, studies make clear that the government’s gun violence—inflicted on unarmed individuals by battlefield-trained SWAT teams, militarized police, and bureaucratic government agents trained to shoot first and ask questions later—poses a greater threat to the safety and security of the nation than any mass shooter.
Debtors’ prisons made a comeback. Not content to expand the police state’s power to search, strip, seize, raid, steal from, arrest and jail Americans for any infraction, no matter how insignificant, state courts were given the green light to resume their practice of jailing individuals who are unable to pay the hefty fines imposed by the American police state. These debtors’ prisons play right into the hands of the corporations that make a profit by jailing Americans. This is no longer a government “of the people, by the people, for the people.” It has become a government “of the rich, by the elite, for the corporations,” and its rise to power has been predicated on shackling the American taxpayer to a debtors’ prison guarded by a phalanx of politicians, bureaucrats and militarized police with no hope of parole and no chance for escape.
The cost of endless wars drove the nation deeper into debt.America’s war spending has already bankrupted the nation to the tune of more than $20 trillion dollars. Policing the globe and waging endless wars abroad hasn’t made America—or the rest of the world—any safer, but it has made the military industrial complex rich at taxpayer expense. Approximately 200,000 US troops are stationed in 177 countries throughout the world, including Africa, where troops reportedly carry out an average of 10 military exercises and engagements daily. Meanwhile, America’s infrastructure is falling apart. The interest on the money America has borrowed to wage its wars will cost an estimated $8 trillion.
“Show your papers” incidents skyrocketed. We are not supposed to be living in a “show me your papers” society. Despite this, the U.S. government has introduced measures allowing police and other law enforcement officials to stop individuals (citizens and noncitizens alike), demand they identify themselves, and subject them to patdowns, warrantless searches, and interrogations. These actions fly in the face of longstanding constitutional safeguards forbidding such police state tactics.
The government waged war on military veterans. The government has done a pitiful job of respecting the freedoms of military veterans and caring for their needs once out of uniform. Despite the fact that the U.S. boasts more than 20 million veterans who have served in World War II through the present day, the plight of veterans today is America’s badge of shame, with large numbers of veterans impoverished, unemployed, traumatized mentally and physically, struggling with depression, suicide, and marital stress, homeless, subjected to sub-par treatment at clinics and hospitals, left to molder while their paperwork piles up within Veterans Administration offices, and increasingly treated like criminals—targeted for surveillance, censorship, threatened with incarceration or involuntary commitment, labeled as extremists and/or mentally ill, and stripped of their Second Amendment rights—for daring to speak out against government misconduct.
Free speech was dealt one knock-out punch after another.Protest laws, free speech zones, bubble zones, trespass zones, anti-bullying legislation, zero tolerance policies, hate crime laws, shadow banning on the Internet, and a host of other legalistic maladies dreamed up by politicians and prosecutors (and championed by those who want to suppress speech with which they might disagree) conspired to corrode our core freedoms, purportedly for our own good. On paper—at least according to the U.S. Constitution—we are technically free to speak. In reality, however, we are only as free to speak as a government official—or corporate entities such as Facebook, Google or YouTube—may allow. The reasons for such censorship varied widely from political correctness, so-called safety concerns and bullying to national security and hate crimes but the end result remained the same: the complete eradication of free speech.
The government waged a renewed war on private property. The battle to protect our private property has become the final constitutional frontier, the last holdout against our freedoms being usurped. We no longer have any real property rights. That house you live in, the car you drive, the small (or not so small) acreage of land that has been passed down through your family or that you scrimped and saved to acquire, whatever money you manage to keep in your bank account after the government and its cronies have taken their first and second and third cut…none of it is safe from the government’s greedy grasp. At no point do you ever have any real ownership in anything other than the clothes on your back. Everything else can be seized by the government under one pretext or another (civil asset forfeiture, unpaid taxes, eminent domain, public interest, etc.).
Schools became even more like prisons. So-called school “safety” policies—which run the gamut from zero tolerance policies that punish all infractions harshly to surveillance cameras, metal detectors, random searches, drug-sniffing dogs, school-wide lockdowns, active-shooter drills and militarized police officers—have turned schools into prisons and young people into prisoners. From the moment a child enters one of the nation’s 98,000 public schools to the moment she graduates, she will be exposed to a steady diet of draconian zero tolerance policies that criminalize childish behavior, overreaching anti-bullying statutes that criminalize speech, school resource officers (police) tasked with disciplining and/or arresting so-called “disorderly” students, standardized testing that emphasizes rote answers over critical thinking, politically correct mindsets that teach young people to censor themselves and those around them, and extensive biometric and surveillance systems that, coupled with the rest, acclimate young people to a world in which they have no freedom of thought, speech or movement.
The Deep State took over. The American system of representative government was overthrown by the Deep State—a.k.a. the police state a.k.a. the military/corporate industrial complex—a profit-driven, militaristic corporate state bent on total control and global domination through the imposition of martial law here at home and by fomenting wars abroad. The “government of the people, by the people, for the people” has perished. In its place is a shadow government, a corporatized, militarized, entrenched bureaucracy that is fully operational and staffed by unelected officials who are, in essence, running the country and calling the shots in Washington DC, no matter who sits in the White House. Mind you, by “government,” I’m not referring to the highly partisan, two-party bureaucracy of the Republicans and Democrats. Rather, I’m referring to “government” with a capital “G,” the entrenched Deep State that is unaffected by elections, unaltered by populist movements, and has set itself beyond the reach of the law. This is the hidden face of a government that has no respect for the freedom of its citizenry. This shadow government, which “operates according to its own compass heading regardless of who is formally in power,” makes a mockery of elections and the entire concept of a representative government.
The takeaway: Everything the founders of this country feared has come to dominate in modern America. “We the people” have been saddled with a government that is no longer friendly to freedom and is working overtime to trample the Constitution underfoot and render the citizenry powerless in the face of the government’s power grabs, corruption and abusive tactics.
So how do you balance the scales of justice at a time when Americans are being tasered, tear-gassed, pepper-sprayed, hit with batons, shot with rubber bullets and real bullets, blasted with sound cannons, detained in cages and kennels, sicced by police dogs, arrested and jailed for challenging the government’s excesses, abuses and power-grabs?
No matter who sits in the White House, politics won’t fix a system that is broken beyond repair.
For that matter, protests and populist movements also haven’t done much to push back against an authoritarian regime that is deaf to our cries, dumb to our troubles, blind to our needs, and accountable to no one.
So how do you not only push back against the police state’s bureaucracy, corruption and cruelty but also launch a counterrevolution aimed at reclaiming control over the government using nonviolent means?
You start by changing the rules and engaging in some (nonviolent) guerilla tactics.
Take part in grassroots activism, which takes a trickle-up approach to governmental reform by implementing change at the local level (in other words, think nationally, but act locally).
And then, nullify everything the government does that flies in the face of the principles on which this nation was founded.
If there is any means left to us for thwarting the government in its relentless march towards outright dictatorship, it may rest with the power of juries and local governments to invalidate governmental laws, tactics and policies that are illegitimate, egregious or blatantly unconstitutional.
In an age in which government officials accused of wrongdoing—police officers, elected officials, etc.—are treated with general leniency, while the average citizen is prosecuted to the full extent of the law, nullification is a powerful reminder that, as the Constitution tells us, “we the people” are the government.
For too long we’ve allowed our so-called “representatives” to call the shots. Now it’s time to restore the citizenry to their rightful place in the republic: as the masters, not the servants.
Nullification is one way of doing so.
Various cities and states have been using this historic doctrine with mixed results on issues as wide ranging as gun control and healthcare to “claim freedom from federal laws they find onerous or wrongheaded.” Most recently, a growing number of communities—including more than a 100 counties, cities and towns in Virginia—have declared themselves to be Second Amendment sanctuaries and adopted resolutions opposing any “unconstitutional restrictions” on the right to keep and bear arms. It is mass movements such as these that the government fears most.
Indeed, any hope of freeing ourselves rests—as it always has—at the local level, with “we the people.” One of the most important contributions an individual citizen can make is to become actively involved in local community affairs, politics and legal battles. As the adage goes, “Think globally, act locally.”
America was meant to be primarily a system of local governments, which is a far cry from the colossal federal bureaucracy we have today. Yet if our freedoms are to be restored, understanding what is transpiring practically in your own backyard—in one’s home, neighborhood, school district, town council—and taking action at that local level must be the starting point.
Responding to unmet local needs and reacting to injustices is what grassroots activism is all about. Attend local city council meetings, speak up at town hall meetings, organize protests and letter-writing campaigns, employ “militant nonviolent resistance” and civil disobedience, which Martin Luther King Jr. used to great effect through the use of sit-ins, boycotts and marches.
Let’s not take the mistakes, carnage, toxicity and abuse of this past decade into 2020.
As long as we continue to allow callousness, cruelty, meanness, immorality, ignorance, hatred, intolerance, racism, militarism, materialism, meanness and injustice—magnified by an echo chamber of nasty tweets and government-sanctioned brutality—to trump justice, fairness and equality, there can be no hope of prevailing against the police state.
As I make clear in my book Battlefield America: The War on the American People, we could transform this nation if only Americans would work together to harness the power of their discontent and push back against the government’s overreach, excesses and abuse.
Despite Star Wars “Success”, U.S. Movie Ticket Sales Plunged 4.6% In 2019
Star Wars: The Rise of Skywalker led at the box office again last week, but while it has helped catalyze a great 2019 for Disney, pretty much everyone else in the movie industry has sputtered and struggled.
The new “Star Wars” film brought in $72 million this weekend, according to the San Francisco Chronicle, easily beating out Sony Corp.’s “Little Women” and “Spies in Disguise,” from Disney’s Fox studio.
But the film’s gross take, which was expected to be as much as $100 million, was down 59% from last week.
But this shouldn’t be much of a surprise: the industry has fallen apart in 2019, with U.S. ticket sales declining 4.6.% from the year prior. 2020 is expected to also be a “challenge”.
Another film that opened this past weekend, “Little Women”, was expected to gross $18 million but only brought in $16.5 million. The animated “Spies in Disguise” raked in $13.2 million after projections of $11 million. “Uncut Gems”, starring Adam Sandler, expanded to more theaters and brought in $9.6 million, in the middle of its forecasted $8.5 million to $10 million range.
Recall, just days ago, we reported on movie theater stocks plunging after continued weak ticket sales for Star Wars were announced for the weekend of December 20 to December 22. AMC Entertainment Holdings, Cinemark Holdings Inc., and Cineworld Group Plc all fell in response.
The movie generated $176 million last weekend weekend, making it the third-largest December debut ever – but it still tracked below estimates of $183 million.
“Hollywood was banking on a strong showing to boost receipts,” Geetha Ranganathan, an analyst at Bloomberg Intelligence, wrote.
“The reception, far below predecessors, may have been partly due to mixed critical reviews.”
North America’s movie theater industry remains in limbo since the emergence of streaming services. A consolidation wave among movie theaters continues despite Hollywood’s softer domestic performance in 2019. Operators have been hunting for additional growth channels, including expansion in Asia.
U.K.-based Cineworld is expected to become North America’s largest movie theater operator as it acquires Canada’s Cineplex in a $1.86 billion deal.
Netflix has undoubtedly disrupted the industry by releasing its content on television screens and mobile devices instead of at the box office. Netflix released 371 new movies and TV shows in 2019, over 50 percent more than they did last year, according to data compiled by Variety Insight.
The movie theater consolidation wave began in 2012 when China’s Dalian Wanda Group purchased AMC Entertainment.
The Wizard of OxyContin – where is he now? That nickname, revealed in leaked documents, belonged to an employee of Abbott Laboratories, which partnered with Purdue Pharmaceuticals to sell the drug. Starting in the late 1990s, he and his colleagues canvassed clinics around the country, hard-selling doctors on their flagship product. Purdue wooed doctors taught to distrust pain medications with steaks, vacations, and a stunning range of swag: Oxy-branded clocks, pens, beach hats, even swing music compilations. They were told that, unlike other opioids, OxyContin was addiction-proof; its time-release coating assured a steady, measured dose and would thwart attempts at abuse.
Unmentioned by those reps – but known by their bosses from day one – was the ease with which this coating could be removed. As doctors began prescribing the drug in ever-larger numbers and Oxy’s sales soared into the billions, this glitch would devastate families, ravage towns, and before long spark the worst drug crisis in US history.
Purdue eventually gestured toward fixing this problem, after 14 years of lucrative dithering. In 2010, a few years before its patent was set to expire, the company prolonged it with a new formula. This revamped Oxy was harder to abuse, and while its effectiveness has been debated, rates of prescription drug abuse have declined, aided by “pill mill” raids and stricter prescribing guidelines. But the wreckage that Oxy left behind is still being felt: In 2017, more than 47,000 Americans have died of opioid overdoses, the highest number on record. That same year, fentanyl became a household name, surfacing in local news segments, policy-website explainers, and thousands of toxicology reports. When the original Oxy vanished from the streets, many of the people addicted to it turned to heroin—and now it emerged that much of the heroin available in the United States (along with fast-rising quantities of cocaine) was laced with fentanyl. The advantage, for dealers, was price: Fentanyl costs less than heroin and is easier to acquire. It also happens to be 50 times more potent.
Often lost in the early news reports was the fact that fentanyl alone wasn’t killing people; many different kinds of fentanyl were. Since its invention in 1959 by the Belgian chemist and doctor Paul Janssen, fentanyl has seen more than 1,400 analogues: twists on the original formula whose origins and effects vary widely. Carfentanil, for instance—100 times stronger than fentanyl—was until 2018 FDA-approved for use as an elephant tranquilizer. It is here that the opioid crisis intersects with (and amplifies) a newer scourge: NPS, or new psychoactive substances, molecularly tweaked stand-ins for traditional street drugs. The best-known of these is probably K2, or Spice, the ostensible marijuana substitute whose high bears little resemblance to the real thing and whose side effects include blood-clotting, kidney failure, and instant death. But there are hundreds more, and likely thousands in development. Mini-pandemics have erupted across the country, as when, in the course of a single week last year, over 100 people in New Haven overdosed on what was later determined to be AB-FUBINACA, yet another synthetic cannabinoid.
Ben Westhoff, in Fentanyl, Inc.: How Rogue Chemists Are Creating the Deadliest Wave of the Opioid Epidemic, charts this progression in harrowing detail. We are now dealing, he writes, with “the harshest drug challenge in our history.” His book is one of the first to address what the Centers for Disease Control has called the “third wave” of the opioid crisis: first OxyContin, then heroin, and now fentanyl and its analogues. Earlier accounts of this crisis – Sam Quinones’s Dreamland: The True Tale of America’s Opiate Epidemic or Beth Macy’s Dopesick: Dealers, Doctors, and the Drug Company That Addicted America – had in Purdue Pharma the benefit, structural and dramatic, of a villain. More or less everyone can agree that pharmaceutical companies should refrain from wantonly pursuing profit at the expense of public health. Dopesick is rarely a pleasant read, but Macy’s account of Purdue’s first major court battle – which culminated in criminal convictions for three executives and $600 million in fines—provided at least some measure of catharsis.
Westhoff, reporting from the flayed, despairing center of this crisis, can’t offer any comparable relief. Purdue Pharma is now dead, and responsibility has devolved, in this third wave, to thousands of loosely affiliated actors: Dark Web distributors, small-time dealers, chemists whose skills and moral scruples vary widely. Like the cryptocurrencies that mask countless NPS transactions, these networks are decentralized: Members taken down are just as quickly replaced. But there is consolation in clarity, and the achievement of Westhoff’s book is to press this sprawling cast and the forces that gave rise to it into something like a coherent narrative, forming legible patterns out of widespread chaos.
Glassine pouches of confirmed fentanyl are displayed at the Drug Enforcement Administration Northeast Regional Laboratory in New York, 2019. (AFP via Getty / Photo by Don Emmert)
As Westhoff points out, many of the most dangerous NPS were developed under completely legal circumstances, by tenured professors at prestigious universities. These experimental compounds—as well as the steps taken to produce them—were written up in small, peer-reviewed science journals and more or less forgotten, until the underworld began to repurpose these articles as recipes for recreational drugs. David Nichols, the utopian chemist who once dreamed of a drug that would end all war, now finds himself faced with the grief of parents like Eric Brown, whose son Montana overdosed on 251-NBOMe, which was brought into the mainstream through his research.
If Fentanyl, Inc. does have a primary antagonist, it’s the Chinese government. Virtually all of the fentanyls that have flooded the United States in recent years have been manufactured in China, where many NPS are legal, an arrangement that allows legitimate businesses to churn them out on a scale inconceivable to illicit drug makers in North America. This process has been heavily underwritten, as Westhoff demonstrates, by “lucrative tax incentives, subsidies, and direct financial support” from the Chinese government, as part of its breakneck bid to expand the country’s biotechnology sector.
The extent to which Chinese officials are aware of what they’re funding is unclear – some of these companies produce hundreds of products, churning out fentanyls alongside collagen, pesticides, and erectile-dysfunction meds – but the blind eye they’ve turned toward the export of these chemicals has yielded a number of complaints from the United States. The companies, meanwhile, know exactly what they’re doing: Fentanyls and NPS that are legal in China but banned in the US are often shipped in disguise, packaged as dog food or high-gluten wheat flour bread. In addition to an urgent public health crisis, this is an issue of international trade, which means that President Donald Trump seems authentically to care about it. In April, under pressure from his administration, China instituted a blanket ban on the production of all fentanyl variants. The majority of Westhoff’s reporting was conducted before this announcement was made, but, as he argues and as recent developments have borne out, it is “far from clear” if these new regulations have had any impact.
To illuminate this deadly, improbable cycle—in which drugs developed at American universities are mass-produced in Chinese factories and then sold to North American dealers, occasionally winding up, as party drugs, on the very same campuses whose endowments funded their creation—Westhoff ranges widely, logging time with each link in the chain of production. Eventually, in the book’s intrepid centerpiece, he manages to infiltrate two Chinese chemical manufacturers. At one of them, undercover as a cautious buyer, he encounters a roomful of cheerful twentysomethings blithely Skyping with potential customers to organize deals. It’s an uncanny moment: With fentanyl components swapped for cheap razors or custom-made mattresses, this could be any number of US start-ups, right down to the strained cheer and punishing work hours (though with the further difference that all of these people live together, in a motel adjacent to their office). But the book’s most revealing encounter takes place back home, when Westhoff, still posing as a buyer, is asked via Skype by one of these young sales reps why exactly people buy a chemical called NPP. Westhoff explains that it’s used to make fentanyl.
“I know Fentanyl,” she continued, “but why [do] people use it?”
“It’s highly addictive,” I said.
“Yes, I know it is a bad ,” the saleswoman admitted, “but I still sell it, so sometimes I feel guilt. NPP is not forbidden in China, so we can sell. I sell it, because I want to earn money, earn a living.”
Westhoff lets this exchange stand on its own, but a whole world throbs beneath it. Like many Chinese companies, the one this woman works for—called Yuancheng—began exporting its products to the United States only after China joined the World Trade Organization in 2001. That development cost millions of Americans their factory jobs and helped speed along the opioid crisis, as thousands of newly unemployed workers started selling their surplus Oxy to make the rent or maintain their own supply. Asked to justify themselves, they might have said something similar. Neither party—the laid-off factory worker selling Oxy out of his foreclosed home; the Yuancheng saleswoman working six-day weeks to keep the room she shares with six coworkers—can really be blamed. That the latter has progressed to killing the former suggests a failure, or an apotheosis, of two miserably enmeshed systems.
Stemming the flow of drugs from China is important, as is working, somehow, to curb the spread of NPS. But this problem isn’t disappearing soon, and there are people who urgently need our help. The relative whiteness of those affected by the opioid crisis has softened the old approach—jail the dealers, jail the addicts, remind young children that drugs are bad—but as Westhoff demonstrates, we have a long way to go. If we are to treat opioid-use disorder as a disease like any other, then here-and-now treatment must be our first priority, andFentanyl, Inc. closes with a tour of some organizations taking that imperative seriously. Most of them are located outside the United States, a country whose fervent commitment to prolonged and needless suffering largely precludes the safe-injection sites and drug-testing operations that have saved countless lives in Europe. There have been some signs of progress—Westhoff highlights Grand Forks, North Dakota, a small conservative city that has liberalized access to Narcan, clean needles, and medication-assisted treatment—but harm reduction has yet to take hold as a national strategy. Which is unfortunate, because no other strategy works.
In “Stunning Twist”, Carlos Ghosn Flees Japanese House Arrest, Arrives In Lebanon To Escape “Rigged” Justice System
Update: Confirming earlier speculation, Nissan’s former Chairman Carlos Ghosn who was facing criminal trial in Japan, said he fled for Lebanon and has left Japan, which Bloomberg called a “stunning twist” in a saga that began over a year ago with this shocking arrest in Tokyo. Ghosn said in a statement through his representatives Tuesday that he was not fleeing justice, but instead seeking to avoid “injustice and political persecution.”
“I am now in Lebanon and will no longer be held hostage by a rigged Japanese justice system where guilt is presumed, discrimination is rampant, and basic human rights are denied,” the former Nissane and Renault head said in an e-mailed statement Tuesday. “I have not fled justice – I have escaped injustice and political persecution.”
Ghosn, now a global fugitive from the law, picked Lebanon as it has no extradition agreement with Japan. The 65-year-old has said he’s the victim of a conspiracy between Nissan executives, prosecutors and government officials to prevent him from further integrating the company with Renault.
Ghosn did not provide details on how he got out but promised to talk to reporters soon. He was awaiting trial for what prosecutors called a pervasive pattern of financial misconduct and raiding of corporate resources for personal gain — allegations that Ghosn has denied. Ghosn fled Japan because he doesn’t believe he will get a fair trial in the country, a person familiar with the matter said earlier.
Ghosn was released on bail in April under the condition that he live at a registered address and not leave Japan. As Bloomberg notes, the strict terms of his release were designed to prevent him from fleeing. He wasn’t permitted to spend more than one night away from his house without a judge’s permission. A video camera was trained on his front door, and at the end of each month, Ghosn was required to provide a list of everyone he’d met. Ghosn’s overseas travel ban was still in place when he fled to Lebanon, according to Kyodo.
The mystery of how Ghosn left Japan deepens as his passport was confiscated as part of the conditions of bail. According to Lebanese media, he arrived on a private jet from Turkey. Neither is it clear how Japan might get Ghosn back: The country has extradition treaties with the U.S. and South Korea, according to the foreign ministry’s website.
Ghosn was born in Brazil and raised in Lebanon, where he has investments in real estate and vineyards and continues to be viewed as a business icon and wunderkind. His image has been used for national postal stamps. Since the early days of his incarceration, Ghosn won support from Lebanon.
And so, just as Jeffrey Epstein managed to “suicide” himself despite constant surveillance and suicide watch, so too Carlos Ghosn, arguably the highest profile alleged criminals under house arrest currently, somehow managed to evade his overseers and flee to one of the few countries that has no extradition treaty with Japan…
* * *
Earlier:
Just over 13 months after his arrest in Japan, The FT reports that former Nissan-Renault Chairman Carlos Ghosn is no longer under house arrest in Japan and has arrived in his parents’ native Lebanon, according to a source close to the Nissan-Renault chairman’s family and a professional associate.
Ghosn had been out on bail, under house arrest, for alleged financial wrongdoing in Japan. Ghosn holds Lebanese, French and Brazilian citizenship.
Local media reported that, according to an associate of Mr Ghosn, he arrived in a private jet at Beirut’s Rafic al-Hariri international airport late on Sunday.
Chinese Scientist Who Created First Gene-Edited Babies Sentenced To 3 Years In Prison
A Chinese court on Monday sentenced a scientist responsible for creating the world’s first genetically modified children to a three-year stretch in prison after his experiments elicited a massive backlash over what some described as a blatant abuse of bioethics, according to reports in the Chinese press that were picked up by WSJ.
The court accused Dr. He Jiankui of forging documents to conceal what he was doing from both the patients he recruited for the trial and the doctors who performed the work alongside him. Both Dr. He and two alleged “accomplices” pleaded guilty, according to the court.
“In order to pursue fame and profit, they deliberately violated the relevant national regulations, and crossed the bottom lines of scientific and medical ethics,” the court said.
Dr. He (the son of rice farmers) graduated with a degree in physics in China before getting a doctorate from Rice University in the US. Eventually, he switched to studying biology, which led to his interest in gene-editing technology.
People who knew the doctor said he wanted to make history, and also ameliorate what he saw as an injustice against HIV-positive people in China, who are barred from receiving fertility treatments. It’s believed that the doctor expected a reward from Beijing for helping China reach its goal of becoming a leader in genetic science.
Instead, Dr. He stunned the global scientific community last year when he revealed that he had successfully edited the genes of two twin babies from HIV+ parents. Dr. He said he had engineered the twin girls using a gene-editing technology called Crispr-Cas9 to be resistant to HIV. The girls were born of a healthy mother and an HIV+ father, which can sometimes lead to the virus being passed down to the children.
He also admitted to creating a third genetically modified baby. Chinese authorities said they will monitor all three children into adulthood.
Unfortunately for Dr. He, the accolades he had anticipated never materialized.
Instead, his revelation elicited condemnation from bioethicists and other doctors in China, including the inventors of the gene-editing technology he used. Dr. He was soon fired from his post at Southern University of Science and Technology (based in the southern city of Shenzhen).
And on Monday, he was convicted by a court in Shenzhen of illegally practicing medicine.
Bioethics contend that editing the genes of embryos is a much more sensitive area because those children will eventually grow up and risk passing on the edited genes to the next generation, creating room for unintended consequences to surface decades down the road.
In the US, gene-editing technology has mostly been applied to terminally ill patients who likely won’t pass on the changes to the next generation.
According to a 36-count grand jury indictment, a Seattle company used a hidden drain to dump a highly-corrosive chemical solution directly into the sewer system.
The King County sewer system eventually reaches the Duwamish Waterway and the Puget Sound.
After “a sensitive sewer flow meter tipped them off to something strange,”agents sent a robot into the sewer to investigate, the Seattle Timesreports.
Inside the sewer, the robot’s camera recorded a white stain of unknown origin and, according to a federal indictment handed down earlier this month, federal agents executed a search warrant after real-time monitoring equipment they installed indicated an unusual spike in the water’s pH.
During the search, a portable pump covered in a high-pH liquid and a hidden drain that had never been disclosed were both discovered.
It turns out, both the company’s owner and the manager of the plant, who happen to be cousins, have been lying to regulators since at least 2009, according to the indictment. The scheme was discovered in 2018.
The Seattle Barrel and Cooperage Company collects used 55-gallon industrial drums and resells them after undergoing a reconditioning process that involves washing them in a tank full of highly-corrosive chemical solution. The family-owned company is legally obligated to dispose of the caustic solution properly.
Louie Sanft and John Sanft have both charged with criminal conspiracy as well as 29 counts of violating the Clean Water Act—one for each of the 29 times that investigators documented the waste being discharged into the sewer system in 2018 and 2019—and are expected to appear in court next month.
The century-old company is laying the blame on a former employee whose employment was terminated earlier this year, according to Seattle Barrel’s lawyer, Harold Malkin. That employee hasn’t been named or charged.
Louie Sanft’s lawyer, Angelo Calfo, blames the former employee as well and says that the Justice Department and the EPA both made a “serious error” in charging his client.
Calfo explained:
“Louie had no motive to do this. Company practice and policy was to have the tank water boiled down and evaporated. Any sludge from the tank would be transported for proper disposal. This case is about a former employee who cut corners for his own gain.”
The county began monitoring Seattle Barrel’s activities via “cover monitoring” after a King County Industrial Waste employee observed the plant manager dump an oily substance directly into a sewer. The company was fined $55,250 in 2013 after the county discovered violations of its wastewater discharge permit. After various improvements, the company claimed to be a “zero discharge” facility but, according to the indictment, those improvements didn’t involve the caustic solution that the company has been dumping directly into the sewer system.
Seattle Barrel was also required to pay $30,000 in fines after the Washington Department of Ecology discovered the company was “failing to identify caustic wastewater as a hazardous waste, missing labels on hazardous waste containers and lacking measures to prevent the escape of hazardous liquids.”
U.S. Attorney Brian Moran said:
“At a time when we are searching for strategies to protect Puget Sound and improve water quality for fish and wildlife, we need companies to do their share—not scheme for ways to pollute in private.”
A Major Bank Admits QE4 Has Started, And That Stocks Are Rising Because Of The Fed’s Soaring Balance Sheet
There was a period of about two months when some of the more confused, Fed sycophantic elements, would parrot everything Powell would say regarding the recently launched $60 billion in monthly purchases of T-Bills, and which according to this rather vocal, if always wrong, subsegment of financial experts, did not constitute QE. Perhaps one can’t really blame them: after all, unable to think for themselves, they merely repeated what Powell said, namely that “growth of our balance sheet for reserve management purposes should in no way be confused with the large-scale asset purchase programs that we deployed after the financial crisis. Neither the recent technical issues nor the purchases of Treasury bills we are contemplating to resolve them should materially affect the stance of monetary policy. In no sense, is this QE.“
As it turned out, it was QE from the perspective of the market, which saw the Fed boosting its balance sheet by $60BN per month, and together with another $20BN or so in TSY and MBS maturity reinvestments, as well as tens of billions in overnight and term repos, and soared roughly around the time the Fed announced “not QE.”
And so, as the Fed’s balance sheet exploded by over $400 billion in under four months, a rate of balance sheet expansion that surpassed QE1, QE2 and Qe3…
… stocks blasted off higher roughly at the same time as the Fed’s QE returned, and are now up every single week since the start of the Fed’s QE4 announcement when the Fed’s balance sheet rose, and are down just one week since then: the week when the Fed’s balance sheet shrank.
The result of this unprecedented correlation between the market’s response to the Fed’s actions – and the Fed’s growing balance sheet – has meant that it gradually became impossible to deny that what the Fed is doing is no longer QE. It started with Bank of America in mid-November (as described in “One Bank Finally Admits The Fed’s “NOT QE” Is Indeed QE… And Could Lead To Financial Collapse“), and then after several other banks also joined in, and even Fed fanboy David Zervos admitted on CNBC that the Fed is indeed doing QE, the tipping point finally arrived, and it was no longer blasphemy (or tinfoil hat conspiracy theory) to call out the naked emperor, and overnight none other than Deutsche Bank joined the “truther” chorus, when in a report by the bank’s chief economist Torsten Slok, he writes what we pointed out several weeks back, namely that “since QE4 started in October, a 1% increase in the Fed balance sheet has been associated with a 1% increase in the S&P500, see chart below.” Not that DB has absolutely no qualms about calling what the Fed is doing QE4 for the simple reason that… it is QE4.
The chart in question, which is effectively the same as the one we created above, shows the weekly change in the Fed’s balance sheet and the S&P500 as a scatterplot, and concludes that all it takes to push the S&P higher by 1% is to grow the Fed’s balance sheet by 1%.
And just to underscore this point, the strategist points out that such a finding is “consistent with this new working paper, which finds that QE boosts stock markets even when controlling for improving macro fundamentals.” Which, of course, is hardly rocket science – after all when you inject hundreds of billions into the market in months, and this money can’t enter the economy, it will enter the market. The result: the S&P trading at an all time high in a year in which corporate profits actually decreased and the entire rise in the stock market was due to multiple expansion.
In short: the Kool Aid is flowing, the party is in full force and everyone has to dance, because the Fed will continue to perform QE4 at least until Q2 2020. Which reminds us of what we wrote last week, namely that another big bank, Morgan Stanley, has already seen through the current meltup phase, and predicts the “Melt-Up Lasting Until April, After Which Markets Will “Confront World With No Fed Support“.”
American journalist H.L. Mencken once observed, “Say what you will about the Ten Commandments, you must always come back to the pleasant fact that there are only ten of them.” Despite an unending respect for Mencken, this is an occasion in which I found him mistaken, after I violated the Eleventh Commandment, “Thou shalt not testify for Republicans.”
Worse yet, I am a recidivist sinner, after testifying as a constitutional expert in both the Clinton and Trump impeachment hearings. Like all mortal sins, the violation of the Eleventh Commandment comes with not just eternal but immediate damnation. What is most striking about this commandment is that it does not matter if your testimony is made in good faith. For example, under the Ninth Commandment, you are only guilty if you give false evidence against your neighbor. Under the Eleventh Commandment, it does not matter if your testimony is true or false. A law-fearing academic must not give any testimony for Republicans.
In my recent testimony before the House Judiciary Committee regarding President Trump’s impeachment, I opposed the position of my fellow witnesses that the definition of actual crimes is immaterial to their use as the basis for impeachment – and I specifically opposed impeachment articles based on bribery, extortion, campaign finance violations or obstruction of justice. The committee ultimately rejected those articles and adopted the only two articles I felt could be legitimately advanced: abuse of power, obstruction of Congress. Chairman Jerrold Nadler even ended the hearing by quoting my position on abuse of power. Our only disagreement was that I opposed impeachment on this record as incomplete and insufficient for submission to the Senate.
None of that matters under the Eleventh Commandment, however. It is the act of testifying for Republicans that is a sin against the legal academy. Indeed, what followed was a series of false stories attacking not my testimony but me, personally. The falsity of these stories is a warning to any academic who considers straying from the Democratic path.
Turley flipped his testimony from the Clinton impeachment.
One of the most bizarre false stories was that I testified differently on my views of impeachment during the Clinton and Trump impeachments. Given the 21-year gap, it might not be strange for views to change. However, my views in the two cases were the same.
In both hearings, I said a president could be impeached for noncriminal conduct, including abuse of public office. Yet stories on CNN and other outlets objected that, in the Clinton case, I warned Congress, “If you decide that certain acts do not rise to impeachable offenses, you will expand the space for executive conduct.” Somehow this was portrayed as a “flip-flop” since I was arguing against impeachment in the Trump hearings on this record. It doesn’t matter that the Judiciary Committee did precisely what I suggested in dropping the four criminal theories for the articles or going forward with the two I said would be legitimate. I was not arguing against impeaching on the two articles adopted — only that a completed record was absent.
More importantly, the statement in the Clinton case referred to perjury. Democrats argued back then that a president could commit perjury on some subjects, such as sexual relations, and not face impeachment; they argued that an impeachment crime must be tied to the office, not to personal interests. That was ridiculous and would allow a president to kill a lover but not face impeachment. Indeed, the Democratic position would allow a presidential Harvey Weinstein to abuse countless interns and then pressure them to lie to an independent counsel.
Turley thought Justice Sotomayor wasn’t smart enough.
Perhaps the most vile false story can be traced to a tweet sent out by a University of Baltimore law professor asking, “Does anybody else remember @JonathanTurley appearing on MSNBC to explain that Sonia Sotomayor didn’t have the intellect to serve on the Supreme Court?” I certainly didn’t remember that — because I never said anything like that. No matter: Soon, from MSNBC to liberal websites, the story was all the rage, with titles such as “Jonathan Turley thought Sonia Sotomayor wasn’t smart enough to be on the Supreme Court.”
When then-Judge Sotomayor was nominated, I was asked as a legal commentator to review her opinions and give my view of what that body of work suggested about her potential on the Supreme Court. The issue at the time was whether President Obama was appointing an intellectual counterweight to conservative Justice Antonin Scalia. I noted that her opinions were narrow and offered few insights into her potential as an intellectual force on the court. My comments were directed to her opinions, not her intellect. And I was not alone in this conclusion: Adam Liptak in The New York Times noted that her opinions were “narrow” and “reveal no larger vision, seldom appeal to history and consistently avoid quotable language.”
In the interview cited by the Baltimore professor, I gave my view of 30 of Sotomayor’s opinions, which did not contain anything particularly deep or profound in judging her possible impact on the court. However, I immediately stated that this is not unique and that other justices have had similarly short, unremarkable appellate opinions yet proved to be profound on the Supreme Court. I expressly compared Sotomayor to Justice John Paul Stevens, whom I have long praised; I also said that Sotomayor could prove to be a truly great justice but that her opinions did not offer any glimpse into how she might emerge in such a role.
In my analysis of Justice Sotomayor’s nomination, I returned to these points and specifically objected to those who said her narrow decisions were evidence of a lack of intellectual depth. I wrote, “This is demonstrably absurd. These opinions are little different from those of [Justices] Alito, Souter, or the limited writings of [Justice] Thomas. Clearly, Sotomayor is quite intelligent. This record is little different from records of Republican nominees who enthralled these same critics.” And I repeatedly stressed that she could prove to be a great nominee in finding voice and depth in her opinions on the court.
Some articles objected that, in an “unprompted” comment, I raised Sotomayor’s gender and race. I did so to praise the selection of the first Latina to the court, a nomination that I said was “rightfully” a point of pride. Moreover, the vast majority of news stories also referenced that historic aspect of her nomination. However, that was separate from the analysis of her opinions and the question of her intellectual legacy. What also was omitted is that, before Sotomayor’s nomination, I wrote a column on intellectual leaders on the courts and pushed for the nomination of Diane Wood of the 7th Circuit, a liberal powerhouse.
None of that matters, however, because heresy demands condemnation — whether or not it is based in reality. After all, this is all meant to get people not to seriously consider the flaws in the impeachment, including the proposed articles that ultimately were dropped. So, for any academic tempted to testify for Republicans in an impeachment proceeding, I can only caution that Romans 12:19 may say that “vengeance is mine … sayeth the Lord” – but judgment will be more immediate for anyone who strays from the chosen professorial path.
Jonathan Turley is the Shapiro Professor of Public Interest Law for George Washington University and served as the last lead counsel during a Senate impeachment trial. He testified as a witness expert in the House Judiciary Committee hearing during the impeachment inquiry of President Trump.
China Approves New GMO Crops From The US For Imports
China’s agriculture ministry said Monday that it had approved two new genetically modified crops for import from the U.S., reported Reuters.
The announcement comes ahead of a potential Phase 1 trade deal signing between Beijing and Washington next month. The U.S. has long demanded that China imports more genetically modified crops.
According to Reuters, the new crops approved for import were Corteva AgriScience’s DAS-81419-2 soybean and 55-1 papaya, developed by the USDA and Hawaii University.
“This further expands channels for imports of U.S. agricultural products, and helps pave the way for buying more U.S. soybeans,” said Li Qiang, chief analyst with Shanghai J.C. Intelligence Co. Ltd.
Reuters also said China renewed import licenses for ten other genetically modified crops, including BASF developed T25 corn, A5547-127 soybean, T45 canola, Oxy-235 canola, and Ms8Rf3 canola.
Bayer-owned Monsanto Far East Ltd’s MON89788 soybean, 15985 cotton, and H7-1 beet were also reapproved for import, along with DuPont subsidiary Pioneer’s 305423 soybean and 305423×GTS40-3-2 soybean.
With the signing of the Phase 1 trade deal expected next month, China’s Customs Administration reported last week that inbound agriculture shipments from the U.S. more than doubled to 2.6 million tons, the highest since March 2018, and up from about 1.1 million tons in October.
While China is unlikely to order less soybean from either Brazil or Argentina any time soon as the two nations have emerged as the two key supply chain alternatives to the U.S., the continued push to reopen the U.S. market to Chinese importers comes as China food inflation is soaring.
If you thought you can’t top the stupidity we experienced in 2019, brace yourself for 2020 because it’s going to be a pronoun-fueled weather cult pinko freakshow. But it won’t be all amusing antics – the left hates us and its ugly mask is coming off, revealing the even uglier fascist visage lurking beneath. If you listen to them, and if you aren’t an insufferable goo goo wimp who refuses to hear them, you will know that they intend to silence you, even imprison you, and deprive you of the ability to participate in your own governance. So, if you want to live as a free man or woman – if they have their way, they’ll destroy you for recognizing that unalterable binary – best be ready.
With that in mind, here are my predictions for 2020:
10. Trump Will Be Impeached…Yawn: Poor, flailing Nancy Pelosi will eventually transmit the articles of impeachment to the Senate, thereby actually impeaching the President. Now, whether Pelosi’s current antics constitute “impeachment” or not is irrelevant, except denying it due to her gamesmanship is fun because it owns the libs. No one cares, and to the limited extent we normal people do, this alleged impeachment is a badge of honor for the President. Her fringe-driven delay tactics make the Dems look dumber, and eventually she will send it to the Senate where Cocaine Mitch will kill it. Sure, some of the useless GOP caucus will make noises about how this clusterfark must be taken seriously because principles and honor and stuff. Saps. They just better take seriously that we in the base will electorally eviscerate them if they vote to convict. Maybe Mitt the Gimp will vote for it because he’s weak and stupid. Maybe Senator Iglookowski (RINO-AK) will too. But in the end, Trump will triumph and yet again humiliate his opponents.
9. The Economy Will Stay Strong, Disappointing Democrats: The party of the workin’ man is already in mourning because the Trump economy has finally brought some prosperity back to the workin’ man instead of concentrating wealth among the globalist liberal gentry that Obama served. The media will cheerlead for a recession; the Democrats will try to ignore the new Roaring 20s, but America’s success will remain a nightmare for liberals during 2020.
8. Virginia Will Declare War on Its Citizens:The liberals recently elected as moderates in the Old Dominion will reveal their true colors as they attempt to crush dissent wherever voters were stupid enough to elect them. The Virginia left will not back down – it will attempt to criminalize vast numbers of citizens and bend them to its will using violence and legal terrorism if need be. This will provoke a counterreaction that will make it clear to moderates that electing liberals means voting for conflict, not just center-left business as usual like with old school Democrats. Look for it to get ugly. They think they can break our will, and they will learn they can’t. This will energize conservatives across the country.
7. Replacing Justice Ginsburg: She’s had a good run but the opponent conservatives tend to most respect for being tough is playing a losing game against statistics. It is not to wish ill upon her to say that time is not on her side; in 2020, it is very, very likely Donald Trump will be replacing her. Count on the Murder Turtle not to buy into an interpretation of the Garland Rule that ties his hands – it’s confirmation time. The Democrats will go even nuttier than usual, but too bad. Just get ready for future Justice Amy Coney Barrett to have to explain that, yes, she likes beer, and no, she didn’t run a rape gang in elementary school.
6. Trans Fascism Backlash: Normal people are getting tired of being told they have to lie and say there are 631 sexes, and they are tired of militant jerks wanting boys hanging out in their girls’ locker room, and they are getting sick of boys winning girls’ sports championships. J.K. Rowling, who is otherwise a leftist doofus, recently survived social media cancelation for telling the truth that sex is real. The rest of us will be roused to action – people were trying to be polite, but now it’s all too stupid and obnoxious to tolerate. There is a big difference between being kind and not adding to the pain of people with real issues, and with being forced by drag bullies and their allies to publicly affirm what everyone knows is false. Look for more and more people, prominent and not prominent, to be told that they must agree that men can get pregnant and that women can have penises, and to answer, “No.”
5. Pardon This:We will see the President pardon the victims of Deep State vendettas designed to overturn the election of 2016. General Mike Flynn, Roger Stone, and Paul Manafort will all be cleared, probably right after the election. Which is good, because we will need the cells for…
4. Durham’s Indictments: The investigation into the soft coup is going to turn up wrongdoing that the entrenched leftist bureaucracy can’t shove under the rug anymore. John Durham telegraphed his righteous retribution when he publicly rejected IG Horowitz’s pathetic shrug over the Deep State’s shenanigans. We’re going to see some folks finally held to account. Not all of them – not Felonia Milhous von Pantsuit, not that Looming Doofus Comey, but others. It’s an important first step in defeating the cancer on our government that is having these Democrat partisans in positions of power in the bureaucracy.
3. Foreign Policy Success: With the National Security Council under the properly low-key and sober guidance of Robert O’Brien (I know him – great guy and perfect for this job), America will continue to rebuild its strength, wind down open-ended military commitments, force allies to do their part, and avoid unnecessary conflicts. Iran will continue to destabilize, but we will not go to war – we will neuter the mullahs economically and let the Persian people deal with their oppressors. China has some strengths but many weaknesses – we will exploit those and build a trade relationship based on reciprocity instead of American submission. NATO countries will reluctantly fork over their dues, and our relationship with the UK will become even more special now that it is free of the EU’s yoke. Foreigners finally understand – America will use every element of its power to defend American interests, so behave. Also, we will get the Space Force going (long overdue) and move toward a 355-ship Navy (very long overdue). Finally, look for a promotion for America’s most effective diplomat (and future GOP presidential contender) Richard Grenell.
2. Democrats Will Lose the House:They took the House back promising to be pragmatic do-gooders who would work across party lines to do the people’s business blah blah blah blah blah. It was all garbage. The ones that weren’t actively defiling hotel room furniture via naked hair brushing grossness with underlings were obediently obeying Pelosi’s commands. “Impeach? Yes, ma’am, right away, ma’am.” And what were they doing that was useful to their voters? Nothing – America’s biggest problem is not that Democrats have too little control.
1. Trump Will Get Reelected: There are a number of reasons, many recited above. But the most important is that God looks out for the United States. Oh, and the Dems will nominate Biden, who will choose Sitting Bolshevik as his VP (He’s gotta choose a girl and Willie Brown’s Ex is out for dissing him and he can’t choose Amy Tantrum Gal Klobuchar because he needs to nail down the Dem’s commie wing). A fake Indian and a fake competent leader – great combo. Once nominated, Gropey J will continue to commit gaffes, only his slobbering media buddies won’t be able to keep hiding them. Plus, there’s the Lil’ Crackpipe factor. Hoover Biden, the nominee’s Snortunate Son, will have another crack issue, or another paternity suit, or maybe both – which the garbage media will tell us is none of our business and is not important. But it is. In the end, Trump will improve on his 2016 Electoral College numbers and win the popular vote too, at which point the liberals will turn against the entire concept of voting.
* * *
I also predict that my newest novel Collapse will continue to be an Amazon bestseller, and that there will be another action-packed, hilarious novel coming next year once I finish my traditional non-fiction book for Regnery that is also due out in 2020. Go ahead and use that gift card you got at Christmas or Hanukkah or Kwanzaa to get the other entries in the series,People’s Republic, Indian Country and Wildfire. Remember, every time you read one of my books, the Never Trump weenies who called them “appalling” sob and rend their sissy bow ties.
Fox Crushes Cable News With Record High Viewership As CNN Implodes
Fox News dominated the basic cable news industry in 2019, according to a new report, which specifies the network has hit record high viewership.
Nielsen Media Research said Fox News averaged 2.5 million viewers during primetime in 2019, far outpacing any other news network. The network’s viewership hit a 23-year high this year, blowing out its competitors, CNN and MSNBC, by a long shot.
Fox News even beat out ESPN with its 1.78 million viewers during primetime. It seems the American people under a Trump administration are more concerned about politics and the economy than sports. MSNBC trailed ESPN for the third spot at 1.75 viewers during primetime. This is the fourth consecutive year Fox News has blown out its competitors.
Nielsen said CNN came in 22nd place, recorded just 972,000 viewers during primetime.
The gap in viewership between Fox News and CNN on a nightly basis is nearly 1.5 million viewers daily during primetime.
Fox News’ “Hannity” was the most popular news show with 3.3 million viewers during primetime. The second was “Tucker Carlson Tonight” with 3.1 million, and MSNBC’s “Rachel Maddow Show” was third with 2.78 million.
To sum up, CNN is suffering a credibility crisis as viewership is in a mass exodus, fleeing the fake news network to more conservative networks, such as Fox News. There appears to be no plan of action by CNN or liberal media to fix the hemorrhaging of viewership, indicating the trend will persist through 2020.
I have to wonder who Secretary of State Mike Pompeo is actually loyal to. Because, the U.S. strike of Kata’ib Hizbullah forces near the Al Qaim border crossing with Syria in Iraq is a dangerous escalation there.
And it’s completely at odds with Trump’s goals of wanting us out of the Middle East. The Al Qaim border crossing is a particular red line for Israel and their allies in the U.S. State and Defense Departments.
It represents the normalization of commerce between Syria, Iraq and Iran over time. This is the so-called Shia Crescent which is the stuff of nightmares for Benjamin Netanyahu.
And the U.S. has been hopping mad for months since now caretaker Iraqi Prime Minister Adil Abdel Mahdi opened the border because it undermines U.S. presence in Syria.
The entire point of U.S. occupation of the Al-Tanf border crossing into Jordan and the oil fields in Deir Ezzor province is about starving the Syrian government of any reliable energy and revenue.
When Al Qaim/Al Bukamai was opened it was only a matter of time before a major skirmish would occur over it. Israel staged a series of air attacks previously using U.S. assets and air bases to launch them back in September.
Now, we have the convenient excuse for attacking these forces which are part of the Popular Mobiliztion Units, PMU, which Pompeo despises by ‘retaliating’ for a rocket attack on the K1 base near Kirkuk where one U.S. mercenary was killed and a handful of others injured.
The response from the U.S. Air Force was completely out of line with the initial attack and occurred without any attempt by Pompeo and Secretary of Defense Mark Esper to justify it.
They just invoked the phrase, “Iran-backed forces” and then bombed troops over 200 miles away where they wanted to strike anyway.
And what’s important is what both Elijah Magnier and Moon of Alabama pointed out immediately, the U.S. struck member of Shia militias who were made official part of the Iraqi defense forces.
In other words the U.S. just attacked and killed dozens of Iraqi military personnel.
32 killed and 45 wounded the count of #US violent aggression on #Iraq security forces brigades 45 and 46 last night on a military position established to counter-attack and raid #ISIS remnant at al-Qaem, the borders between Iraq and Syria.https://t.co/pmBZ3fJu9e
His actions remind me of Italy’s Sergio Mattarella who inserts himself into the process of government formation there to suit his EU partners-in-crime.
In Iraq the U.S. has been officially silent on the government turmoil there but the circumstances are pretty clear that the chaos works as a cover for what was an egregious violation of Iraq’s sovereignty.
Remember, the U.S. forces there are at the invitation of the Iraqi government and with Salih keeping the Shia political forces from uniting to choose a Prime Minister, the likelihood of that invitation being rescinded now is remote.
Color me not shocked that this attack on PMU forces occurred. Pompeo has been itching for an excuse to attack them for months. He tried his version of diplomacy with Prime Minister Mahdi to rescind their official status and was unsuccessful.
Mahdi was livid after Israel’s air attack and made noises about rescinding the U.S. invitation. No shock then that protests against his government spun up quickly after that.
So at some point this attack was going to happen. Netanyahu in serious political trouble facing a third election in a year, unable to form a government.
Pompeo coming to his rescue to keep the dream of warring with Iran should be obvious to all.
The question is whether President Trump is engaged with this policy at all or did Pompeo and Defense Secretary Mark Esper go off on their own, pull this trigger and then inform Trump and get him to accept this post hoc?
Everywhere Pompeo goes one week winds up in flames the next anymore. When he visits a trouble spot which Israel and the neoconservatives he represents want destabilized, a miracle occurs the next week.
Before this it was Lebanon and Iraq. This week it’s Ukraine. There is the threat of peace breaking out there with Russia and Ukraine agreeing to terms on both a gas and oil transit contract into Europe which Pompeo is dead set against.
Will we see some attack on Ukrainian forces which break the peace and can be blamed on Russia?
Trump has to know that escalation from here ends with U.S. forces coming home in body bags as PMU forces themselves, go off the reservation during this power vacuum in Baghdad and attack U.S. troops directly.
But I think this is exactly what Bibi and Pompeo want. This attack was a clear provocation to escalate and give Israel and the neocons all the ammunition they need to force Trump into the wider conflict with Iran they’ve been angry about not getting for six months now.
They failed with the Global Hawk incident back in June. That operation got John Bolton fired as National Security Director. Now we have a clearly disproportionate strike designed to inflame passions of Iran-backed Shia forces.
The entirety of Iraq’s leadership seems to be of the same mind, and even rejected the US plan to strike when they were tipped off immediately before it happened, per NBC:
In a statement, [former PM] Abdul-Mahdi said Secretary of Defense Mark Esper had called him about a half-hour before the U.S. strikes Sunday to tell him of U.S. intentions to hit the bases of the militia suspected of being behind Friday’s rocket attack. Abdul-Mahdi saidhe asked Esper to call off the U.S. plan.
One byproduct of the major US strikes on Sunday is sure to be that more and more of the Iraqi population will view the Americans, and not the Iranians, as the foreign occupiers.
This dramatic escalation by Washington is only likely to push more popular support toward the Shia PMF, and strengthen the movement in parliament to have US forces legally expelled, especially with the demise of the ISIS threat.
Any strike by the PMU here on U.S. forces will be music to Pompeo’s and Netanyhahu’s ears. And it will put Trump in a real bind with his base during an election year and an impeachment process Speaker Nancy Pelosi is purposefully dragging out to build a stronger case.
What stronger case could there be at this point if Trump were to not declare war or fire back on our troops getting attacked in Iraq or Syria? He’s derelict as Commander-in-Chief. It’s part of their stupid Ukraine narrative that Trump withheld aid weakens our national security.
As Secretary of State Pompeo has been nothing short of a disaster, undermining President Trump’s strong instincts to get the U.S. out of the Middle East and solve the myriad of open geopolitical wounds around the world.
Unlike his former-partner-in-neoconservatism, John Bolton, Pompeo is more adept at playing at being loyal to Trump while always seeming to move U.S. diplomacy in a more belligerent direction in the wake of any of Trump’s ‘impulses’ to act on his conscience and/or instincts.
It doesn’t matter if we’re talking Iran (Pompeo’s demands of Iran are off-the-charts insane), Lebanon (outright blackmail of the Lebanese government) or North Korea (making demands in negotiations which overstep Trump’s promises to Kim Jong-un) Pompeo is always there doing his thinly-veiled Israeli loyalty dance with the subtlety of a freight-train but somehow always framing it as making it Trump’s policy.
This move by Pompeo looks like a classic pre-emptive move to bind Trump down force him into a war which will be unpopular back home. The only one who wins with this attack is Israel.
U.S. troops are now less safe, effective forces fighting ISIS have been neutered and the Iraqi government is in shambles. Good job Mike.
Mike wants his golden parachute back to the Senate where he can continue doing god’s work for the Israelis, one more voice in a U.S. Senate seemingly without a limit on its thirst for power and the blood of the world.
This won’t end well and Trump better get his Flying Monkeys under control quick or he won’t be President much longer. Because when the body bags start, he’ll be the one who gets blamed.
China Non-Manufacturing PMI Slides Back Near Multi-Year Lows
Following a big, surprise jump in November, China’s official PMIs were expected to fall back a little in December (but remain – handily – above 50 and the ‘expansion/contraction’ divide), helped by an improvement in industrial production and hopes after the ‘phase one’ trade deal was (allegedly) completed.
A mixed bag though with manufacturing PMI flat at 50.2 (better than the expected 50.1) and non-manufacturing PMI lower at 53.5 (from 54.4) and below expectations of 54.2.
New manufacturing orders picked up (the last time the reading was above 50 was May 2018), but the improvement in manufacturing was concentrated in large- and medium-sized enterprises with small enterprises plunging deeper into contraction (at 47.2).
New non-manufacturing orders slowed as prices (selling and buying fell), pushing employment further into contraction (48.3).
We wonder how long this re-excitement of hope about Chinese economic growth will last given the massive amount of stimulus has produced a very meager credit impulse…
“The potential de-escalation of China-U.S. trade tension, improved global manufacturing demand, inventory restocking driven by lessening demand headwinds, and accelerated infrastructure investment growth in China may continue to support a moderate cyclical recovery,” China International Capital Corp. economist Eva Yiwrote in a note.
“Gross domestic product growth in the fourth quarter may pick up on a sequential basis compared with the third quarter.”
The government is also reportedly rolling out a range of policies to support the economy in 2020.
The Trump Derangement Syndrome fevers ran high last week, as the media chattered on about their new favorite boogeyman. He’s a madman. He’s a gangster. He’s the most dangerous man on the planet. He’s Trump the Terrible – and we must get rid of him at any cost lest he win another term in the White House.
Donald Trump is clearly insane – as in, 25th Amendment, let’s get him out of office insane. Or that’s the professional opinion of the completely ethical and uninterested in politics Dr. Bandy X. Lee. Back in January of 2018, Dr. Lee generously examined President Trump – without actually meeting with him – and declared him dangerously nuts. There is one problem with her diagnosis, however. As Liberty Nation’sMark Angelides explained at the time:
“The American Psychiatric Association (APA) actually bans psychiatrists from making a diagnosis without a direct examination. Not only is this rule in place because the APA believes without a face to face examination, all information is worthless, but they also see it as highly unethical.”
And as for not being politically motivated, at the time of her so-called diagnosis, Dr. Lee was promoting a book titled – of all things – The Dangerous Case of Donald Trump.
Thankfully, her plan to have the president declared unfit and removed from office based on her clearly biased opinion failed and she faded out of the public eye. But just as the Herpes virus lurks beneath the surface only to pop up from time to time with surprise outbreaks, Dr. Lee has not and will not leave us be. She erupted back into the spotlight in June of 2019, leading a group of other anti-Trump mental health professionals at Capitol Hill as they tried to spread awareness of the Delusional Don.
It seems as true now as it was back in June when LNwrote, “if you thought you had heard the last of Dr. Bandy X. Lee, you’re as crazy as anyone who thinks her plan could actually work. That’s right, she’s back.” And back she is. This time, the good doctor is calling on Speaker of the House Nancy Pelosi (D-CA) to demand Trump receive an evaluation.
Leave it to Salon to dig up the doctor for her opinion on Trump’s mental health. Their title says it all: “Pelosi ‘has the right’ to submit Trump to an ‘involuntary evaluation’: Yale psychiatrist Bandy Lee.” Never mind impeachment – Speaker Pelosi, it seems, is falling behind in her duty to protect the nation from this dangerous madman.
“As a coworker, she has the right to have him submit to an involuntary evaluation, but she has not,” Lee told Salon. “Anyone can call 911 to report someone who seems dangerous, and family members are the most typical ones to do so. But so can coworkers, and even passersby on the street. The law dictates who can determine right to treatment, or civil commitment, and in all 50 U.S. states this includes a psychiatrist.”
Dr. Lee goes on to say that a mental health hold seems inevitable, but her opinion here is once again suspect. “I am beginning to believe that a mental health hold, which we have tried to avoid, will become inevitable,” Lee said. Avoid? She has actively campaigned to have him declared unfit to lead and removed from office! It makes you wonder which of the two, Donald Trump or Bandy Lee, has a mental health issue. She’s bound to fail and fade away as she always does, but when will she pop back up and what will her scheme be then? All we can really say with any certainty is that she will be back, eventually.
Trump The Thug
“Donald Trump will not be bound by any rule, even after he has been caught.” So reads the conclusion of a Saturday article in The Atlantic, titled “A Gangster in the White House.” So what has Teflon Don – admittedly, a rather gangster sounding nickname – done this time? He retweeted a follower’s post revealing the name of the person believed to be the whistleblower behind the Ukraine call reveal.
That’s right – the president shared a tweet revealing a name that has been circulating in the media for weeks. By late October, a bevy of articles offering “everything you need to know about Eric Ciaramella the whistleblower” had flooded the media. But Trump’s a gangster because he retweeted a story using the name.
“Trump is organizing from the White House a conspiracy to revenge himself on the person who first alerted the country that Trump was extorting Ukraine to help his reelection,” the author wrote before declaring the act “more lawbreaking to punish the revelation of past lawbreaking.”
But there are a few problems with this argument even if we pretend Trump’s call was criminal. First, there is some debate as to who is forbidden from outing a whistleblower. Even if Trump isn’t allowed to reveal the name, his retweeting of a news story two months after the man was first exposed by the media as the most likely candidate is hardly leaking top-secret information.
And then there’s the question of the whistleblower’s protected status. Of course, the government that has had the whistle blown on it never wants to admit it – just ask Edward Snowden, who would still face prosecution for leaking should he return to the U.S.
This so-called whistleblower, on the other hand, certainly seems to have some powerful friends protecting him. Did he discover some wrongdoing and blow the whistle, or was he sent to Adam Schiff by a deep state that wants Trump gone? He wouldn’t have a chance if it weren’t for a last-minute rule change removing the requirement that a whistleblower’s complaint be based on first-hand knowledge. LN’sTim Donner hit the nail on the head when he said, “Common sense can lead you to only one conclusion when rules that would have disallowed the explosive complaint were changed just in time to allow it.”
Democrats In Denial
Despite trying to brand President Trump as a mafia-style criminal, a madman, and the most dangerous world leader today, the left has failed to erode his support. But still, they hurl their attacks. Surely, if they just keep fighting on, they can do enough damage to cost him the 2020 election. The left, of course, is simply in denial. Filmmaker and rabid anti-Trumper Michael Moore declared that if the next presidential election were held right now, Trump would win re-election – and he was probably right. But even he suffers from the delusion that Trump is nigh-universally hated. He explained that 70% of the 2020 electorate will be women and racial minorities, all of whom are on the side of the Democrats. Never mind the large number of conservative women who voted for Trump in 2016, and never mind the many blacks and Hispanics who have walked away from the Democratic Party since the last election, who now enjoy the lowest unemployment rates in the nation’s history. To the Democrats in denial, they don’t exist.
Tesla Plunges After Cowen Note Predicts Missed 2019 Delivery Targets
Tesla stock fell as much as 5% in trading on Monday, suffering its biggest drop in nearly a month after Cowen released a note suggesting that the company could miss its delivery target for the year.
The note suggested that Tesla could deliver 356,000 vehicles for the year, which is slightly below the company’s target of 360,000 to 400,000, according to Bloomberg.
Cowen’s note said: “Excluding the Netherlands and China, we expect Model 3 deliveries to be down compared to the prior quarter and year-ago period.”
Analyst Jeffrey Osborne’s estimate “highlights the demand saturation we are seeing across most mature markets as we shift from pent-up demand to steady flow demand.”
Cowen also raised its fourth quarter delivery estimate to 101,000 from 95,000 to reflect better expectations for the Netherlands and China. Osborne sees the company missing expectations for Model S/X and posting in-line numbers for Model 3.
At the same time, Wedbush’s Dan Ives released a note that predicted “Tesla will find success in China with Giga 3 and potentially hit the key 100,000 delivery number quicker than the U.S./Europe trajectory and be a demand tailwind.”
But the market seemed to agree with Cowen on Monday at least, as Tesla stock was clipped 3.7% on the day, closing at $414.60.
Osborne believes there are many issues facing the company, including “pricing and mix issues that we believe will affect margins and profitability in the fourth quarter”. He’s also skeptical about long-term demand in China, where we have noted an electric vehicle supply glut is likely in the midst of taking place.
Cowen notes that the best selling EV in China this year “has sold less than 2,000 vehicles per week and the top 5 models (all local brands) combined for less than 6,000 vehicles per week.” These models cost about 25% to 75% less than what the China made Model 3 will cost.
“While Tesla has built a very dedicated fan base that has been willing to excuse poor build quality, customer service, and service infrastructure, we continue to be skeptical around broader adoption,” Osborne concluded, slapping a price target of $210 on the stock.
Will Osborne be the trend setter for analysts now that Tesla stock has hit the stratosphere, or will the company continue to elude reality? As the year wraps up, it won’t be long before we know whether or not their prognostication holds water.Tick tock, Elon.
The Federal Cigarette Labeling and Advertising Act of 1965 required a health warning to be placed on packs of cigarettes sold in the United States. The original warning, which appeared on cigarette packs from January 1, 1966, through October 31, 1970, was
Caution: Cigarette Smoking May Be Hazardous To Your Health
There are more dangerous things that Americans should be on the lookout for.
Just before Christmas, Donald Trump signed two bills into law to fund all the departments and agencies of the federal government and avert a government shutdown. According to the White House, the bills are:
H.R. 1158, the “Consolidated Appropriations Act, 2020,” which provides full-year funding through September 30, 2020, for projects and activities of certain agencies of the Federal Government; and
H.R. 1865, the “Further Consolidated Appropriations Act, 2020,” which provides full-year funding through September 30, 2020, for projects and activities of the remaining agencies of the Federal Government.
The bills do some other things as well.
They expand paid family leave. Said President Trump, “I am proud to report after that, after decades of empty promises and inaction, the legislation I have signed into law provides 12 weeks of paid parental leave for federal employees. This ensures parents are not forced to choose between their jobs and spending precious time with their children.”
They give U.S. military personnel and most federal workers a 3.1 percent pay raise. Said President Trump, to federal workers, “This pay raise reflects the excellent work of our federal workforce.” And to service members, “Your selfless service, noble sacrifice, and unfailing allegiance to duty and country is what keeps America safe, strong, proud, and free.”
They repeal three taxes in the Affordable Care Act (Obamacare): the so-called “Cadillac tax” on generous employer health plans, taxes on health insurance companies, and taxes on medical-device makers.
They reauthorize the U.S. Export-Import Bank.
And they raise the federal age for purchasing tobacco products from 18 to 21 years old. Specifically, in the “Further Consolidated Appropriations Act, 2020,” under Division N, “Health and Human Services Extenders,” in Title I, “Health and Human Service Extenders,” Subtitle F, “Miscellaneous Provisions,” Sec. 603, “Minimum age of sale of tobacco products,” it states,
(a) In General. — Section 906(d) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 387f(d)) is amended —
(1) in paragraph (3)(A)(ii), by striking “18 years’” and inserting “21 years”; and
(2) by adding at the end the following:
“(5) Minimum age of sale. — It shall be unlawful for any retailer to sell a tobacco product to any person younger than 21 years of age.”
This is something that has been in the works all year.
Back in May, Senate Majority Leader Mitch McConnell (R-Ky.) and Sen. Tim Kaine (D-Va.) introduced a bill, the “Tobacco-Free Youth Act” (S.1541), to raise the federal minimum age for purchasing tobacco products to 21. “We’re in the middle of a national health epidemic,” said McConnell in a speech on the Senate floor. Kaine said in a statement, “Today, we are coming together to side with young people’s health. With this bipartisan legislation, Senator McConnell and I are working to address one of the most significant public-health issues facing our nation today.” American Heart Association CEO Nancy Brown said she supports the bill, saying in a statement, “We commend Majority Leader McConnell and Senator Kaine for prioritizing the health of teens and young adults with a bill to raise the national sales age for tobacco products to 21. We urge strong bipartisan support for this bill as written, and we call on lawmakers to reject any effort to add language that would weaken its impact or benefit tobacco companies.”
At the same time, but in the House, Rep. Donna E. Shalala (D-Fla.), sometime secretary of the Department of Health and Human Services under Bill Clinton, and Frank Pallone (D-N.J.), current Energy and Commerce Chairman, introduced a similar bill, the Reversing the Youth Tobacco Epidemic Act of 2019 (H.R.2339). “We’re trying to protect children,” said Shalala in an interview with CQ Magazine.
With the passage of the “Further Consolidated Appropriations Act, 2020,” those bills are now irrelevant.
Anyone with half a brain in the United States knows that smoking cigarettes is dangerous, destructive, and deadly. According to the Centers for Disease Control and Prevention (CDC),
Cigarette smoking is the leading preventable cause of death in the United States.
Smoking causes more deaths each year than the following causes combined: HIV, illegal drug use, alcohol use, motor vehicle injuries, firearm-related incidents.
More than 10 times as many U.S. citizens have died prematurely from cigarette smoking as have died in all the wars fought by the United States.
Cigarette smoking increases the risk for death from all causes in men and women.
But none of that means that the federal government should raise the federal age for purchasing tobacco products from 18 to 21.
Consider the following:
First of all, the Constitution. Nowhere does the Constitution authorize the federal government to set a minimum age for anyone to purchase tobacco products. And not only that, neither does the Constitution authorize the federal government to have anything to do with smoking tobacco or anything else. Tobacco was a plentiful commodity at the time the Constitution was written. If the Framers wanted to mention tobacco in the Constitution, they certainly could have done so.
Second, unnecessary legislation. Sixteen states, the District of Columbia, and more than 500 localities have already raised their minimum age to purchase tobacco products to 21. These states are: Arkansas, California, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, New Jersey, New York, Ohio, Oregon, Texas, Vermont, and Virginia. The minimum age increases to 21 next year in Pennsylvania and Washington, and in Utah in 2021. Some other states have a legal age between 18 and 21. The new federal tobacco legislation is an assault on federalism and the Tenth Amendment.
Third, the proper role of government. Is it the proper role of government to keep the peace and punish those who violate the personal or property rights of others, or is it the proper role of government to be a nanny state that micromanages the behavior of its citizens? The federal government not only shouldn’t have a minimum age of 21 to purchase tobacco products, it shouldn’t even have a minimum age of 18.
Fourth, consistency. There are many dangerous activities that Americans engage in every day. And sometimes they lead to serious injury or death. Here are ten of them:
Skydiving
Bungee jumping
Operating a chainsaw
Climbing a ladder
Riding a motorcycle
Working as a roofer, fisherman, logger, or miner
Taking prescription drugs
Driving a car
Taking a bath
Crossing the street
If the government is going to have a minimum age for tobacco purchases to “protect children,” then why not a minimum age to engage in those other dangerous activities to protect even more children? And why not a maximum age to protect the elderly?
Fifth, second-class citizens. At the age of 18, Americans have the legal right to marry, enter into contracts, adopt children, vote in elections, and join the military and possibly die for their country. Yet, with this new tobacco legislation, the federal government is instituting a second class of citizens who can do all of those things but not buy a pack of cigarettes.
And sixth, the nature of government. Government has always been the greatest violator of personal freedom and property rights. As former Foundation for Economic Education president Richard Ebeling put it, “There has been no greater threat to life, liberty, and property throughout the ages than government. Even the most violent and brutal private individuals have been able to inflict only a mere fraction of the harm and destruction that have been caused by the use of power by political authorities.”
Regardless of how dangerous, destructive, or deadly the use of tobacco might be, the government hazard to the individual liberty and personal freedom of Americans is infinitely more dangerous, destructive, and deadly.
Greta Thunberg: “I Wouldn’t Have Wasted My Time” Meeting With Trump
During a Monday interview with BBC radio’s “Today” program, teenage climate activist Greta Thunberg said that she wouldn’t have met with President Trump on the sidelines of the UN General Assembly, even if she had the opportunity.
She wouldn’t meet with him, Thunberg said, because she doubts that he would take her seriously: if Trump won’t acknowledge the work of the world’s leading climate scientists, then what hope would Thunberg have?
“Honestly, I don’t think I would have said anything [to Donald Trump] because obviously he’s not listening to scientists and experts, so why would he listen to me?” Thunberg said. “So I probably wouldn’t have said anything, I wouldn’t have wasted my time”.
Back in September, a video of Thunberg giving Trump the “death stare” – as left-leaning outlets like the Guardian, Buzzfeed and Huffington Post described it – during her visit to the UN General Assembly went viral, earning the 16-year-old climate activist more plaudits from her peers and supporters.
Donald Trump earned the enmity of climate activists when he decided to pull the US out of the 2015 Paris Climate Accord back in 2017. So far, Trump has directed his administration to relax or rescind dozens of Obama-era environmental rules. And if he wins another term (an outcome that is looking more likely by the day), it’s almost guaranteed that he will continue to gut the EPA while relaxing restrictions on the American energy industry – coal in particular.
Since Thunberg’s rise to fame earlier this year, Trump has repeatedly criticized the teenager, once joking that she should “work on her anger management problem.”
And he’s not the only world leader to criticize young Greta. Brazilian President Jair Bolsonaro once called her “a brat” and complained that she receives too much attention from the media.
Australian Prime Minister Morrison told Thunberg that he was “not here to impress people overseas” after she accused his administration of not doing enough to protect the environment.
During Monday’s interview, Thunberg accused Bolsonaro, Morrison and her other critics of being “terrified of young people” and their insistence that their countries do more to protect the environment.
“Those attacks are just funny because they obviously don’t mean anything,” Thunberg said during the interview. “I guess of course it means something – they are terrified of young people bringing change which they don’t want – but that is just proof that we are actually doing something and that they see us as some kind of threat”.
Her father, who also chimed in during the interview, praised his daughter for handling the criticism “incredibly well” consider his daughter’s autism.
Thunberg rejoined the activists camping outside Sweden’s Parliament in December after four months of traveling overseas, starting with her trip to New York for the UN General Assembly back in September.
“I hope I won’t have to sit outside the Swedish parliament for long. I hope I don’t have to be a climate activist any more,” she said on Monday, adding she was looking forward to returning to school in August.
“I just want to be just as everyone else. I want to educate myself and be just like a normal teenager.”
Unfortunately for Thunberg, the young activist will likely find that there’s no going back. But fortunately, she has a good sense of humor, as Reuters pointed out.
“Quite frankly, I don’t know how she does it, but she laughs most of the time. She finds it hilarious,” said Thunberg’s father, Svante Thunberg, who also participated in the interview.
Don’t take criticism from strangers on the Internet so seriously: now that’s a lesson that could benefit thousands, if not millions, of Americans.
The events of the past couple of days should be a major wake up call for all of us. The number of mass shootings in the United States hit a record high in 2019 as the thin veneer of civilization that we all take for granted on a daily basis continues to disappear. And these mass shooters seem particularly attracted to soft targets such as schools and churches. When I was growing up, I never even imagined that a gunman might storm into my school or church and start shooting. And as far as I knew, neither my school nor my church had any sort of armed security. But now if you are attending a church or sending your kids to a school that does not have armed security, you are literally gambling with the lives of your family members. The world that we live in has dramatically changed, and if we choose to ignore the harsh realities that now confront us, we do so at our own peril.
On Sunday, a gunman opened fire at a Church of Christ in Texas about eight miles away from Fort Worth, and it immediately made headlines all over the nation…
A gunman killed two people during a Sunday morning service at a church in White Settlement before members of the congregation fatally shot him, authorities say.
Police in White Settlement, about eight miles west of Fort Worth, were called before 11 a.m. to the West Freeway Church of Christ at 1900 South Las Vegas Trail after two members who are part of the church’s security team opened fire on the gunman.
What do you think would have happened if nobody in that church had been armed?
The gunman could have just run around the congregation shooting people at his leisure.
In the video, the gunman, who is wearing what seems to be a dark-colored hood, gets up from a pew in the back of the room and walks up to a man in a suit who is standing in the corner.
As the two speak and the man points to his right, the gunman reaches into his jacket and pulls out a shotgun.
Of course this kind of thing seems to be happening every few days now, and as a result many of us have become desensitized to this sort of violence.
I just did a Google search for church gunman and I got 23,800,000 results. The unthinkable has suddenly become a reality that every church in America must deal with.
If you are holding services that are open to the public, you must have armed security. There is simply no other safe alternative.
And this rise in violence here in the U.S. is happening in the context of rising persecution all over the globe.
On Christmas Day, 11 Christians were brutally martyred by Islamic terrorists in Nigeria, but it barely made a blip in the U.S. news cycle…
Bloodthirsty ISIS terrorists have reportedly beheaded 11 Christian hostages on Christmas Day in Nigeria. The militants said in a sickening video that the mass killing was in revenge for the deaths “of our leaders, including Abu Bakr al-Baghdadi”. Islamic State West Africa Province (ISWAP), which includes supporters from Boko Haram, released a shocking 56-second video. Claiming to show their captives’ execution, the clip was produced by ISIS’s media arm, Amaq, reports the BBC.
Sadly, what we have seen so far is just the beginning. Thousands of Christians were martyred for their faith in 2019, and the persecution just continues to intensify with each passing year.
Meanwhile, anti-Semitic violence just continues to escalate as well. On Saturday night, a horrific anti-Semitic attack in New York shocked the entire nation…
Authorities say an Orange County man stabbed five people at a rabbi’s home late Saturday night in Monsey, New York — the latest and most violent in a string of anti-Semitic attacks in the greater New York City area in the last few days.
Ramapo Police Chief Brad Weidel said the suspected attacker, identified as Grafton Thomas, 37, of Greenwood Lake, entered the residence around 10 p.m. armed with a knife. Saturday was the seventh night of Hanukkah and was being widely observed in Monsey, a hamlet that is home to thousands of Orthodox Jews. There were as many as 70 people in the rabbi’s home at the time of the attack.
These precious people were not even meeting in a synagogue.
This gathering was being held in a private home, and you would think that would be safer.
Unfortunately, that was not the case, and the attacker moved from one target to another with brutal efficiency…
“He took out his knife, sword from a holder and started hitting people back and forth. Nothing, he didn’t say anything. He screamed after me when I came out here, he screamed after me, ‘Hey you, I’ll get you,’” one witness told CBS2’s Marc Liverman. “He moved to the front door. He could go straight into the kitchen and the dining room’s the first thing. First, he went into the dining room and hit a few people there. Then he went into the kitchen and hit one guy there, and then he came back to the dining room.”
We live at a time when anti-Semitic violence is on the rise all over the nation. Leading up to the attack on Saturday night, there were anti-Semitic incidents in New York state on Monday, Tuesday, Wednesday, Thursday and Friday. Many in the Jewish community in New York are living in fear at this point, and according to the Washington Post the number of anti-Semitic crimes in New York City alone has “jumped 21 percent in the past year”…
Anti-Semitic attacks are on the rise around the country, leaving members of the Jewish community feeling frightened and unsafe. In New York City, anti-Semitic crimes have jumped 21 percent in the past year. According to the Anti-Defamation League, there were 1,879 incidents of anti-Semitism in the United States in 2018, including more than 1,000 instances of harassment.
But of course this epidemic of anti-Semitism is not just isolated to New York. Hatred for Israel and hatred for the Jewish people is rising all over the nation, and it is being fueled by extremely evil people that are absolutely seething with hatred.
We can certainly wish that the world would go back to the way it once was, but meanwhile we have to take the steps that are necessary to protect our families and our communities.
From now on every house of worship in America should have armed security, and if your house of worship does not, I would find somewhere else to go.
In the time-honored tradition of Machiavellian statecraft, all of the charges being leveled against Donald Trump to remove him from office – namely, ‘abuse of power’ and ‘obstruction of congress’ –are essentially the same things the Democratic Party has been guilty of for nearly half a decade: abusing their powers in a non-stop attack on the executive branch. Is the reason because they desperately need a ‘get out of jail free’ card?
Due to the non-stop action in Washington of late, few believe that the present state of affairs between the Democrats and Donald Trump are exclusively due to a telephone call between the US leader and the Ukrainian President Volodymyr Zelensky. That is only scratching the surface of a story that is practically boundless.
Back in April 2016, before Trump had become the Republican presidential nominee, talk of impeachment was already in the air.
“Donald Trump isn’t even the Republican nominee yet,” wrote Darren Samuelsohn in Politico.
Yet impeachment, he noted, is “already on the lips of pundits, newspaper editorials, constitutional scholars, and even a few members of Congress.”
The timing of Samuelsohn’s article is not a little astonishing given what the Department of Justice (DOJ) had discovered just one month earlier.
In March 2016, the DOJ found that “the FBI had been employing outside contractors who had access to raw Section 702 Foreign Intelligence Surveillance Act (FISA) data, and retained that access after their work for the FBI was completed,” as Jeff Carlson reported in The Epoch Times.
That sort of foreign access to sensitive data is highly improper and was the result of “deliberate decision-making,” according to the findings of an April 2017 FISA court ruling (footnote 69).
On April 18, 2016, then-National Security Agency (NSA) Director Adm. Mike Rogers directed the NSA’s Office of Compliance to terminate all FBI outside-contractor access. Later, on Oct. 21, 2016, the FBI and the DOJ’s National Security Division (NSD), and despite they were aware of Rogers’s actions, moved ahead anyways with a request for a FISA warrant to conduct surveillance on Trump campaign adviser Carter Page. The request was approved by the FISA court, which, apparently, was still in the dark about the violations.
On Oct. 26, following approval of the warrant against Page, Rogers went to the FISA court to inform them of the FBI’s non-compliance with the rules. Was it just a coincidence that at exactly this time, the Director of National Intelligence James Clapper and Defense Secretary Ashton B. Carter were suddenly calling for Roger’s removal? The request was eventually rejected. The next month, in mid-November 2016 Rogers, without first notifying his superiors, flew to New York where he had a private meeting with Trump at Trump Towers.
According to the New York Times, the meeting – the details of which were never publicly divulged, but may be guessed at – “caused consternation at senior levels of the administration.”
Democratic obstruction of justice?
Then CIA Director John Brennan, dismayed about a few meetings Trump officials had with the Russians, helped to kick-start the FBI investigation over ‘Russian collusion.’ Notably, these Trump-Russia meetings occurred in December 2016, as the incoming administration was in the difficult transition period to enter the White House. The Democrats made sure they made that transition as ugly as possible.
Although it is perfectly normal for an incoming government to meet with foreign heads of state at this critical juncture, a meeting at Trump Tower between Michael Flynn, Trump’s incoming national security adviser and former Russian Ambassador to the US, Sergey Kislyak, was portrayed as some kind of cloak and dagger scene borrowed from a John le Carré thriller.
Brennan questioning the motives behind high-level meetings between the Trump team and some Russians is strange given that the lame duck Obama administration was in the process of redialing US-Russia relations back to the Cold War days, all based on the debunked claim that Moscow handed Trump the White House on a silver platter.
In late December 2016, after Trump had already won the election, Obama slapped Russia with punitive sanctions, expelled 35 Russian diplomats and closed down two Russian facilities. Since part of Trump’s campaign platform was to mend relations with Moscow, would it not seem logical that the incoming administration would be in damage-control, doing whatever necessary to prevent relations between the world’s premier nuclear powers from degrading even more?
So if it wasn’t ‘Russian collusion’ that motivated the Democrats into action, what was it?
From Benghazi to Seth Rich
Here we must pause and remind ourselves about the unenviable situation regarding Hillary Clinton, the Secretary of State, who was being grilled daily over her use of a private computer to communicate sensitive documents via email. In all likelihood, the incident would have dropped from the radar had it not been for the deadly 2012 Benghazi attacks on a US compound.
In the course of a House Select Committee investigation into the circumstances surrounding the attacks, which resulted in the death of US Ambassador Chris Stevens and three other US personnel, Clinton handed over some 30,000 emails, while reportedly deleting 32,000 deemed to be of a “personal nature”. Those emails remain unaccounted for to this day.
I want the public to see my email. I asked State to release them. They said they will review them for release as soon as possible.
By March 2015, even the traditionally tepid media was baring its baby fangs, relentlessly pursuing Clinton over the email question. Since Clinton never made a secret of her presidential ambitions, even political allies were piling on. Senator Dianne Feinstein (D-Calif.), for example, said it’s time for Clinton “to step up” and explain herself, adding that “silence is going to hurt her.”
On July 24, 2015, The New York Times published a front-page story with the headline “Criminal Inquiry Sought in Clinton’s Use of Email.” Later, Jennifer Rubin of the Washington Post candidly summed up Clinton’s rapidly deteriorating status with elections fast approaching: “Democrats still show no sign they are willing to abandon Clinton. Instead, they seem to be heading into the 2016 election with a deeply flawed candidate schlepping around plenty of baggage — the details of which are not yet known.”
Moving into 2016, things began to look increasingly complicated for the Democratic front-runner. On March 16, 2016, WikiLeaks launched a searchable archive for over 30 thousand emails and attachments sent to and from Hillary Clinton’s private email server while she was Secretary of State. The 50,547-page treasure trove spans the dates from June 30, 2010 to August 12, 2014.
In May, about one month after Clinton had officially announced her candidacy for the US presidency, the State Department’s inspector general released an 83-page report that was highly critical of Clinton’s email practices, concluding that Clinton failed to seek legal approval for her use of a private server.
“At a minimum,” the report determined, “Secretary Clinton should have surrendered all emails dealing with Department business before leaving government service and, because she did not do so, she did not comply with the Department’s policies that were implemented in accordance with the Federal Records Act.”
The following month brought more bad news for Clinton and her presidential hopes after it was reported that her husband, former President Bill Clinton, had a 30-minute tête-à-tête with Attorney General Loretta E. Lynch, whose department was leading the Clinton investigations, on the tarmac at Phoenix International Airport. Lynch said Clinton decided to pay her an impromptu visit where the two discussed “his grandchildren and his travels and things like that.” Republicans, however, certainly weren’t buying the story as the encounter came as the FBI was preparing to file its recommendation to the Justice Department.
The summer of 2016, however, was just heating up.
I take @LorettaLynch & @billclinton at their word that their convo in Phoenix didn’t touch on probe. But foolish to create such optics.
On the early morning of July 10, Seth Rich, the director of voter expansion for the Democratic National Committee (DNC), was gunned down on the street in the Bloomingdale neighborhood of Washington, DC. Rich’s murder, said to be the result of a botched robbery, bucked the homicide trend in the area for that particular period; murders rates for the first six months of 2016 were down about 50 percent from the same period in the previous year.
In any case, the story gets much stranger. Just five days earlier, on July 5th, the computers at the DNC were compromised, purportedly by an online persona with the moniker “Guccifer 2.0” at the behest of Russian intelligence. This is where the story of “Russian hacking” first gained popularity. Not everyone, however, was buying the explanation.
In July 2017, a group of former U.S. intelligence officers, including NSA specialists, who call themselves Veteran Intelligence Professionals for Sanity (VIPS) sent a memo to President Trump that challenged a January intelligence assessment that expressed “high confidence” that the Russians had organized an “influence campaign” to harm Hillary Clinton’s “electability,” as if she wasn’t capable of that without Kremlin support.
“Forensic studies of ‘Russian hacking’ into Democratic National Committee computers last year reveal that on July 5, 2016, data was leaked (not hacked) by a person with physical access to DNC computer,” the memo states (The memo’s conclusions were based on analyses of metadata provided by the online persona Guccifer 2.0, who took credit for the alleged hack). “Key among the findings of the independent forensic investigations is the conclusion that the DNC data was copied onto a storage device at a speed that far exceeds an Internet capability for a remote hack.”
In other words, according to VIPS, the compromise of the DNC computers was the result of an internal leak, not an external hack.
At this point, however, it needs mentioned that the VIPS memo has sparked dissenting views among its members. Several analysts within the group have spoken out against its findings, and that internal debate can be read here. Thus, it would seem there is no ‘smoking gun,’ as of yet, to prove that the DNC was not hacked by an external entity. At the same time, the murder of Seth Rich continues to remain an unsolved “botched robbery,” according to investigators. Meanwhile, the one person who may hold the key to the mystery, Julian Assange, is said to be withering away Belmarsh Prison, a high-security London jail, where he is awaiting a February court hearing that will decide whether he will be extradited to the United States where he 18 charges.
Here is a question to ponder: If you were Julian Assange, and you knew you were going to be extradited to the United States, who would you rather be the sitting president in charge of your fate, Hillary Clinton or Donald Trump? Think twice before answering.
“Because you’d be in jail”
On October 9, 2016, in the second televised presidential debates between Donald Trump and Hillary Clinton, Trump accused his Democratic opponent of deleting 33,000 emails, while adding that he would get a “special prosecutor and we’re going to look into it…” To this, Clinton said “it’s just awfully good that someone with the temperament of Donald Trump is not in charge of the law in our country,” to which Trump deadpanned, without missing a beat, “because you’d be in jail.”
Now if that remark didn’t get the attention of high-ranking Democratic officials, perhaps Trump’s comments at a Virginia rally days later, when he promised to “drain the swamp,” made folks sit up and take notice.
At this point the leaks, hacks and everything in between were already coming fast and furious. On October 7, John Podesta, Clinton’s presidential campaign manager, had his personal Gmail account hacked, thereby releasing a torrent of inside secrets, including how Donna Brazile, then a CNN commentator, had fed Clinton debate questions. But of course the crimes did not matter to the mendacious media, only the identity of the alleged messenger, which of course was ‘Russia.’
By now, the only thing more incredible than the dirt being produced on Clinton was the fact that she was still in the presidential race, and even slated to win by a wide margin. But perhaps her biggest setback came when authorities, investigating Anthony Weiner’s abused laptop into illicit text messages he sent to a 15-year-old girl, stumbled upon thousands of email messages from Hillary Clinton.
Now Comey had to backpedal on his conclusion in July that although Clinton was “extremely careless” in her use of her electronic devices, no criminal charges would be forthcoming. He announced an 11th hour investigation, just days before the election. Although Clinton was also cleared in this case, observers never forgave Comey for his actions, arguing they cost Clinton the White House.
Now James Comey is back in the spotlight as one of the main characters in the Barr-Durham investigation, which is examining largely out of the spotlight the origins of the Trump-Russia conspiracy theory that dogged the White House for four long years.
In early December, Justice Department’s independent inspector general, Michael E. Horowitz, released the 400-page IG report that revealed a long list of omissions, mistakes and inconsistencies in the FBI’s applications for FISA warrants to conduct surveillance on Carter Page. Although the report was damning, both Barr and Durham noted it did not go far enough because Horowitz did not have the access that Durham has to intelligence agency sources, as well as overseas contacts that Barr provided to him.
With AG report due for release in early spring, needless to say some Democrats are very nervous as to its finding. So nervous, in fact, that they might just be willing to go to the extreme of removing a sitting president to avoid its conclusions.
Whatever the verdict, 2020 promises to be one very interesting year.
The world situation is changing very fast and one needs to make an effort in order to keep pace with the events. The end of a year is a welcome opportunity for an assessment of the current situation.
2019: The West has lost the supremacy in the Middle East
I think that this was the most important change in the year drawing to a close. Iran has successfully and creatively defended herself against the „maximal pressure“ from the USA and has kept her distance with the West European countries. Economically, the country has suffered from the US-sanctions, but she has now passed the biggest crisis. The country took the imposed problems as a motivation to improve the economical governance and to diminish the dependance from petrol. While in June, say, there was a more or less real danger of an aggressive war against Iran, now, this treat haas faded into the background. The report of UN-Secretary-General Guterres of Desember 10 saying that the UN, after an investigation in Saudi Arabia, cannot verify the US and Saudi claims that Iran was behind the strikes on Aramco in September, is a diplomatic victory for Iran. As for the Iranian trade, an official recently said that, during the last 9 months, China, Iraq, UAE, Afghanistan and Turkey were major destinations for the Iranian exports while Turkey, UAE and Germany are biggest Iranian trade in terms of imports.
Syria has made further important progress in the fight against terrorism, in particular in the province Idleb. Moreover, the government and the army were able to utilize the partial withdrawal of the US occupying army in the north-east of the country. The reconstruction in Syria moves forward, Russian and Chinese enterprises will thereby play an important role. Hundreds of thousands refugees have come back. In short, as President Assad said in the interview with Italian Rai News 24: „[… ] the situation is much, much better […] and I think that the future of Syria is promising; we are going to come out of this war stronger.“
In the absurd war of Saudi Arabia against Yemen, the strategic situation has completely changed. Saudi Arabia has lost the initiative and different Arabian and African countries have stopped the support for the Saudi army. The Ansarallah movement of the Houthis has made important attacks, in particular against Aramco, and the movement has now strong official relations with Iran.
The West and Israel are still trying hard to exploit the economical and political crisis in Lebanon and Iraq. However, the patriotic forces in both countries were able to keep a positive outlook of the situation and could avoid to fall into the traps.
There is no reason to think that the positive development in the Middle East will change in the next months. Quite the contrary. One can expect that the fight in Afghanistan against terrorism and US occupation will make important progress. Moreover, the influence of China and Russia will further increase. However, the general situation will remain tense. This is of course due to the fact that there is a country like Israel in this region which is utterly hostile against the neighboring countries and tyrannizes the indigenous population.
Asia as a whole has already widely casted off the yoke of Western hegemonism. As of South America, the developments in 2019 show – despite of the coup in Bolivia – a movement to more independence which very probably will continue. I would assume that this vague will also grow in Africa, in particular in Western and central Africa, due to the fight against terrorism and the beneficial influence of China and Russia.
2020: The fight between the American national imperialism and Western hegemony will come to a decision
Trump has won in 2016, based on his program of „America first“. Since then, it has become more and more clear that this program is in fact a program of an American national imperialism. Trump is not interested in a „Western“ perspective. A typical example are the US sanctions against numerous countries, even against traditional allies. This is a crucial change. Since the end of World War 2, the USA were constructed as a worldwide leading power. During the cold war, this has developed into the collective Western hegemony – including countries like Japan, Australia and others – with the USA as the undisputed leader. The emergence of an American national imperialism is a somewhat unexpected challenge for all other Western countries. Nevertheless, it is a logical evolution, provoked among other things by the declining power of Western hegemony and the appearance of China, the new Russia, as well as their strategic collaboration.
The traditional Western hegemonic forces have never accepted the election of Trump in 2016. They are very strong inside the US Democratic Party and in the US parliament in general, but also in Western Europe. With the impeachment and the US election in 2020, the fight between the both tendencies will reach a decision. One should expect that this fight will be very hard. The only logical outcome will be a victory of Trump; however, it is still to be seen whether this will be a clear victory or not. In other words, will the Western hegemonic forces be obliged to accept it this time? I think that these questions will be very crucial in 2020.
Also for Western Europe, the influence of this fight will be immense. Concerning this matter, the UK is the most advanced country in Western Europe. After a struggle of 3 and half years, the population has given a clear mandate to the Johnson government to deliver Brexit. It is probable that now, where this central question is resolved, the development in the UK will be quite dynamical. The formation of a national imperialism will advance quickly. France also is rather well prepared for a victory of the American national imperialism; with the period of de Gaulle in the 1960s, she has a historical model.
On the other hand, I believe that Germany is the less prepared country. Germany is very anti-Trump. In 2016, polls in Germany indicated that up to 90% would vote for Hillary Clinton and only 4% for Donald Trump. The polls during the last years have clearly confirmed this rejection of Trump in the German population. Also, German Chancellor Merkel has been widely seen as a stronghold of the traditional Western hegemony and against American national imperialism. However, the situation is changing. Merkel has lost her authority and is now rather isolated. The awareness is growing that Trump does not stand for a parenthesis in history, but for a fundamental change. The impeachment is not judged as positive as one could await. Moreover, the German industry would like to have better relations with Russia. The US sanctions against Nord Stream 2 will only reinforce the will in Germany to become more autonomous.
There is still another problem. While national imperialism has a long tradition in the UK and in France and will probably be accepted without too much of resistance, in Germany, national imperialism is not popular, for historical reasons. Therefore, one may predict that Germany will have a big debate on her political identity; even a profound crisis is possible. This is certainly complicated by the fact that Merkel has to be replaced and that there is – actually – no convincing successor. I am however quite confident that Germany will be able to find a way for playing a quite positive role in the future world.
We therefore may anticipate that Western hegemony is replaced by national imperialisms. Of course, they will remain a big problem for the world, even if the classical Western hegemony will suffer an important defeat. But the contradictions of other Western countries with the USA will strongly expand. This gives the remaining world much better perspectives.
From my point of view, 2019 was a very positive year and I am convinced that the same will be the case for 2020.
Compulsive Gambler Sues Casino For “Letting Him” Lose $260,000
It’s a bold strategy, Cotton, let’s see if it pays off for him…
Tarwinder Shokar is taking an unorthodox step after getting cleaned out on a gambling binge. After losing about $260,000 US, Shokar has now turned around and sued the Caesars Windsor Resort And Casino as well as the Ontario Lottery and Gaming Commission for his losses – plus about $381,000 in punitive damages, according to Newsweek.
The case was filed around the time the gambling took place and has been recently transferred to the Superior Court of Justice in Windsor.
Shokar’s lawyer Iain MacKinnon said: “Our position is he was a compulsive gambler and the casino and/or the OLG were either well aware of his past background—or should have been.”
Shortly prior to his binge, Shokar apparently attempted suicide by throwing himself in front of a bus after losing all of his money at a different casino. Ironically, he survived the accident and actually wound up collecting a large insurance payout as a result of his injuries. He then took the insurance money and lost that all, too.
Shokar reportedly had fraud convictions and had been banned from a number of other casinos due to his behavior. A travel agency was said to then recommend Caesars Windsor, who Shokar claims knew that he was there to spend a large amount of money, and who treated him to VIP treatment, including plying him with alcohol.
His first visit on October 17, 2013 resulted in him losing about $70,000 US. On his next visit, he racked up losses of about $190,000 US. The lawsuit says the casino should have known that he had a gambling problem, but instead chose to “take advantage of him”.
Which is precisely the line of business that casinos are in…
Former US President Barack Obama is now in severe legal jeopardy, because the Russiagate investigation has turned 180 degrees; and he, instead of the current President, Donald Trump, is in its cross-hairs.
The biggest crime that a US President can commit is to try to defeat American democracy (the Constitutional functioning of the US Government) itself, either by working with foreign powers to take it over, or else by working internally within America to sabotage democracy for his or her own personal reasons. Either way, it’s treason (crime that is intended to, and does, endanger the continued functioning of the Constitution itself*), and Mr. Obama is now being actively investigated, as possibly having done this. The Russiagate investigation, which had formerly focused against the current US President, has reversed direction and now targets the prior President. Although he, of course, cannot be removed from office (since he is no longer in office), he is liable under criminal laws, the same as any other American would be, if he committed any crime while he was in office.
A December 17th order by the FISA (Foreign Intelligence Surveillance Act) Court severely condemned the performance by the FBI under Obama, for having obtained, on 19 October 2016 (even prior to the US Presidential election), from that Court, under false pretenses, an authorization for the FBI to commence investigating Donald Trump’s Presidential campaign, as being possibly in collusion with Russia’s Government. The Court’s ruling said:
In order to appreciate the seriousness of that misconduct and its implications, it is useful to understand certain procedural and substantive requirements that apply to the government’s conduct of electronic surveillance for foreign intelligence purposes. Title I of the Foreign Intelligence Surveillance Act (FISA ), codified as amended at 50 USC. 1801-1813, governs such electronic surveillance. It requires the government to apply for and receive an order from the FISC approving a proposed electronic surveillance. When deciding whether to grant such an application, a FISC judge must determine among other things, whether it provides probable cause to believe that the proposed surveillance target is a “foreign power” or an agent a foreign power…
…The government has a heightened duty of candor to the FISC in ex parte proceedings, that is, ones in which the government does not face an adverse party, such as proceedings on electronic surveillance applications. The FISC expects the government to comply with its heightened duty of candor in ex parte proceedings at all times. Candor is fundamental to this Court’s effective operation…
…On December 9, 2019, the government filed, with the FISC, public and classified versions of the OIG Report… It documents troubling instances in which FBI personnel provided information to NSD[National Security Division of the Department of Justice] which was unsupported or contradicted by information in their possession. It also describes several instances in which FBI personnel withheld from NSD information in their possession which was detrimental to their case for believing that Mr. [Carter] Page was acting as an agent of a foreign power…
On December 18th, Martha McCallum, of Fox News, interviewed US Attorney General Bill Barr, and asked him (at 7:00 in the video) how high up in the FBI the blame for this (possible treason) goes:
MACCALLUM: Were you surprised that he [Obama’s FBI Director James Comey] seemed to give himself such a distance from the entire operation?
“JAMES COMEY: As the director sitting on top of an organization of 38,000 people you can’t run an investigation that’s seven layers below you. You have to leave it to the career professionals to do.”
MACCALLUM: Do you believe that?
BARR: No, I think that the — one of the problems with what happened was precisely that they pulled the investigation up to the executive floors, and it was run and bird dogged by a very small group of very high level officials. And the idea that this was seven layers below him is simply not true.
The current (Trump) A.G. there called the former (Obama) FBI Director a liar on that.
If Comey gets heat for this possibly lie-based FBI investigation of the US Presidential nominee from the opposite Party of the sitting US President (Comey’s own boss, Obama), then protecting himself could become Comey’s top motivation; and, in that condition, protecting his former boss might become only a secondary concern for him.
Furthermore, inasmuch as this operation certainly involved Obama’s CIA Director John Brennan and others, and not only top officials at the FBI, there is no chance that Comey would have been the only high official who was involved in it. And if Comey was involved, then he would have been acting in his own interest, and not only in his boss’s — and here’s why: Comey would be expected to have been highly motivated to oppose Mr. Trump, because Trump publicly questioned whether NATO (the main international selling-arm for America’s ‘defense’-contractors) should continue to exist, and also because Comey’s entire career had been in the service of America’s Military-Industrial Complex, which is the reason why Comey’s main lifetime income has been the tens of millions of dollars he has received via the revolving door between his serving the federal Government and his serving firms such as Lockheed Martin. For these people, restoring, and intensifying, and keeping up, the Cold War, is a very profitable business. It’s called by some “the Military-Industrial Complex,” and by others “the Deep State,” but by any name it is simply agents of the billionaires who own and control US-based international corporations, such as General Dynamics and Chevron. As a governmental official, making decisions that are in the long-term interests of those investors is the likeliest way to become wealthy.
Consequently, Comey would have been benefitting himself, and other high officials of the Obama Administration, by sabotaging Trump’s campaign, and by weakening Trump’s Presidency in the event that he would become elected. Plus, of course, Comey would have been benefitting Obama himself. Not only was Trump constantly condemning Obama, but Obama had appointed to lead the Democratic National Committee during the 2016 Presidential primaries, Debbie Wasserman Schultz, who as early as 20 February 2007 had endorsed Hillary Clinton for President in the Democratic Party primaries, so that Shultz was one of the earliest supporters of Clinton against even Obama himself. In other words, Obama had appointed Shultz in order to increase the odds that Clinton — not Sanders— would become the nominee in 2016 to continue on and protect his own Presidential legacy. Furthermore, on 28 July 2016, Schultz became forced to resign from her leadership of the DNC after WikiLeaks released emails indicating that Schultz and other members of the DNC staff had exercised bias against Bernie Sanders and in favor of Hillary Clinton during the 2016 Democratic primaries — which favoritism had been the reason why Obama had appointed Shultz to that post to begin with. She was just doing her job for the person who had chosen her to lead the DNC. Likewise for Comey. In other words: Comey was Obama’s pick to protect Clinton, and to oppose Trump (who had attacked both Clinton and Obama).
Nowadays, Obama is telling the Party’s billionaires that Elizabeth Warren would be good for them, but not that Sanders would — he never liked Sanders. He wants Warren to get the voters who otherwise would go for Sanders, and he wants the Party’s billionaires to help her achieve this (be the Party’s allegedly ‘progressive’ option), so that Sanders won’t be able to become a ballot option in the general election to be held on 3 November 2020. He is telling them whom not to help win the Party’s nomination. In fact, on November 26th, Huffington Post headlined “Obama Said He Would Speak Up To Stop Bernie Sanders Nomination: Report” and indicated that though he won’t actually say this in public (but only to the Party’s billionaires), Obama is determined to do all he can to prevent Sanders from becoming the nominee. In 2016, his choice was Hillary Clinton; but, today, it’s anyone other than Sanders; and, so, in a sense, it remains what it was four years ago — anyone but Sanders.
Comey’s virtually exclusive concern, at the present stage, would be to protect himself, so that he won’t be imprisoned. This means that he might testify against Obama. At this stage, he’s free of any personal obligation to Obama — Comey is now on his own, up against Trump, who clearly is his enemy. Some type of back-room plea-bargain is therefore virtually inevitable — and not only with Comey, but with other top Obama-appointees, ultimately. Obama is thus clearly in the cross-hairs, from now on. Congressional Democrats have opted to gun against Trump (by impeaching him); and, so, Trump now will be gunning against Obama — and against the entire Democratic Party (unless Sanders becomes its nominee, in which case, Sanders will already have defeated that Democratic Party, and its adherents will then have to choose between him versus Trump; and, so, too, will independent voters).
But, regardless of what happens, Obama now is in the cross-hairs. That’s not just political cross-hairs (such as an impeachment process); it is, above all, legal cross-hairs (an actual criminal investigation). Whereas Trump is up against a doomed effort by the Democratic Party to replace him by Vice President Mike Pence, Obama will be up against virtually inevitable criminal charges, by the incumbent Trump Administration. Obama played hardball against Trump, with “Russiagate,” and then with “Ukrainegate”; Trump will now play hardball against Obama, with whatever his Administration and the Republican Party manage to muster against Obama; and the stakes this time will be considerably bigger than just whether to replace Trump by Pence.
Whatever the outcome will be, it will be historic, and unprecedented. (If Sanders becomes the nominee, it will be even more so; and, if he then wins on November 3rd, it will be a second American Revolution; but, this time, a peaceful one — if that’s even possible, in today’s hyper-partisan, deeply split, USA.)
There is no way that the outcome from this will be status-quo. Either it will be greatly increased further schism in the United States, or it will be a fundamental political realignment, more comparable to 1860 than to anything since.The US already has a higher percentage of its people in prison than does any other nation on this planet. Americans who choose a ‘status-quo’ option will produce less stability, more violence, not more stability and a more peaceful nation in a less war-ravaged world. The 2020 election-outcome for the United States will be a turning-point; there is no way that it will produce reform. Americans who vote for reform will be only increasing the likelihood of hell-on-Earth. Reform is no longer an available option, given America’s realities. A far bigger leap than that will be required in order for this country to avoid falling into an utter abyss, which could be led by either Party, because both Parties have brought the nation to its present precipice, the dark and lightless chasm that it now faces, and which must now become leapt, in order to avoid a free-fall into oblivion.
The problem in America isn’t either Obama or Trump; it’s neither merely the Democratic Party, nor merely the Republican Party; it is instead both; it is the Deep State. That’s the reality; and the process that got us here started on 26 July 1945 and secretly continued on the American side even after the Soviet Union ended and Russia promptly ended its side of the Cold War. The US regime’s ceaseless thrust, since 26 July 1945, to rule the entire world, will climax either in a Third World War, or in a US revolution to overthrow and remove the Deep State and end its dictatorship-grip over America. Both Parties have been controlled by that Deep State, and the final stage or climax of this grip is now drawing near. America thus has been having a string of the worst Presidents — and worst Congresses — in US history. This is today’s reality. Unfortunately, a lot of American voters think that this extremely destabilizing reality, this longstanding trend toward war, is okay, and ought to be continued, not ended now and replaced by a new direction for this country — the path toward world peace, which FDR had accurately envisioned but which was aborted on 26 July 1945. No matter how many Americans might vote for mere reform, they are wrong. Sometimes, only a minority are right. Being correct is not a majority or minority matter; it is a true or false matter. A misinformed public can willingly participate in its own — or even the world’s — destruction. That could happen. Democracy is a prerequisite to peace, but it can’t exist if the public are being systematically misinformed. Lies and democracy don’t mix together any more effectively than do oil and water.
* * *
* The given official US definition of “treason” (see top of page 3 there) is “Whoever, owing allegiance to the United States, levies war against them or adheres to their enemies, giving them aid and comfort within the United States or elsewhere, is guilty of treason.” Any US official has sworn to uphold and defend, never to subvert, the Constitution of the United States, and this is defining the US, itself, as being the continued functioning of the US Constitution. Treason is thus the supremely illegal act under US law, the act that violates any US official’s oath of office. (When treason is perpetrated by someone who is not a US official, it is still a severe crime, but less severe than it is for any US official.) The phrase “levies war against them” means war against the functioning of the Constitution that is their supreme law. “Or” means alternatively, and “adheres to their enemies” means is a follower of any person or other entity that seeks to impose a different constitution. “Enemies” is not defined — it need not be a foreign opponent; it may be a domestic opponent of the US Constitution. Thus, an American can be an enemy of the United States of America. In fact, the official definition explicitly refers ONLY to an entity “owing allegiance to the United States.” (Obviously, that especially refers to any US official.) This is how a “traitor” is understood, in US law. Obviously, the worst traitor would be one who committed the treasonous act(s) while a US official.
Petrodollar Shock: Russia Could Invert Part Of Its National Wealth Fund In Gold
In the past two years Russia has been quite explicit in its shifting preference between fiat, in the form of the world’s reserve currency, US Dollars and hard assets, i.e., gold: after liquidating almost all of its Treasury holdings in mid 2018, roughly around the time relations between the US and Russia hit rock bottom and started digging, Russian gold holdings continued to climb and just a few months back rose to a record, more than doubling in the past 4 years.
It now appears that the recent gold-buying spree wasn’t enough, because according to Russia’s Finance Minister Anton Siluanov, Russia is now also considering investing part of its National Wealth Fund in gold, adding that it is Russia’s view that investment in the precious metal as more sustainable in the long-term than in financial assets.
“There is a discussion on whether to invest the fund’s money in gold and precious metals. There are a lot of supporters and opponents,” Siluanov said.
While Russia has traditionally been one of the world’s largest gold producers, its central bank has been the main buyer of its metal in recent years, partly as a result of Western sanctions imposed on Moscow in 2014, which forced the central bank was reducing the share of U.S. dollar assets in its reserves.
So is Russia about to double down and in addition to converting its forex reserves into gold, will start buying the yellow metal for its sovereign wealth fund too? It appears so: speaking to reporters last Tuesday, Siluanov said that the finance ministry proposes that the National Wealth Fund’s new investment structure would mirror the foreign exchanges reserves structure of the central bank and excludes gold. As of December 1, the central bank’s gold reserves stood at 72.7 million troy ounces, worth approximately $108 billion.
As a reminder, the Russian National Wealth Fund accumulates revenues from oil exports and was initially designed to support the pension system. It was worth $124 billion as of Dec. 1. It is, therefore, a key cog in the petrodollar mechanism. This means that a key player in the global petrodollar recycling pathway will instead convert its revenues from sales of oil not into dollars, but directly into gold, bypassing the current reserve currency.
As a reminder, it was in late 2014, shortly before China’s economy suffered its first major shock – and currency devaluation – of the post-crisis era, when we reported in “How The Petrodollar Quietly Died, And Nobody Noticed” that as a result of the oil price crash of late 2014, the petrodollar had suffered its first near-death experience, as petrodollar exports would fall negative in 2014 for the first time in 18 years. And while since then we have seen a modest rebound, the net exported capital remains dangerously close to zero, in effect keeping the entire petrodollar system on death watch.
Russian gold miners usually sell their metal to Russian commercial banks, which then re-sell it to the central bank. Russia’s Polyus and Polymetal, along with Canada’s Kinross, are the world’s top producers.
That said, for now, the petrodollar is safe: “The Finance Ministry does not propose (the fund) investing in the precious metals, though one could think and consider this,” Siluanov said. “My point of view is that gold might well be present when investing reserve money.”
In November, the Russian finance ministry proposed spending 1 trillion roubles ($16 billion) from the National Wealth Fund to support infrastructure projects and exports between 2020 and 2022, as it tries to boost economic growth. The government will be able to use money from the Fund once its liquid assets exceed 7% of GDP, something the finance ministry expects to happen in 2020.
According to the Encyclopedia Britannica, “Auld Lang Syne” literally translates to “Old Long Since” which could also be interpreted as “since long ago” or “for old times’ sake”. Certainly, there is a feeling of melancholy when the song is sung at the end of another year gone by. Maybe any sadness could be attributed to good times that are now gone or, perhaps, especially, regret at what might have been.
The same goes for inevitable outcomes of unavoidable events, predictable denouements of tragic stories, and the ineluctable death of nations. It calls to mind a quote from the 1994 movie “The Legends of the Fall” when the Native American narrator described how a beautiful young woman caused brothers to hate one another and a family to fragment. He said:
She was like the water that freezes inside a rock and breaks it apart. It was no more her fault than it is the fault of the water when the rock shatters.
Indeed. Natural forces rage over and upon the earth. And who is Man to stop the rain?
A recent article addressing our “hysteric times” identified America as a corpse consumed by maggots, with liberals acting as the maggots and conservatives as “rooting for the corpse”. What an astute analogy. Because the Collective acts to completely consume rotting systems as those wearing MAGA hats perform CPR on a skeleton.
There are those who will say America’s fate was sealed when her government assimilated education, or when the Bible was banned in schools. Others will blame the creation of the Federal Reserve in 1913, or FDR’s New Deal, or the assassination of JFK, or the advent of The Great Society under Lyndon Johnson.
History buffs might claim the nation began its first convulsions when Abe Lincoln overturned states’ rights in the Civil War era or even earlier than that – when the Federalists overrode the Anti-Federalists in 1788.
Or maybe it was due to the covert implementation of the 45 Communist Goals, or the development of the League of Nations and United Nations.
Perhaps it was the Nixon Shock. Roe v. Wade? Disco? 911? The Patriot Act? Smartphones? Social Media? Foreign wars? Too big to fail? Political correctness? Illegal immigration? The exponentially growing national debt? Corruption in the CIA, FBI, DoJ and other alphabet soup government agencies?
In truth, it could’ve been any, and all, of the above or maybe these were just the symptoms of something deeper and more profound. In any case, they were all cracks and water in the nation’s foundation. And as was expected, winter is finally here.
Exactly how and when America’s foundational stones will shatter in the coming months is anyone’s guess, but do know this: When Progressive Democrats, and an activist mainstream media, stage a third-world impeachment trial of a U.S. President while reverently citing the words of the nation’s long-dead founders who were, by their own definition, privileged white males and racist slave owners – the end is nigh.
So it was no surprise when several days ago, in a buffet line, this blogger overheard an overweight man tell an obese woman the following:
“Poor Trumpy. He got hisself impeached.”
To which the woman replied with a Cheshire-cat grin of satisfaction:
“Yep! History will always show that he was impeached“.
One wonders if these citizens were aware of President Trump’s December 17, 2019 letter to House Speaker Nancy Pelosi. It was sent the day before the impeachment vote and it said, in part, the following:
I write to express my strongest and most powerful protest against the partisan impeachment crusade being pursued by the Democrats in the House of Representatives. This impeachment represents an unprecedented and unconstitutional abuse of power by Democrat Lawmakers, unequaled in nearly two and a half centuries of American legislative history.
The Articles of Impeachment introduced by the House Judiciary Committee are not recognizable under any standard of Constitutional theory, interpretation, or jurisprudence. They include no crimes, no misdemeanors, and no offenses whatsoever. You have cheapened the importance of the very ugly word, impeachment!
By proceeding with your invalid impeachment, you are violating your oaths of office, you are breaking your allegiance to the Constitution, and you are declaring open war on American Democracy…
….You are the ones interfering in America’s elections. You are the ones subverting America’s Democracy. You are the ones Obstructing Justice. You are the ones bringing pain and suffering to our Republic for your own selfish personal, political, and partisan gain…
…. Any member of Congress who votes in support of impeachment – against every shred of truth, fact, evidence, and legal principle – is showing how deeply they revile the voters and how truly they detest America’s Constitutional order. Our Founders feared the tribalization of partisan politics, and you are bringing their worst fears to life.
Worse still, I have been deprived of basic Constitutional Due Process from the beginning of this impeachment scam right up until the present. I have been denied the most fundamental rights afforded by the Constitution, including the right to present evidence, to have my own counsel present, to confront accusers, and to call and cross-examine witnesses ….
It means there is no coming back from this one. The damage is done.
It means, by any definition, perilous times are here; and that predictably programmed dialectics will prevent either side from accepting the results of the 2020 Presidential Election. Surely, the ANTIFA crowd will be rioting in the streets in the event of a Trump win. And, if Trump loses and contests the results over wrongful impeachment, illegal immigration, vote fraud, or any other reason – the rioting of the collectivists will be even worse.
It also means that if Trump loses, a large percentage of the U.S. population will not accept the tyranny of the Political Left; because if the Progs are now willing to engage in such nefarious deeds as recently demonstrated on Capitol Hill with the impeachment sham, and in states like Virginia regarding gun control, imagine what happens when they win the power to legislate socialist hell from sea to shining sea.
Understandably, therefore, many natives have become increasingly angry and restless; and this may also be due to the fact that Epstein didn’t kill himself.
For example, at a recent election rally for Joe Biden, a random nobody in the audience called out the former vice president of the United States regarding his corrupt involvement in Ukraine. The heckler, additionally, yelled to Biden as one of the leading presidential candidates in the Democratic primaries:
Certainly, U.S. Attorney John Durham may plumb the depths of the Russiagate rabbit hole but his report is not due to be delivered until late spring or early summer 2020. Even then, one wonders if Americans will have the stomach to digest it fully; that is, of course, if the corporate media spinners choose to spoon-feed any of Durham’s findings to the imprudent plebes.
Ask yourself these questions, Dear Reader: Do American’s have the political will to actually drain the swamp? What happens when the economy tanks in 2020? Do you think they’ll desire to root out any corruption then?
Or stated another way: Do the current measurable demographics in America today identify a sufficient percentage of the body politic as having the necessary moral outrage, and the courage, to sustain real swamp draining? And will the current demographics significantly change in the New Year as fiat green confetti rains down over Wall Street and onto Main Street?
Regardless, it has become clear that those at the top of the pyramid, as well as their minions comprising the Political Left, care not to consider the historical view of their actions. It could be because they are now desperate as cornered animals. Or maybe it’s because they believe they’ll soon be the victors who will rewrite history. And perhaps from their perspective, these are not mutually exclusive.
Even so, take heart. America’s fate may have long been sealed, but the ideas that originally made the country great will never die. Many will rise to meet the collective tide and even if victory is not assured under Trump’s presidency – his election will prove to have been a crucial catalyst toward that end.
Until that time, trust nothing reported by the Orwellian Media, remain ever skeptical, and never overestimate the American Sheeple. One day, in their wake, new mini-republics might rise and become known en masse as Nobullshitopia. Because then, and only then, can we stand united.
In the meantime, cheers to the New Year as we raise our glasses to the like-minded near and far. The past is a bright dream, and hope is the future’s fixed star.
China’s Next Real Estate Bubble: Building EV-Production Cities Across The Country
Just in time for Tesla’s big move to China, entire cities are popping up from within the country dedicated solely to making electric vehicles.
Shunde New Energy Vehicle Town in China is taking shape inside of the city of Foshun as a hub for EV production and research. It is estimated that the city could eventually generate $15 billion in revenue per year.
Bloomberg calls the cities “at least 20 electric-centric versions of Detroit under construction as China” as the country continues to bet big on EV technology. President Xi Jinping hopes that EV manufacturers will help boost other industries. He aims for the country to become a “manufacturing superpower” by 2025, in hopes that it’ll make China more self-sufficient and diversified.
And cities in China are working to shift their economies to become a part of Xi’s new plan. They are offering cheap land and tax breaks to bring in car makers, parts supplies and engineering labs, in hopes of bolstering their own local economies.
He Xiaopeng, chairman of Xpeng Motors Technology Ltd., said: “The new-energy vehicle industry is a bet local governments must take. A successful EV maker could bring at least 200 companies in the industry chain into a province.’’
So far, about $30 billion has been committed to developing these EV towns. The commitments range from fixed asset investments to development costs. It’s a move that’s typical of China’s “command-led” approach to its economy, as Bloomberg calls it.
To us, it looks similar to the country’s real estate strategy: try to build it, and hope they come.
That’s what China has been doing, erecting industrial parks, apartments and schools while laying out their offers – and sitting back, hoping that companies come in to take them up on thier offers.
Between 2009 and 2017, the country spend about $36.5 billion subsidizing EV sales. This could be why China now accounts for more than half of all passenger EV sales worldwide.
The rapid urbanization of the country has taken up many available land tracts, which has in turn pushed prices higher and made zoning laws tougher. By committing to EVs, local officials are likely to find it easier to get central government approval for redevelopment plans.
Shunde NEV Town is being built by China’s largest developer, Country Garden. The company has promised to bring EV-related businesses and meet tax revenue targets.
Liu Wei, who’s overseeing the project for Country Garden said: “The industry chain is far more comprehensive than car manufacturing. We’re well aware the fever will fade, but some emerging firms will grow, and that’s who we want to house.”
Country Garden has been able to keep office rents cheap (by as much as 25%) by using land in small towns, instead of adjacent areas. The businesses in these small towns will then need workers.
Cui Dongshu, secretary general of the China Passenger Car Association, said: “The towns have at least one key resource that EV makers and suppliers are eager to own: the land. That will naturally attract them to move into the towns.”
But EVs only make up less than 5% of total car sales in China. Some analysts see these pop-up towns as destined for failure, as a result. John Zeng, managing director of LMC Automotive Shanghai said: “Most of those EV towns will fail. This wave of electric-vehicle building will come to a life-or-death moment. When EV carmakers are being squeezed, the ‘EV Town’ bubble will burst.’’
Liu Wei concluded: “I admit that the EV sector is still working its own way. But we have been well aware of sector challenge since planning it two years ago, and we’re confident that we can adapt to the change.”
As we roll into a new decade it might be a good time to explore the five top trends that define and are shaping our world. Overall, I wish I could be more positive but it seems the story of mankind is rooted in our moving forward in fits and starts as we work our way through adversity. War and conflict have always caused the world great grief. Sadly, with the increase in our ability to caused mass destruction, this is even more troubling. Adding to my concerns is that we are not trending towards a more peaceful sustainable place.
We live in a world where our system of governance is geared at getting politicians re-elected and fulfilling the most pressing needs of today. Things like profit, greed, and quenching our endless desire for growth is placed in front of longer-term issues and needs. The idea that we must increase our population to create growth is flawed. Simply adding mouths to feed and adding new workers to replace those retiring creates additional demand but is shortsighted in that it ignores the problems exploding population across the planet brings with it.
Mapping out a logical and sustainable long-term plan requires delving into some rather hefty philosophical questions like what brings real happiness. Dictators that govern under an agenda totally of their own creation have been no more successful than elected officials in coming up with real answers to our woes. Below are what I see as the “key” and most powerful directional shifts dictating our future and shaping our culture. These are followed by a few words on each.
The central banks pouring money and credit into the financial system in an effort to keep the economy moving forward.
The growing number of social ills, sick, and dysfunctional people.
Political shifts and polarization are rapidly increasing. – Populism has been growing for several years when combined with surging inequality and discontent people rise-up in protest.
As technology and artificial intelligence advance those in power are moving forward using these tools to turn us into pawns.
Concern over climate change is on the rise. Sadly, few of those talking about it see cutting waste as a priority.
Too many economic watchers, it has become obvious the greatly expanded role of central banks in the world’s economy is not working. The global financial system has morphed into a giant experiment controlled by an evil alliance that could be called the “Financial-Political Complex.” Interest rates have been flat or negative in real terms still many people advocate they still need or should go lower. These people forget that low-interest rates flowing from policies such as ZIRP and NIRP do not extend down to low-income individuals with poor credit.The huge number of people that fall into this category get no relief while low rates punish those that have saved. This fuels inequality. The concept that a rising tide floats all boats or trickle-down economics has proven to heavily favor the rich.
As a result of society’s growing ability to care for people and expanded medical care we have bent Charles Darwin’s law concerning, “survival of the fittest.” Governments have engaged in constructing a safety net under societies most vulnerable but whatever we do it seems it “ain’t enough.” Examples of social ills include crime, bullying, racism, delinquency, discrimination, family disintegration, drug addiction, poverty, and homelessness. While some of these problems may be less drastic than others all are costly to society and lessen the ability of our culture to function. Ironically, the often considered conservative belief in the “right to life” in some ways adds to this dilemma. simply put, children born with at least one dysfunctional parent have a greatly reduced chance of becoming a successful adult.
The world is undergoing a huge political shift that has magnified the sharp divisions of contrasting groups as to how issues should be addressed. This has resulted in a rapid increase in polarization as opinions and beliefs conflict. Populations frustrated by the failure of their leaders to create a more just world are taking to the streets in large protests to put their demands forth. Inequality and globalization are fueling a populist movement that will most likely grow as governments that have over-promised fail to carry out all they have pledged. Unfortunately, these movements can turn into revolutions that merely switch out one incompetent or corrupt leader for another.
We need only to look at a country like China where conformity is highly valued and the government tries to control all facets of a person’s life to see how such actions conflict with the idea of freedom of choice. A balance between conformity and “over the top” diversity is most likely a place where society finds its happy place. Conformity can crush the human soul while the lack of it is often difficult for society to address because it raises the issue of where one person’s rights end and another persons begin. Today we are seeing inequality soar and it can be argued conformity greatly reduces the ability of individuals to move up the social ladder.
A growing question is just how much of this is by design due to the culturally elite putting their foot on the head of those below them. Over the years with the aid of new technologies governments across the world have greatly expanded their ability to watch our movements and everything we do. They have even incorporated and leveraged the ever-present smartphone as an ultra-powerful surveillance device. The control over the individual will become complete as they move us towards being a cashless economy. This translates into where we will be unable to buy food, may at any moment have our ability to message others cut, and will be forced to rely on autonomous vehicles to deliver us to our destinations.
A lack of control over our lives grants those in charge total control over us making us powerless pawns and slaves with little choice but to do their bidding or perish. This dovetails with the move towards artificial intelligence where there exists great potential but also the dangerous possibility and risk that technology could create an environment where mankind is rendered redundant. This would leave mankind facing robots and weapons of mass destruction. The noose is rapidly tightening around our necks os quickly it hasresulted in a reshuffling in the list of the “Worlds 10 Worst Problems.”
The last major trend to have exploded on the scene is growing concern over climate change and global warming. Sadly, few of those talking about it see cutting waste as a key part of the answer and a priority instead they tout massive change. The fact is, many of our problems flow from governments and consumers wasting so much. While this waste drives the GDP higher it does little to make our lives better.
The reality is that “waste” is proving massively destructive to life on this planet. This extends to governments misallocating funds as corruption and crony capitalism flourish. Whether we are talking about bombs built and dropped in the middle of an empty desert, brochures that are printed but never distributed, or Medicaid fraud all add to our deficit and pull resources away from more important areas.
For both political and economic reasons, poor planning, weak recycling practices, and wasteful squandering of our natural resources on things that yield little of value continue to haunt America and most of the world. The message that we should conserve our natural resources is vastly understated. Most climate change advocates seem to be nibbling around the edges of cutting waste and focused on issues few people agree about. These include over the top ideas that are predicted to cost a huge amount of money but may prove ineffective and even harm the environment over time. Often it is the same people responsible for our problems that propose these expensive cures. They also promote them as “job creators” to sweeten their allure. Sadly, most do not work but generate negative unintended consequences as they become giant costly boondoggles.
After examining the top trends defining the last decade and ushering in the new there is little question they will play a key part in determining our future. The world is changing at a more rapid pace than at any time in our history. The takeaway is we can expect things to be very interesting going forward. This doesn’t necessarily mean they will be good or events will unfold as we hope but you can rest assured that boredom is not in the cards.
Average US Family Can’t Afford A Home In 71% Of The Country
More Americans are getting priced out of purchasing homes than ever, as soaring prices continue to outpace wages, according to a new report.
ATTOM Data Solutions’ Q4 2019 US Home Affordability Report says the average wage earner can’t purchase a home in 344 out of 486 counties, or about 71% of the US.
The report revealed the top five largest populated counties where median-priced homes outpaced wages in Q4 that made it unaffordable to the average American — were in Los Angeles County, CA; Maricopa County (Phoenix), AZ; San Diego County, CA; Orange County, CA (outside Los Angeles) and Miami-Dade County, FL.
The top ten least affordable counties in Q4 were: Kings County, NY; Dallas County, TX; Riverside County, CA; Queens County, NY; and San Bernardino County, CA.
About 142 out of 486 counties, or about 29% of the US, had an affordable median-priced home in Q4 for the average wage earner. Those counties were: Cook County (Chicago) IL; Harris County (Houston), TX; Wayne County (Detroit), MI; Philadelphia County, PA, and Cuyahoga County (Cleveland), OH.
The report listed ten more counties where the average American could afford to purchase a home in Q4: Franklin County, OH; Oakland County, MI; Allegheny County, PA; Mecklenburg County, NC; and Fulton County, GA.
Stagnate wages and excessive monetary policy via the Federal Reserve have contributed to an affordability crisis across the country. At least 34% of Americans, or approximately 100 million people, are in the renting economy, which has plunged homeownership rates to lows not seen since the 1960s.
Almost half of US workers between ages 18 to 64 are employed in low-wage jobs, a recent Brookings Institution report found. Low wage jobs represent between 33% to 66% of all jobs in more than 400 metropolitan areas across the country.
“The Greatest Economy Ever” could be a reality for the top 10% of Americans who are a majority of the asset owners and have benefited from the Fed pumping trillions of dollars into the financial markets over the last decade. Still, the middle class has been wiped out, now referred to as the bottom 90%, most of them have been left behind and can’t purchase a home in a majority of the country.
Something has to change in the early 2020s, or the extreme wealth inequality that is building up could lead to social unrest. We’re sure the Fed, government and financial elites have a plan to launch People’s Quantitative Easing to thwart riots.
Authorities have power over people, and they enjoy this power. They preserve their power in society primarily by imposing knowledge on people. Authorities have been teaching us everything we know. Nothing can come to us if it does not pass the filters of authorities. We are what the authorities made us become, and it is challenging to escape from it.
If you love baseball, democracy, or god, this is because the authorities made you love it. People hardly get a chance to love something if the authorities did not let them, even though people believe that they have free will. The point is, people may only choose the options that authorities give them. Inconvenient options for authorities are not even accessible to people. For example, society has never developed a knowledge of how to create a just society because the authorities have prevented searching for the solution. When people build something new on the top of the choices the authorities give them, this is only the development of the will of authorities.
Authorities create rules which implement social policy, and people have to obey them. These rules have become the origin of social sciences. Authorities have always supported social ideas that followed their interests and suppressed those that didn’t. Therefore, social scientists have followed the interest of authorities and not of people. As a result, social sciences alienate society from social justice. We may accept that social scientists acted the best they could under the pressure of authorities, but also, their work prevents the progress of society.
Even when social scientists want to improve society, they can hardly do it because the alienated knowledge they accepted from their predecessors put them on the wrong path. Through the history of humankind, authorities have supported the creation of complex social sciences that prevent us from finding the escape from social problems. We think the way the authorities taught us to think, and that prevents us from searching for the bright future of humankind.
Social scientists have developed democracy and presented it as the best political choice of the people, by the people, for the people. According to this introduction, democracy must have been in the interest of authorities; otherwise, it would not be allowed to exist. Authorities have learned that dictatorship initiates a rebellion of people, which may take their lives. They found it more convenient to control the social policy secretly by manipulating people. Today they do it by controlling politicians, scientists, and media with the economic power they possess. I have presented how efficient they are in the article The Conspiracy of the World Exposed. As a result, we have a democracy that follows the interests of the elite and not of people. It is nothing else but a form of dictatorship that keeps preventing the freedom of people. Democracy must have been a designed forgery of the authorities.
We name the authorities in capitalism, the elite. We call them the elite because they do not rule over society openly as authorities historically did, but by secretly using the wealth they possess. Their power is nothing lesser than the power of dictators who openly ruled, but it is much more secure and stable. People cannot replace the elite from power because they do not know who they are. The politicians who work for the elite listen to their messages very carefully because otherwise, they would lose financial support from the elite and would not be able to be politicians.
Scientists know as well if they do not obey the elite, they will not get grants for their researches, and they would not be able to be scientists. This is the reason social scientists present capitalism as a final stage in the development of society. At least by not offering real solutions that might improve capitalism if not replacing it. The whole philosophy of capitalism is to let capitalists make profits. All of the paths that achieve this goal today lead to the exploitation of workers. The capitalism we know is very unjust.
Social scientists prevent ideas which may endanger the status of the elite and support ideas that help the elite survive. The elite has encouraged social sciences to support Marxism because the elite knew in advance that Marxism would put the workers on a wrong path that could not replace capitalism. History has proved it. It also shows that the elite can cheat on the highest intellectuals. If Marxism were able to replace capitalism, the elite would ban it, and not one Marxist would be able to propagate Marxism freely. I have explained it in the article Marx still prevents the progress of society.
All organizations in the western world that fight for a better future need money for their operations, and they can get it only from the elite because nobody else has it. By depending on the elite, these organizations lose their strength in fighting for social justice and a better world. Instead, by being corrupted by the elite, they rather mislead the people and prevent the bright future of humankind.
All the information available to people is created and supported by the elite. The elite owns the mainstream media of the western world, but they hide it. So-called independent media desperately need money for their operations, and they may get it only from the elite because nobody else has a financial power to support them. They pay this support by being obedient to the elite. They do not publish material the elite do not like. On the other hand, when the elite are interested in promoting something, you may find information about it where ever you turn your head. When you see a persistent media reporting, you may be well aware it is created to deceive you.
For example, people are perplexed about what exactly happened on the 9/11 terrorist attack thanks to the elite who invested billions of dollars in the 9/11 false propaganda. They did it to hide their involvement in 9/11, but also to deceive and mislead people. The elite used 9/11 to conquer independent countries around the world and to reduce the freedom of people. The elite are masters of deception. Their manipulation also divides people because then, they cannot change anything. I explained what happened on 9/11 in the article My investigation of 9/11.
Global warming propaganda is about increasing restrictions in CO2 production, which has the intention to keep the power of the elite by preventing the progress of the world, especially in developing countries. Yes, the Sahara desert expands, and the Arctic shrinks as the result of global warming, but it does not affect the rich countries. The elite has created the global warming issue, not because they are concerned about climate change, but because they want to enforce rules to control the world.
In a similar example, the development of nuclear weapons is forbidden in countries that do not have it. It should obliged developed countries to get rid of their nuclear weapons as well, though they do not have any intention to do it.
The elite has initiated all of the events and talks in the western world. Nothing beside it on a public level exists. That means people think the way the elite made them think. That means whatever people do, they can do nothing but support the elite. This is the reason nothing changes. Today’s society is an authoritarian dictatorship that prevents people from freedom of creating and meeting their needs.
* * *
All social problems have their origin in authoritarian systems, and an escape from all of the social issues lies in equal human rights. Equal human rights will create good societies unconditionally by giving everyone the same opportunities. This is what authorities have prevented from all of the history of humankind, and as a result, we do not know even what equal human rights are.
There is no such thing as partially equal human rights because these human rights are not equal. There is only one package of equal human rights, and it should not be rocket science to discover how equal human rights are supposed to look. Everyone can come up with the idea alone if they eliminate all rights that are not equal and try to imagine the equal human rights replacement. The problem is quite simple, and yet, society has not defined equal human rights so far.
To be able to define equal human rights, we need to rethink all of the imposed knowledge authorities have produced through the history of humankind. Social scientists not only do not want to do it, but they also refuse new ideas that reconsider the alienated knowledge they have accepted. Social sciences should develop society, but in fact, they prevent the development of society and the bright future of humankind.
People tend not to accept new ideas that question the established way of thinking. Once we start loving baseball, democracy, or god, we keep loving it no matter what. As a result, people live in a deception created by authorities from the day they are born till the day they die. It alienates them from a good life, and it is tough to change.
George Orwell: “The further a society drifts from truth, the more it will hate those who speak it.”
Mark Twain: “It’s easier to fool people than to convince them that they have been fooled.”
The fight for equal human rights will not be easy, but it is well worth it. Once we start establishing equal human rights, a bright future of humankind will begin. And defining equal human rights is very simple. I did it in the article Equal Human Rights will Build a Good Society Unconditionally.
Chinese President Xi Installs Finance Experts To Avoid “Lurking, Devastating Debt Bombs”
The average forecast for China’s GDP in 2020 could be around 5.9%, indicating that the world’s second-largest economy will continue to experience downward pressure.
Slowing growth, deteriorating financial conditions for local governments, slowing property construction investment, plunging manufacturing investment, and credit crunches in low-tier cities have sparked concerns that China’s big financial meltdown could be nearing.
In response to the elevated financial risks, Chinese President Xi Jinping installed 12 former executives at state-run financial institutions across the country who will support the communist government’s ability to combat banking and debt difficulties, reported Taipei Times.
Some of the most recent appointments have been central bankers, veteran securities officials, and provincial governors, who will also help transition China’s economy from the world’s factory to a service-based economy producing high-quality goods. At the same time, the government is preparing for an extensive personnel reshuffle in 2022, with at least half of its 25 members of the Politburo could be replaced.
Feng Chucheng, a partner at Plenum, an independent research platform in Hong Kong, told Taipei Times that “Bankers are now in demand, as local governments are increasingly exposed to financial risks.”
“These ex-bankers and regulators are given the task of preventing and mitigating major financial risks,” Chucheng said.
The appointments are in response to growth collapsing to a three-decade low in 2019, as traditional monetary policy becomes ineffective to boost the economy.
One reason behind the ineffectiveness behind monetary policy in the country could be due to a balance sheet recession of companies that are paying down high debt loads, in an attempt to deleverage, causing investments to decline and contributing to slower economic growth.
Taipei Times noted that five regional banks have had “liquidity problems this year, raising the prospect of devastating debt bombs lurking in unexpected corners.”
He Haifeng, director of the Institute of Financial Policy at the Chinese Academy of Social Science, said: “Appointing financial vice governors to provinces can help better integrate financial policies into local practice, and to prevent financial risks beforehand.”
And while central banks around the world are cutting interest rates and pumping liquidity into markets on the premise of a return to global growth in 2020, China is currently preparing for a slowing economy and financial armageddon.
While it is a truism that in many respects some form of taxation is needed to provide necessities to a society, in practice many government and social detriments arise as either a consequence to or are derivative of tax policy. I’ve found for myself that fostering a personal goal of avoiding specific taxation or in many cases excessive taxation generally comports with a greater advocacy of morality in several beneficial forms.
First I must emphasize the difference between Tax Avoidance and Tax Evasion.
Tax Evasion is the criminal and / or civil refusal to make payment of taxes a taxpayer is legally compelled to provide as a consequence of earnings or purchases.
Tax Avoidance is the lawful participation in a practice where a taxpayer is not legally required to pay taxes or he or she chooses to abstain from or to minimize activities that generate lawful tax liability.
I am by no means advocating tax evasion and I strongly discourage others to engage in such. While we have an obligation to pay the tax we are required, we are also equally obligated to make use of any deduction or credit of tax we are due.
I believe this topic can be discussed in lengthy detail but for the purpose of brevity a primer should suffice.
In tax avoidance as a moral duty one has to probably accept the notion that not all goals sought by government or especially politicians are benevolent. For nearly the past two decades the U.S. Federal Government’s political leadership has actively engaged in what I consider to be highly immoral behavior. At it’s worst it has willingly engaged in instigating completely elective foreign expeditions and wars that resulted in the deaths of hundreds of thousands of foreign civilians, and thousands of American military personal and citizens. In fact it could realistically be argued that the resolve “to get” individuals who our politicians did not like, such as Saddam Hussein , Assad, and Quadaffi, was so prevalent that Congress and the then presidents convinced themselves that close to a million lives were worth taking out these three men. Men I might add posed no true threat to the people of the United States. So over a trillion dollars of tax payer supplied money and treasury securities went toward those debacles.
I do not take issue with the idea of needing a military to protect ourselves in the ordinary sense, but lately in my life politicians have shown on the federal level that they believe a tool for personal political gain is to cause the death of civilians and our soldiers here to “get the bad guy”. And that looking tough works to get hired in an elected position. I am not willing to reward that behavior.
Often in the past wars have ended simply because a nation depleted itself of money and materiel and could no longer prosecute the battle. It could also be argued that a government being awash in the financial means to fight an elective war would be more tempted to use such means than if it was constrained by a limited budget. For me I do not agree with providing that means so easily.
The first example of “getting the bad guy” I came to realize in my life was President George H.W. Bush’s need to get Bad Guy Manuel Noriega. back in the 1980s. Most of you readers know of this affair so I won’t repeat it. For those who do not feel free to search for “Operation Just Cause”, the almost complete joke of a name our government gave that endeavor.
I remember having a training class with two officers who formerly served in U.S. Special Forces during the invasion of Panama to oust Bad Guy Noriega on drug trafficking charges (or so that was the excuse)–A police action as it was called then. One of the officers said they were sent there to get Noriega and when in country found themselves pinned down by sniper fire. So, they called in an airstrike which leveled a building. Of course they had to defend themselves but I had to wonder what kind of police action this was. I knew that generally when we went to take down a drug dealer in the county it generally did not involve airstrikes and blowing shit up all over town. But it seems that when it involves bad guys our federal government doesn’t like, well what’s a few hundred or thousand civilian lives anyway? I must have missed something when I went through the academy. I thought we had to preserve the peace not destroy it.
Controlling the size and over-reach of government
The old maxim goes, “a government that is big enough to give you everything you want is strong enough to take everything you have” and the more money we supply government the greater it grows in terms of control and want of increasing revenue. Such is the way of empire building.
I’ve seen many examples over the years where politicians here at the state level only curtailed spending when faced with either a crisis of revenue shortfalls or when the voters finally had enough and revoked their ability to tax excessively via the Citizen’s Initiative process or by removal at the ballot box. If we continue to allow government to be provided with limitless amounts of tax revenue it only encourages excessive spending and decreases any need for efficiency. And once again the pols will demand increasing tax rates exacted against citizens just to keep the juggernaut rolling. And the bigger it is, the more it wants to encroach upon others.
The Practice of Tax Avoidance results in stronger, more independent living.
Consider the notion of Conspicuous Consumption, that is the never-ending goal of spending money on “things” to elevate one’s self-image. It is the antithesis of Simple Living.
Living beyond one’s means results in many greater tax liabilities, whether it be in the form of higher amounts of sales tax or engaging in activities that generate tax itself. The simplest form of this involves eating in expensive restaurants in high-sales-tax cities as opposed to buying ordinary food at a grocery store (tax free) and eating at home for fifteen-percent of the cost. The food is also healthier I might add.
The stupidest example I personally saw was a Seattle based restaurant that charged more for pop than beer (due to Seattle’s sugared beverage tax) and because of the higher costs restaurants must pay due to over-regulation , the restaurant added an extra labor cost surcharge which was also subject to sales tax. In the end it cost more than five day’s worth of groceries just so that I could pay more tax and reward a city that is governed by some of the biggest fools in the state.
Yet, if instead we buy ordinary groceries, and don’t support a government that is incompetent, if enough restaurants fail maybe businesses might actually begin to exert some action against bad legislation. Surely this is a bit harsh, but who really motivates politicians, the voter or corporations?
Also ,if we looked carefully as a measure of what type of house or car to buy by the amount of tax we must pay resulting from such a purchase we might soon begin to realize that perhaps we don’t need the biggest, most expensive, most energy intensive, and most arrogant example of a dwelling or vehicle. An eight thousand square foot house that we can barely afford is not only more costly on the environment but can we morally justify our actions when a two thousand square foot house is just as livable? How much more hubris do we need when so much of the world would be greatly pleased just to have clean water and electricity. If instead we took some of that cost savings or superfluous property tax (which would probably be wasted otherwise) and gave it directly to a legitimate charity that actually bettered the lives of others less fortunate than we. Or we could at least be somewhat selfish and keep the money ourselves and not be as strapped for cash.
Beneficial Tax Law Can Elicit Morally Sound Behavior
While it can be debatable as to whether or not subsidies and tax credits result in a net benefit to the intended recipient generally speaking there are times where it does much good.
When deductions to charity are permitted there is a direct link between the amounts individuals give and what tax breaks they receive, and in the absence of such charity is curtailed. The per-capita generosity for Americans is one of the highest in the world and we have a tradition of tax deductions for charitable giving. (Though unfortunately this has lessened recently due to tax law changes). We have also benefited from tax credit schemes that encouraged the purchase of greener vehicles and the willingness of investors to engage in the construction of Tax Credit low-income housing projects to house the under-served. In the latter, the desire for tax avoidance actually put roofs over people’s heads.
I believe it is incumbent upon people to strongly consider how government will use what is given to it. The more power it is given, the less benevolent it will inevitably become. We only need a cursory understanding of history to recognize how usual this is the case. And money is as inseparable from power as it is from greed. The more money you give to politicians, the less freedom you will have.
Powerful Winter Storm To Dump Snow And Ice From Northern Plains and Upper Midwest to Northeast
Winter Storm Gage is producing snow, ice, and strong winds from the Northern Plains and upper Midwest Sunday will move into the Northeast early next week and unleash a wintery mess that could cause severe travel headaches ahead of New Years, reported The Weather Channel.
The storm is expected to traverse across a broad area from Nebraska to Dakotas to northern and western Minnesota. Snow and high winds could produce blizzard conditions in these areas throughout Sunday. Some regions could see as much as 12 inches by Monday morning.
The National Weather Service (NWS) published winter storm warnings, watches, and advisories for parts of the Central Plains into the northern Great Lakes, eastern upstate New York and parts of New England.
NWS warned, “the same winter storm that is impacting areas of the Plains and Upper Midwest will be heading east next week and is expected to bring locally significant snow and ice across portions of the Northeast ahead of the New Years holiday.”
The same winter storm that is impacting areas of the Plains and Upper Midwest will be heading east next week and is expected to bring locally significant snow and ice across portions of the Northeast ahead of the New Years holiday. For more, please visit https://t.co/QoghhWMaO7. pic.twitter.com/7zmBZe2ELU
Then by Tuesday, colder air will swoop into the region from Canada and turn much of the storm into a snow event for eastern upstate New York as well as in central and northern New England. Rain is expected in coastal areas of southeast New England.
The Weather Channel predicts eastern Dakotas to northern Minnesota, northern Wisconsin and the Upper Peninsula of Michigan could receive around six inches of snow by Tuesday evening. Northeastern New York, Vermont, New Hampshire, and northern New England could see six to 12 inches.
WCCO CBS Minnesota shared a video of a school bus sliding sideways down a street amid icy conditions on Saturday.
Well there’s something you don’t see every day! Thanks to Neil D. Marriott for sharing this video of a school bus sliding sideways “downhill” on Eden Prairie Road near Highway 5. | https://t.co/VqSViIxQIJpic.twitter.com/1khKPV1UV4
Earlier in the week, the storm produced wet conditions and heavy fog in Texas, led to this dramatic accident caught on camera:
A shocking tractor-trailer crash in Texas was caught on camera. First responders were on the scene of an accident working to clear the road, when another tractor-trailer was unable to stop. It barreled into cars while troopers had to run to get out of the way. (Video KCBD|CNN) pic.twitter.com/mAvzTHft28
At some point, an economic problem deepens so much that the piper has to be paid. Both in the U.S.and globally, one of those problems appears to be mountains of debt.
Jim Rickards recently issued a dire proclamation about the global debt situation:
Current global debt levels are simply not sustainable. Debt actually is sustainable if the debt is used for projects with positive returns and if the economy supporting the debt is growing faster than the debt itself. But neither of those conditions applies today.
In other words, most of the global debt we’re racking up isn’t being used for productive purposes. Instead it’s being used to service “benefits, interest and discretionary spending,” according to Rickards.
This debt growth should continue. According to the Institute of International Finance (IIF), global debt is expected to pass $255 trillion by the end of this year, and they don’t see the pace of debt accumulation slowing down.
In fact, you can see below how the official global debt has already skyrocketed from about $80 trillion in 1999 to this new record:
The world bank looked at the four major episodes of debt increases that have occurred in more than 100 countries since 1970 — the Latin American debt crisis of the 1980s, the Asian financial crisis of the late 1990s and the global financial crisis from 2007 to 2009.
The bank says that we’re in the fourth episode now, and their prognosis isn’t good. In fact, they called the failure to properly manage the global debt “complacency”:
“The increase in debt globally has already been larger, faster, and more broad-based since the Great Financial Crisis than in the previous three waves. This should be seen as a leading indicator for the possibility of financial crises ahead and shake up the complacency that is evident in macroeconomic policy making today with regard to increasing levels of both public and private debt.”
Jim Rickards thinks the “trigger” for an imminent global debt crisis, if one happens, would boil down to rates:
Low interest rates facilitate unsustainable debt levels, at least in the short run. But with so much debt on the books, even modest rate increases will cause debt levels and deficits to explode as new borrowing is sought just to cover interest payments.
He also thinks that if these debt levels and deficits spiral out of control, it won’t take much to trigger a debt crisis not seen since the 1930s.
World Bank President David Malpass sounded another alarm that if a crisis were to hit: “Emerging and developing economies are already more vulnerable on a variety of fronts than they were ahead of the last crisis.”
Put simply, that means disaster for those economies if the global economy is upended. The ripple effects from such a crisis would also hit the U.S. economy hard.
Once it hits, no amount of wishful thinking, denial, or ignorance will make this problem go away.
Make Sure Your Retirement Stands On Solid Ground
Unabated debt fueled growth on a global scale has put the world economy on a “knife edge of a debt crisis,” if Jim Rickards ends up being right.
So now is an ideal time to consider fortifying your own “economy.” Market optimism is almost always pushed until it’s too late.
If you want to hedge against that, don’t wait to start preparing your exit plan. Consider adding precious metals like gold and silver to your savings, which tend to perform well under uncertain economic conditions.
US Conducts Air Strikes In Iraq And Syria, Targeting Iran-Backed Militia After US Contractor Killed
The U.S. military conducted air strikes in Iraq and Syria against the five facilities controlled by the Kataib Hezbollah militia group in response to the killing of a U.S. civilian contractor in a rocket attack on an Iraqi military base, US Central Command said on Sunday. A U.S. official told Reuters that the strikes were carried out by F-15 fighter jets.
U.S. conducted defensive strikes in Iraq and Syria against 5 Kata’ib Hezbollah facilities in response to recent attacks against @CJTFOIR coalition forces. @ChiefPentSpoxhttps://t.co/YQXUnLzq2F
Iraqi security and militia sources said at least 18 militia fighters were killed and more than 50 wounded following three U.S. air strikes in Iraq on Sunday evening, with Reuters reporting that at least four local Kataib Hezbollah commanders were among the dead, adding that one of the strikes had targeted the militia group’s headquarters near the western Qaim district on the border with Syria.
The Pentagon said it had targeted three locations of the Iranian-backed Shi’ite Muslim militia group in Iraq and two in Syria. The locations included weapons storage facilities and command and control locations the group had used to plan and execute attacks on coalition forces.
“In response to repeated Kata’ib Hizbollah attacks on Iraqi bases that host @CJTFOIR forces, U.S. forces conducted precision defensive strikes against 5 KH facilities in Iraq & Syria [to] degrade KH’s ability to conduct future attacks against @coalition forces.” ~@ChiefPentSpoxpic.twitter.com/g2hmTD4Eqw
— OIR Spokesman Col. Myles B. Caggins III (@OIRSpox) December 29, 2019
“In response to repeated Kata’ib Hizbollah attacks on Iraqi bases that host Operation Inherent Resolve (OIR) coalition forces, U.S. forces have conducted precision defensive strikes … that will degrade KH’s ability to conduct future attacks against OIR coalition forces” chief Pentagon spokesman Jonathan Hoffman said in a statement.
The US has accused Kataib Hezbollah of carrying out a strike involving more than 30 rockets on Friday which killed a US civilian contractor and injured four US service members and two members of the Iraqi Security Forces near the oil-rich city of Kirkuk.
#BREAKING: #PMU released first images of the aftermath of #USAF airstrike at the local command & control base & ammunition depot of #IRGC‘s Kataib Hezbollah terrorist organization in #AlQaim, west of #Iraq. Death of several terrorists including two from #IRGC-QF is reported! pic.twitter.com/q8r1aTRlaH
Earlier this month, Secretary of State Mike Pompeo blamed Iranian-backed forces for a series of attacks on bases in Iraq and warned Iran that any attacks by Tehran or proxies that harmed Americans or allies would be “answered with a decisive U.S. response” which begs the question if today’s attack is just a precursor to a broader Iranian offensive.
And in what may perhaps be an early response to this question, shortly after news of the air strikes, the US evacuated all staff from the Iraq embassy in Baghdad following speculation that Kataib Hezbollah might carry-out a rocket attack in retaliation
And while we wait to see if an attack will indeed take place against the US embassy in Baghdad, there were unconfirmed reports that Kataib Hezbollah had fired four 107mm rockets at Camp Taji where US troops are present and the Iraqi Air Force has a base; the attack was in response to the US airstrike targeting the Kataib Hezbollah’s local HQ.
#BREAKING: Minutes ago, #IRGC backed 47th Brigade of #PMU (Kataib Hezbollah) fired four 107mm rockets at Camp #Taji where #US troops are present & #Iraq|i Army Aviation has a base. This attack is carried-out in response to #USAF airstrike at Kataib Hezbollah’s local HQ in #AlQaimpic.twitter.com/2qrvRpMKOy
A bankruptcy boom has hit the oil and gas industry, and it’s just getting started. Investors have lost their appetite for shale, and energy debt has become among the least desirable in the market.
The industry has been teetering on the verge of mass hysteria for much of 2019 as a record number of energy companies folded.
According to Energy and Restructuring law firm Hayes and Boone’s, a grand total of 50 energy companies filed for bankruptcy during the first nine months of the year, including 33 oil and gas producers, 15 oilfield services companies and two midstream companies.
In contrast, 43 oil and gas companies filed for bankruptcy for the whole of 2018.
The biggest oil and gas bankruptcy of the year–indeed, the biggest since 2016–was EP Energy, which filed for bankruptcy in October, unable to pay back some $5 billion in debt.
Now, some observers are warning that the shakeout will pick up serious momentum in 2020.
Bingeing on Debt
During the latest shale boom, the putative class valedictorian of the modern energy industry, American drillers binged on mountains of readily available debt as they capitalized on investors and financiers willing to gamble on the premise that fracking operations could be significantly cheaper and more efficient than conventional drillers.
Before long, oil markets were flooded with a deluge of the commodity far outstripping demand. In what few could have foreseen, the US became the world’s largest oil producer, with its nearly 13 million b/d output turning it from a net importer to a net exporter of crude. Predictably, prices tanked by a sizable margin, dropping to levels well below the breakeven points of many drillers.
Suddenly, investors became wary of the shale industry and energy debt became anathema.
They have good reason to be scared.
Companies with junk-rated bonds have been defaulting on interest payments at record levels, while dozens of smaller drillers that had saddled themselves with too much debt have been dropping like flies.
Now analysts see this taking an even sharper turn, with more mergers and more debt restructurings required to get the industry back in shape.
As Ken Monaghan, Amundi Pioneer co-director of high yield, has told CNBC:
“We’re at the early stages [of the shakeout]. The problem is some of these companies still have a bit of rope to go. they don’t have [debt] maturities that are coming up in 2020 and 2021. They’re going to try to outrun the clock and hope that oil prices move higher.”
Michael Bradley, energy strategist with Tudor, Pickering, Holt, has expressed a similar sentiment, saying that the market is no longer rewarding energy companies with aggressive expansion schemes, preferring instead to see profits and money returned to shareholders.
“Most people are saying we don’t want you to spend money on growth. We want you to give the money back because you guys are dummies.”
Monaghan says there are more distressed companies in the energy sector than in any other, with energy bonds only recently moving to the green after remaining in losing territory for much of the year thanks to the latest oil price mini-rally.
Bradley estimates that about $30 billion- $40 billion of high-yield energy debt [bonds] is now at risk. These companies have little choice but to seek bankruptcy protection and restructure if they hope to live to see another oil boom.
Catch 22
Shale drillers face a catch 22 situation because of the very nature of their business. Young shale wells decline at notoriously fast clips, with many depleting 70 percent to 75 percent of their reserves in the first year, thus forcing shale drillers to continue drilling new wells to replace lost supply. But with a freeze-out in debt and oil prices still low, they are bound to find it increasingly hard to keep up production.
Bradley sees many mid-cap oil companies resorting to mergers in order to survive with an estimated $2B-$7B in M&A deals over the next two years.
These won’t be the usual gilt-edged mergers with fat premiums, though, as the tie-up between WPX Energy and Felix Energy has proved. This was a smart and sober $2.5-billion tie-up that reflects the fact that investors have soured on the sector.
In other words, the consolidation wave that everyone seems to expect is going to focus on smart deals, or none at all.
This also means that large-cap independent players such as Concho Resources Inc. (NYSE:CXO) and Diamondback Energy Inc. (NASDAQ:FANG) are likely to see their market shares grow.
Ultimately, the ongoing shakeout is likely to leave the industry in a much better patch, though not so much for the consumer who will have to contend with higher oil prices thanks to higher levels of production discipline.
China Launches Stealth Rate Cut By Switching Benchmark Lending Rate, Lowering Funding Costs
More than 4 years since the last official Chinese rate cut (not of its far more targeted Required Reserve Ratio but its broad Benchmark rate), economists and pundits were wondering when, if ever, Beijing would finally cut its main rate again to ease financial conditions again at the broadest level and boost fading corporate profits while kickstarting the country’s moribund economy whose GDP is now growing below 6% GDP, the lowest on record. To be sure, China has had its share of setbacks in the past year preventing it from implementing the type of monetary policy it desires, most notably soaring food inflation as a result 110% pork CPI…
… even as producer prices, a driver of industrial profits, slumped below zero earlier in 2019, a clear indicator that China’s enterprises desperate for lower rates.
And yet, a wholesale easing, such as cutting the benchmark rate, could potentially spark even more food inflation, setting off violent popular protests. After all, the Chinese population’s patience is already running thin, forcing Beijing to scrap import tariffs on US pork exports, a move which Xi Jinping (and Trump) quickly spun as a trade war concession, but in reality was a matter of preserving the peace for China which is desperate for any sources of cheaper protein to keep its 1.4 billion people fed, and happy.
Well, overnight China finally did what so many had been expecting to do, if once again it did so in a roundabout way.
Remember that back on August 17, China’s central bank unveiled detailed measures on its long-awaited interest rate reform by establishing a reference rate for new loans issued by banks to help steer corporate borrowing costs lower and support a slowing economy.
As a key part of the rate overhaul, the Loan Prime Rate (LPR) would eventually become the new Benchmark Reference Rate to be used by banks for lending which is aimed at supporting funding as well as lower borrowing costs for small businesses; the rate will be set monthly (20th of every month) and will be linked to the Medium-term Lending Facility rate. The current 1 year LPR stands at 4.15% after its latest cut on Nov 30 versus the Benchmark Rate 4.35%.
So even with the PBOC pushing the LPR lower by 10bps since its August inception, the benchmark rate has remained unchanged at 4.35% since October 2015.
It is in this context that on Saturday, China’s entire interest rate framework was overhauled when the PBOC ordered lenders to adopt the new LPR rate as the de facto basis for all credit from next year, marking an end to the previous benchmark in what Bloomberg said was another step toward liberalizing the financial system (although many disagree).
In a statement, the PBOC said that financial institutions should stop using the old lending rate as the pricing reference for all credit from January, and gradually convert existing loans to a new base using the loan prime rate, from March to August. The one-year lending rate had provided the previous anchor for loans across the economy.
And since the PBOC is effectively forcing lenders to adopt a reference rate that is 20bps lower than the benchmark, Saturday’s announcement is effectively stealth easing, and will lower costs for the roughly 152 trillion yuan ($21.7 trillion) in yuan-denominated outstanding loans held by financial institutions and boost economic growth, even though – as with most things in China – it does not involve a straightforward cut to interest rates.
The transition is “in line with the need to further reduce the financing costs for the real economy, although there’s still a long way to go,” said Fan Ruoying, analyst at the Bank of China’s Institute of International Finance in Beijing, as quoted by Bloomberg. The shift to the LPR comes at a time when Beijing has unveiled a raft of pro-growth measures, including tax cuts, more infrastructure spending, reductions in the amount of cash banks must keep on reserve and lending rates to boost credit.
Ironically, while the move will benefit end-consumers and debtors, it could have an especially adverse impact for creditors, forcing even more bank failures, bank runs, bailouts and nationalizations. As Fan warned, “the move will present more challenges for commercial banks because the interest margin will be squeezed and lenders will need to improve their pricing ability.” As a reminder, many of the small and medium-bank failures that took place in 2019 – and there have been more this year than ever on record – have been attributed to the ongoing drop in rates that banks can charge client which in a time of shadow bank crackdowns, has meant more bank failures amid a flattening of the Net Interest Margin curve.
“The purpose of the step is to make interest rates more market-driven and help lower financing costs,” said Wen Bin, an economist at Minsheng Bank in Beijing.
To be sure, the impact of the loan reform won’t be groundbreaking as most new loans issued in the past 4 or so months already track the LPR: “By now close to 90% of new loans are priced with the LPR, but outstanding loans with floating rates are still based on the benchmark lending rate,” the central bank said in a separate statement. That means the real lending cost “can’t reflect changes in market interest rates.”
Why did the PBOC decide to shift to the LPR, which we also dubbed China’s Libor rate when we discussed it in the summer, besides providing it a convenient way to cut rates by 20bps without actually implementing a 20bps rate cut? As a reminder, the rate which will become the benchmark for new loans this year, is based on the interest rate for one-year loans that 18 banks offer their best customers. Banks submit the quoted price each month in the form of a spread over the rate of the PBOC’s medium-term loans.
According to Bloomberg, the move may help make monetary policy more effective, resolving a long-standing problem in which cheap funding that the PBOC offers banks doesn’t result in cheaper loans to businesses. In the new scenario when all borrowing is based on the LPR, the supply of central bank funding or cuts to the rates of medium-term loans will in theory push down the LPR, and reduce the cost of all lending to businesses. One can almost call it trickle down credit with Chinese characteristics…
Whether or not such a move will succeed remains to be seen, but one thing is certain: the transition to just one short-term rate will simply somewhat China’s arcane rate system. The following Bloomberg explainer makes it clear why this was long overdue: most central banks govern the price of money in an economy via the rate that banks are charged to borrow cash over short time periods. In China, that approach had been divided into two steps. First, the PBOC guided prices for funding in the inter-bank market via its reverse repurchase agreements and medium-term lending facility. Then, it set the benchmark rates that were used to price mortgages, business loans and other commercial lending – the one-year and five-year lending rates.
So will a successful transition from a benchmark to an LPR rate stoke another asset bubble? Perhaps, although the PBOC is careful to avoid overheating among China’s most important assets: housing. While the interest rate of home mortgages should also be converted to the LPR, the central bank said that the new borrowing cost must be the same as the current charges to “reflect the request to regulate the property market.” Eventually, at some point in the future, home mortgages could be repriced in the future, based on the LPR, the PBOC said, giving itself a buffer for when China’s housing market takes its next leg down.
And while Bloomberg concludes that this latest stealth rate cut shows the PBOC’s “commitment to making the interest-rate system more market-driven” controls on deposits remain for now. In short, the step-by-step approach appears to be trying to open up the system without shrinking interest margins too rapidly and adding more pressure to smaller lenders. Unfortunately, with numerous banks having already failed previously in 2019 (as discussed here), and with more than half of China’s banks failing a recent central bank stress test, the only guaranteed outcome from this weekend’s effective rate cut is that, paradoxically, it will only accelerate the rate of failure of China’s already cash strapped, and in many cases insolvent, banks.
Which begs the question: did Beijing, in hopes of gently stimulating the economy, start a cascade of failures that will eventually drag down more than just the small and medium banks (and result in the executions of many more bank CEOs) despite such “brilliant” marketing ploys as offering a pound of pork to starving savers with every new deposit, and precipitate China’s long-overdue financial crisis?
Imperialist spinmeisters are trial-ballooning a new Syria narrative that is so breathtakingly stupid it needs its own article solely for the purpose of mockery.
On Christmas Eve PBS aired a bizarre segment on the death of James Le Mesurier, the former military intelligence officer who founded the extremely shady propaganda construct known as the White Helmets. The segment makes relentless, ham-fisted appeals to emotion, even attempting to associate the White Helmets with Armistice Day using wistful camera pans over poppy flowers and misty war memorial art exhibits, but by far the most yogurt-brained part is its repeated suggestions that Le Mesurier killed himself because people had been accusing him of being a propagandist.
“And now a story of a humanitarian trying to help Syria: the suspicious death in Turkey last month of James Le Mesurier, the co-founder of the White Helmets rescue organization in Syria,” opens PBS News Hour’s Judy Woodruff.
“Friends and colleagues fear that he may have been murdered or driven to suicide by a campaign of character assassination.”
“Whatever the cause, Le Mesurier was a victim of a very modern war,” the special’s narrator solemnly intones.
“There is no hiding place in cyberspace. Le Mesurier was at the epicenter of a propaganda war, and his friends are appalled at what they regard as a campaign of character assassination.”
“The amount of abuse, the amount of ill-placed propaganda, disinformation that’s on social media and the Internet coming out of Russian bots and Syria, Syrian regime, and others was unbearable,” Col. Hamish de Bretton-Gordon mourns.
This ridiculous narrative was picked up and run with by Syria narrative managers on Twitter.
“This is a disturbing report by Malcolm Brabant on the lethal consequences of conspiracism. It shows how slander and disinformation may have pushed James Le Mesurier, one of the finest humanitarians, to his death. The report highlights the pernicious lies issuing from the self-described ‘Working Group on Syria, Propaganda and Media’, which is a small group of academics, none specialising in Syria or the Middle East, in alliance with a group of pro-Kremlin trolls like Vanessa Beeley et al.”
It is true that both Beeley and the Working Group on Syria, Propaganda and Media have accused Le Mesurier of running a propaganda operation on behalf of western governments using western government funding. But if Ahmad truly believed that accusing people of conducting propaganda caused them to kill themselves, he should turn himself in for attempted murder, because he accuses people of being propagandists constantly.
Here’s a link to Ahmad calling journalist Max Blumenthal a “propagandist for Maduro”. Here’s a link to Ahmad calling Beeley a “pro-regime propagandist”. Here’s a link to Ahmad calling award-winning journalist Jonathan Steele “a fabricator and a propagandist”. Here’s a link to Ahmad calling CIA whistleblower John Kiriakou “a propagandist for Putin”.
Talk about “lethal disinformation”, Idrees.
Alexander “I’m so far left I agree with Mike Pompeo on every foreign policy issue” Reid Ross also assures us that questioning establishment Syria narratives definitely kills people. https://t.co/RyDlQ7Ex7X
But of course, no one really believes that accusations of conducting propaganda actually drive people to suicide. If that were so, people like me would have thrown ourselves off a building years ago.
I am accused of being a propagandist nearly every day. At the height of Russiagate hysteria it happened many times a day in my blog post comments and social media notifications. Depending on what’s in the news and how I’ve responded to it I’ve been accused of writing paid propaganda for the Kremlin, Assad, the Iranian government, Palestinians, Pyongyang, Beijing, Maduro, the alt-right, George Soros, and WikiLeaks, just off the top of my head.
Every anti-imperialist, anti-interventionist, and antiwar activist with any kind of platform has had this experience. Ever since the new McCarthyism of establishment-driven Russia hysteria took off, accusing people who question imperialist narratives of conducting psyops for foreign governments has become the norm in political discourse. It’s created an extremely hostile and vitriolic environment in which productive conversations are vanishingly rare.
Where’s our PBS special? Does anyone care? Is there any compassion from these hand-wringing establishment loyalists for the fact that Vanessa Beeley and the members of the Working Group on Syria, Propaganda and Media are hounded day in and day out by establishment narrative managers and their brainwashed followers with accusations of spreading propaganda, supporting genocide, and embracing war crimes? I know I’ve never had a garment-rending Idrees Ahmad thread written about concerns for my psychological well being, and I’ve been targeted by multiple online harassment campaigns over the years.
The amount of hateful vitriol that gets leveled at people for simply opposing imperialism, for wanting peace, is truly astonishing. Just for saying “Hey here are some reasons we should maybe reconsider toppling yet another government in yet another Middle Eastern nation” will bring in complete strangers calling you all sorts of names, calling you disgusting, calling you evil, calling you a monster. For supporting peace.
There are all kinds of people in the world who are very deserving of harsh words. Powerful exploiters, oppressors and manipulators. People who destroy the environment for profit. People who get rich selling weapons of war while paying politicians and think tanks to advance the cause of war. War criminals who’ve never faced justice. With all those people in the world who we can all agree are terrible, you wouldn’t think peace activists should feature anywhere near the top of anyone’s list. But they do. Because war propaganda is just that influential.
And, of course, nobody cares. None of these narrative managers care about what psychological burden they might be placing on people by assuring their audiences that it’s perfectly sane and normal to hound and harass anyone who questions imperialist propaganda. Their concern is not and has never been about anyone’s psychological health. Their concern is in managing narratives in a way that favors the US-centralized empire that they serve.
I do not know what caused Le Mesurier’s death; to be in any way confident that a known spook committed suicide at all, or was murdered by Russians, is absurd. Maybe he killed himself because he failed to listen to the adage “Before you diagnose yourself with depression or low self-esteem, first make sure that you are not, in fact, just surrounded by assholes.”
What I do know, with absolute certainty, is that only idiots believe that skepticism about western regime change agendas in the Middle East kills people.
'Mass Stabbing' At Jewish Hannukah Celebration In New York, At Least 5 Injured
At least 5 people have been stabbed after a black male entered Rabbi Rottenburg’s Shul, located in the Forshay neighborhood in Monsey, New York, and pulled out a machete.
As VosIzNeias.com reports, the alleged assailant pulled off the cover and stabbed at least 5 people. One of the victims was stabbed in the chest. Two of the victims of the attack were taken into hospital as critical.
One of the victims was stabbed at least 6 times.
The fifth/least severe case had a cut in his hand.
The perpetrator then ran out and escaped in a vehicle. His plates were spotted before he left (HPT-5757 per the person who saw it and we confirmed it with him directly – a Gray Nissan Sentra), and the police are currently searching for him.
Videos of the stabbing attack began disseminating on social media.
Motti Seligson, director of media for Chabad.org, told The Jerusalem Post that the congregants, Hassidim, were gathered for a Hanukkah party and confirmed the preliminary details of the event.
Video from the scene of the stabbings at a synagogue in Monsey where Chassidim were gathered for a Hanukkah celebration. pic.twitter.com/wQhWp9SrdA
The Orthodox Jewish Public Affairs Council said five people, all Hasidic, were transported to local hospitals with stab wounds.
At 9:50 this eve, a call came in about a mass stabbing at 47 Forshay Road in Monsey (Rockland County; 30 miles North of NYC). It’s the house of a Hasidic Rabbi. 5 patients with stab wounds, all Hasidic, were transported to local hospitals.
OJPAC also noted that “the perp’s face was partially covered with a scarf but skin showed him to be an African American.”
New York Attorney General Letitia James tweeted support for the Jewish community shortly after the reported attack.
“There is zero tolerance for acts of hate of any kind and we will continue to monitor this horrific situation,” the tweet read in part.
“We are closely monitoring the reports of multiple people stabbed at a synagogue in Monsey, NY (Rockland County),” a representative of the New York City Police Department Counterterrorism Bureau tweeted.
Hatzalah emergency response team is on scene and victims have been transferred to the hospital.
One of five (total number is developing) reported stabbing victims tonight after a man brought a knife into a rabbi’s house during an anti-Semitic attack https://t.co/vQ5mgLdKZMpic.twitter.com/A3QazlqEBN
Even the most curmudgeonly boomer would probably agree that the millennial generation is struggling. Though they have no great wars to fight (in the West, wars are now fought by volunteers), millennials are facing enormous loads of student debt, stagnant wages, and an entrenched sense that the future looks bleak. Whatever skills they have learned will likely be rendered unmarketable thanks to AI, and anybody who isn’t programming the machines and computers who will run our future society should fear them.
As a group, those aged 23 to 38 earn less and have fewer assets than their parents. But across the US, there’s a pretty wide variance in living conditions, and for millennials who need to watch every penny, certain states make more hospitable homes than others.
In a recent research project, Zippia.com determined the 10 worst states/territories for millennials. They are:
District of Columbia
Georgia
New York
Florida
North Carolina
California
South Carolina
Alabama
Louisiana
Mississippi
As a region, the south is the most heavily represented on this list, accompanied by states with expensive urban enclaves where young people flock seemingly to live in penury while they follow their dreams chasing those entertainment and media jobs that will seemingly never provide a realistic paycheck (the share of millennials in their 20s and even into their 30s who depend on financial support from parents has never been higher).
To arrive at its rankings, the researchers assigned number values for each of four categories: millennial unemployment rate, average student loan debt load, millennial home ownership and the percentage of millennials living in poverty.
A city known for its ridiculous housing prices, one in four millennials in our nation’s capital live in poverty. They also have the highest average student loan debt in the nation.
Though housing is relatively affordable in Georgia, and the student-debt burden is much lower than Washington DC, roughly one in five millennial Georgians live in poverty, which is enough to secure the No. 2 spot on this list.
Low home ownership rates coupled with brutally high rents make New York a no-brainer for the No. 3 spot. Millennials also face high poverty rates and burdensome student debt loads.
The state best known as a sunny place for shady people, one in five of the state’s millennials live in poverty. Setting the numbers aside, the proximity to Florida Man can’t be easily quantified, but it definitely sucks.
Piss-poor policymaking in Sacramento has saddled Californians with expensive housing prices (because endless environmental regs make building so expensive), while nature is punishing the state with wildfires and a brutal drought that finally ended this year. Homeownership is simply out of reach for all but the wealthiest tech industry drones.
Things aren’t easy for millennials down by the bayou. Like Alabama before it, young people face high rates of poverty and unemployment. But at least they can drink their troubles away in the Big Easy.
Hardly a surprise. One of the only Southern states that’s entirely devoid of a large urban commercial center (the largest city is the capital, Jackson, and it’s the only municipality in the state with a population of over 100,000 people), Mississippi is known for grinding rural poverty in communities where jobs, solid housing and even basic services like supermarkets can be hard to come by.
If your state isn’t listed above, you can see where it fell on the list here.
During the 1990’s I served as a militia leader in Texas; it was after Federal agents killed Vickie Weaver and her son in Ruby Ridge, Idaho (1992), the Branch Davidian massacre in Waco, Texas (1993), the Assault Weapons Ban (1994), and the Oklahoma City bombing (1995). The nation was in turmoil. The Clintons were in power with “Bloody Janet” Reno as Attorney General. Even the Home-Schooling movement was under fire by the Clinton cabal. We were told it “took a village’ to raise our children–but their village was full of unpatriotic idiots.
Democrat Ann Richards (responsible for the illegal military involvement at the Waco massacre) was Governor of Texas, and we had almost no gun rights. You couldn’t even legally carry a pistol in your vehicle unless you could establish that you were “traveling” and staying away from home overnight (keep a suitcase in the trunk). By 1996 the militia movement was in full swing across the nation, with a bunch of poorly-trained men and women in camo, faced off against well-armed federal agents, law enforcement and the National guard. To say it was a powder keg would be an understatement. To make matters even more dangerous, the feds were using undercover operatives to stir up and instigate violence in militias.
Today when I see people write about how close to a revolution we are, I understand the sentiment, but you ain’t seen nothing yet! Wait until you decide to group together, armed and wearing some kind of military uniform, making loud anti-government statements, and planning your resistance! Lots of interesting things will follow!
Siren’s Song
Oh, the romance of being a revolutionary: square-jawed, armed and dangerous, feared by men, admired by women and children–and your dog. But mostly it gives you a chance to buy loads of expensive, dangerous-looking toys and cool camo gear! Who could resist swaggering around with salty BVD’s, and a full complement of “weapons of war” strapped to your body? Then there are bivouacs where, after a hard day of standing around in the woods, you sit around a campfire talking shit. Maybe, if you’re lucky, one of the militia members has some acreage where you can waste a couple of hundred dollars praying and spraying ammo in the general direction of a target—it’s all about the noise! The member with the loudest gun wins. And let’s not forget the comradery forged in the fires of Hell as you and your buddies fight off mosquitos during practice night missions while humping the seventy pounds of gear (mostly useless to real guerilla fighters) someone convinced you to purchase.
Brief History
During the 1990s, the media managed to paint the militia movement as a dangerous bunch of kooks. Many will tell you that the bombing of the Murrah building in Oklahoma City was a government-initiated operation to further alienate the public. For many reasons I won’t get into here, I wouldn’t argue with those people.
The Clinton administration was very unpopular, and the last thing they needed was a national uprising. Bill Clinton was cozy with the United Nations. Globalization had reared its ugly head in the form of NAFTA and the World Trade Organization (which followed GATT). I don’t have the space to cover how these organizations crippled the US economy or affected society, so you will have to do some research on your own. Suffice it to say that both Republicans and Democrats in Washington were working together (still are) on the financial demise of our nation and its sovereignty. The Assault Weapons ban was a bi-partisan fear-response to the threat posed by a well-armed civil resistance.
To Be or Not to Be a Militia Member
The first question you have to ask yourself is what you hope to gain by putting a government target on your back, and those in your family. In 1997 I hosted a national militia meeting on my property in Texas; it was a large encampment of militia leaders and members from all over the country. We even made the cover of Time Magazine as a “militia hotspot.” What was the goal of this get-together?
Before I begin, let me tell you a funny story. During our camp set-up, we rented one of those huge blue and white striped tents (urban camo) and enough chairs to fill it. The day before our official agenda began, Channel Eight of Dallas sent a news chopper out to film our camp from the air. Seeing a bunch of people with AK’s slung over their shoulders, the chopper flew a wide circle around the camp–so wide they couldn’t get decent footage. They spent so much time flying this distant arc they ran low on fuel and had to leave. About thirty minutes later they came back, this time cautiously venturing in closer and closer; eventually, the side door opened and their cameraman began filming. I guess they decided we weren’t going to shoot them out of the sky. The point of the story is how the media had bought into their own militia boogeyman narrative.
“They” will set you up
Now back to the purpose of the meeting. Militia leaders were being picked off by the federales via entrapment schemes similar to what happened to Randy Weaver in Idaho. Government informants joined these groups and set up the leaders by doing things such as planting explosive devices (pipe bombs) on militia leader’s property to be “discovered” during federal raids. Other informants acted as instigators (our Texas group had one) prodding leaders and members into taking action that would unnecessarily put the unit in danger (physical and legal), and in a bad light to the public. Some informants got militia members on tape talking about planning illegal activities (this was actually a lot of empty bullshit boasting).
The national meeting acted as a sounding board so that other militia leaders could be informed of the risks they were taking. I also believed that we needed a strong joint public statement about our mission and our intentions. So, we invited the FBI and any law enforcement members who might want to attend—we knew they would find their way in anyway. A local sheriff deputy sat in his car across the road, watching with binoculars; my neighbors kept goading him into going up the hill to our event. He declined. Back then police were taught to be afraid of militia members and mental patients. At least we were in good company.
The negative government public relations campaign didn’t always work. During the national meeting, several families came to the gate with food and encouragement. My rural neighbors supported and encouraged what we were doing. When a Dallas news team gathered, interviewing people off our property, they only found one person (not a local) who said anything negative—guess which interview made the nightly news!
I haven’t seen Clint Eastwood’s movie on Richard Jewel yet, but the Atlanta bomb that Jewel discovered was most likely planted as a false flag. Working as security, Jewel found the package and reported it. He paid the price for screwing up their operation. In a joint personal assault, the federal government and the media tried desperately to paint him as a domestic terrorist. Interestingly, the feds never investigated anyone else for this crime. See the movie.
Who joins the militia?
There were very few militia members with military experience. The ones, like myself, that had experience were Vietnam Vets. If you were around back then you will remember how vets were painted by the media as dangerous, wild-eyed camo-wearing kooks. It seemed that not a month went by without a violent incident involving a veteran. Just as school shootings are now, the media rushed to cover every veteran-involved incident. We were still wearing the scourge of the Vietnam War, and most media types came from the same liberal group that protested the war. Back then, no one knew anything about PTSD, and the VA denied such a malady existed (kind of like Agent Orange). The term “postal” was derived from Vietnam Vet Post Office employees losing it and shooting up the place. Occasionally a VA center would be the target. Eventually, many of these vets got help, but not nearly soon enough for them or their families. I digress.
Most newbie militia members had no experience, and putting these well-intentioned, patriots in a real military-type operation would have been leading lambs to slaughter. A militia leader had to be realistic about his members and their capabilities. If you were lucky you would have at least a sprinkling of country people with firearms and woodland experience. At the time, people were coming in from everywhere because so many were concerned about a government mass round-up of dissenters and/or a societal breakdown where the bad guys could come from anywhere. I personally focused on gun safety, weapons familiarization, and marksmanship. Additionally, we worked on techniques for traveling safely during times of unrest, home defense, and survival.
There was a reason so many people were worried about citizen internment. The plan for FEMA concentration camps was real. Former Congressman Henry B. Gonzales, R, of Texas, publicly admitted their existence and their purpose (contain people during a period of mass unrest). State troopers had been put on alert to be watchful for anyone who might be a militia member. Sheriffs and municipal police across the country were being fed scary bullshit by the FBI, and law enforcement was running around with hair-triggers during traffic stops.
Nothing has changed–for the good
I guess I have spent most of your time talking about how things were “back in the day,” but you can count on the same dynamics this millennium. The government is much more sophisticated in keeping an eye on citizens, and there are thousands more armed government agents. You have to assume that everything you do or say is being monitored by Big Brother. The good news is, if your group stays small and keeps their mouths shut, the feds are unlikely to bother with you. If you are looking for strength in numbers, assume you will have at least one informant in your group.
Cull these members out immediately
Gung-ho members who encourage aggressive illegal actions should be expelled immediately. Now, that may rub some patriots the wrong way, but to do otherwise is to set up your members for potential prison time. Just like in other relationships, everyone is not trustworthy. If you have a member(s) go off the rails and do something stupid, you are all guilty by association. If, on the other hand, you are willing to “take a stand” like they did at the Bundy Ranch in Nevada, just be aware it will be expensive and you risk your lives, family fortunes, and many years behind bars. Only you can know if the price is worth it. Also, be aware that if you have an informant or agitator in your group, your operation may be compromised in advance and your members put at risk, physically.
The FBI planted a secret informant and FBI agent in the militia in 2008 to record the activities of the group. The video and audio recordings became the crux of the federal case, including clips of the elder Stone making anti-government statements and remarks about killing police officers. The defendants all faced a maximum sentence of life in prison. Fortunately, after a very expensive and lengthy trial, most of the members were cleared of all charges. The leader and his son faced weapons charges.
Explosive “experts” (guys who want to show you how to make illegal weapons like pipe bombs, grenades, etc.) should not be allowed in your organization unless you know them really, really, really well—even then you have to worry about other members who might inform on your group. In case you choose to train members on how to manufacture/store illegal explosives or weapons, the risk is great that they will be found and you will be prosecuted. Two militia leaders in South Carolina went to prison when two informants slipped onto their property and planted pipe bombs. The guilty verdict came even though there was testimony from several witnesses, including the informants, that the group had stated repeatedly that it was NOT interested in making explosives or doing anything illegal.
In summary, there are fewer risks in forming your group around like-minded family members and close friends. As you can see from the Michigan Christian militia group–even they were infiltrated. Any stranger brings with them more risks than rewards. A family unit focused on self-protection and survival is your best option. If everyone is trained in survival skills, including marksmanship, and all members are equipped with everything they need, you should be prepared for almost anything coming your way. If society falls apart, or a government, foreign or domestic, imposes itself on the population, your group will have the option of joining with others if you so choose.
With the threat of a “foreign” military (immigrant militias) operating in our country, danger could come from any quarter!
Wealth Of The Richest Surged By $1.2 Trillion In 2019
At the same time that dipshits future Nobel Prize winners at the Fed like Neel Kashkari are walking around pondering why the inequality gap continues to widen in the United States, monetary policy has catalyzed another year of surging wealth for the richest in the country while keeping its boot on the neck of the poorest.
In fact, as Bloomberg notes, the wealth of the 500 richest people surged 25% in 2019. And the riches are coming in atypical fashion.
Among those are social media giants like Kylie Jenner, who became the youngest self-made billionaire this year after her cosmetic company signed an exclusive partnership with Ulta Beauty. She sold a 51% stake in her company for $600 million.
Similarly, the Korean family who helped popularize the Washington Nationals’ rally cry, “Baby Shark, doo-doo doo-doo doo-doo”, is now worth about $125 million.
Another great example is Willis Johnson, who made his $1.9 billion fortune by building a network of junkyards to sell damaged cars.
All of these are examples of just how much money made its way to the richest over the last 12 months. The Bloomberg Billionaires Index added $1.2 trillion, now placing their collective net worth at $5.9 trillion.
Only 52 people on the ranking saw their fortunes decline during the year. Jeff Bezos, for example, lost $9 billion – but only due to his divorce.
The 172 American billionaires on the Bloomberg ranking added $500 billion, with Facebook Inc.’s Mark Zuckerberg up $27.3 billion and Microsoft Corp. co-founder Bill Gates rose $22.7 billion.
Representation from China continued to grow, with the nation’s contingent rising to 54, second only to the U.S. He Xiangjian, founder of China’s biggest air-conditioner exporter, was the standout performer as his wealth surged 79% to $23.3 billion.
Russia’s richest added $51 billion, a collective increase of 21%, as emerging-market assets from currencies to stocks and bonds rebounded in 2019 after posting big losses a year earlier.
Newly minted billionaires included Anthony von Mandl, the man behind “White Claw” hard seltzer and Hong Kong’s Lo family, who are in the business of producing soy milk.
With the market hitting new highs every day and President Trump’s relentless pressure on the Fed to keep rates low, the gap will likely continue to widen heading into 2020 – a year politicians will undoubtedly spend bickering about proposed solutions to the problem, all the while failing to understand that the alarm is coming from the inside, right before their eyes.
The gains are an obvious continued indicator of flawed monetary policy that everybody – except those at the Fed (and Steve Liesman) seems to understand.
As a result, currently, the 0.1% control the biggest share of the pie in the U.S. than at any time since 1929.
The UN Panel on Outrage Change has confirmed the worst: global levels of outrage may reach the point of no return in 2020.
Outrage levels previously reached dangerous highs during the Bush administration, but Obama was able to reverse the trend. He didn’t change much about the way Bush was handling things, but he was a Democrat, so outrage levels went back down as the press stopped reporting on scandals and corruption.
However, in 2016, global outrage reached record highs, especially among Democrats. Republicans had been mildly outraged during the Obama years but mostly had to go to work so didn’t have much time to spew toxic, harmful outrage into the environment. Libertarians have generated almost no outrage since they are high all the time.
Experts believe the reelection of Trump in 2020 would be “catastrophic,” catapulting outrage levels well into the stratosphere.
“If we do not cut our anger emissions immediately, the world will be consumed by fiery outrage by the end of next year,” said outrage expert Dr. Hal Gourd, pointing to a hockey-stick graph.
The audience responded by getting really mad, shaking their fists at the sky and making loud grunting noises.
“Now, now, let’s all calm down,” Gourd said, but this only angered the crowd further.
Finally, Gourd began to freak out as more and more bricks were lobbed his direction.
“OK, FINE, IT’S TIME TO PANIC! AHHHHHH!!!!”
He jumped out a window to his waiting luxury jet and flew away.
Experts recommend everyone stop “yelling and stuff,” so we can prolong our inevitable death by outrage a few years. Those who do not wish to stop being outraged can purchase “outrage credits,” generated by people who are just chillin’.
Musk Tweets Boring's Las Vegas Tunnel To Open In 2020
Elon Musk is on top of the world, has been able to capitulate shorts and send Tesla’s equity price above the $420 per share buyout level, to close at $430.380 on Friday.
With Musk’s ego higher than ever, he tweeted Friday night that Boring Company would complete a commercial tunnel in Las Vegas in the near term and be fully operational in 2020.
“Boring Co is completing its first commercial tunnel in Vegas, going from Convention Center to Strip, then will work on other projects,” Musk tweeted late on Friday.
Last month, we noted how Boring officially won the contract from Las Vegas to build a “subterranean transit system” by undercutting the bids of established players in the engineering space.
We pointed out how Boring is going to have to prove that its technology and talent can scale to municipality size projects, instead of a test run using a go-kart on skates in 50 feet of tunnel.
In July, Boring raised $120 million in a round of funding from gullible cultists “disruptive investors.”
We noted earlier this year that Boring’s tunnel projects were debunked by PhDs and ridiculed by government officials as nothing new: “There’s no revolution here. Let’s be honest here: he’s driving a car through a sewer pipe,” Ph.D. chemist and video blogger Phil Mason recently said.
With the test tunnel completed in Hawthorne, California, and other projects in Chicago and Washinton, D.C. to Baltimore, Musk has made a lot of promises in the past where his timelines don’t exactly come true.
…We’re still waiting for the one million “robotaxis” to hit the streets in 2020, another promise made by Musk.
Cohen: How Impeachment Is Escalating The New US-Russian Cold War
Podcast of John Batchelor Show
Summary of Broadcast Produced by Yvonne Lorenzo:
As the New Cold War gathers up speed and escalates, we are entering a “fact free world” as allegations are made that are proved not to be true are promoted; for example, the allegation that the DNC was hacked by Russia has been officially debunked—no one could name the seventeen intelligence agencies, the Coast Guard was one. The notion of the hacking was cooked up by two agencies: by the DNI’s head James Clapper and Brennan at the CIA. Nevertheless, recently News Anchor Chuck Todd of NBC (the most pro-Russiagate network, the ones who shamelessly accused presidential candidate Tulsi Gabbard of being a Russian asset) took it one step further: ignoring the facts, Todd again stated that seventeen intelligence agencies agreed that the Russians not only interfered in the election but that they swung the election to Trump. While interference is one thing, no one has previously made that allegation. Consequently, we are now in a fact-free discourse in America: no evidence is necessary to prove anything, falsehoods are taken up by the legacy media, what Professor Cohen would call a world of tabloid gossip media, except in their favor the tabloids, fearing lawsuits, will do some fact checking, which is conspicuous in its absence in the legacy media. And Professor Cohen noted that it’s hard to get traction and you can’t have a conversation with someone when you don’t agree upon the facts.
In conversation on a cruise with fellow liberals, Professor Cohen noted most take the view that where there is smoke there is fire and there is something to these allegations of Russiagate and Putin’s control over Trump; they state the media wouldn’t continue to promote these conspiracy theories, these allegations about Trump’s nefarious relations with the Kremlin, without reason and so there must be something to them. Yet while facts have become absolutely critical Cohen notes you can’t get people to focus on the facts; for that reason, he feels despair and observes that for the first time in his life in his public discussions of Russia there are no basic premises that people accept any more, for if you say “If there’s smoke, there’s fire,” that is just not a logical way of thinking: you either have the facts or you don’t.
Batchelor also points out in the impeachment charges there is a great deal of presumption; there are no facts regarding the president as well, and he cites Trump’s letter to Nancy Pelosi and poses this question: what does the Kremlin think about the impeachment?
Cohen answers that the Russian high policy class in the 1990s – the America worship period – they and not just the youth, strongly believed that Russia’s future was with the West and America in particular, and now what strikes Russians most is the role of Russian intelligence services in the Western allegations. Pro-America Russians thought that American intelligence services didn’t play the role that the Soviet ones did. In Russian history classes and as a staple of popular culture, the sinister role of the “secret police” goes back to the Czarist era but what distinguished America was that it didn’t have anything comparable in abuses by its intelligence services—or so it was believed. Consequently, for those who looked up to America, it’s a source of disillusion and shock to learn that the American special services “went off the reservation” for quite a long time, not unlike Russia’s, and so they have become disillusioned while for those who tried to get Russians to be more nationalistic, their perspective is to say with gratification, “We told you so. Now will you please grow up!”
Russians call the American agencies “the organs” perhaps not being clear on the difference between the CIA and the FBI and conflating them. For Russians, the role of such agencies is baked into the culture and this has resulted in rethinking not only about America but about their own special services. An Op-Ed piece in a Russian liberal newspaper the Russian liberal author wrote, after watching what’s unfolding in America, we used to beat up on our intelligence services for decades but now maybe we need them. Contrary to a “cult of the intelligence services,” Cohen thinks what must be determined is the role of the American intelligence services in creating Russiagate from the very beginning.
Yet what is critical is to know how Russiagate began in America, with the Barr-Durham probe into the origins of Russia and Russiagate will continue to be a major issue in the 2020 election. What struck Cohen about the letter from Trump to Pelosi—which was so eloquent he doubts Trump wrote it—was that he understands it will be an issue in the 2020 elections, and it was a campaign document. That aside, Trump is aware that Democrats are campaigning still on Russiagate; nothing has turned up that it factual. Therefore, despite the absence of facts, this will be a major issue. Ukraine has turned into a stand-in for Russia.
Jennifer Rubin of the Washington Post, once a quintessential conservative, published an article titled “Time to Call out and Remove Putin’s Propagandist in America.” While the article is slightly cagier than that headline, essentially she wants to shutdown and deprive access to media who aren’t espousing and promoting the Russiagate/Russophobic narratives. Cohen condemns that kind of behavior is that. On opposite side of Rubin, Cohen stated he himself has never advocated the silencing and removal of those who promote among other falsehoods the provably false Russiagate narrative. He asks where are things drifting and he answers discourse and relations are becoming ugly and awful.
Returning to the past, he notes there was an assumption that Russia under Yeltsin would emerge as a replica and junior partner of America; Cohen believes those who promote the Russiagate narrative and demonize Trump because their “impossible dream” failed—Russia is too old, too vast to ever be a replica of America. What took Professor Cohen aback in the testimony from Fiona Hill and others was how deep and wide the Russophobia runs in the Washington think tanks. Until she spoke and testified he had no idea how much she—and the other Russia experts—hate Russia.
Batchelor noted this is the language of civil war in Trump’s letter; Trump uses the term “Star Chamber of partisan persecution” and “coup” which are the language of a country torn in half and he asked the question whether the weakening of the civil contract to be an advantage to Putin and Russia.
Cohen notes every newspaper and media source in America say Putin is delighted since it is his goal is to foment disarray in America.
The fact is, however, this chaos and dysfunction and enmity is one of the last things Putin wants. Putin’s purpose is to rebuild Russia from the economic and political catastrophes of the 1990s; Putin’s role is to reverse the demographic trend—men died in their fifties in the 1990s—and spend funds on modernization; that would be his legacy. Four hundred billion dollars has been saved to implement the modernization program. That attempt would be taken with modernizing partnerships with the West. Therefore, the last thing he wants is a new Cold War; the last thing he wants is political turmoil in America or in any Western nation. Cohen points out President Macron of France appears to understand that; he called for a rethinking of relations and said there could be no European security without Russia. Macron has broken with Washington and there will be a hell of fight because Washington is against it. But the notion that Putin wants to disrupt American society is wrong; Putin wants stability and partners.
Cohen still thinks that leadership—the new President of Ukraine, Trump and Putin—could make a difference.
'Former Trump Voter' Spotlighted In Democratic Ad Campaign Caught Lying; Didn't Actually Vote In 2016
A Pennsylvania man featured in a $3 million advertising campaign by Democratic ‘nerd virgin‘ commander David Brock’s Super PAC was found to be a total liar, after he feigned regret over voting for Donald Trump in 2016.
“I voted for Donald Trump in 2016because I thought he would make a change,” claimed Mark Graham, a registered Republican who lives in Erie, PA.
“Did he make a change?” asks Brock’s virgin, off camera.
“Not for the good!” Graham replied.
“If I could go back in time, I would tell myself to beware the changes that President Trump has made.”
“Voting for Donald Trump in 2020 would be like putting gasoline on a fire.“
Except Mark was full of shit. An investigation by local news outlet JET 24 action’s Chelsey Withers (as she reports in YourEerie) revealed that Mark didn’t vote at all in 2016, much less for Donald Trump.
And according to PennLive, Mark’s lie caused the New York Times to issue correctionsin two stories about swing voters and disaffected Trump supporters.
“While Mr. Graham acknowledged misspeaking about his voting record, he said the Times article and the ad campaign accurately reflect his feelings about the 2016 race and President Trump’s performance in office.”
Graham told Eerie News that he became involved with American Bridge through a 2018 focus group by Democratic Congressional Candidate Ron DiNicola.
Graham said the focus group was comprised of local Republicans who supported DiNicola’s run for Congress. Former Erie County Director of Administration [G]erry Mifsud was working with DiNicola.
“I sat through this focus group and a New York Times reporter had sought out [G]erry. How he got Jerry I don’t know. Maybe it was DiNicola. Maybe it was the Democratic Party,” Graham said.
The reporter wanted to do a story on President Trump’s popularity in Erie. He asked the focus group how they felt about the president. –Eerie News Now
“That’s when I told him ‘It’s like if you re-elect this guy it’s like throwing gasoline on a fire.’ I just made it up. He said, ‘I like that. I’m going to use that,’ Graham told the outlet.
WikiLeaks has published yet another set of leaked internal documents from within the Organisation for the Prohibition of Chemical Weapons (OPCW) adding even more material to the mountain of evidence that we’ve been lied to about an alleged chemical weapons attack in Douma, Syria last year which resulted in airstrikes upon that nation from the US, UK and France.
This new WikiLeaks drop includes an email from the OPCW Chief of Cabinet Sebastien Braha (who is reportedly so detested by organisation inspectors that they code named him “Voldemort”) throwing a fit over the Ian Henderson Engineering Assessment which found that the Douma incident was likely a staged event. Braha is seen ordering OPCW staff to “remove all traces, if any, of its delivery/storage/whatever” from the organisation’s secure registry.
Minutes from an OPCW meeting with toxicologists specialized in chemical weapons: “the experts were conclusive in their statements that there was
no correlation between symptoms and chlorine exposure”.https://t.co/j5Jgjiz8UYpic.twitter.com/vgPaTtsdQN
The drop also includes the minutes from an OPCW toxicology meeting with “three Toxicologists/Clinical pharmacologists, one bioanalytical and toxicological chemist”, all four of whom are specialists in chemical weapons analysis.
“With respect to the consistency of the observed and reported symptoms of the alleged victims with possible exposure to chlorine gas or similar, the experts were conclusive in their statements that there was no correlation between symptoms and chlorine exposure,” the document reads.
According to the leaked minutes from the toxicology meeting, the chief expert offered “the possibility of the event being a propaganda exercise” as one potential explanation for the Douma incident. The other OPCW experts agreed that the key “take-away message” from the meeting was “that the symptoms observed were inconsistent with exposure to chlorine and no other obvious candidate chemical causing the symptoms could be identified”.
Like all the other many, many, many, many different leaks which have been hemorrhaging from the OPCW about the Douma incident, none of the important information contained in these publications was included in any of the OPCW’s public reports on the matter. According to the OPCW’s Final Report published in March 2019, the investigative team found “reasonable grounds that the use of a toxic chemical as a weapon took place. This toxic chemical contained reactive chlorine. The toxic chemical was likely molecular chlorine.”
We now know that these “reasonable grounds” contain more holes than a spaghetti strainer executed by firing squad. This is extremely important information about an unsolved war crime which resulted in dozens of civilian deaths and led to an act of war which cost taxpayers tens of millions of dollars and had many far-reaching geopolitical consequences.
Yet the mass media, freakishly, has had absolutely nothing to say about this extremely newsworthy story.
As of this writing, a Google News search for this story brings up an article by RT, Al-Masdar News, and some entries by alternative outlets you’ve almost certainly never heard of like UrduPoint News and People’s Pundit Daily.
Make no mistake about it: this is insane. The fact that an extremely important news story of immense geopolitical consequence is not getting any mainstream news media coverage, at all, is absolutely stark raving insane.
Up until the OPCW leaks, WikiLeaks drops always made mainstream news headlines. Everyone remembers how the 2016 news cycle was largely dominated by leaked Democratic Party emails emerging from the outlet. Even the relatively minor ICE agents publication by WikiLeaks last year, containing information that was already public, garnered headlines from top US outlets like The Washington Post , Newsweek, and USA Today. Now, on this exponentially more important story, zero coverage.
The mass media’s stone-dead silence on the OPCW scandal is becoming its own scandal, of equal or perhaps even greater significance than the OPCW scandal itself. It opens up a whole litany of questions which have tremendous importance for every citizen of the western world; questions like, how are people supposed to participate in democracy if all the outlets they normally turn to to make informed voting decisions adamantly refuse to tell them about the existence of massive news stories like the OPCW scandal? How are people meant to address such conspiracies of silence when there is no mechanism in place to hold the entire mass media to account for its complicity in it? And by what mechanism are all these outlets unifying in that conspiracy of silence?
We can at least gain some insight into that last question with the internal Newsweek emails which were published by journalist Tareq Haddad two weeks ago. The emails feature multiple Newsweek editors telling Haddad that they would not publish a word about the OPCW leaks for two reasons: (1) because no other outlets were reporting on them, and (2) because the US government-funded narrative management firm Bellingcat had published a laughably bogus article explaining why the leaks weren’t newsworthy. Haddad has since resigned from Newsweek.
We may be certain that this story is being killed in news rooms all around the world in similar fashion, and possibly using those very same excuses. As long as no other “respectable” (i.e. establishment) outlets are covering this story, it can be treated as a non-story, using a deceitful US government-funded narrative management operation as justification as needed. If one journalist threw his life into chaos and uncertainty by resigning and blowing the whistle on this conspiracy of silence, we may be certain that the same is happening to countless others who don’t have to courage and/or ability to do the same.
Our fearless media watchdogs still maintaining complete blackout on @OPCW whistleblower leaks debunking WMD attack in Douma. The leaks show that Trump—like Dubya— used fake WMDs to bomb Arab country—then strong-armed @OPCW to cover up the lies.https://t.co/bdbzf6py8p
Many alternative media commentators are highlighting this news media blackout on social media today.
“Our fearless media watchdogs still maintaining complete blackout on OPCW whistleblower leaks debunking WMD attack in Douma. The leaks show that Trump—like Dubya— used fake WMDs to bomb Arab country—then strong-armed OPCW to cover up the lies,” tweeted journalist Mark Ames.
“The US attacked Syria for a chemical attack by Assad last year. But official OPCW scientists who investigated the event didn’t find evidence the Syrian military used chemical weapons. The media has chosen to ignore this story and fire its own journalists who try to report on it,” tweeted author and analyst Max Abrahms.
“This is the FOURTH leak showing how the OPCW fabricated a report on a supposed Syrian ‘chemical’ attack,” tweeted journalist Ben Norton. “And mainstream Western corporate media outlets are still silent, showing how authoritarian these ‘democracies’ are and how tightly they control info.”
“Media silence on this story is its own scandal,” tweeted journalist Aaron Maté.
But this spin machine is twirling off its axis trying to normalize this silence.
Surprise, surprise, Wikileaks didn’t leak the next email in this chain from the OPCW questioning why Ian Henderson was creating rogue reports.
This email also quite clearly contradicts “Alex’s” claim that Henderson was in the FFM. pic.twitter.com/qcJkAyXe9W
Bellingcat narrative jockeys such as “senior investigator” Nick Waters are already scrambling to perception manage everyone into believing their own eyes are lying to them. Waters has a thread on Twitter that’s being shared around by all the usual Syria spinmeisters claiming, based on no evidence whatsoever, that WikiLeaks is selectively publishing the documents it has to create a false impression of events in the OPCW. Waters falsely claims that an email by Sebastien “Voldemort” Braha — the guy at the center of the scandal — proves that Ian Henderson was not a part of the Fact-Finding Mission (FFM) in Douma, in contradiction to the claims made by the anonymous second OPCW whistleblower who goes by the pseudonym of “Alex”.
As Waters is one hundred percent aware, Henderson absolutely was part of the Douma Fact-Finding Mission, and one of the FFM members who actually went to Douma no less. I’ve put together a Twitter thread refuting Waters’ ridiculous claims which you can read by clicking here, but in short an arbitrary distinction seems to have been made between the FFM and the “FFM core team”, or what is labeled the “FFM Alpha team” in a newly leaked email trying to marginalize Henderson’s assessment. Henderson actually went to Douma as part of the FFM, unlike almost all members of the so-called “core team” who except for one paramedic operated solely in another nation (probably Turkey).
Of course, the distinction of whether Henderson was or was not “in the FFM” is also itself irrelevant and arbitrary, since we know for a fact that he is a longtime OPCW inspector who went to Douma and contributed an assessment which was hidden from the public by the OPCW.
So this narrative being spun by the US government-funded propagandists at Bellingcat is bogus from top to bottom, but what’s infuriating is that we already know who editors in news rooms are going to listen to.
“We have this alternative media ecosystem that is driving a lot of disinformation. It is not understood by journalists or anyone really beyond a very small group of people who are really engaged with it,” @EliotHiggins says https://t.co/RWi2Mqy8jV
It’s absolutely amazing how tightly interlaced Bellingcat is with the upper echelons of mainstream news media and the public framing of what’s going on in Syria. Mere hours after the latest WikiLeaks drop, CNN pundit Brian Stelter shared an article about Bellingcat founder and former Atlantic Council Senior Fellow Eliot Higgins, who warns of the dangers posed by alternative media reporters who cover underreported stories like the OPCW scandal.
“We have this alternative media ecosystem that is driving a lot of disinformation. It is not understood by journalists or anyone really beyond a very small group of people who are really engaged with it,” reads the ironic Higgins quote in the excerpt shared by Stelter.
We’ve been seeing a mad rush from mass media pundits to give this US government-funded narrative management operation unearned and undeserved legitimacy, churning out tweets like Stelter’s and fawning puff pieces by The New York Times, The Guardian and The New Yorker. This unearned and undeserved legitimacy is then used by editors to justify looking to Bellingcat for instructions on how to think about important information on Syria rather than doing their own basic investigation and analysis. It’s a self-validating feedback loop which just so happens to work out very conveniently for the government which funds Bellingcat.
It remains unknown exactly what’s transpiring in news rooms around the world to maintain the conspiracy of silence on the OPCW scandal, but what is known is that by itself this scandalous silence is enough to fully discredit the mass media forever. WikiLeaks has exposed these outlets for the monolithic propaganda engine that they really are, and they did it just by publishing extremely newsworthy leak after extremely newsworthy leak.
In order to perception manage us any harder, these freaks are going to have to go around literally confiscating our ears and eyeballs.
Democrats Want To Outlaw 'Racist' Single-Family Housing In Virginia
Democratic lawmakers in Virginia want to override local zoning laws and abolish single-family housing, which they say is racist and bad for the environment.
According to the Daily Caller‘s Luke Rosiak, “The measure could quickly transform the suburban lifestyle enjoyed by millions, permitting duplexes to be built on suburban lots in neighborhoods previously consisting of quiet streets and open green spaces. Proponents of “upzoning” say the changes are necessary because suburbs are bastions of segregation and elitism, as well as bad for the environment.”
The proposed changes were introduced on Dec. 19 by VA House Delegate Ibraheem Samirah (D) as part of six housing measures.
“Single-family housing zones would become two-zoned,” Samirah told the Caller. “Areas that would be impacted most would be the suburbs that have not done their part in helping out.”
“The real issues are the areas in between very dense areas which are single-family zoned. Those are the areas that the state is having significant trouble dealing with. They’re living in a bubble,” he added.
He said suburbs were “mostly white and wealthy” and that their local officials — who have historically been in charge of zoning — were ignoring the desires of poor people, who did not have time to lobby them to increase suburban density.
In response to a question about whether people who bought homes in spacious suburbs have valid reasons, not based on discrimination, for preferring to live that way — including a love for nature and desire to preserve woods and streams — he said: “Caring about nature is very important, but the more dense a neighborhood is, the more energy efficient it is.”
He said if local officials seek to change requirements like setbacks to make it impossible to build dense housing in areas zoned to preserve a nature feel, “if they make setbacks to block duplexes, there’d have to be a lawsuit to resolve whether those zoning provisions were necessary.” –Daily Caller
“Because middle housing is what’s most affordable for low-income people and people of color, banning that housing in well-off neighborhoods chalks up to modern-day redlining, locking folks out of areas with better access to schools, jobs, transit, and other services and amenities,” Samirah wrote on Facebook, adding “I will certainly get pushback for this. Some will call it ‘state overreach.’ Some will express anxiety about neighborhood change. Some may even say that the supply issue doesn’t exist. But the research is clear: zoning is a barrier to more housing and integrated communities.”
Important Q about new social/public housing programs: where are we going to put the units?
Under current zoning, new low-income housing is relegated to underinvested neighborhoods, concentrating poverty more.
Ending exclusionary zoning has to be part of broader housing reform. https://t.co/XZZSM7nM8e
Fairfax County Republican Committee Chairman Tim Hannigan told the Caller that urban Democrats are waging war on the suburbs.
“This could completely change the character of suburban residential life, because of the urbanization that would develop,” said Hannigan. “So much of the American dream is built upon this idea of finding a nice quiet place to raise your family, and that is under assault.”
“This is a power-grab to take away the ability of local communities to establish their own zoning practices … literally trying to change the character of our communities.”
“You don’t make mistakes when you don’t have money. When you have too much money, you will make a lot of mistakes.”
– Jack Ma, founder of Alibaba, the Amazon of China
“My view is simple and starts with the observation that gold is a lot like religion. No one can prove that God exists…or that God doesn’t exist…Well, that’s exactly the way I think it is with gold. Either you’re a believer or you’re not.”
– Howard Marks, founder of OakMark, whose newsletter Warren Buffett reads “religiously”
“Because of Paul Volcker, our financial system is safer and stronger. I’ll remember Paul for his consummate wisdom, untethered honesty, and a level of dignity that matched his towering stature.”
– Barack Obama
“Every penny of QE undertaken by the Fed that cannot be unwound is monetized debt.”
– CNBC regular and former senior advisor to the president of the Dallas Fed, Danielle DiMartino Booth
Interest rates and inflation couldn’t be more different today than they were in the 1970s.
One of the shocking surprises of the last decade is that despite ultra-low, zero, or, even, negative interest rates inflation has generally fallen rather than risen.
Yet, when it comes to asset prices (US stocks, global bonds, and real estate), it has been a completely different story.
One asset class that hasn’t risen as swiftly as others is gold and other precious metals.
This underperformance has caused most American investors—be they retail or institutional—to give up on precious metals as an essential asset class.
However, John Hathaway, who is considered to be the “Warren Buffett of the precious metals space,” is much more bullish given all of the macro-economic factors at play.
In the short-term, John and top economist David Rosenberg anticipate we could have a recession in 2020.
This becomes much more probable should financial markets correct hard next year after this year’s historic and euphoric rally.
We are likely to see governments and central banks launch a coordinated blitz made up of additional trillions of pseudo-money and unbridled spending should a recession hit.
With most US portfolios heavily skewed towards paper assets (i.e. stocks and bonds) and nearly devoid of hard assets (i.e. energy producers/transporters, gold miners, copper producers, and agriculture nutrient companies) the stage is set for a significant paradigm shift over the next decade.
TAKING THE HARD WAY OUT
40 years is a very long time, at least in human terms. But when it comes to inflation, the not-so-fine 1979 seems like 400 years ago. It was in that difficult year — with spiking oil prices pushing the CPI up at close to a double-digit rate — President Jimmy Carter appointed Paul Volcker as the head of the Federal Reserve. Even in those days, Mr. Volcker was a larger than life figure—in more ways than one.
He stood 6’7” and he had already earned a reputation as a “hard money” proponent, in contrast to the politically-pliant and inflation-prone Fed heads who had preceded him in the wake of the last strong Fed chairman, William Chesney Martin. The latter was one of the few men Paul Volcker looked up to, reputationally if not literally. He also was the creator of the line that in time would become immortal, at least in economic circles: “It’s the Fed’s job to take away the punch bowl just when the party gets going.”
It was Mr. Martin’s propensity to be a punch-bowl cop that got him into hot water in 1965. He was reluctant to monetarily accommodate Lyndon Johnson’s Great Society and Vietnam war spending sprees. This resistance reportedly caused LBJ to slam his Fed chairman up against a wall at the President’s Texas ranch, bellowing: “Boys are dying in Vietnam and Bill Martin doesn’t care.”
But care he apparently did. Even as the US economy boomed and inflation began to rise at a disturbing clip in 1966 and 1967, Martin only timidly raised interest rates. It was not until President Johnson shocked the world in March of 1968 by announcing he would not run for re-election that Mr. Martin let interest rates really fly. The Fed’s discount rate popped from 4.7% to 5.6% in just two months, the fastest increase in a decade.
Mr. Martin’s lectures to Congress over his 19-year tenure at the Fed revealed a mindset that likely would have put him at odds with LBJ’s successor, Richard Nixon. At the bottom of one economic slump, Mr. Martin warned Congress that you can’t ”spend yourself prosperous.” (He no doubt would have added or “print yourself prosperous” but that was an activity Mr. Martin likely never dreamed his cherished Fed would one day pursue…and pursue…and pursue…and pursue—that’s a pursue for each version of its Quantitative Easings!)*
*The Fed refuses to call its latest money creation blitz QE 4 but almost everyone else is.
For good measure, he remarked on another occasion, ”A perpetual deficit is the road to undermining any currency.” Despite Nixon’s impeccable GOP credentials, Mr. Martin may have suspected an inflationary wolf in sheep’s clothing. He resigned in January 1970, just one year into Richard Nixon’s first term. The next year, Mr. Nixon pulled the US off the gold standard and then proceeded to bully Mr. Martin’s replacement, Arthur Burns, into maintaining excessively low interest rates. This sequence led to Mr. Nixon’s re-election in 1972 but also to the virulent inflation that would haunt America over the next decade. (Do you discern any similarities with what’s happening today?)
Earlier this month, Mr. Martin’s kindred spirit, Tall Paul, passed away at age 92. While most post-mortem commentaries were laudatory, there were a surprising number of criticisms of his anti-inflation campaign which, at one point, raised short-term borrowing rates to 21 ½%. Undoubtedly, many small business owners suffered mightily with the cost of money nearly 10% over the prevailing 12% inflation rate. Some critics even called Mr. Volcker a union-killer, erroneously, in my view, blaming him for the long decline in American union membership that has occurred since the early 1980s.
Of course, interest rates and inflation couldn’t be any different today. Instead of a fed funds rate far above inflation, presently it is below it, even using the Fed’s preferred cost-of-living measure. (More on that topic in a bit). And instead of trying to quash inflation, most leading central banks are striving to force it up to 2% which has, for some reason, become the Holy Grail for the global gods of monetary policy. In most of the “advanced” world, interest rates are negative and, accordingly, well below the inflation rate of that particular country.
One of the shocking surprises of the last decade is that despite ultra-low, zero, or, even, negative interest rates—combined with around $15 trillion of manufactured money—inflation has generally fallen rather than risen. Actually, the popular notion seven or eight years ago, as rates collapsed and central banks began their various Quantitative Easing programs (QE, i.e, digital money fabrication), was that high inflation, potentially of the hyper variety, was nearly certain.
These concerns centered on the CPI and its less well-known corollary, the PPI, or Producer Price Index (basically, wholesale vs retail inflation). Yet, as we are all aware, when it came to asset prices – especially US stocks, global bonds, and real estate—it was a totally different story… except for one slice of the investment world that many thought would be among the biggest beneficiaries of this worldwide attempt to create printing-press prosperity. That would be gold and the other precious metals.
Early on, it looked like the assumed scenario would play out. As QEs spread around the planet in the early part of this soon-to-be-completed decade, the precious metals complex went postal. As usual in bull phases, silver had the greatest surge, rising by 452% from its lows during the Great Recession. Gold’s ascent was less spectacular, but it nonetheless vaulted almost 170% from where it bottomed in late 2008. By the spring of 2011, both were far ahead of global stock markets, including the S&P 500, once again measured from the lowest points of the financial crisis.
Fast forwarding to right now, it’s a very different story, at least for the S&P. The most revered stock index on the Planet Earth is up a prodigious 498.5% (total return) from its 2009 low-point, while gold and silver have roughly doubled by comparison. However, they do look much better compared to the global stock market index, excluding the US, since then; this is due to how poorly international stocks have performed vis-à-vis the US. (Ironically, in 2011 and 2012, overseas shares were all the rage, especially emerging markets.) On the more embarrassing side, gold and silver returns aren’t that much better than bonds over the past decade, despite having a monster lead in the early years. (Platinum has performed even worse!)
This long performance lag has caused most American investors—be they retail or institutional—to give up on precious metals as an essential asset class. After all, if they couldn’t deliver during a time of ideal conditions (collapsing interest rates and binge-printing by central banks), what could possibly cause them to rise now? (Note: Central bank money fabrication causes their balance sheets to increase.)
For an answer to this reasonable question, it might be helpful to review a summary created by Evergreen’s bright and inquisitive research team member, Michael Schaloum. Michael does this author a great favor by regularly listening to video interviews with many of the investment world’s brainiest inhabitants. He recently watched and summarized a debriefing on Real Vision TV with John Hathaway. For those of you that don’t know of John, he is considered to be the Warren Buffett of the precious metals space. He also lives near our family’s winter home and I’ve had the pleasure of meeting him on two occasions. Here is a bullet-point summary of Michael’s recap:
With $13 trillion of negative yielding bonds around the world, it’s evidence of systemic risk that is far bigger than the housing/mortgage crisis of last decade.
When interest rates do rise materially, it will trigger huge value declines for pensions and other institutions on their supposedly safe assets. He believes these losses will dwarf those seen in 2008.
Almost no one today expects an inflation resurgence. That’s why gold is cheap insurance should governments resort to attempting to inflate away entitlement obligations (social security, Medicare, Medicaid, etc).
We’re not going to see 1970s-type inflation, but it will be higher than we have now.
The dollar is constantly described as the best house in a bad currency neighborhood but that’s crazy because the “hood” is going down the
There’s a very good chance of a US recession next year.
Gold is the “third rail” of money management. It’s been in the penalty box for so long that an investment advisor can get fired for even mentioning it.
However, gold has recently broken out from a long basing period. The wind now appears to be at its back after six years of slogging. (Our “Going for the Gold” EVA in February, 2018, gave a strong endorsement to gold; since then it has generated a respectable 6% return.)
Gold miners now have a reserve life that is the lowest in 30 years. They are very reluctant to build new
Silver is gold on steroids. (Please refer back to the above chart of the former’s moonshot from 2008 to 2011.)
Though apparently he didn’t mention it, John might have added that the Fed has now launched QE4 even though they refuse to call it that. Just since September, the Fed has whipped up another $500 billion of fake money. In this case, the precipitating factor was severe stresses in the repo, or repurchase agreement, market. This is where banks borrow and lend vast sums to each other on a very short-term basis, secured by treasury securities.
It’s incredible, at least to me, that the Fed feels compelled to both cut rates and print money at a time when unemployment is at a 50-year low and the S&P 500 is cranking out record highs. Its rationale is partially due to fears of another repo market seize-up (which briefly drove the overnight lending rate to 10% in September) and its singular focus on an inflation measure almost no one else tracks, the PCE or Personal Consumption Expenditures.
As storied money manager Stan Druckenmiller said last week, referring to the Fed’s preoccupation with the PCE:
“Well, first of all, there’s 14 recognized measures of inflation. Twelve of them are above 2%. Their preferred measure, the core PCE is at 1.7%. The risks they are taking with regard to misallocation of resources, bubbles, all that stuff because something is at 1.7% as opposed to two, and now they’re talking about a makeup period?”
His last point is that the Fed is now openly discussing letting inflation run over 2% for an extended period to compensate, or make up for, the years when it’s been below 2%. Frankly, I continue to wonder why 2% is a good inflation level when it erodes purchasing power in a big way over time. With 2% inflation over a twenty-year timeframe, a dollar depreciates by roughly one-third (compounding works in reverse when a value is shrinking). Long-term, the story is much more dismal.
Ironically, prior to the creation of the Fed in 1913, US consumer prices were stable for most of America’s 130-year history, outside of the War of 1812 and the Civil War. The deflation in the non-war years prior to 1913 offset the brief inflation bursts, so that for over a century the dollar roughly retained its purchasing power. Since then, outside of the Great Depression and those eras when people like Bill Martin and Paul Volcker were in charge of the Fed, it’s been all downhill. The US dollar’s purchasing power is less than 5% of what is was when the Fed opened its impressive doors, on the eve of WWI.
As Mr. Druckenmiller alludes to, and I wholeheartedly agree with, the Fed’s preoccupation with a debatable and minor shortfall by inflation has led to series of dangerous circumstances, including monetizing the federal debt. In English, this means financing the government’s trillion dollar plus deficits with funds whipped up by the Fed’s magical money machine. As noted previously in these pages, if I’d said years ago that the Fed would be doing this, particularly at a time of decent economic performance, EVA readers would have questioned my sanity…even more than they normally do.
Due to the Fed’s frenzied efforts, the money supply is in a ripping bull market of its own. The correlation between M2 (the main money supply metric) and the stock market recently has been remarkable.
Other central banks have joined in opening up the liquidity fire hose. It’s certainly been glorious for investor portfolios as 2019 winds down but a rational person with a knowledge of history must realize the eventual payback. There’s never been a time in the past when central bank debt monetization hasn’t ultimately led to an unhappy ending. (Sorry for the double negative but this is a topic that deserves serious negativity!) Yet, it seems like almost no one is thinking about the eventual agonizing hangover these days; rather, it’s all about the intoxicating near-term returns.
Referring back to John Hathaway’s comments about entitlement obligations, it’s almost inarguable that either benefits need to be drastically reduced or the US, and other developed world governments, must use inflation to reduce the nominal costs of those and the debt that is used to finance them. Since the former is politically untenable, the latter becomes the path of least resistance. Who seriously believes this current feckless cast of policymakers won’t take the easy way out?
In the short-term, though, we could see a scenario that both John and another very wise man, David Rosenberg, anticipate. In their view, and I suspect they are right, we could have a recession in 2020. This becomes much more probable, in my opinion, should financial markets correct hard next year after this year’s historic and euphoric rally. It’s during the next recession that we are likely to see governments and central banks launch a coordinated blitz made up of additional trillions of pseudo-money (pseu-dough?) and unbridled spending (even more than we have today, which is expecting the truly surreal).
To quote David: “Remember that what follows this period of recessionary deflation will be MMT or some facsimile thereof. That is the ‘big bomb of debt monetization that ends up sending gold beyond a bull market towards a parabolic surge.” In other words, the next recession and/or bear market (believe me, dear EVA reader these are both certain to happen again) will set off the chain reaction that leads to the atomic event which creates the inflationary burst central banks so dearly desire. It’s likely to be a classic case of “Be careful what you wish for—you may get it good and hard.”
Another rich irony is that the central banks – the very perpetrators of this bizarre world in which we find ourselves, with all of its long-term inflationary implications – are in many cases buying gold in massive quantities. In 2018, central bank gold purchases were the highest in 50 years and 2019 might see a similar pace. Those based in the developing world and in Russia have been the most avid buyers. The former USSR now has almost 20% of its total foreign reserves in the yellow metal.
In China, however, that number is under 3%, implying that gold could become a far larger component. This is particularly true given the trade war with the US and China’s increasingly dim view of the dollar’s long-term purchasing power. (I can’t blame them, can you?)
To reiterate a theme from several recent EVAs, Evergreen believes (or at least it’s Chief Investment Officer does) that the next decade will be very different than the past for financial markets. The last 10 years have seen receding inflation and interest rates, both of which have been jet-fuel for bonds and equity sectors such as consumer staples/discretionary, healthcare, and, of course, tech. These all fall under what I would call the “paper asset’ category.* Conversely, the “hard asset” sectors and sub-sectors like energy producers/transporters, gold miners, copper producers, and agriculture nutrient companies have been the ultimate St. Bernards—i.e., huge dogs. (Real estate is one hard asset that has flourished in the last decade, after its disastrous collapse in 2008 and 2009. However, the high degree of leverage and inflated prices that characterize much of the property market today is worrisome.)
With most US portfolios heavily skewed toward the paper asset category and nearly devoid of hard assets, the stage is set for one of those paradigm shifts that is exceedingly painful for backward-looking, trend-following investors. As noted in last week’s EVA, that is everyone who is heavily involved with today’s most popular investment vehicles–US-focused stock index funds.
Per Jack Ma’s quote at the opening of this EVA, when money is too abundant bad decisions are made and they typically involve the recent performance stars. There’s never been a time in American history when there has been this much excess liquidity greasing the markets for paper assets. If there was ever time to channel your inner contrarian, this is it—asap, if not sooner!
Trump Exposes Pelosi And Son's Ties To Ukraine-Linked Energy Group
Well, this is a little awkward…
Having earlier called Speaker Nancy Pelosi “desperate,” a clearly frustrated President Trump told reporters this week, following a video teleconference with U.S. troops,
“she hates the Republican Party. She hates all of the people that voted for me and the Republican Party.”
Marc Short, chief of staff to Vice President Pence, said of Trump on “Fox News Sunday.”
“He’s frustrated [with] what he found to be a completely unreasonable impeachment.”
And that frustration boiled over as the president tweeted a link to something that the Democrats may have trouble fully explaining…
“Wow Crazy Nancy, what’s going on? This is big stuff!”
Shortly after his mother became the first woman speaker, Paul Pelosi Jr., was hired by InfoUSA for $180,000 a year as its vice president for Strategic Planning.
Nancy Pelosi’s son Paul is also on the board of an energy company.
As Patrick Howley reports, Nancy Pelosi’s son Paul Pelosi Jr. (who went to Ukraine in 2017) was a board member of Viscoil and executive at its related company NRGLab, which did energy business in Ukraine!
.@oann exposes those DemocRATS & their Ukraine ties Joe & Hunter & Nancy & Paul; seems like it’s a Family Affair
What’s going on here ? Pay attention to 1:13 in this video as it has been removed from social media pic.twitter.com/EFivBxANF1
— Constitutional Republic TEXT TRUMP 88022 (@Text88022) December 27, 2019
And Speaker Pelosi even appears in the company’s video commercials…
And Howley confirms NGRLabs links to Ukraine…
Here’s another video NRGLab posted the SAME DAY confirming in the Youtube text description they did energy business in Ukraine: “For example, Mika Newton helped to secure the rights to build a plant for the production of SH-boxes in Ukraine”https://t.co/e1mjss8GzT
Of course, while there is no allegations of wrongdoing in the Pelosi case (and certainly no political intervention which we know Biden admitted publicly), it does make you wonder just how deep the cookie jar goes in Ukraine…
Earlier this week, on Christmas Eve, an order from the city of Cleveland was posted on the door of the Denison Avenue United Church of Christ, demanding that they kick out the homeless people that they had been allowing to sleep on their property or face losing their status with the city as a religious organization.
The order came from the Cleveland Division of Fire, citing code violations that they claim are dangerous for the inhabitants. The city is following the letter of the law, in this case, suggesting that it is illegal to change the official use of the building without first filling out the required paperwork and making significant changes to the property.
According to the city’s building department, for the church to give shelter to homeless people, they would need to go through a costly process of not only updating the building but also getting the required permits and licenses that would designate the building as a homeless shelter.
Today, on Christmas Eve, Denison UCC was issued a Cease of Use notice even after Fire Chief Calvillo agreed to meet this AM as a result of yesterday’s action.
Let’s not forget that these threats arise from Councilwoman Brady’s efforts to keep homeless people out of her ward. pic.twitter.com/CIMWluJH5i
Pastor Nozomi Ikuta has promised to appeal the ruling, saying that the church has been battling the city for months over their right to help the homeless.
“According to the city, it is improper for us to allow the Metanoia Project to use our building to provide overnight hospitality. They are telling us to apply to change the use of our building from a church to a shelter,” Ikuta told Cleveland.com.
Ikuta said that the church is happy to make changes to their building to make it safer, but she doesn’t believe that the church should have to change its designated purpose.
“In essence, this forces us to choose between our identity as a church and helping homeless people. We want to work with the fire department to resolve any concerns it might have, but we don’t think we should have to stop being a church just so we can help keep people off the street,” she said.
Among the changes that are required by the fire department are updates to the building’s fire alarm system, adding fire extinguishers and exit sights, along with fire sprinklers and other safety measures.
Local homeless advocates have argued that it is more dangerous to keep these people out on the streets than it is to house them in a building that may not be entirely up to code.
“Six people have frozen to death over the past few years and the unsheltered homeless population continues to rise,” NEOCH executive director, Chris Knestrick toldScene.
Auto Lenders Have Verified Income On Just 7% Of All Loans Since 2017
The auto industry in 2019 is starting to look a lot like the subprime mortgage market in 2007.
One such example of an industry trying to move vehicle inventory by any means necessary was Mirna Lopez, a 65 year old who was able to buy a 2018 Nissan Pathfinder on monthly earnings of just $660. Her car loan’s monthly payment was slated to be $809.
How was this possible? The Wall Street Journal reports that an employee at the dealership that sold her the car simply listed her monthly earnings at $7,833. Nothing creative, nothing fancy: just plain old fraud.
It’s no longer good enough for customers to be buying cars with debt only. Now, while the auto industry struggles to pull itself out of the recession it is mired in, some dealerships around the country are “dressing up” loan applications with fake incomes, according to consumer lawyers. Additionally, some large lenders have cut back on safeguards that could catch the fraudulent applications.
The result is usually a quick default on these loans and consumers destroying their credit.
Richard Feferman, a New Mexico lawyer who has sued dealerships and lenders said: “The consequence for a lot of people is to ruin them financially for five to 10 years.”
The amount of false applications is “hard to quantify” according to PointPredictive, which sells software to detect loan fraud. The company estimates that more than 20% of loans have inflated incomes.
Of course, dealers have the option to ask for documentation to prove income, but over the past few years some subprime lenders have stopped checking them – partly in response to dealers demanding faster decisions. In fact, lenders verified income on only about 7% of all loans since 2017, the Journal found.
And the share of loans that go delinquent after origination is rising, specifically among subprime loans. Satyan Merchant, SVP of TransUnion’s auto business said: “That can be a signal of fraud.”
By the end of September, U.S. consumers had $1.3 trillion in auto debt outstanding, up $740 billion from a decade prior.
After disclosing their income to a salesperson in the financing office at a dealership, that information then sends an electronic loan application to banks and finance arms of the dealership, which then decide whether to fund the loan.
“Problem loans” often start with borrowers making poor decisions about what they can afford. Many borrowers don’t even read their loan application or final contract.
Dealerships can add to the trouble, rushing borrowers through the process or only showing them a partial copy of the application.
Sometimes, dealers will even “fill out one application with correct information and submit an incorrect one to lenders.” Others tell the consumer they can come back and refinance some months later to a lower interest loan, only to find out it isn’t really an option.
As we have reported on, dealers now make more money from financing than they do on the sale of vehicles. And the Consumer Financial Protection Bureau oversees auto lenders, but not dealerships, leaving room for dealers to act in bad faith. Last year, the FTC went after dealerships in Arizona and New Mexico for allegedly making up car buyers’ income.
GM’s AmeriCredit verified incomes on roughly 70% of loans in some bond pools, while the auto financing arms of CarMax and Ally Financial were found to have verified income on less than 1% of loans, an analysis of 6 million prime and subprime loans showed.
Life Comes At Us Way Too Fast: One Banker's Striking Explanation Why Nothing Makes Sense Any More
Deutsche Bank’s postmodern philosopher-cum-credit strategist Aleksandar Kocic, who missed his true calling and instead of writing a sequel to Ulysses, Finnegan’s Wake or some other pomo stream of consciousness piece in the style of Lacan, Derrida, Deleuze (or even Foucault, Beckett, Ginsberg or Burroughs) was reduced, no pun intended, to predicting the future by describing the shift in yield curves or their “Greek” derivatives, has always had a way with words and he certainly uses them in his 2020 vol market outlook which can be summarized – and we use the term very loosely – as follows, in his own words: “We see last year as the final stage of an on-going process of vega collapse caused by the chronic lack of demand, disruption of the vol/leverage cycle, and activity of the Central Banks. At the core of these developments resides an emerging new perspective of uncertainty: On top of the structural drivers, low volatility levels, compressed vol risk premia, and flat vol forwards present an articulation of the flattening of horizons.”
Like we said, “a way with words.”
While it would be an injustice to the Deutsche Banker to summarize what he talks about in simplistic terms (the problem with post-modernism is that it can’t by definition be reduced, hence why nobody really reads it), what the Serbian strategist focuses on in broad strokes is the ongoing collapse of vega (and its deficit), which however may be approaching the “boundaries of vol decline” (i.e., the moment when the Fed loses control so to speak)…
… the persistence of low volatility risk premia, with Implied/Realized vol ratios free-falling from nearly 130% during the summer to current 70-80% range, even as volatility risk premia away from rates remain above 100%, as central banks do everything to surpress rate vol…
… amid a structural shift in the vol market across two decades, the first culminating with the 2008 crisis, in which the “vol market was demand driven”, a period of “unprecedented systematization of mortgage hedging practices and concentration of negative mortgage convexity in a relatively small number of portfolios, as well as an aggressive growth of the hedge funds
community…”
… which however was followed by a “new equilibrium” defined by the post-2008 regulatory changes, nationalization of mortgage negative convexity, reduction of risk appetite, and recentering of supply and demand. In this decade, Kocic proposes that “the most significant change was the disappearance of the mortgage related demand, severance of the transmission mechanisms and the new role of Central Banks.” To wit, the “Fed has transformed from uninvolved player to an active convexity manager and its major supplier.” And with mortgage hedgers’ role nowhere nearly as significant as before the crisis, “as a consequence of regulatory changes, vol market in the second decade has been operating in an insurance mode (with more flows in out of the money vol) resulting in lumpy negative convexity distribution.”
Putting these vol market shifts in context, Kocic notes that in contrast to the beginning of the first decade, when net demand was about 50MM, or about 5% of total flows, second decade’s finale is dominated by nearly 20MM of vega surplus, or about 2% of total flows.
There is another observation of this ubiquitous collapse in vol: as Kocic “explains”, low volatility is no longer perceived as ominous, “its persistence emerges as likely while flat or inverted curve is no longer meant to be a forecast of recession. Volatility and curve are now causally trapped by each other: For volatility to return in a meaningful way, the right side of the (rates) distribution needs to open up and, for (long) rates to be liberated, risk (and volatility) has to be brought back.”
Yet for those who have followed Kocic’s observations in the rates market over the past few years, the above is not new. What may be new, however, are Kocic’s latest thoughts on why the “new normal” no longer strikes even skeptics as surreal or bizarre.
As the DB strategist writes, the persistence of low volatility levels and compressed risk premia together with their continuous decline “remains particularly puzzling in the context of the current environment where long-term risks remain abundant and substantial.”
This, of course, is another way of saying (much more simply) that vol should be far higher considering the accrued risks form a decade of capital misallocation, rising political instability, and a market that is now as illiquid and fragile as it was during the financial crisis.
So going back to what is new in Kocic’s latest report, is hiw interpretation of why the market no longer seems to care about, well, stuff. This is what he says: “in our view, such state of affairs reflects less the distribution of long-term risks then indifference to what lies ahead.”
We can admit, that we live in a time when algos and traders all seem to ignore newsflow that does not fit a given, mostly bullish, narrative and blissfully trade purely based on irrelevant, non-discounting “signals” such as momentum, or frontrunning what others are doing. This in turn traps the Fed as markets, which are no longer efficient, discounting mechanisms as a result of central bank interventions – a theory first proposed by Citi’s Matt King in 2016 – get pushed even further from equilibrium, and force the Fed to intervene after even a modest drawdown as the alternative is nearly instant risk of catastrophic market collapse should markets be forced to reappraise assets in some fundamental value context.
The implication is striking, because according to Kocic it suggests that reality itself has become too surreal:
“Given the underlying political entropy and reality contortions which it continues to produce, we are forced to abandon as inadequate the tools and frameworks that used to provide insight and access beyond immediate future and, in the absence of their replacement, confine our efforts to short-term horizons.“
What is the origin of this change in perspective? Here is Kocic again:
Perspective is not a static concept, it is a function of condition under which it is formed. In skydiving, eyeballing consists in visually assessing our distance from the ground during the fall. We evaluate our altitude and work out the exact moment we need to open our parachute based on a dynamic visual impression. At 2000 meters, immediately after the jump, we cannot see the ground approaching. But when we reach the 800 to 600 meter mark, we start to see it “coming”. The sensation is very different than when observing the ground from a “static” perspective, e.g. from the plane at the same (600m) altitude. Speed affects our perspective: As the ground “rushes” towards us, the apparent diameter of objects increases faster and faster than our distance from the ground shrinks, and we suddenly have the feeling we are not seeing them closer but seeing them move apart suddenly, as though the ground were splitting open. Perspective is dependent on speed — it is a function of acceleration.
And the punchline, which one can loosely paraphrase as “life comes at you too fast”:
When extreme events begin to saturate the info-sphere on daily basis (sometimes even intraday), reality unfolds too fast – we no longer remember (or don’t care about) the headlines from two or three weeks ago. Our perspective and assessment of the horizon (“cognitive eyeballing”) is distorted. We are blinkered by intensity of information we have to process – overwhelmed by both its quantity and speed of its arrival – and no longer seem to be unable to properly assess the risks ahead of us, and have become insensitive to them. The distorted perspective downplays the risk of “hitting the ground”. The informational intensity transcends our capacity for statistical approximation and this rarefication of control affects the temporal regime of our decision making. As a consequence, our horizons flatten and everything that resides beyond immediate future is bundled as “long-term” — we appear to be indifferent to its temporal distance — it is all equally remote and equally out of grasp and we capitulate on our efforts to forecast beyond short term horizons.
We find it amusing that it is the Wall Street strategist who tends to find delight in the absurd turns of the financial equivalents of post-modernism, not only in its linguistic realm but also its philosophy and how it applies to capital markets, that found it fitting to conclude his year ahead forecast with what can only be described as peak absurdity: to paraphrase Kocic, reality is now so perverted, with a barrage of flashing read headlines, news and events “coming at you” so fast that one can no longer discern what is signal and what is noise, that trying to not only predict the future but explain the present is at best an exercise in futility which is why markets no longer care and are “forced to abandon as inadequate the tools and frameworks that used to provide insight and access beyond immediate future”, instead focusing only on the moment.
Biden Attempts To Defend Hypocritical Subpoena Refusal (That Trump Is Being Impeached For)
Despite previously demanding a “fair trial” in the Senate in which “all witnesses be seen and heard,” former VP Joe Biden appears to mean all witnesses except him and his son.
Having complained bitterly that President Trump did not comply with subpoenas in The House inquiry (and seeing Trump impeached for obstruction of Congress for such), Biden has said he will not comply with a Senate subpoena (which he has not received yet!).
During an interview with the editorial board of The Des Moines Register, Biden stated that he would not play into the president’s “game.”
“The reason I wouldn’t is because it’s all designed to deal with Trump doing what he’s done his whole life: trying to take the focus off him,” he said.
“The issue is not what I did.”
“This is all about a diversion,” Biden said to the newspaper.
“And we play his game all the time. He’s done it his whole career.”
The Democratic Party presidential nominee candidate’s comments came after Trump essentially said that if the Democrats want witnesses, we will have witnesses, but they will not like who they are.
However, after legal experts and commentators criticized Biden for his remarks to the Iowa newspaper, noting that the White House’s refusal to comply with congressional subpoenas was part of the reason why Trump had been impeached, Biden decided to clarify his remarks this morning.
“I want to clarify something I said yesterday. In my 40 years in public life, I have always complied with a lawful order and in my eight years as VP, my office – unlike Donald Trump and Mike Pence – cooperated with legitimate congressional oversight requests,” Biden said on Twitter.
“But I am just not going to pretend that there is any legal basis for Republican subpoenas for my testimony in the impeachment trial,” Biden added.
Then Biden really exposed his perspective:
“The subpoenas should go to witnesses with testimony to offer to Trump’s shaking down the Ukraine government — they should go to the White House.”
“It was the era of risk, it is the era of sustainability, it was the age of unicorns, it is the age of wisdom, it was the epoch of renewal, it is the epoch of repair, it was the season of sure fire gains, it is the season of uncertainty, it was the spring of monetary policy, it is the winter of fiscal credulity, we had everything behind us, we have nothing ahead of us..”
The Next Decade: The most exciting 10-years will be the next 10-years.
Introduction
The global market is a dynamic, energetic and malicious entity. It delights in confounding those who try to understand it. Blain’s Market Mantra No 1 states: “The market has but one ambition: to inflict the maximum amount of pain on the maximum number of participants.”
The global economy is equally dynamic. It does not exist as a steady-state entity. It is constantly evolving with increasing rapidity. Competition among new unicorns demonstrates what we once held to be constant and forever, is now likely to be done, dusted and obsolescent over a very short-time frame, but also the fundamentals of good, profitable businesses don’t change.
I am only a part-time market strategist – most of my day is spent trying to figure out who will buy my latest private debt deal, venture capital issue or where to finance yet another jet or block of commercial property. It does mean I spend my days actually talking with investors, traders, issuers, government and regulatory officials, rather than just looking at numbers. I’m sitting in the middle of a trading floor watching screens, hearing deals, and after 35 years of listening to market mumble-swerve with a trained broker ear… some of it is finally beginning to make sense!
(Most traders my age retired long ago with the loot they amassed during their careers. Not me. I am addicted to sailing and yachts. It will say on my grave: “He spent it on fast boats, fast cars and fast women his wives, and squandered the rest….”)
My greatest difficulty is collating what I hear, explaining my experiences, and putting them together into context as meaningful market insights… It’s fairly easy to do when I’ve got a time horizon of the next day – which I do on the Morning Porridge each day.
To make this more difficult, I am going to give you a market outlook for the whole of the next decade – the 2020s.
More Years – It’s all about Themes and the Narrative
An awful lot happened over the last 10-years. Stock markets have risen dramatically. Bonds yields have never been so low. Passive index tracking has become the norm. Interest rates have never stayed so low so long. We have seen a European sovereign debt crisis and repeated country crisis in Latin America, Russia and Asia. Fintech, cryptocurrencies, unicorns, gaming, streaming and lots of other stuff we’d never heard of 10-years ago now dominate our current thinking. Our world has become much more complex, integrated, more fractious, innovative and changes far more swiftly.
What word would you chose to sum up the last decade?
Credulous – the era of showing too great a readiness to believe.
What word will sum up the next 10-years? Who knows? I suspect:
Cautious – eventually the party will stop…
The pace and breadth of change across electorates, governments, businesses, and new opportunities over the next 10-years will have enormous implications for markets. There are so many potential points of divergence, it’s going to prove even more impossible to accurately predict the numbers, but we can certainly make educated guesses at what the themes are likely to be.
Given an infinite number of economists, analysts and strategy geeks armed with computers, I suppose it would be possible to brainstorm the future and come out with proper predictions. Flying cars? 3D Star Trek replicators producing perfect steaks? Teleportation? Investment certainty? Dow to hit 100,000?
I was going to start with one high-probability prediction: “this will be the last Decade Outlook I write”, but who knows: if interest rates remain this low, will I be able to afford to retire in my 60s?
Markets are Event Driven, but trends are critical
Economists and Strategists pepper their yearly outlooks with comments on the likelihood of recession, downturns, upturns, the shape of yield curves, overbought and undersold markets, sector developments and where gold, currencies, rates, and commodity prices are heading.
Investment banks and fund managers are very good at producing pages and pages and pages of graphs, charts and pies showing just how the market will develop. Prices move in line with trends, which are set by events.
Events can take form of a tiny little improvement to a product that increases its sales, right the way up to the scale to fundamental economic shifts, like a trade war or a surprise in politics. They can be momentary “no-see-ums” like an earthquake, or a culmination of a long-term trend, such as the unravelling of Unicorn tech valuations. Markets are determined by events. Some are predictable, some are not. The UK election illustrates how an event moves markets – on the back of increased Brexit certainty, sterling rallied, and we can predict businesses will move forward with new investment plans in terms of Capex, infrastructure, hiring and property plans. Even more prices move up and down.
Themes are very different. They are the tides, currents and winds of markets around which events occur and trends follow. Skilled investors who can read these themes and use them to navigate the global markets by making educated guesses on where they will lead us next. Themes tend to merge and change as they encounter other narratives, becoming new market moving themes in themselves.
Let me present a number of themes and narratives I reckon will play out during the next decade. Individually they might be limited, but it will be how they interreact with each other that will be most significant.
Seven Major Themes
There are 7 themes which I reckon will really matter:
1) Market Distortion
Are the market distortions of the 2010s in terms of QE and monetary experimentation sustainable?
How damaging are the unintended consequences of distortion – inflated financial asset prices driving sub-optimal investment decisions and increasing income inequality across economies?
Can/will central banks continue to prop up markets and repress volatility via monetary policy?
Are central banks caught between a desire to normalise rates, but can’t?
If they withdraw monetary support, will markets tumble?
How violently could markets correct?
Are we still looking at lower for longer rates and zero inflation, or will inflation return?
Are deflation and Japanification greater threats than ongoing distortion?
2) New Opportunities and business
A fourth industrial revolution is underway – Artificial intelligence, robotics, 3-D printing, nanotech, AR/VR, longevity, health, bio-pharma and climate cure tech will change business, employment and incomes.
The invention/innovation/commercialisation cycle is accelerating.
As the economy evolves, the need for new approaches to education and work will create bottlenecks.
Consumption, supply chains and work patterns will evolve.
New industry and manufacturing chains will require massive investment and financing to benefit.
Focus to shift back on profits, payback, competition and fundamental risks.
3) Politics
Increasing dissatisfaction with politics, the political classes, and policies will lead to increasing unrest across democratic economies – raising the prospects of political event risk and/or gridlock.
Mature democracies may find new leaders emerging into the current political vacuum. Increased populism, especially on the right wing. Raised risk of charismatic leaders on right winning power.
10 years of austerity will prove difficult to unwind through fiscal reflation in stressed debt markets – increasing political dissatisfaction.
Dissatisfaction with big-tech, surveillance capitalism, and Income inequality may spawn considerable voter pressure and regulatory backlash – ‘blame somebody’ theory.
Europe likely to suffer particular problems as the “committee” structure fails to agree fiscal policy, banking union, and how to enact fiscal support to struggling economies. Increasing imbalance and tensions between key members could pressure Euro.
US political cycle will continue to dominate markets and confidence in dollar and central banks.
Perversely, a period of potential calm for UK may beckon in early part of decade.
4) Debt Crisis
If fiscal spending is the answer, will global debt levels test the limits of political credibility and thus the likelihood of rising rates and inflation?
Corporate debt levels look unsustainable and a result of distortion – will they break?
Liquidity issues will dominate any debt crisis.
Personal indebtedness is rising in line with diminished responsibility and victimhood society – it’s nobody’s fault but yourself does not play anymore.
Massive implications for risk – risk has been transferred from banks to asset managers. Can nonbanks manage rising fixed income risk?
5) Geopolitics
Tensions between Europe, US, China and Russia will continue to rise.
Need for fundamental defence review and increased spend across democracies.
China likely to set own economic sphere using Chinese tech and Chinese government system – market driven communism.
Changing global supply chains will exacerbate tensions
6) ESG/Sustainability and Fundamentals
ESG has emerged as a critical component of investment decision making over the last few years. It is likely to further develop as a theme.
It will become more thorough to prevent greenwashing, ensure sound governance and increasingly play to social themes.
Labels such as “Green Bond” will be redundant – everything will be expected to include a green element and be compliant.
Risk that potential regulatory capture of climate change agenda causes as much distortion as QE… for instance, disrupting supply chains by penalising fossils fuels and investments perceived as non-green.
Sustainability as an investment precept will become increasingly important; analysing firms, their business, and their place within the social and changing real environment as the critical issues in investment management. It’s a less proscriptive and more effective way to judge companies than ESG 101.
In a new global business environment of increased competition and shorter and shorter business life cycles, investors can’t wait aeons for profits. It will mark a return to fundamental investment based on rational expectations, profitability and sound businesses.
Opportunity to invest in efficient sectors damaged by excessive ESG.
7) Climate Change
The easy one to predict– but the 2020s will likely confirm the reality of the environmental threat.
It raises increased sudden event risk from meteorological disasters, stressing the abilities of markets to cope with sudden large insurance and stranded costs.
Likely to create a massive new climate cure opportunity – inventing, innovating and commercialising climate cure technologies.
Perhaps the best way to address climate change is to stabilise populations – which could be done through education and jobs – but raising the issue of how to sustain growth while cutting emissions?
And the rest…
It’s a rule of markets that while things are never as bad as you think they might be, they are never as great as you hope. In a new era of financial realism and the re-establishment of monetary sanity, the new businesses claiming to have discovered a philosopher’s stone – for instance turning base automobiles into gold plated EVs worth trillions – are likely to be tested to destruction.
Two Major Narratives
There are multiple narrative possibilities, but two particular stories are most likely to dominate the next 10-years. From these flows many of the other themes, including geopolitics and how we react to Climate Change.
Unravelling 10-years of Financial Repression: Past Performance is not an indicator of future performance.
My first prediction for the next 10-years is: Markets are likely to hurt if and when they ever normalize. However, there is a possibility they remain distorted for far longer than we expect due to central banks fearing a stock or bond crash would trigger damaging global congestion.
If you simply invested all your money in global stocks in 2010 you would have done rather well. Spreading it out to cover bonds also would have further enhanced your returns. If you did so, did you thank the Central Banks who funded your market upside?
Can central banks continue to repress market volatility and push markets higher by throwing cash at them? That’s effectively what’s happened over the last 10-years. QE, ultra-low interest rates, and now the US Fed is repeating QE to stem a crisis in the repo market.
The result has been massive market distortion – low rates chased investors down the credit risk curve in search of returns and into the equity markets; yield tourism. Corporate owners took advantage of low rates to leverage up and buy back stock, and spend on M&A.
How complex will it get before it all breaks?
We have to pay the piper not just for the last 10-years of distortion, but for the last 40 years spent in a bull interest rate environment. As yet there is little sign of inflation in the real economy – all the inflationary money created by central banks has flowed into the inflated financial assets. When I started in markets in 1985 the US 10-year Treasury was yielding around 12%, having fallen from 21% in 1980, and 15% in 1982 as I studied economics. Today its yielding 1.5%!
Let’s remind ourselves how financial assets played out over the past 10-years:
US 10 Year Treasury – Rallied from 3.91% to 1.79%
Dow Jones – Rallied from 10,329 to 28,000
What do such low interest rates tell us? Conventional economics would tell us low rates describe a global economy in slowdown, depression, limited inflation, minimal growth and few positive prospects. It sounds like the lower for longer economy many analysts predicted in 2010.
Or you could look at the stock markets. Totally contradictory story. The US Dow is 3 times higher than 2010! It’s been driven by an insane mix of inspiration, insights and insolence as Unicorns reared and stumbled, corporate buybacks and low rates. A glance at stocks would suggest it remains a global boom time.
The bottom line is simple. The last 10-years has been a story of massive central banking distortion to address the 2008 crisis. Now central banks face the consequences and are trapped. The distortion can’t go uncorrected indefinitely.
10 years of monetary experimentation, QE, ultra-low interest rates fuelled and juiced an extension to an ongoing 30-year binge of irrational exuberance. It has fuelled massive inflation in financial assets – stocks and shares. Whatever lessons were learnt in 2008 have been quickly forgotten as investors followed the money and gorged on financial assets.
Globally debt yields have tumbled. Most government bonds have flirted around negative yields. Even serial debt basket cases like Greece now trade within a few points of financial paragons like Germany. Ultra-low interest rates have meant debt levels are at a place that would have given bond analysts conniptions just a few decades ago.
Equity prices are at record levels – juiced by corporates who have raised billions on the bond markets to buy back their own stocks and yield tourists looking for higher returns.
Meanwhile, regulators have overseen rules that have resulted in risk being quietly transferred from banks to the investment sector – putting the savings of billions of pensioners and savers in peril
Analysts will tell you the markets can’t continue to hide the distortion.
Central bankers will privately admit there is nothing else they can do except maintain the distortion.
Traders will tell you to follow the money and buy the distortion
The traders called it right for the last 10-years, backing their hunch central banks were trapped. They coat-tailed QE and low rates with a certainty global central banks have no alternative but to maintain low rates and keep juicing the markets.
Analysts know it can’t continue indefinitely. Experienced traders know markets can remain irrational longer than investors can remain solvent. Global central banks know that to take their fingers off the monetary easy dead-man’s switch will destroy confidence. If they do extract the proverbial digit, then the all-out contagion consequences could make 2008 look like a slightly runny nose.
The real threat would appear to be deflation and the Japanification of occidental economies. That may change if a crisis was to uncork the inflationary genie?
How the end of financial distortion plays out depends on how other themes develop.
Debt Markets depends on how much credibility Governments maintain.
Prediction 2 – Global Debt is likely to Hurt. Lots.
Global GDP is around $85 trillion, meaning the global economy is levered by a factor of some 3:1 – on $260 trillion of public and private debt, which is startling.
The first question to ask about debt should always be: how will interest and principal be repaid? Have the trillions that have been raised in the last 10 years been spent in ways likely to return money to investors? Has the money been spent on building factories, creating jobs or building efficient infrastructure that will generate the returns necessary to repay the debt? Anyone looking in at how ultra-low interest rates have driven stock prices higher due to an orgy of debt-funded corporate buy-backs or to fund ill-advised M&A, or how massive populist-driven fiscal spending programmes are likely to increase
government debt, would immediately assume the current debt markets are completely unsustainable…. The looming debt crisis of the 2020s will be complex and multifaceted. Even governments with access to magic money trees, who retain the keys to their own printing presses, are going to struggle to retain credibility and financial probity in the face of massive funding needs.
Government Debt
Over the next 10-years governments are going to be forced to correct the fact fiscal policy has effectively been ignored the last 10-years – buried in austerity budgets. There are two main factors that point to the need for massively increased government spending in coming years – populism and decay.
Populism
Electorates are angry. They increasingly perceive the last 10-years of monetary mistakes have made the rich richer by ramping financial assets and executive bonuses, while they were forced to pay through austerity public spending. The UK election illustrates the competition between politicians willing to buy votes through fiscal spending programmes. The revolting French illustrate the refusal of electorates to accept tough decisions. Pensions, health services and other public goods including defence and educationdemand spending.
Decay
A massive infrastructure rebuild is required across the occidental economies – simply to maintain the current dilapidated occidental system. Yet infrastructure and government spending are massively inefficient in terms of cost overrun, delay and effectiveness.
Any significant infrastructure enhancements – including HS2 in the UK – are going to be luxuries, perhaps killed by other competing demands.
To replace ageing infrastructure with new climate-cure compliant rail, roads and port facilities, while rebuilding hospitals, schools and the housing stock to meet green goals is going to be massively expensive.
10-years of government austerity programmes have created the need for massive social infrastructure catch-up spending. Education, health, benefits and care are all under pressure.
Rising geopolitical threats in an increasingly uncertain world where food and water security become the major issues means spending on defence will need to dramatically increase.
The bottom line is government spending has to rise, at a time when rates are likely to be rising. Does that matter for economies that can create their own money? Not really, the choice is to create new money and call it debt.
The factor that matters is credibility – if governments are credible and deliver credible spending plans then global investors will be prepared to fund debt at low prices. If credibility in the government wavers, the price of debt starts to increase.
The problem here is not the amount of debt – because governments can create as much money as they care to. It’s the credibility of the government that sets the price of the debt – and that’s a political issue.
Politics is the major factor likely to break the credibility of governments and trigger a succession of major global government debt crises.
This is especially true in Europe where governments don’t hold the keys to the printing presses – they are owned by the committee called the ECB. This actually works in favour of some governments – where the credibility of the ECB outweighs the lack of credibility specific governments with investors who are willing to accept an implicit assurance the ECB will “do what it takes” to conditionally bail-out bad governments. What if that breaks? As it nearly did during the European sovereign debt crisis in 2010?
Corporate Debt
Corporate debt is dead simple. If interest rates rise, then lots of companies will struggle to repay debt and will go bust. Highly levered private companies that form the bulk of CLOs will probably collapse first, triggering a wave of panic around the market. Investors trying to exit corporate debt will find themselves trapped in illiquidity, driving prices swiftly down – which will look like a massive buying opportunity…. eventually.
A few years later analysts will wonder why we allowed covenant-lite borrowing by barely solvent borrowers; why companies were allowed to bankrupt themselves by transforming equity into debt via buybacks; or how stockholders failed to constrain company managements.
Corporate debt spreads show how the market is undervaluing risks. Corporates can’t make money the way governments do – they can’t create more; they have to borrow and most certainly pay it back. The risks of corporate debt are completely different to governments – the business ability to repay, the business environment etc. That risk is significant and isn’t covered when junk borrowers can issue debt a point over governments. When the market realises… it will be a wake-up moment.
Personal Debt
If you start your working career encumbered by £50k of student debt, with no chance of ever getting on the housing ladder, and with limited job prospects as careers are automated or digitised while workers are treated as anonymous resources to be hired/fired and employed by algorithms, then it’s hardly any wonder young Millennials, Gen X, Y and Z are increasingly angry. What else is there to do but spend money and borrow more.
When a company can make workers redundant and skip paying wages or redundancy, and makes off with the pension pot, then what’s the incentive on the young workers to repay their pay-day lending? Go buy a car – what else would you spend your gig-economy wages on? If the delivery company lays you off because of a recession or replaces you with a drone – what can you do about it….
If personal debt flattens consumption, then the whole corporate party tumbles off the merry-go-round as consumers stop buying. Helicopter money?
History repeats. Egyptian masons downed tools building pyramids and swiftly robbed graves when they weren’t paid. Peasants were revolting in Plantagenet England. A guillotine was erected in Paris on the back of bread riots and an ill-timed comment about cake instead. The Nazis arose from the inflation of the Weimar era.
Rising personal debt in this age of fake, easy money is presented as a consumer choice and desirable outcome – it’s not. It’s a massive political threat.
Details, just details
The predictability of events ranges from a nailed-on dead certainty, to a completely unexpected “no-seeums”. Without intending to insult believers in the Cygnus Atrastus, the predictability of events is not digital – almost everything is predictable, especially from the perspective of hindsight! Themes are complex and are only doors to more and more questions. Investors should regard the themes and narratives I’ve described above as concepts to drill down into further.
There is so much more I would like to find the time to write about.
I have a massive list of things that will solve everything, like cracking the capacitance problem; doing away with inefficient batteries and making electric vehicles light and efficient. Or maybe we will see the fusion problem solved – fusion power could save us with unlimited power, and its only 30-years down the line. (Its been 30-years down the line since fusion was declared our energy messiah in the 1950s).
I would love to write how opportunities to develop new technologies to clean the seas of plastic, to develop hydrogen and electric aircraft will develop, or how we can crack the water crisis with desalination and icebergs. These things are all possible, but will require significant investment.
Or I could look at areas like global aviation, berate both Boeing and Airbus for their failure to develop new cheap efficient regional aircraft using modern tech. Both got greedy and stuck with 1960s and 70s designs. Maybe the Chinese will win that one – surprising us all by introducing a competitor. Even a plane with similar capabilities to the current aircraft would cause a demand shock in aviation.
Maybe I should spend time talking about market risks from defaults, distressed debt, a new EM crisis brewing… but there is only so much I can say without getting really boring.
For instance:
Animal Protein
Cutting back on meat production will reduce methane. It will drive business opportunities for protein replacement in terms of fake meat, vegetable alternatives, and the prospect of increasing food security by replacing land used for meat production with crops for human production. It will spur the development of 3D meat printing.
It will also trigger a luxury meat market – where countries that can produce Co2 efficient meat command premium prices.
These sub-themes create multiple new narratives:
The UK could benefit from a shift from meat to crop production – our damp climate produces superb pasture allowing the production of high-quality luxury animal protein with a limited carbon footprint (because we don’t have to hack down forest to provide grazing). It opens the opportunity to export our meat around the globe.
In contrast, repurposing former rain forest that was slashed/burnt to create cattle ranges by planting food crops will require soil enhancement and new farming infrastructure across South America at a time when water security is becoming difficult – begging further questions!
Or,
How about China?
How successfully can China under the new great helmsman Xi navigate the next 10-years? Will China end up on a path of tumbling into a new gerontocracy of elderly men whose experience was moulded as children during the pain of the cultural revolution and the great leap forward? Or will it find a new route forward to successfully manage its evolution from a developing country into superpower?
What are the prospects for success? Can it innovate technical solutions to its demographic, environment and bureaucratic challenges? I reckon China faces as much pressure as any state to improve its environment, and far from being suspicious of its ongoing reliance on power, the fact its embraced renewables is fascinating. Can China sustain growth without a debt bubble or does that actually matter if the state simply prints money and internalizes debt? Where does the party take the country – domestic capitalism or state control?
It looks like China will go its own way – developing its own tech ecosystem, hi-value goods in autos, aerospace, shipping and rail. It will stage its own industrial revolution – AI, robotics, energy, pharma and health. The Chinese economy is going to move forward – and in the face of the increasingly erratic behaviour of the US president, and the political gridlock apparent to anyone trying to read US politics, perhaps long-term relationships with China will be preferable to a relationship with a flaky USA?
Finally…. Some predictions from readers:
Markets
“I am expecting to see a massive correction in the bond markets. 10 yr UST moving above 3%, 10 yr Bunds above 1%. Credit spreads blowing out and Stock markets falling 20 to 30%.”
“We will not see much higher yields next year. There is no case for inflation. Rates will go back to January 2019 levels once Trump settles with China. There is a case for margins to widen. We need a couple of spectacular defaults and that could signal a turn in the market. A future crisis will not be with banks but with institutional investors who have to write-off a lot of debt in their balance sheet and will try and sell deals.”
Fiscal Policy
“2020 will be the year where we will hear much more about governments’ opening up the purse strings in response to widening inequality. This is likely to result in developed market bond yield curves meaningfully steepen and 10-year Bund yields turn positive as the Germans finally give in to some stimulus.”
“2020: Who wants to invest in the long Euro government bonds at -.5% or -0.7% of the countries that need to borrow heavily, i.e. that are in deficit? Only if you are forced to…Therefore capital controls are coming in Euroland sooner or later!”
US Politics
“Donald Trump will be easily beaten in November 2020 and win fewer electoral college votes than John McCain managed in 2008. The US economy will grow nicely but the impact of Trump’s unpresidential behaviour and his deep unpopularity with women will be impossible to overcome. In the early part of 2020 speculation will emerge that Hillary Clinton will enter the democratic primary. She will be blocked from running however – centrist candidate Biden will win the Dem nomination and then the election.”
“In 2020 markets will fret about the choice between four more years of Donald Trump or a Democrat elected on a “socialist” platform. The battle will mean delays in corporate, and investor, decision making suggesting a sluggish economy and a sluggish market.”
Tech Unicorns
“2020 will be the year when Silicon Valley investors are caught swimming without trunks. IPOs start to dry up for cash-guzzling companies that have followed the ‘blitzscaling’ growth strategy and that has a knock-on impact on sentiment amongst the funders that have supported them to date. VCs start to look for businesses that can achieve profitability even if their ambitions are more modest than dominating entire industries or creating new paradigms.”
Weinstein Accusers Balk After Lawyers Set To Make More Than Plaintiffs
Last week, a tentative settlement agreement for $25 million was reportedly reached between Harvey Weinstein and more than 30 women who have accused him of sexual misconduct. If approved by the court, the deal would bring an end to the majority of lawsuits pending against the disgraced Hollywood mogul.
Now that the details have come out, however, several of the women are objecting to attorney’s fees, which in some cases would hand the lawyers more than 10 times more than some of the accusers, according to The Guardian.
Should we file this under ‘that’s how class-action lawsuits work’ or are the attorneys asking too much after two years of negotiations?
Elizabeth Fegan, the lead attorney representing the women who are part of the original class action lawsuit and all future claimants who choose to join it, could receive up to 25% of the payout if the settlement goes ahead, legal observers said. They pointed out that sum could end up being 10 times or more the payment to individual victims, especially if more join the case and dilute the amount of the awards.
Lawyer Douglas Wigdor says this is one of the grounds upon which he intends to fight the proposed settlement on behalf of two of his clients who have announced they will object.
He says Fegan’s fee “could end up being significantly more than 10 times the amount” that individual plaintiffs will receive.
“She stands to make millions of dollars in attorney fees if it settles and if it doesn’t, then she’s out of luck.” –The Guardian
The proposed settlement with accusers is just one component of a $47 million deal which would also pay the Weinstein Company’s debts. Of it, $6.2 million would go to 18 accusers in the US, Canada and UK, while around $18.5 million would be set aside for class action participants – with more expected to join.
Over a quarter of the overall settlement package, $12m, will go towards the legal costs of Weinstein, his brother Bob, and former members of the company’s board if the agreement goes ahead.
According to attorney John Clune, who has advised several dissatisfied Weinstein accusers, “It certainly doesn’t seem fair that lawyers could be getting more than their clients … This is one of the things that I think the judge is going to have to take a close look at.”
Fegan told The Guardian, “As in all class actions, attorneys’ fees are ultimately determined by the judge, who must evaluate and approve the percentage. If the court awards them 25% for fees, the attorneys will receive less than the value of time spent on the case using industry standard defined billing rates.”
According to the report, New Zealand model Zoe Brock says she intends to file an objection to the proposed settlement – the fourth accuser to publicly say she will do so, adding that she feels “hopeless and defeated” by the proposed terms under which Weinstein wouldn’t be required to personally pay his accusers or admit any wrongdoing.
Instead, the settlement would be paid by insurance companies representing the Weinstein Company.
Brock, who was part of the original class action filed against Weinstein in November 2017, says she feels her hands are tied. “Even if I walk away I can’t take another suit against Harvey, or anyone connected to him, because the class action has already been filed,” she said.
“I have been dealing behind the scenes with the weight of this negotiation for months and I have been very vocal about how unhappy I am about it with my legal team,” she told New Zealand radio station, Stuff.
“They have been very careful in every email and every interview to say that no one is being forced into this settlement but I feel forced … I don’t feel like I have a choice.”
Brock is among the Weinstein accusers who have sought outside advice from lawyers not involved in the settlement negotiations. –The Guardian
Another Weinstein accuser who says she was sexually assaulted by the mogul in 2010, Dominique Huett, says she is also considering filing an objection, however she’s worried that if the settlement is not passed, nobody will be compensated.
“I’m not sure I want to sign up to this,” she said, “but I feel I need to do what’s best for the collective and don’t want to get in the way of other women who feel this is their only option.”
“It has been a very disturbing process. He [Weinstein] is still holding all of the power and all of the cards.”
Meanwhile, Weinstein’s criminal trial is scheduled to begin January 6 in Manhattan, while he may also face charges in Los Angeles.
The Overton window is the range of policies politically acceptable to the mainstream population at a given time. It is also known as the window of discourse. The term is named after Joseph P. Overton, who stated that an idea’s political viability depends mainly on whether it falls within this range, rather than on politicians’ individual preferences. According to Overton, the window frames the range of policies that a politician can recommend without appearing too extreme to gain or keep public office given the climate of public opinion at that time.
CIA Wikipedia
Heaven forbid anyone appear too extreme. Our rulers keep discourse safely within the Overton window by allowing debate about the details of what the government does or doesn’t do. However, those who question the necessity of particular government agencies or programs, or government in general, are beyond-the-pale extremists and cast into the Abyss of the Unacceptable, one zip code over from the Abyss of the Deplorable.
The Federal Reserve has been much in the news lately. The term “repo” is shorthand for a repurchase agreement. The repo market allows those who own securities to sell them to lenders and repurchase them on a set day at a higher price. The difference between the sale and the repurchase price is interest to the lender. The repo market is huge, providing short-term financing for hundreds of billions of dollars worth of transactions daily, primarily in government and agency debt.
On September 16 the repo market blew up. Short term repos usually carrying interest rates of 1 or 2 percent required rates approaching 10 percent for the market to clear. The Fed stepped in, offering massive fiat credit to push rates back down. It wasn’t just a one-time glitch. Since then, the repo market has required substantial and repeated injections of Fed fiat credit. The Fed has announced injections totaling close to half-a-trillion dollars, or $500 billion, over the next few weeks to prevent the market from seizing up over year-end, when demand for repo financing is traditionally brisk. That will take the Fed’s balance sheet to around $4.5 trillion, the high reached after the last financial crisis.
There are plenty of articles about the causes of the blowup and its implications and SLL has reposted some of them. Not alone among commentators, SLL’s best guess is that markets are seizing up under massive and ever-expanding US government debt. Unless the Fed buys what nobody else wants, the market will crash and rates will skyrocket. Time will tell. Without getting further into those weeds, the incident follows a pattern inherent in any government-central bank sponsored system of fiat credit creation.
Credit expands faster than underlying economic production until interest and principal can no longer be paid and credit begins to contract. Governments and central banks meet that inevitable consequence with a still greater expansion of fiat credit, setting the stage for the next contraction and expansion. How successful governments and central banks are in forestalling economic and financial catastrophe is merely a detail. The important point is that the cycle, each successive crisis larger than the previous one, is a feature, not a bug, of fiat credit systems. Eventually they all crash.
Will the repo market be the tipping point for the next credit contraction? Apparently it already is, judging by the Fed’s frantic response. However, focusing on the details keeps the debate within the Overton window. Instead, ignore the details and look at the destruction wrought by the fiat credit system since inception. The dollar is worth about 2 percent of what it was in 1913 when the Fed was created. The Fed has amplified rather than damped economic fluctuations (for a masterful exposition of the destructiveness of US, European, and Japanese central banks the last several decades, see “The Japanization of the European Union,” Jesús Huerta de Soto, SLL, 12/13/19). Which prompts the Overton window-shattering question: why do we need central banks in the first place? The Overton window-shattering answer: we don’t.
We’re not yet to the point where shattering questions are asked about central banks or other government or government-aligned institution, but we’re well into stage one: the realization that the status quo is not working for anyone but a small sliver of the population. Stage two has also launched: recognition that promoters of the status quo lie incessantly. So too has stage three: things keep getting worse.
The lying is incessant. The Organization for the Prohibition of Chemical Weapons’ (OPCW) official conclusions about an alleged chlorine attack in Douma, Syria were unsupported by the evidence and several OPCW investigators raised unaddressed objections at the time. The findings were skewed to support propaganda justifying retaliatory airstrikes by the US, UK, and France. Justice Department Inspector General Michael Horowitz’s report detailed the FBI’s lies and deliberate omissions of exculpatory material to the FISA court. The Washington Post recently published what are being called the Afghanistan Papers, culled from a trove of Freedom of Information Act releases. Numerous military and civilian officials lied about America’s eighteen-year and counting war in Afghanistan from its inception.
This is a couple of weeks’ disclosures concerning official prevarication. The OPCW story hasn’t received much coverage in the mainstream media, while the IG report and the Afghanistan Papers have. They’re the tip of the iceberg. While more people are seeing the iceberg that’s above the water line, the Overton window and pervasive official secrecy still obscures the much larger part floating below the surface.
It probably doesn’t matter. There is one bedrock truth about governments: they are based on coercion, violence, and fraud. It’s easy to mistake lack of public reaction to stories like the above for insouciance or mental sloth, but many people have internalized that governments repeatedly lie, they don’t need the details. They don’t have time to follow all the stories or to speak out and protest the undeniable lies and injustices—they have lives to lead. There are often nasty reprisals for those who speak out or protest, and they know that, too. But an ever-increasing percentage of the populace know in their bones that contemporary governance is rotten to its evil core. Whatever trust that once existed between government and the governed is long gone and it’s not coming back.
What visibly agitates people are officially promoted issues and the attendant propaganda when they clearly see the effects on own their lives and well-being. Donald Trump rode immigration to the White House, astounding legions of pundits and self-proclaimed experts who endlessly assured us that illegal immigrants don’t take jobs, commit crimes disproportionate to their numbers, run drugs, or soak up welfare-state benefits. The unwashed masses rejected the assurances in favor of their own experience and knowledge.
Once a person or institution loses trust, propaganda and “explanations” only increase skepticism and cynicism. The crowd promoting anthropogenic, apocalyptic global warming climate change is the same one that’s promoted open immigration, welfare and warfare states, and central banking, among other follies. Climate change is nothing more than a Trojan horse for more coercion, command, and control, ultimately leading to global government.
The “deniers” reject the supposedly settled science. Science is never settled, there are only hypotheses that offer more explanatory and predictive power than previous hypotheses. Nobody listens to messages from messengers they don’t trust, and resorting to hysterically hectoring harpies doesn’t help the cause. AOC can take care of herself, but using a sixteen-year-old stooge is particularly reprehensible. Patriotism was once the last refuges of scoundrels, now it’s “the children” (see Clinton, Hillary, It Takes a Village: And Other Lessons Children Teach Us, 1996, Simon & Schuster).
The 1910-1920 decade kicked off the long bull market in government.
In the US, we got the Federal Reserve, the income tax, direct election of senators, and Prohibition.
The world got World War I and the Treaty of Versailles, the Middle East sliced up into European satrapies, the Bolshevik Revolution, and the Spanish Flu.
The next hundred years was a montage of government-sponsored horrors: the Great Depression, World War II, tyrannical dictatorships, mass slaughter, nuclear weaponry, terrorism, environmental degradation, the American military-industrial-intelligence-media-academic complex, and an unprecedented explosion of debt to pay for it all. Yet, after the bloodiest century in human history, in which governments killed an estimated 100 to 200 million people not counting the wars, questioning the legitimacy and necessity of governments is still outside the Overton window.
Arctic blasts of reality are set to shatter that window and freeze all those who believed its double panes would protect them. It’s necessary because the current system is never going to improve itself. Only a full demonstration of the horrors of the old and unimproved will open people’s minds to the possibility of something different, something new and improved. Stage four is system collapse and we’re on the cusp. It will be the direct result of the last century’s follies and will spell the end of the bull market in government.
The widespread dissatisfaction with the way things are, even before collapse, portends something much more ominous ahead. Brexit, Trump, Catalonia, Hong Kong, the Yellow Vests, and the other protests and unrest are relatively minor perturbations. Reform and separation are their predominant themes, not rebellion and overthrow. Reform, unfortunately, is impossible; entrenched elites’ money and power flow from the corruption. Separation and secession are the last, best hope for any kind of semi-peaceful resolution of the tensions besetting the world.
The Civil War was fought to preserve the federal government’s control of the states. The Overton window puts beyond question that the Civil War permanently vanquished all consideration of secession. However, the centrifugal forces of decentralization and devolution are waxing. Eventually they will hurl present political arrangements against the wall. Doesn’t some sort of peaceful breakup make more sense than an inevitably bloody and doomed effort to preserve the unwieldy dominion of the corrupt, parasitic, and bankrupt federal government?
For those of us bent on upending present political arrangements, it’s more logical to lay claim to part of the country as the US splats against the wall than to try and reconstitute a government to govern the sprawling American land mass, and a disparate and ideologically incompatible population of 330 million. Part of something is better than all of nothing. Texit or Appalachexit would be far easier than restoring a Constitutional republic to the whole of the United States. And there’s a tactical advantage to advocating for peaceful secession rather than violent revolt: the former won’t get you thrown in jail—yet, unless you’re in Catalonia or China—the latter might.
Let those who want to remain safely within the Overton window have their welfare and warfare state, their central bank, their faltering empire, and their domination by parasitic government. Let the rest of us discover freedom, true peace, and self-sovereignty in one or more breakaway provinces.
Surely if these outside-the-window notions are merely crackpot fantasies our efforts will fail and we’ll come skulking back, recognizing Washington as our one true master and begging for reunification. And if our efforts succeed? That’s stage five, a prospect we’re not to supposed to think of, dream about, or strive for, the stuff of our rulers’ nightmares. It’s why they installed the Overton window in the first place.
U.S.-led wars in the Middle East have killed some four million Muslims since 1990. The recently published Afghanistan papers, provided an insight into the longest war in U.S. history and revealed how U.S. officials continuously lied about the progress being made in Afghanistan, lacked a basic understanding of the country, were hiding evidence that the war was unwinnable, and had wasted as much as $1 trillion in the process.
Unfortunately, this phenomenon is nothing new. While most people accept that the United States has been interfering with Muslim populations quite heavily since World War II, the truth is that the U.S. has been fighting “forever wars” against Muslim populations for well over 100 years. (If you want to really go back into history, Thomas Jefferson was also fighting Muslims in the oft-forgotten Barbary Wars in the early 1800s).
The average American school curriculum likely doesn’t feature the fact that the U.S. waged a war from 1899 to 1913 in the southernmost island of the Philippines. Known as the Moro War, it was the longest sustained military campaign in American history until the war in Afghanistan surpassed it a few years ago. As a result, the U.S. and the Philippine governments are still embroiled in a battle with Islamist insurgents in the southern Philippines, which takes the meaning of “forever war” to a whole new level.
Despite over a century passing since the U.S. led a counterinsurgency war against the Islamic Moros, its similarities with the Afghanistan war are incredibly noteworthy, to say the least.
Even reading accounts of the terrain in which both conflicts were fought suggest they were equally as treacherous. As detailed in the memoir of Captain John Pershing, fighting the Moro Wars “entailed guerrilla warfare in a country unknown to us, with its swamps and rivers and its hills and mountains, every foot of which was familiar to the inhabitants and their insurrecto troops.”
While the U.S. often boasts about fighting for freedom, many Americans may be wondering how it is that their freedom came to be located in the Philippines in the first place. Was it worth sending 75,000 American troops in just 1900 alone to the Philippines to fight and die? And was the operation even remotely successful?
More importantly seems to be the indication that the U.S. military was not welcome in the Philippines, much as it is not welcomed by Afghanistan or any other Muslim-majority nation which has to duel with the U.S. Empire. After the U.S. defeated the Spanish fleet in Manila Bay and annexed the Philippines under the 1898 Treaty of Paris, the Moro population were not even consulted. The U.S. then sought to “pacify” them using brute force.
“I want no prisoners,” ordered General Jacob Smith on Samar Island during the war in 1902. “I wish you to kill and burn, the more you kill and burn the better you will please me.”
Fast forward over 100 years later and it is difficult to see how U.S. military doctrine has changed for the better.A video came to light in 2010 of then-General James Mattis saying that it was “a hell of a lot of fun to shoot” people in Afghanistan. Mattis was later rewarded for his heroism and bravery by being crowned Donald Trump’s secretary of defense for a short while.
As you can imagine, General Smith received his wish just as Mattis after him, with perhaps half a million locals dying as a result of the U.S. invasion. At Bud Dajo, some 1,000 Moro separatists, including their families had fled to the crest of a volcano to escape the American invasion. Allegedly, American troops reached the top of the volcano and fired down into the crater until they killed 99 percent of the inhabitants. The colonizers then took the time and effort to pose for a photograph with the hundreds of dead bodies (no, seriously).
It is also worth noting that some 4,000 U.S. soldiers lost their lives during this particular war. This closely mirrors the number of coalition deaths since 2001 in Afghanistan—and for good reason. To minimize U.S. personnel deaths in the Philippines’ war, the U.S. military deployed Filipinos led by U.S. officers into battle. (Sound familiar?)
At one stage, Filipinos ended up doing almost all of the dying as U.S. soldiers slowly left the battle theatre. In fact, the final year of conflict was the bloodiest year of the Moro war. This seems to be the trend in a number of U.S. wars. This is certainly true with respect to Afghanistan, with the U.S. military and its Afghan lackeys on the ground killing more civilians than the Taliban in recent times.
But what is all this senseless violence for? To put it simply, whether in the Philippines, Iraq, Afghanistan, or elsewhere, this rampage is all borne out of the belief that America’s subordinates are not capable of ruling themselves and will ultimately profit from American occupation. This was actually the firm thinking of U.S. President Theodore Roosevelt, who saw it as the duty of the United States to maintain the Philippines as a protectorate. This idea was famously (or infamously) termed the “White Man’s Burden” in a poem written by Rudyard Kipling, who sent the poem to Teddy prior to his decision to engage in the Philippine-American war. A 1902Life Magazine cover even depicted an apparent waterboarding of a Filipino POW by U.S. personnel (the supporters in the background seem to be watching with glee).
When not much has changed, it seems it never will. We can also expect this type of activity to continue for the foreseeable future, given the geopolitical stakes at hand. In the case of the Philippines, it was recently reported that Chinese and Philippine foreign ministers have sealed an agreement for the two nations to pursue joint oil and gas exploration in the hotly contested South China Sea.
As it turns out, the South China Sea could contain anywhere between 125 billion barrels of crude oil and 500 trillion cubic feet of natural gas. The idea that a foreign adversary, especially one rising to prowess on the world stage such as China, could control the majority of these resources unchecked is a major blow to the U.S. Empire.
Whether it is lithium, opium, and geostrategic chess moves in Afghanistan; or natural gas and oil in the South China Sea, Muslim populations will continue to suffer in a colonial terror campaign which has been unfolding for over 100 years.
Think of it this way: if another century passes and your great grandchildren had never heard of the “forever war” that took place in Afghanistan in the early 2000s, all the while watching a new war unfold in the Indo-Pacific region for similar reasons, you would rightfully be fuming in your grave.
In the U.S., electricity generation from coal has been dropping since the late 2000s, and in Europe the departure from coal has accelerated even quicker. In fact, it’s estimated that European coal power output could fall 23% in 2019 alone.
A Different Global Story
However, despite a growing consensus around the use of thermal coal in the West, the global story is actually quite different.
Today’s animation from SVT Nyheter details every coal power plant in the world from 1927 to 2019, and it shows that coal power — especially in South Asia — has continued to ramp up.
As of 2019, there are an estimated 2,425 coal-fired power plants in the world, combining for an operating capacity of about 2,000 GW and roughly 15 billion tonnes of CO₂ emissions.
Global Tipping Point?
Since 2010, there have been hundreds of new coal power plants commissioned — and almost all of them can be found somewhere in Asia:
However, it seems that this could be the year that the story changes.
Preliminary data suggests that Indian coal consumption could drop in 2019 for the first time in over a decade. Meanwhile, it’s expected that China’s growing coal capacity could be fully offset by decreasing use of the fossil fuel in developed nations.
As a result, according to Carbon Brief, global coal power generation could fall 3% in 2019:
If this trend continues, it could be a sign of a tipping point in global coal consumption — and if the sentiment around coal shifts the same way in China, the potential impact could be amplified even further.
Will 2020 provide additional evidence towards a global sea change in coal dependence, or is 2019 just a blip on the radar?
To understand why there’s no-one in the administrative mid-tier of the FBI acting in a whistle-blowing capacity requires a background perspective looking at the totality of corruption. The institutions are protecting themselves; and yes, that protection applies to the internal dynamics.
Former DAG Rod Rosenstein was dirty. He might not have started out dirty, but his actions in office created a dirty mess. Rosenstein facilitated the McCabe operation against Trump during the May 16th, 2017, White House FBI sting against Trump with Mueller. Rosenstein also facilitated the special counsel (writ large), and provided three scope memos to expand the corrupt investigation of President Trump. According to the inaction of AG Bill Barr, we’re not allowed to see those authorizing scope memos.
Additionally, despite knowing the Trump investigation held a false predicate, Rosenstein signed the 3rd renewal of a fraudulent FISA application. Worse yet, even if Rosenstein was caught up by corruption around him, he did nothing to stop the fraud once identified.
Why is Rosenstein a key inflection point? Because Rod Rosenstein recommended current FBI Director Christopher Wray to President Trump. POTUS then allowed Wray, as he does all department heads, to select his deputy – Wray chose David Bowditch.
Keep in mind the National Security Division of the DOJ (DOJ-NSD) was/is the epicenter of many corrupt activities, including filing the fraudulent FISA application, manipulating interpretations of law for FARA (§901) violations, and doing all of this while denying any inspector general oversight. As FISA Judge Rosemary Collyer recently noted, the DOJ-NSD is positioned as a rogue legal arm of the U.S. intelligence apparatus.
FBI Director Wray selected the former head of DOJ-NSD to become the lead lawyer for the FBI, chief legal counsel Dana Boente.
So from Rosenstein we got: Chris Wray, David Bowditch, Dana Boente and another dubious DOJ recommendation, DC U.S. Attorney Jessie K Liu (ref. Awan Bros and James Wolfe). Keep this in mind moving forward.
Another career corrupt-o-crat to come out of the DOJ-NSD, who was also involved in the fraudulent legal filings was the lead lawyer for the division, Michael Atkinson.
Atkinson was moved from DOJ-NSD to become the Intelligence Community Inspector General (ICIG). Yes, the same IGIC who manipulated the rules and regulations to allow the hearsay Ukraine CIA “whistleblower”, Eric Ciaramella.
What we end up with is a brutally obvious, convoluted, network of corrupt officials; each carrying an independent reason to cover their institutional asses… each individual interest forms a collective fraudulent scheme inside the machinery of the FBI apparatus.
The motive behind the DOJ/FBI effort to cover for Senate Intelligence Committee Security Director James Wolfe’s unlawful classified information leaks, is connected to this network and expands into the SSCI Chairman (Richard Burr) and Vice-Chair Mark Warner.
Security Director Wolfe was working on instructions from inside the committee itself; his leak of the FISA application to journalist Ali Watkins was in alignment with the intents/motives of the SSCI in March 2017. Dirty politicians corrupting staff.
The DOJ and FBI didn’t charge James Wolfe with the leaking of classified information because it would have exposed corruption within the SSCI. Wolfe was prepared to call the senators in his defense…. this could not be allowed. The SSCI has oversight over the intelligence community to include the FBI, DOJ, DOJ-NSD, CIA, ODNI etc.
How does all of this corruption come together?…. More importantly how does this level of institutional corruption create the inability of FBI whistle-blowers to come forward?
The Senate Select Committee on Intelligence is the approver for any nominations for any executive appointed position involving the intelligence community.
If the senate intel committee wants to block the nomination, likely adverse to their interests, they can… simply, they don’t take it up. (See Trump’s attempt to appoint Representative John Ratcliffe as ODNI as an example.)
However, along with approving Wray and Bowditch, the SSCI also approved former DOJ-NSD legal counsel Michael Atkinson to become Intelligence Community Inspector General. Who would an honest intelligence whistle-blower have to go through? Dirty Michael Atkinson.
The same dirty Michael Atkinson who was the top legal counsel to the head of the DOJ-NSD when the corrupt DOJ-NSD agency operations were ongoing. See how the whistle-blower block works?
Aligned interests – The Senate Intel Committee uses the placement of Atkinson to block any whistle-blower action that would be adverse to their interests. Whistle-blowers ain’t stupid, they know what surrounds them.
Senator Mark Warner and Senator Richard Burr are dirty. So too is ICIG Atkinson, FBI Director Chris Wray, FBI Deputy Director David Bowditch and FBI Legal Counsel Dana Boente.
Robert Mueller was dirty. Rod Rosenstein was dirty. All of the special counsel lawyers including Andrew Weissmann and Brandon Van Grack (Flynn prosecutor) are dirty. Additionally Mueller’s lead FBI Agent David Archey, who was promoted after the corrupt special counsel investigation to be the head of the Virginia FBI field office, dirty.
FBI official David Archey, like ICIG Michael Atkinson, conveniently put into a place where he can run cover for FBI operations that might expose dirty DC and Virgina-based FBI activities. See how that works?
Try telling me with all we know about the Mueller investigation how anyone on the special counsel assignment was participating in a fraudulent investigation without knowing.
Special Agent Peter Strzok, dirty. FBI lawyer Kevin Clinesmith, dirty. FBI Lawyer Lisa Page, dirty. FBI media spox Michael Kortan, dirty. James Comey, Andrew McCabe and James Baker, dirty-dirty-dirty. Fortunately all of these are fired… but what about Supervisory Special Agent Joseph Pientka (SSA1)? Pientka clearly outlined as dirty by IG Horowitz report on FISA abuse, and yet still employed; still providing cover.
So what exactly does that make Horowitz? Perhaps lead corruption polisher who comes in willfully blind behind the Bondo application team?
That, all of that, in its brutal totality, is why we have not seen any honest FBI whistle-blowers come forward.
There’s no-one for them to blow the whistle to…
Every day we spend outraged about what the DOJ and FBI did in 2016 and 2017, is one less day that AG Bill Barr is not being held accountable for all of this current DOJ and FBI corruption that stares him in the face when he brushes his teeth each morning.
If we had a functioning Fourth Estate none of these corrupt officials could survive investigative media scrutiny. Unfortunately the corrupt administrative state doesn’t *play* the press, it actually involves the press…. it absorbs the press… it attaches the press viability to its own position…. it makes the press part of the corrupt process.
The press cannot turn against the corrupt administrative state without exposing their own culpability, participation and lack of credibility… It’s a protective circle.
As the decade comes to a close, what better time to look back and review which trends in alcohol made an impact – and which ones likely won’t be sticking around for the 2020s.
Craft spirits caught on in a big way during the decade, according to Bloomberg. There were 195 independent craft distilleries in the U.S. in 2010 and that number rose to 1,586 by 2018. With handmade-style liquors becoming popular, major brands like Proximo and Remy Cointreau found themselves purchasing majority stakes in small distilleries.
Kaveh Zamanian, founder of Louisville, Kentucky’s Rabbit Hole Distillery, which was purchased in 2019 by Pernod Ricard said: “The benefit of a strategic partnership allows us to scale up in a meaningful way.”
Zamanian doesn’t see the partnership as “selling out”, but rather as an investment in his vision and path toward more product innovation.
Meanwhile, U.S. tariffs on European alcoholic products could continue to make the next year even better for domestic-made spirits. Additionally, the recently signed Craft Beverage Modernization Tax Reform Act provides distillers savings of $10.80 per gallon of the first 100,000 gallons produced.
Celebrity liquor also became popular in the 2010’s, including “Born & Bred Vodka from Channing Tatum, Heaven’s Door Whiskey from Bob Dylan, Virginia Black Whiskey from Drake, Villa One Tequila from Nick Jonas, and even Ron de Jeremy spirits from porn star Ron Jeremy.”
George Clooney also wound up selling his Casamigos tequila brand to Diageo for $1 billion in 2017. Actor Ryan Reynolds acquired part of Oregon’s Aviation Gin in 2017, also.
Andrew Chrisomalis, CEO of Davos Brands, which owns Aviation, said: “Ryan is recruiting new fans to the gin category and to American gin in particular.”
Aside from ownership, some other actors took a different angle on things. Meanwhile, Matthew McConaughey was named “creative director” for Wild Turkey in 2016.
Julka Villa, managing director at Campari Group, which owns Wild Turkey said: “The decision to partner with Matthew was born out of a desire to share our rich, storied history with a younger bourbon consumer.”
In the decade ahead, eyes will also be on Aaron Paul and Bryan Cranston’s “Dos Hombres” mezcal brand and Kate Hudson’s gluten free, non-GMO corn-based vodka, “King Street”.
The rise in premium spirits has also led to higher quality mixers. For instance, Fever Tree from the U.K., which makes mixers, was valued at $4.5 billion earlier this year. Other mixer companies will also be gaining traction in the upcoming decade.
Jordan Silbert, founder of Q Mixers in Brooklyn, New York said: “When we launched over 10 years ago, consumers in the know wanted to make great drinks and they began investing in premium spirits. It only made sense that mixing those better spirits with mixers of comparable quality and sophistication would make better drinks.”
Additionally, low alcohol drinks have also been a trend over the past decade, as we have highlighted before here on Zero Hedge.
Lynn House, national spirits specialist and portfolio mixologist for Heaven Hill said: “Spritzes and low alcohol session cocktails are a way for people to enhance a moment without the punch of a high proof spirit.”
The trend seems to be set for the upcoming decade: low alcohol fizzy and highball type drinks made with liquers won’t be going away anytime soon, even though tariffs may have an impact on availability of some cordials.
Meanwhile, according to Nielsen, sales of hard seltzer like White Claw are up more than 208% in 2019.
There has also been a rise in bitter-style drinks that has coincided with the hop-heavy beer trend that started in the late 90’s and early 2000’s. Amor y Amargo, a bitters-focused cocktail bar in New York City, started as a pop-up bar in 2011 and has graduated to a full blown bar due to popular demand. It now has a second location in Williamsburg, Brooklyn, that it opened in 2019.
Nick Elozevic, co-owner of Diamond Dogs, a casual neighborhood bar in Astoria, Queens said: “Years of watching people like Anthony Bourdain on TV has expanded American consumers’ palates and appreciation for different flavors.”
Finally, the growth of cocktails on social media has helped contribute to their popularity outside of social media. Bright drinks and ridiculous glasses all make for good fodder on social media.
Liquor brands hire social media cocktail stylists like Josue Romeo to help in posting content. They also work with consultants like Alexandra Farrington to come up with eye-catching concepts that will grab people’s attention on social media. Some bars even have their own budgets for “creative directors”.
But looking into the 2020’s, some are hopeful that the trend doesn’t continue. “With constantly shifting algorithms and platforms such as Instagram experimenting with not posting “likes”, maybe we can all soon go back to sipping plain old glasses of wine—and not telling anyone about it,” Bloomberg concludes.
An illustrative personal anecdote, one of many over the last three years: A creative writing PhD with tons of debt, whose wife happens to be an undocumented Filipina, became mighty angered by the promise of student debt cancelation. What about those who have paid their dues by taking out debt? No doubt he would refuse a blanket amnesty for “illegals” too. His DACA wife paid her dues.
The columnists at the New York Times are all angry at the possibility of decriminalization of border crossings, health care for the undocumented, and abolition of private insurance. They don’t want to do away with Trumpian inhumanity. They want the oppression to continue, but without the transparent rhetoric.
Minus the Trumpian rhetorical overlash, war, empire, violence, hollowness, junk goods, and a junk life are all the people have ever known and all they want.
Historical movement in long cycles can’t be short-circuited, as we can see in the resistance of the liberal elites toward Sanders, the only candidate who could beat Trump, versus the stampede toward Warren, who provides a safe alternative, and would surely lose.
But what kind of a fascist doesn’t start a war in three years? Trump doesn’t need war, because he has brought the war home by making us confront our emptiness directly. He is the catalyst we needed at this time, and he is fulfilling his purpose beautifully. America is exhausted, which the liberal elites don’t get.
Trump keeps making noises about Iran, but he hasn’t actually done it yet. His pullback at the last moment, when the bombers were supposedly already on their way, is a trope that makes sense to a lot of people. We could have, in a science-fictional world, the repetition of this particular action—pulling back from the brink, the antithesis to Strangelovian irrevocability—day after day, and it would be the right psychotropic drug to rouse us.
And what kind of a huckster is he? He constantly keeps changing his mind, which is not a character flaw, but the essence of his “deal-making.” America can’t find a better deal—from the New Deal to the Fair Deal to the imaginary Green New Deal, a landscape of lost opportunities and blighted dreams—so contingent honor, betrayed promises, and infinite self-cancelation constitute the only kind of deal-making possible. And unlike The Apprentice there can be no winner at the end, while the rest get fired, because the endless prevarication—saying two things at the same time, often diametrically opposite—is what constitutes deal-making. We’d better get used to it: it is the welcome end to a century of liberal social planning.
To be totally adrift, he’s saying and resonating mightily, is to have total freedom. The empire embraces its most recent eruption of vulgarity, barbarism, and eco-destruction as a welcome development—at least the dispossessed do, if not the meritocrats. To move beyond the dead language of liberal political correctness, which all of the Democratic candidates suffer from, is a great service. He is preparing us for the imminent turmoil of the coming decades—concluding at last in secession and fragmentation by mid-century—with the kind of language the empire needs now. He’s reading history well, only too well, far better than his ideological opponents, the neoliberal globalizers or the democratic socialists.
Not one of his opponents is prepared to say that power is America—brute, unforgiving, no-second-chances power. This kind of power requires a base removed from liberal education. He reforms language every day, in his tweets, which emanate from our deepest unconscious, such as when liberal stand-up comedians turn out to be racists and mysogynists in their revealing moments.
As we prepare for the age of brutality, he’s telling us—as the Times columnists confirm every day in the limits they impose to compassion—that the recent gloss of multicultural tolerance, in the Reagan/Clinton/Obama years, was the final fantasy. His border wall seeks to literalize the walls of segregation and inequality that have been going up relentlessly all throughout the interior. He won’t start wars of humanitarian liberation, because that was the foreign aspect to the domestic malevolence passing as tolerance.
Trump doesn’t want to restart history, to repudiate Francis Fukuyama, or Bill Clinton. Nor does he want to start a clash of civilizations, to validate Samuel Huntington, or Bush Jr. He is content with leaving history alone, which seems natural, coming so soon after Bush Jr.’s counselors, who wanted full spectrum dominance. The deal, as Trump sees it, is ever-changing, immune from textual recreation, legal solidity, constitutional affirmation.
What is his obsession with China then? China for the last three decades has been a management consultant’s dream come true. Trump is not playing a zero-sum game, a chessboard called economic nationalism, with China. With him we move beyond oligarchic nationalism or even democratic fascism. China helps construct a total vacuum of thought reaching even beyond the vulgarity of trashy American consumerism. We no longer want their tacky goods. We want the Harley-Davidsons back—or not, it’s okay if they don’t come back. If we can’t recall manufacturing, and we leave world trade, then we are thrown upon a manly ideal, where we make things and do things for ourselves, except that Trump and his followers know that that ideal is well past reach, going out of fashion with the rise of consumerism precisely a century ago.
The 2020s: an exact reversal of the rise of optimistic consumerism in the 1920s. History does have its symmetries, if you know where to look. The end to advertising, news broadcasting, modernist propaganda, the religion of self-help and therapy, physical fitness, institutionalized spying, and technological utopia.
His attack on the media, the breathing tube for an empty liberal consumerism that died long ago, is the most welcome move to his fervent supporters. You can’t believe a word you see. You have to create your own reality, which the Internet helped bring about starting in the 1990s. Consider the real scandal of Joe Biden’s son’s corruption, already noted matter-of-factly in leading newspapers, versus the impeachable scandal of just talking—airing out possible deals to land political opponents in trouble.Torture, assassination, deportation, and ecocide are all within the pale, for the resistance, for those who would like to replace him with an acceptable alternative who will take empire back to where it was.
But it’s not going to happen, because he never was the bearer of a virus, which implies something alien. He is the perfect mirror, just as Nixon followed Johnson, Reagan followed Carter, and Bush followed Clinton, in performing not so much an oscillation but an exaggerated return to form. Empires, heavy and difficult to maneuver, don’t engage in circular or sideways motions. Trump is the accelerant to the end point empire needs now, just as Reagan and Bush served their functions earlier, and in that sense he is a true man of the people. You don’t beat a man of the people electorally, you just don’t.
Is Tesla Shoving It In Trump's Face By Producing Cars In China To Skirt Tariffs?
Once again it seems like the rules apply to everyone – except Tesla.
First it was “Funding Secured”, argued to be one of the most blatant examples of securities fraud in recent history – all but ignored by the SEC. Then it was scores of Tesla vehicles involved in various “Autopilot” related accidents – all but ignored by the NHTSA.
Now it’s moving to China to produce vehicles in order to skirt tariffs – all but ignored by President Trump.
Tesla is now going to be delivering Model 3 vehicles built in its Shanghai factory effective Monday, according to Reuters. Construction of the plant began in January and production started in October. Tesla’s goal is to produce 250,000 vehicles a year at the factory, after the Model Y is added to the line.
The first 15 cars to roll off the line on December 30 will go to employees.
The factory will be delivering cars just 357 days after the factory’s construction started. We also recently reported that Musk was somehow able to procure a $1.4 billion loan from various Chinese banks at a 10% discount to the prime rate.
That’s right, nothing to see here, President Trump…
The China made cars are priced at $50,000 before subsidies and Tesla wants to have deliveries in full swing by January 25. China is the world’s biggest EV market and sold 1.3 million NEVs last year.
Tesla is also working to build infrastructure in China, setting up service centers and charging stations across the country.
We can’t help but ask: With all of the outrage Trump has directed toward conventional manufacturers like General Motors and Carrier – why does Elon Musk and Tesla once again get a pass?
The debate about the existence of alien life has been a topic that has interested humans for a long time and the scientific community has had split opinions regarding our solitude in this amazingly big universe.
Now, new research published in the Astronomical Journal provides further information that invites us to rethink our mindset on this topic.
During the summer of 1950, physicist Enrico Fermi posed a question to his colleagues over lunch:
“Don’t you ever wonder where everybody is?”
He was referring to alien life.
The Earth is 4.5 billion years old, and we could say that that was roughly the time it took a “kind of life” to be capable of space travel. Our universe is approximately 13.8 billion years old.
Fermi proposed that during this time, the galaxy should have been overrun with intelligent, technologically-advanced aliens. Yet, we have no evidence of this despite decades of searching. This postulate became known as the Fermi Paradox.
Briefly, some of the main points of this paradox, formalized by Michael H. Hart, are:
There are billions of stars in the Milky Way similar to the Sun.
With high probability, some of these stars have Earth-like planets, and if the Earth is typical, some may have already developed intelligent life.
Even at the slow pace of currently envisioned interstellar travel, the Milky Way galaxy could be completely traversed in a few million years
And since many of the stars similar to the Sun are billions of years older, this would seem to provide plenty of time
Now, you can have a clearer view of why this paradox is so interesting for scientists and further investigation is being done, the odds seem to be really high.
The expectation that the universe should be teeming with intelligent life is linked to models like the Drake equation, which suggests that even if the probability of intelligent life developing at a given site is small, the sheer multitude of possible sites should nonetheless yield a large number of potentially observable civilizations.
This new study offers a different perspective on the question: maybe aliens are just taking their time and being strategic.
“If you don’t account for the motion of stars when you try to solve this problem, you’re basically left with one of two solutions,” Jonathan Carroll-Nellenback the study’s lead author said.
“Either nobody leaves their planet, or we are in fact the only technological civilization in the galaxy.”
Stars orbit the center of the galaxy on different paths at different speeds. They occasionally pass each other, so, aliens could be waiting for their next destination to come closer, Caroll-Nellenback’s study says.
Researchers have formulated different theories trying to answer the Fermi Paradox, including the possibility that all alien life forms in oceans below a planet’s surface and there’s even the “zoo hypothesis” which imagines that societies in our galaxy decided to not contact us to “preserve” us in a way analogical to how we preserve some natural places—or even to prevent them from getting some kind of “disease” from us.
A crucial fact to this new study is the fact that, as previously mentioned, the galaxy moves. So, aliens could be waiting for an optimal travel distance to explore new territories.
“If long enough is a billion years, well then that’s one solution to the Fermi paradox,”Carroll-Nellenback said.
Another important thing to notice is that the research team did not attempt to guess at the alien’s motivations or politics, something that usually delayed the attempts to solve the Fermi Paradox.
We have to consider also that our consciousness and our perception of the “civilization” concept may play a crucial part in this kind of studies. So, our predictions may be based on our own behavior.
“We tried to come up with a model that would involve the fewest assumptions about sociology that we could,” Carroll-Nellenback said.
So far, we’ve detected about 4,000 planets outside of our solar system and none have been shown to host life. But we haven’t looked that hard—there are at least 100 billion stars in the Milky Way and even more planets, so we still have a lot more to explore.
Maybe, merging philosophy and science together for a moment, we could believe that at some point, if there is in fact alien life out there in the universe, we (or our kids, grandkids, or great grandkids) will get to know them and make really close contact, assuming all of this in basis of some of the ideas exposed in Kant’s Critique of Pure Reason, where he says that if something can happen, and there is enough time for that to happen, it will happen.
Russian YouTubers Create Gas-Powered Replica Of Tesla's Cybertruck Using A Hatchback And Some Sheet Metal
Who knows how long it could be before Tesla finally starts production and delivery of its Cybertruck? Given the company’s timelines of days past, it could be years.
Maybe that’s why a group of three men in Russia decided they were just going to make their own knock off of the truck, from a gas powered car, according to Business Insider. And so, that’s exactly what the YouTube channel Pushka Garazh – which translates to “Gun Garage” in English – did.
And they did it using an early model of a Russian made hatchback. The men started with this: a Lada Samara, a hatchback created by Russian car maker AvtoVAZ.
The group spent about $1,300 USD to create the replica, spray painting the hatchback after covering the car in sheet metal. However, at 13 feet long, the replica is about 6 feet shorter than the actual Cybertruck.
The replica, however, doesn’t have any doors (just like a Model S in the winter!). So people that want to get in and out are forced to go through the trunk.
The guys even added Tesla branded hubcaps and a horizontal beam brakelight, like the one found on the actual Cybertruck. The replica is also gas powered.
If you ask us, they did a great job in re-creating the overall hideousness of the vehicle. Given how shoddy it looks, we’re sure those on the street lucky enough to catch a glimpse of the replica likely had no problem believing it was the real thing.
You can watch the entire episode where they build the replica here:
According to experts, climate change will result in “millions” of deaths, major European cities being sunken, nuclear war and global environmental riots…all within the next 5 days.
That’s because they made the prediction back in 2004 and said all that would happen by 2020, which is just 5 days away.
“Climate change over the next 20 years could result in a global catastrophe costing millions of lives in wars and natural disasters,” reported left-wing newspaper the Guardian on February 22, 2004.
“A secret report, suppressed by US defence chiefs and obtained by The Observer, warns that major European cities will be sunk beneath rising seas as Britain is plunged into a ‘Siberian’ climate by 2020. Nuclear conflict, mega-droughts, famine and widespread rioting will erupt across the world,” the report added.
The alarmist document went on to claim that nations would resort to using nuclear weapons to protect dwindling food supplies, a situation that would “bring the planet to the edge of anarchy.”
Remember guys, it’s just 5 days until the UK is “plunged into a Siberian climate.”
From the same trustworthy people who gave you mass starvation of humanity by the 80’s, “ice free” Arctic summers by 2013 and Greta Thunberg.
The authors of the report, Peter Schwartz and Doug Randall, also asserted that “By 2020 ‘catastrophic’ shortages of water and energy supply will become increasingly harder to overcome, plunging the planet into war,” causing widespread “crop failure” and “famine.”
So apparently, the UK is just 5 days away from being plunged into a “Siberian climate” and millions of people are about to die in a giant nuclear carnage caused by global food shortages and monster droughts.
Or alternatively, so-called “climate experts” have been proven spectacularly wrong on absolutely everything, from Paul Ehrlich’s prediction of millions of deaths from famine by the 80’s, to Al Gore’s absurd claim that the Arctic would have “ice free” summers by 2013.
Just like the much heralded “secret report” that predicted global catastrophe by 2020, none of it happened.
So why should we trust the same people now?
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Opioid Abusers Also Face Higher Risks Of Death From Suicide, Disease & Car Accidents
The surge in drug overdose deaths linked to powerful opioids like fentanyl and other analogues will likely be remembered as the defining national health crisis of the 2010s. And as the decade draws to a close, one study found that people who use illicit opioids face an increased risk of other “deaths of despair.”
According to CNN, which cited findings from the study initially published Thursday in the medical journal JAMA Psychiatry (one of the more well-respected medical journals in the US) users of illicit opioids (i.e. everyone who uses them without a prescription) face an elevated risk of dying from noncommunicable diseases (like heart disease), infectious diseases and viruses (like HIV and Hep C), suicide and other unintentional injuries (like car accidents).
Suicide deaths among the sample group studied occurred at nearly 8x the expected rate, while unintentional injuries occurred at 7x the expected rate. Deaths from interpersonal violence, while still relatively infrequent, occurred at 9x the normal rate, which is also unsurprising. Heroin addicts will often take risks to get high, including trying to rob drug dealers, who often carry guns to ward off such attacks.
“People might be surprised that although overdose was the most common cause of death, it’s far from the only cause of death that people using opioids outside a prescription experience at excessive rates,” said Sarah Larney, lead author of the study and a senior research fellow at the University of New South Wales’ National Drug and Alcohol Research Centre in Australia.
“Smoking-related illnesses such as cancer and cardiovascular diseases are common. Trauma is another major factor. People are exposed to car accidents, assaults and other causes of injuries at greater than usual rates, and suicide is also much more common than in the broader population,” she said. “It’s really clear that although overdose prevention is critical, we also need to look at the range of poor outcomes that people are experiencing, and work to reduce other causes of excess mortality such as suicide, chronic diseases and infectious diseases.”
Researchers looked at opioid users across 28 countries, and compared their data to data collected from 124 previously published studies, some that were conducted as far back as Jan. 2009.
Unsurprisingly, researchers found that men faced significantly higher rates of drug-related deaths than women (unsurprising since the majority of hard-drug users are men). Older users also faced significantly higher rates of drug-related deaths.
But among women examined in the study, deaths from HIV were particularly pronounced. That’s hardly surprising, since female heroin users will often work as prostitutes to raise money to finance their addictions. Men who consume excessive amounts of alcohol, meanwhile, registered much higher rates of deaths related to liver disease.
Overall, while poisoning- or substance-related deaths were the most common cause of death among opioid users (accounting for 31.5% of deaths), noncommunicable diseases accounted for 24.1% of deaths, while infectious diseases accounted for 19.7% and physical traumas accounted for 18.1%.
“To me the most important message to take from this study is that we need to think beyond the drug. People using opioids are people first and foremost, and have complex health and social needs,” Larney said. “Making sure people have access to essential medicines to treat HIV and Hepatitis C; encouraging smoking cessation through access to nicotine replacement therapies; and ensuring access to nutritious food and safe shelter would all go towards reducing the death toll in this population.”
A report issued in September by the US Congress Joint Economic Committee entitled “Long-Term Trends in Deaths of Despair” found that “mortality from deaths of despair far surpasses anything seen in America since the dawn of the 20th century…the recent increase has primarily been driven by an unprecedented epidemic of drug overdoses.”
Currently, there is a lot of discussion about the impact of technologies such as artificial intelligence on the world of work and employment.
Some of this is alarmist, and some excessively excited. There will indeed be dramatic changes, but history and economic theory both suggest that these will not radically alter the nature of the economic system.
However, while we should not fear the changes brought by widespread and extensive automation, we should be concerned about the way the process works and about its short-term and transitional aspects. Devising ways of dealing with these is a real challenge for both public policy and civil society.
In the last few years, there has been a lot of discussion about a new wave of automation that is already under way and starting to transform much of the economy. The central element in this is the combination of telecommunications with artificial intelligence (AI). This makes possible, people both hope and fear, the replacement of a great deal of human labor of many types. It is AI in particular that attracts the attention, not least because of recent dramatic breakthroughs such as the development by the Google-owned firm Deep Mind of an AI that could defeat the world’s best Go player (Go is a game played mainly in the Far East that in terms of its complexity is at least one order of magnitude higher than chess).
There have of course been many episodes of mechanization and automation before over the last 250 years. The argument made by many is that this time really is different for two reasons:
AI replaces not just human labor but the human mind and judgment as well;
and the automation will make market signals unnecessary because the key resource will be information, which is inherently abundant and can be reproduced at zero marginal cost.
There is a consensus that a lot of jobs or kinds of employment are going to disappear in the next two decades or so. There is disagreement over just how many will go as a proportion of currently existing employment. The OECD estimates that just under 10 percent of existing jobs are at high risk of automation. Other studies all conclude that the correct figure is somewhere in the high 40 percent range. The weight of opinion is therefore on the higher side of the two kinds of estimate.
Kinds of Jobs
There is a general agreement about the kinds of jobs that are likely to vanish. They all have certain qualities. One is that they are routine and repetitive, involving the repeated performance of standardized tasks. This includes both simple manual jobs and process-driven desk jobs. Another is that the job or role can be captured in a decision-making tree or flow diagram so that the range of decisions that have to be made is finite (it may still be large) — this means it can be done by an algorithm.
There is also general agreement about the kinds of work that are at low risk of automation. One is work requiring manual dexterity and manipulation (because of the difficulty of replicating the human hand); another is anything that requires human judgment or creativity, dealing with something that cannot be captured in an algorithm. The OECD study also argues that work involving human interaction is likely to survive simply because people crave human contact. Others are skeptical about this. Finally, there are some cases where stubborn human prejudice will keep the job in existence: it would be much safer if airplanes were entirely automated, but in polls most people would (irrationally) prefer a human pilot.
Given this, we can easily construct a list of the kinds of employment that are likely to vanish in the next decade or two. These range from jobs such as truck drivers and taxi drivers (replaced by autonomous vehicles), to a lot of logistics and warehouse work (replaced by automated handling systems), to a lot of routine work in the financial-services sector both high and low paid, to most legal work (but not trial lawyers) and most medical work, including diagnosis and prescription (but not surgery). There will thus be substantial losses of both blue collar and white collar jobs — in fact the losses of the second kind are likely to be larger.
Common Responses
Faced with this prospect of a huge upheaval in employment with many kinds of work simply vanishing, one response is to panic. The fear is that there will simply be no work available, or not enough for the people looking for and needing paid work. Others are excited and see this as a huge opportunity.
A popular reaction at the moment is to see this as the way toward a radical reconstruction of the entire economic system and a move beyond capitalism to some other kind of economic order. The idea is that the connection between work and income will be decisively severed and that we will also move into a world in which many products will be capable of being reproduced at zero marginal cost, which means they will be effectively free: in that case, the price mechanism will no longer operate.
This view has been eloquently put forth by people on the Marxist left such as Paul Mason (in Post-Capitalism) and Aaron Bastani (in Fully Automated Luxury Communism). These authors see the chance to realize the vision of the young Marx, in which the alienation of work is abolished along with the division of labor.
There are also people on the free market side who see this kind of outcome as likely, although what they envisage is a capitalist economy in which a large part of the population subsists on free stuff while not working or doing low-paid work.
New Kinds of Work
Neither panic and despair nor excitement is justified. The question to ask is not whether new technology is going to replace many jobs but whether those jobs will be replaced by new ones. There have been several episodes before where observers have expected the end of employment because of automation, and in every case the actual result has been that while many jobs do disappear, they are replaced by even more new ones.
Of course, that does not mean the same pattern is bound to happen again — to think so is to commit the fallacy of induction. It really could be different this time. However, there are theoretical reasons to doubt the more excitable predictions.
Firstly, many theoreticians of AI have a mechanistic view of human consciousness and decision making. For them, the human brain is simply a computer, only more complex and made of neurons rather than silicon. Hence the processes that create human thought are no different from the kind that take place in a computer or an AI, and any and all of them can be reproduced in a sufficiently advanced AI. This would mean that any and all human activities could be performed by an AI.
This, however, confuses intelligence and consciousness. We truly have no idea what the latter is or how it is produced, but we do know that the two are distinct (there are animals that we can show to have one but not the other). An AI or computer procedure, no matter how advanced, can only do what its programming and algorithm allow for — it cannot originate anything. This means that genuine creativity or the exercise of judgment when confronted by something novel cannot be built in. They remain human capacities.
Secondly, there is the question of knowledge. Even if most activities can be reduced to an algorithmic decision tree, the knowledge that those decisions will be made on is mostly tacit, localized, changing, and therefore incapable of being expressed in writing or numbers. This gives humans an advantage because of their greater flexibility and adaptability (AI can also learn, but this process is not as flexible as in humans). Putting the two things together means that there are many areas where humans will retain an advantage. Even if AI can also do these things, it will do so at a higher cost.
Thirdly, this misunderstands what automation does and hence its effects. What automation of any kind does is to make work more productive and hence to free up time and resources by increasing the intensity of the use of resources. Instead of using X amount of time and Y physical resources to get a given output, you use a fraction of X and Y to get the same result. This frees up the resources and human time for doing other things.
The result is fewer people doing some things and the people no longer doing them doing other things (often in different places). One challenge is that we do not know what those other things will be (although we can make informed guesses). We should not speak of a displacement of human labor but rather of its being freed up to do new things, in the way that all of the labor once needed to grow food has been released to do a myriad of other tasks. (The argument about zero-marginal-cost production misunderstands the nature of both scarcity and the price system, but that is another argument).
Genuine Challenges
So should we just chill and see what happens? Not so. There are two genuine challenges that these changes pose. The first is that the rewards from the new activity and its output will accrue to a small minority. The historical pattern is that this is what happens in the early phase of any technological transformation, due to first-mover advantage and simple good fortune.
However, as time passes and the returns to the new technologies decline as it becomes mature and widely adopted, the income and wealth gap that widened in the earlier phase starts to shrink. This is what we can observe in both the 19th and 20th centuries. However, this takes time, and in the meantime you can have serious political and social unrest, for obvious reasons. Moreover, today the high rewards to first movers are artificially heightened and prolonged by the legal system, above all the current regime of intellectual property rights.
The second challenge is that the transitional costs in human terms of rapid innovation can be very high. Outside the world of economic models, the reallocation of both capital and labor as a result of technological innovation is neither immediate nor frictionless. This is because of the heterogeneity of both labor and capital — they are not uniform.
In plain English, this means that many capital resources such as buildings and machinery will simply become useless because they are in the wrong place or cannot be readily adapted or changed to a new use. In terms of labor, a person who has a range of skills that are now redundant may find it very difficult to acquire new ones or to move physically to a different place. In human terms, this can be very painful and traumatic and very destructive of both human connections and personal happiness. This is a real challenge – you can write off capital, but writing off human beings (often in large numbers or in concentrated locations) is both wrong in itself and very dangerous.
What Should Be Done?
If that is the real challenge of AI and automation (as opposed to fantasies of automated luxury communism or panic and despondency about the replacement of humans), what then should be done? Clearly, there is a place for imaginative public policy, which should mainly take the form of institutional reform and innovation rather than paid programs (e.g., radical reform of intellectual property).
The main step though is to look to social entrepreneurialism. We need people to develop solutions to the challenge of radical change in work and employment at a local level and in a decentralized but networked way. It is mutualism and social action that we need to rediscover and employ. Fortunately, some of the results of the current wave of automation are likely to make this easier, but that is for another column.
Japan's Richest Man Quits SoftBank Board After Clashes With Masayoshi Son
After the year SoftBank just had, this is probably the last thing its shareholders want to see.
One of SoftBank’s last two remaining non-executive directors is stepping down from its board after 18 years, removing perhaps the company’s biggest internal skeptic, according to a Reuters report.
Tadashi Yanai, the CEO of Uniqlo owner Fast Retailing and a longtime Masa advisor, said he’s leaving SoftBank to focus more on expanding his own business into new markets, including Italy, India and Vietnam. With a net worth of $25 billion (according to Forbes), Yanai is the wealthiest person in Japan. But at SoftBank, he was known as a close ally and sometimes critic of Masayoshi Son credited with attempting to rein in some of Masa’s more reckless tendencies.
But whatever his reasons for leaving, the fact remains that Yanai’s departure comes at a time when his more conservative outlook is badly needed.
In one of his most famous quotes, Yanai said “Dreams are all good, but nothing beats realistic management. Let’s keep our feet firmly on the ground.”
Unfortunately, the word “Realistic” was never a big part of Masayoshi Son’s vocabulary. As his reputation as one of the world’s greatest momentum investors grew, Son pushed his firm toward ever-larger bets on Silicon Valley startups, leaving firms like Uber and WeWork with outrageous valuations that many analysts found difficult to justify.
After WeWork scrapped its planned IPO, SoftBank was forced to swoop in with a rescue package to stave off an imminent WeWork bankruptcy filing.
Then, in its Q3 earnings report, SoftBank suffered a staggering $4.6 billion writedown on its WeWork investment. But that wasn’t all: In addition to the WeWork fiasco, SoftBank’s ill-advised bets on Uber and Slack, both of which flopped after their long-anticipated IPOs this year, bringing the firm’s losses in 2019 to somewhere around $10 billion.
After the WeWork fiasco, shareholders were calling for Masa to step aside. Instead, the SoftBank founder and chairman acknowledged that “there was a problem with my own judgment, that’s something I have to reflect on.” He promised to be more conservative in the future.
But according to the FT, it appears that Masa has already changed his mind. Despite the failure of the first SoftBank Vision Fund, a $100 billion pot of mostly Saudi money used to invest in dozens of tech startups, sources close to Masa say the chairman wants to continue investing aggressively by raising a Vision Fund 2 (though it’s not clear where he intends to find the money and investors, now that the Saudis have reportedly soured on their relationship with SoftBank, and Japanese Telecom/Tech/VC/whatever conglomerate’s reputation as a responsible steward of capital lies in tatters.
Back in 2017, Yanai told a weekly Japanese business newspaper that his role was to raise sometimes painful questions.
“I realise he has a knack for investing, but if he’s going to make use of his ability, I want him to be successful as an entrepreneur rather than as an investor,” Yanai said in an interview with weekly paper Nikkei Veritas at the time. “I want him to focus on his core business.”
During a presentation last month, Son joked about being scolded by Yanai, and said his longtime friend could be a “scary external director” at times.
Shortly after, Bloomberg published the latest edition of Bloomberg Businessweek with a cover lampooning Son’s many investing failures.
At this point, remaining SoftBank investors should be trying to figure out exactly why Yanai left. Was he simply exhausted after 18 years of service on the board? Or was it Masayoshi Son’s hubris that drove him out the door?
Whatever the reason, with Yanai out, SoftBank’s board is now composed almost entirely of SoftBank executives and employees. That’s definitely a recipe for a more insular company, and more “yes” men surrounding Masayoshi Son.
Fifty years ago, an international team of researchers was commissioned by the Club of Rome to build a computer simulation of exponential economic and population growth on a finite planet.
In 1971, its findings were first released in Moscow and Rio de Janeiro, and later published in 1972 under the title The Limits To Growth. The report concluded:
Given business as usual, i.e., no changes to historical growth trends, the limits to growth on earth would become evident by 2072, leading to “sudden and uncontrollable decline in both population and industrial capacity”. This includes the following:
Global Industrial output per capita reaches a peak around 2008, followed by a rapid decline
Global Food per capita reaches a peak around 2020, followed by a rapid decline
Global Services per capita reaches a peak around 2020, followed by a rapid decline
Global population reaches a peak in 2030, followed by a rapid decline
Growth trends existing in 1972 could be altered so that sustainable ecological and economic stability could be achieved.
The sooner the world’s people start striving for the second outcome above, the better the chance of achieving it.
Few reports have generated as much debate, discussion and disagreement. Though it’s hard to argue that its forecasts made back in the early 1970s have proved eerily accurate over the ensuing decades.
But most of its warnings have been largely ignored by policymakers hoping (blindly?) for a rosier future.
One of the original seventeen researchers involved in The Limits To Growth study, Dennis Meadows, joins us for the podcast this week. Fifty years later, what does he foresee ahead?
Decline is now inevitable.
We’re without any question moving into the remainder of a century which is going to see, by the end of these decades, a much smaller population, much lower level of energy and material consumption and so forth.
Whether we retain equity amongst people and avoid the more violent forms of conflict remains to be seen. But sustainable development is no longer an option.
This is one of the most important discussions we’ve ever recorded among the hundreds produced over the past decade.
Click the play button below to listen to Chris’ interview with Dennis Meadows (55m:24s).
China has been raiding Bitcoin miners who’ve been illegally using electricity — presents a significant danger since so much of the world’s hash rate is concentrated in one country, reported Asia Times.
A recent interview with Ethan Pierse, director of the CryptoAssets Institute, said a recent government crackdown on mining facilities was due to miners illegally using electricity. By law, miners have to register with the government to use large amounts of power. Since electricity is so cheap, miners from around the world have flocked to China.
Pierse said, “People are going around that even still and tapping into electricity where they can and siphoning that off. So basically, they see that and monitor that there are weird peaks of electricity usage in places, and they go and track it down. One miner’s using the same electricity as a single household or dozens of households.”
Pierse said 65% of the world’s hash rate is produced in China. He said the Siachen region is responsible for 50% of that.
If any network disruption occurred in China, it would be very problematic for the global Bitcoin network.
Pierse said, “If you’re basing your economy or if you’re trying any kind of monetary policy to anything, whether it’s bitcoin or eventually other things, and the mining of that particular cryptocurrency is controlled this much by another government, more or less their ability to shut that down in and of itself can cause severe economic problems for governments or large corporations or other platforms that are leveraging this.”
In June, China’s Bitcoin miners controlled 60% of the global hash rate, and now the figure is up to 65% in December.
Chris Bendkisen, head of research at CoinShares, believes the rapid increase in the Chinese share of hash rate could be due to the deployment of advanced mining technology and cheap electricity.
“This is beneficial to the Chinese mining industry,” said Bendiksen. “If you are the first to increase your proportion of the hash rate, and you can do that before your competitors, that’s generally good.”
Mining crypto has become more difficult over the last several years as profitability sags. The overall Bitcoin hash rate has risen 80% since June, which in recent times, has created stronger profitability for miners who have access to cheap electricity.
Other top mining hubs are in the US, Russia, and Kazakhstan.
China could be laying the groundwork for a state-backed digital currency in the mid-2020s as it wants to become a leader in crypto in the intermediate timeframe.
The danger at play is that there’s too much hash rate concentrated in China and could lead to global network issues if disruptions in the country were seen.
When the Russians take decisive action, it is usually for a reason. As you will see below, the Russians have suddenly decided that now is the time to create an organization that will be tasked with detecting, tracking and potentially destroying incoming asteroids. Are they doing this now because they have finally decided that this is a good idea, or has something gotten their attention? Of course they are not likely to publicly admit if they have come to the conclusion that a gigantic space rock is heading directly toward us. Just like the U.S. government, the Russian government is very interested in maintaining social order, and so they would probably delay telling the public about a potential asteroid impact for as long as possible.
In life, what people do is far more important than what they say, and the new center that the Russians have just created will not just be watching giant space rocks. According to Futurism, this new organization will be in charge of making sure “they don’t collide with Earth”…
Russian space agency Roscosmos is creating a center devoted to monitoring meteors, comets, and asteroids to ensure they don’t collide with Earth — even it means having to blow them up in space.
“As part of the creation of a monitoring system and information support for the safety of space activities in near-Earth space, we plan to launch the Russian Center for Small Celestial Bodies, whose main task will be to detect and track celestial bodies approaching Earth,” Igor Bakaras, a senior official at Roscosmos subsidiary TsNIIMash, told Russian-owned news agency Sputnik.
Certainly nobody can fault the Russians for allocating resources toward this purpose.
Our solar system is full of potentially dangerous giant space rocks, and a big enough impact could literally end our civilization.
But why now?
According to a British news source, this new organization will be evaluating whether it is better “to destroy celestial objects or steer them on to new trajectories and away from Earth”…
Roscosmos, the Russian equivalent of Nasa, wants to work out if it’s possible to destroy celestial objects or steer them on to new trajectories and away from Earth.
This could involve slamming a ‘kinetic impactor’ craft in the rock or using a satellite to drag it onto a new course. Nukes could also be sent into space to blow up the rocks.
A new department at Roscosmos called the Russian Centre for Celestial Bodies will be tasked with looking into space to find comets and asteroids approaching Earth.
Once again, nobody can argue with the value of such a major project, but isn’t NASA already doing all this?
Couldn’t the Russians just sit back and let us Americans do all the work?
I wish someone would ask Vladimir Putin that question.
In 2018, The White House Office of Science and Technology Policy released a new report titled the “National Near-Earth Object Preparedness Strategy and Action Plan”.
The 18-page document outlines the steps that NASA and the Federal Emergency Management Agency (FEMA) will take over the next 10 years to both prevent dangerous asteroids from striking Earth and prepare the country for the potential consequences of such an event.
Maybe U.S. officials suddenly decided last year that having a plan for incoming giant space rocks was a great idea, and maybe the Russians decided that it was such a great idea that they should copy us.
Or maybe both governments know something that they aren’t telling us yet.
Of course the truth is that NASA has not even identified most of the giant space rocks that are floating around out there. For example, back in July a very large asteroid came very close to hitting us…
A 427-foot-wide asteroid whizzed within 45,000 miles of Earth on Thursday.
While that may sound far away, 45,000 miles is what astronomers consider a close shave: It’s less than 20% of the distance between Earth and the moon. This was the closest we’ve come to an “Armageddon”-like scenario in at least a few years.
If that asteroid had actually hit our planet, it would have been the worst disaster that any of us have ever seen by a very wide margin.
Travelling at 55,000mph and measuring 426 feet by 187ft (130m x 57m), NASA only realised 2019 OK was coming 24 hours before it passed.
Experts say that had it hit, it would have devastated an entire city like London with over 30 times the energy of the atomic blast at Hiroshima.
So the truth is that we could be hit by a giant space rock at any time, and none of us may have any idea that it is even coming.
With that being said, there are a couple of enormous asteroids that scientists do know about that could potentially be major problems over the next decade.
The first one that I want to discuss is 2007 FT3. That is not a fancy name, and not that much is known about the asteroid, but apparently there is a chance that it “might hit the planet on Oct. 2, 2024”…
In the case of 2007 FT3, Sentry reported that the asteroid could hit Earth between the years 2024 and 2116. During these years, Sentry recorded a total of 164 potential Earth impacts caused by the asteroid. As noted by the monitoring system, there’s a chance that 2007 FT3 might hit the planet on Oct. 2, 2024.
By the way, Rosh Hashanah begins on the evening of October 2nd, 2024. I don’t know if that is important, but I thought I would throw that out there.
Based on the data collected by Sentry, the asteroid has an estimated diameter of about 1,115 feet, which makes it almost as tall as the Empire State Building. The monitoring system noted that it could breach Earth’s atmosphere and hit the planet at a velocity of around 46,000 miles per hour.
Given the asteroid’s speed and size, it is certainly capable of causing high levels of destruction if it ends up colliding with Earth. Upon impact, it would create a crater that’s several miles long. The energy that will be released from the asteroid’s explosion would be powerful enough to level an entire city as well as its neighboring areas.
2007 FT3 is not getting much publicity at all, but a slightly larger asteroid that could potentially hit us in 2029 is getting far more attention.
On April 13th, 2029, it is being projected that Apophis will pass by our planet at a distance that is “ten times closer than the moon”. The following comes from Wikipedia…
The closest known approach of Apophis comes on April 13, 2029, when the asteroid comes to within a distance of around 31,000 kilometres from Earth’s surface. The distance, a hair’s breadth in astronomical terms, is ten times closer than the moon, and even closer than some man-made satellites.[23] It will be the closest asteroid of its size in recorded history. On that date, it will become as bright as magnitude 3.1[22] (visible to the naked eye from rural as well as darker suburban areas, visible with binoculars from most locations).[24] The close approach will be visible from Europe, Africa, and western Asia. During the approach, Earth will perturb Apophis from an Aten-class orbit with a semi-major axis of 0.92 AU to an Apollo-class orbit with a semi-major axis of 1.1 AU.
NASA insists that it will not actually hit us, but other independent researchers are skeptical.
And if Apophis doesn’t hit us then, NASA has listed ten other future dates when it potentially could…
In what sounds like an elevator pitch for an Armageddon sequel, Russian scientists announced that they’ve developed intercontinental ballistic missiles that aim to destroy asteroid Apophis, which is going to swing by Earth in 2036.
Also referred to as 99942 Apophis,it measures 210-330 meters (690-1080 feet) in diameter. According to a Slate article by astronomer Phil Plait an encounter with Earth would mean not so fun times for our planet; “it would release the energy equivalent to more than 1 billion tons of TNT exploding, at least 20 times more than the largest nuke ever detonated!”
But for now, both American and Russian scientists are assuring us that everything is just fine and that there is no reason to panic.
Do you believe them?
Maybe they are telling us the truth.
Maybe there is nothing to be concerned about at all.
But of course both governments have a long track record of being loose with the truth, and it wouldn’t be much of a surprise at all if they weren’t exactly being straight with us.
Demographic Armageddon: Japan's Births Drop To Lowest Since 1874 As Deaths Hit Highest Since World War II
Japan’s demographic Armageddon made another entry in the history books this week when Japan’s welfare ministry estimated that in 2019, Japan’s population organically shrank by 512,000 people this year compared to 2018. That’s a drop of more than the entire population of the city of Atlanta.
While Japan’s demographic doom is well-known, its severity has taken on a breathless haste in recent years with births in the country — which are expected to drop below 900,000 this year — are at their lowest figure since 1874 according to the NYT, when the population was about 70% smaller than its current 124 million.
Meanwhile, as Japan’s birthrate collapses, the total number of deaths is accelerating with every passing year, and in 2019 the figure is expected to reach almost 1.4 million, 60% more than the number of births, and the highest level since the end of World War II, a rise driven by the country’s increasingly elderly population.
That gap between births and deaths, which has risen above half a million for the first time ever, has put Japan on the path to demographic destruction and deflationary doom, because in a country that shrinks by over half a million people each year, economic concepts such as resource scarcity become increasingly quaint.
Indeed, as the number of births goes down, there are fewer young people entering its work force. That means fewer people to replace retiring workers and support them as they age, a situation that poses a serious threat to Japan’s economic vitality and the security of its social safety net – although, as we noted previously, Japan is not even in the Top 10 list of nations with the heaviest retiree burden; that group is headed by Italy, Greece and France.
Japan is not the only country having to cope with a shrinking society. It’s not even the country with the lowest birthrate: That title, according to the NYT, goes to South Korea. Meanwhile, other countries — including China and the United States — also face declining birthrates, which could spell demographic trouble down the road.
But Japan stands out in one specific way: it is the world’s grayest nation, with almost 28% of its residents over the age of 65.
Japan reached it demographic tipping point over a decade ago, giving Tokyo ample opportunity to find a solution and address the effects of its declining population. The country has been consistently shrinking since 2007, when the country’s population dipped by around 18,000 people. Since then, however, the losses have accelerated, crossing the half-million mark this year for the first time. Across the nation, whole villages are vanishing as young people choose not to have children or move to urban areas in search of better employment opportunities (or they just happen to be close to the Fukushima radioactive wasteland).
Unfortunately for Japan, it’s only going to get worse as there is no end to the decline in sight. The government estimates that the population could shrink by around 16 million people, nearly 13%, over the next 25 years.
In seeking to stave off demographic armageddon, Japan has made efforts to push up its fertility rate defined as the average number of births per woman, from its current level of around 1.4 to a target of 1.8, although still short of the 2.1 considered necessary to hold the population steady. The government has moved to encourage births by increasing incentives for parents to have more children and reducing obstacles that might discourage those who want to.
But like every other failed attempt by the state or economists to dictate behavior, the incentives have proved woefully insufficient as more people in Japan are putting off childbirth — or not having children at all — either to take advantage of economic opportunities or because they worry that economic opportunities do not exist and feel that they cannot afford children. Even for those who do want to be parents, the hurdles remain daunting.
Demand for day care in the country far outstrips supply, making it difficult for working women to juggle careers and children. Meanwhile, working men who want to take advantage of the country’s generous paternity leave can find themselves stigmatized by an entrenched cultural belief that a man’s place is in the office, not in the home.
If this wasn’t enough, the NYT also notes that adding to the government’s worries, marriage is also on the decline. The number of marriages dropped by 3,000 year-on-year to 583,000, according to the data released on Tuesday, part of a steep decline over the last decade.
Ironically, the most practical solution, if only from a labor standpoint, is also a terminal one for Japan as a society: as births continue to drop, Japan has tried to promote robots as a supplement for its shrinking work force. The only problem: robots don’t vote, don’t pay taxes, and don’t have little robot children of their own.
Finally, in an attempt to succeed where Germany, and Merkel’s “Open Door” policies failed, Japan has also committed to accepting limited numbers of immigrants to handle vital work such as caring for the elderly. This year the country began issuing more than a quarter-million visas to immigrants who will do such work. The only problem: the Japanese are notorious nationalists and tend to ostracize, mock and ridicule and gai jin to the point where nobody actually wants to stay in the notoriously closed-off society.
International Man: Trump is calling for a weaker dollar and negative interest rates. What does this tell you about Trump’s understanding of economics?
David Stockman: It tells you that he has no understanding of economics at all!
I think Trump is not even a primitive when it comes to economic comprehension. His views are just plain stupid when it comes to exchange rates. He seems to think it’s some grand game of global golf, where the strongest player gets the lowest score.
What sense does it make tweeting as he did recently in attacking the Fed?
According to Trump, the US economy is so much better than the rest of the world’s economies, and therefore we should have the lowest interest rate as a result. It has nothing to do with economic logic or with principles related to sound money. I think he’s just thrashing about trying to create a warning that if things go badly, it’s the Fed’s fault.
The whole narrative on the economy is wrong.
The low unemployment rate is something he inherited. It’s the end of the longest business cycle in history—126 months.
As the economy continues the inch forward, the inventory of excess labor goes down. The unemployment rate, even as badly measured as it is by the U.S. Bureau of Labor Statistics (BLS), inherently goes lower. He didn’t have anything to do with it.
In fact, if you look at the first 33 job reports under President Trump, the average gains have been 190,000 a month. During the last 33 reports under President Obama, it was 225,000 a month.
There has been no acceleration. There has been no improvement. It’s a running out of the business cycle, even as the foundation underneath has been made worse and worse by Trump’s trade policies and a really insane fiscal policy of driving the deficit to over a trillion dollars at the top of the business cycle.
Even John Maynard Keynes himself said that you ought to try to balance the budget and even generate a surplus at the top of the cycle.
We’re right in the middle of the worst kind of economic policy in my lifetime, anyway—going back to the 1960s.
Trump is completely clueless about how we got here, how he got here, and where we’re going.
I’ve said many times that if you boast about it, you own it. He’s been boasting about the stock market, which is the greatest bubble in history. He’s been boasting about a business cycle that he inherited that’s got all kinds of rot underneath and that’s nearing its final days.
All of that’s going to come home to roost, and I think it’s very likely to happen before the 2020 election.
So the 2020 election is not all over except for the shouting, as a lot of people believe. In fact, the prospect that Elizabeth Warren gets the nomination on the Democratic side and becomes a serious contender to the Oval Office is very high. The irony is that it will ensure the stock market’s collapse and Trump’s defeat. He’s setting himself up for the worst possible outcome.
International Man: The Fed recently said it could increase its tolerance for inflation before it considers raising interest rates. It would be a major policy shift. What’s really going on here?
David Stockman: I think what’s going on is that they’re looking for another excuse to capitulate to Wall Street next time it has a hissy fit because it believes the Fed owes them another shot of stimulus and more liquidity.
Let’s address the underlying issue now. The 2% inflation target is absurd to begin with. There is no historical or theoretical evidence to suggest that inflation at 2% is better for growth and prosperity than inflation at 1.5%, 1%, or even -1%.
This is just made up, just like the money they created that’s been snatched from thin air, adopted as official policy in January 2012.
It becomes a rolling excuse for running the printing press and accommodating both the politicians in Washington, D.C., who want low interest rates so that debts are cheap to finance and the gamblers on Wall Street who want low interest rates because they result in higher asset values and cheaper costs for carry trade speculators.
The idea that we haven’t had enough inflation as it’s measured by one indicator—the Personal Consumption Expenditure (PCE) deflator—is kind of crazy for two reasons.
First, there’s a lot of other inflation measures that say we easily achieved 2% inflation.
The 16% trimmed-mean CPI is a very handy tool. It has the same CPI data at the product code level as that in the regular CPI, but in order to smooth out the monthly figure, it takes out the lowest and highest 16% of individual prices.
It’s probably more accurate than CPI because it removes the outliers but puts them back in as soon as they reach the center of the distribution.
The trimmed-mean CPI has averaged 2% since January 2012. During the last 12 months, it’s reached 2.34%, way over the Fed’s 2% target.
There are lots of issues here.
One of them is that there are many ways to measure inflation. Another issue is that you can’t scientifically measure inflation in a dynamic global economy like the one we’re in today.
It’s just an average in some arbitrarily-weighted product categories that are way too complicated, even for the bureaucrats at the BLS.
And third, even if you could measure it halfway accurately, which I seriously doubt, the Fed has no tools to achieve its targets anyway.
The big swings of inflation are from commodity cycles and the global trading system, evidenced in oil prices, metal and materials prices, food and grain prices, and so forth. The Fed can’t do much about that.
The point is, inflation targeting is one of the greatest efforts at misdirection that a government agency has ever concocted. This gives them a license to constantly intervene and meddle in the financial markets—pointlessly fiddling with the whole price structure of debt and equity assets.
The less inflation there is, the better.
They can’t target it to the second decimal point, and you can’t measure it anyway.
The fact that they’re now saying, “Well, we don’t mean to target inflation on a monthly basis or quarterly or annual basis, it’s a cumulative basis from a day one,” indicates they are maybe starting from the Garden of Eden or something like that.
It just shows you that they’ve backed themselves into a corner of illogic and stupidity, from which I don’t think there’s any exit.
International Man: There are increasing calls for central banks to combat climate change. The IMF, the European Central Bank, and several others have chimed in. What does this mean, and why are central bankers suddenly so keen on this topic?
David Stockman: This is beyond stupid. What could the central banks possibly do to help the global economies adjust to climate change? Climate change may or may not be happening, and if it is, it’s due to planetary forces that central banks have absolutely no power to impact or counteract.
In my view, it’s one of the many hoaxes going on. It does remind you of how far out modern Keynesian central banking has become. They only have one tool: they can try to falsify interest rates, and they do that by injecting flat credit and liquidity into the market.
That’s all they can do. They have no other ability to drive the $85 trillion global economy, or the $21 trillion domestic economy.
They have a crude instrument. As they say, when your only instrument is a hammer, everything looks like a nail. That’s the case with the Fed.
The only thing they can do is inflate financial asset prices on Wall Street and other financial markets. If they can’t even drive the macroeconomy to hit their inflation targets, how are they going to redirect the macroeconomy to use more green energy?
It’s so idiotic that it doesn’t merit any further discussion.
These central banks are the all-time champions at mission creep.
They have added mission after mission, including inflation at 2%, as they measure it, and now they want another mandate. They want another reason to enhance their power. When already, they are the most powerful state institutions in the world, and they’re in the process of wrecking prosperity everywhere.
David Stockman: What he’s going to find is just more detail on the absurdities of what they’re doing already.
I think one that you would look into is this policy called Interest on Excess Reserves (IOER). They targeted that number at 1.55% right now. There’s about $1.5 trillion of excess reserves in the banking system.
So, they’re paying out to the banks upwards of $23 billion a year in order to keep excess funds on deposit at the Fed, rather than putting it to work in the macroeconomy.
How stupid is that?
They are blindly fixated on commanding the money market rate. The Federal Funds Market has disappeared. Ben Bernanke basically destroyed that. There’s nothing left there.
Since they know that the federal funds rate is pretty much nothing in the broad money markets—which are dominated by the repo markets, they have come up with IOER to show that they can make an interest rate happen.
It’s crazy. This is what you get from modern central banks.
We have to ask, why don’t they just get out of the way and let those reserves either stay on deposit at the Fed, or let them flow into the repo market, the money market, or the commercial paper market?
So, that’s one area that a thorough audit of the Fed could get at.
The second one that I think would be even more interesting, if it were done properly, is to recognize that they’ve created a bloated balance sheet. They’re back at it again—it peaked at $4.5 trillion from a base of $900 billion, at the time of the crisis in 2008.
They rolled it back a little bit under the short-lived Quantitative Tightening (QT).
The minute the stock market had a moderate hissy fit last fall and last Christmas, they immediately dropped the project, announced the end of QT in August, and started back the other way.
So, now they’re back up to $4 trillion and rising rapidly.
The reason I’m mentioning this is that you have $4 trillion of assets at work earning the interest rates that Uncle Sam is paying on 10-year paper, the interest rates that Freddie Mac and Fanny Mae are paying on their longer-term securities—all of this money is coming into the Fed.
The cost of their liabilities is practically nothing because they’ve been created from thin air by hitting the button on the digital printing press. Other than the $23 billion that they’re paying out in this phony IOER scheme, basically, they have cost-free liabilities, and a $4 trillion balance sheet that is earning interest.
Now, the reason I’m bringing this up is it brings in a massive profit. A lot of it that gets cycled back to the Treasury, which is another circular scheme of stupidity. But it also gets used for a big fat, juicy payroll, for some 20,000 people—including several thousand economists.
It’s not only these people on the payroll, but there are all kinds of contract research they fund from the massive profits they generate from printing money. That means that a substantial share of the academic economists in the United States is on the payroll of the Federal Reserve. They lick the boots of the guy who’s signing the checks.
The system is bad enough the way it is—between the political process, the dominance of statism, interventionism, and Keynesianism. But now, even the academic economists on the payroll are being paid to find that the Fed is doing a wonderful job and should be doing even more.
If we have an audit, we ought to find out the name and serial number of every damn economist that’s on their payroll or that’s getting contract research and ignore them—because they’re saying what the master wants to hear.
* * *
What could be the greatest bubble in history is reaching its final days. President Trump’s call for a weaker US dollar and negative interest rates is a last ditch effort to keep the party going. The whole financial system could come crumbling down much faster than most people think. That’s exactly why NY Times bestselling author Doug Casey and his team just released an urgent report on how to survive and thrive during an economic collapse. Click here to download the PDF now.
At least that’s the tone coming from an email she sent supporters on Friday. Warren, who ironically spent the last Democratic debate trying to distance herself from Buttigieg’s fundraising tactics, disclosed that it has only raised $17 million in the fourth quarter, marking a significant drop from her fundraising totals in the third quarter.
“So far this quarter, we’ve raised a little over $17 million. That’s a good chunk behind where we were at this time last quarter,” her e-mail says, according to CNBC.
In the third quarter, her campaign brought in $24.6 million, far more than most other candidates, including Joe Biden and Buttigieg.
Warren’s momentum in the Democratic primary race has slowed in recent months, as she has fallen behind Joe Biden, who now leads the field of candidates. The plunge in fundraising also comes after Warren escalated her attacks on billionaires like Leon Cooperman and Mike Bloomberg, who she has accused of “trying to buy” the nomination.
Warren said during the last debate to Mayor Buttigieg: “So, the Mayor just recently had a fundraiser that was held in a wine cave full of crystals and served $900 a bottle wine. Think about who comes to that. He had promised that every fundraiser he would do would be open door but this one was closed door. We made the decision many years ago that rich people in smoke filled rooms would not pick the next President of the United States.”
You can watch Warren spar with Buttigieg at the last debate here:
Consider the age of monarchs. Squabbling barons select a supreme ruler – a king or an emperor — to suppress the squabbling. Peace and prosperity return to the land. The king makes policy but he can’t do everything. His minions take care of the details.
Minions mean bureaucracy. The bureaucracy grows. The king grows old and dies. The dynasty continues. The bureaucracy continues – always continues, and always grows. The bureaucracy becomes an establishment kingdom unto itself. The bureaucracy grows in power and serves its own interests. The king diminishes in power. The land grows restless under the increasing regulatory tyranny and taxes. Legitimacy – what the Chinese called the “mandate of heaven” – is lost and so is the dynasty.
Change the names and we are at the end of a similar cycle – a cycle that began with the guillotine. This time it is a world-wide cycle. The modern king is a modern tyrant – Stalin, Hitler, Mao were the worst.
The socialist idea had been kicking around since the 18th century. This seemingly plausible notion shaped the various Marxist evils of the 20th century. The Soviet Union, Mao’s China, Nazism, Fascism, and today’s imperious European Union, are all socialist tyrannies of one degree or another.
Bureaucratic agencies become ideal tools for tyrants. A tyrant can point his agencies in a particular direction and unleash them. They immediately glory in their new power. Horrors ensue. Nazi Germany gave us the Holocaust and war. Stalin used betrayal. Friends betrayed friends. Children spied on parents. During the Soviet show trials of the 1930’s Stalin’s innocent victims were forced to falsely confess in order to save the lives of their families. Fear reigns.
Sound familiar? How about the FBI inducing General Flynn to plead guilty in order to protect his son? Mao injected dark comedy by unleashing hordes of children to humiliate their elders. No one was safe. Fear reigns. Sound familiar? Antifa anyone? Black Lives Matter anyone? Greta anyone? Mao lives!
The United States has become an undemocratic administrative state as well, but only by happenstance. In this country Congress has ceded much of its power to unchecked regulatory agencies, allowing them to write their own laws — regulations which enable them to prosecute, and persecute, anyone who might stand in an agency’s way. The agencies are powers unto themselves — judge, jury, and arresting police altogether. Innocents are often victims.
It isn’t just the regulatory, or administrative, state that is the problem. There is a growing sense that something is terribly wrong throughout society – throughout progressive liberal society, that is. How about needles in the street? How about sanctuary cities, counties and states? How about the ruins of Detroit? How about the weekly slaughter in Chicago? How about suppression of free speech in academia? How about the corrupt liberal media? How about big tech bias and censorship? It seems that our governments, and our intellectual establishments both, no longer serve the average citizen. They serve only a leftist political ideology, and themselves.
Worst of all, the political ideology that the establishment promotes is antithetical to the native ideology of America. America was founded as a society with spiritual values. True America is a society where the family is paramount. It is a society where a person is rewarded in proportion to his contribution. It is a society devoted to the individual where the individual is inherently free because his rights derive from the Creator not from the government. The purpose of government, according to the American ideology, is to serve the individual, not to be his master. The collection of individuals is to be the master of the government. This is classical liberalism – now a conservative ideal. It is the opposite of “progressive liberalism.”
The true American ideology cautions against granting power to any bureaucratic establishment. In its ever increasing hunger for power the establishment has gravitated to an alien progressive ideology – an ideology of ever bigger government and government control. But the bossy progressive Left increasingly forbids Americans to be Americans.
Political turmoil is the consequence. The barons are squabbling. The Left openly advocates overthrowing the Constitution. The Right counters with Donald Trump. The Left politically assassinates him with impeachment. The Right, with centrist allies, will reelect him anyway. The Mandate of Heaven has been removed from the elitist establishment. It is passing to the Deplorables.
It isn’t just in America. The world as a whole is pivoting. The dogmatic socialist established order is ending. We enter the age of the Deplorables. The Deplorables are ascending in America, with Trump, in Britain with Brexit, in Hong Kong, in much of Europe, in Latin America, in Iran. Deplorables are the antidote to arrogant globalist socialists. Deplorables everywhere say “from now on we will make our own decisions.”
Hong Kong Deplorables protest extradition bill (credit: Studio Incendo)
What is it with the Deplorables? What gives them such power?
Three things, I believe, are elevating them.
Deplorables are pragmatic. They are not wedded to any extreme ideology. Deplorables will go with anything that works. It is no wonder that the Deplorables began in America. For, as Americans we inherit the pragmatism of our pioneering ancestors.
Second, the Deplorables adhere to the original American ideology of free individuals. They reject the concentration of government power that has accumulated over the past century.
The third energizer is a technological miracle – the internet. Establishments everywhere fear the internet. And properly so. For the first time we can instantly communicate across the world. We can find like-minded people everywhere. We have discovered just how very many people agree with us.
It follows that Deplorables are no longer just an American phenomenon, the phenomenon resonates with people everywhere. People around the world are much the same. They value their traditions and customs. They value their families, their values, their spiritual heritage. They value their nation. They resent the imposition of intrusive government by strangers, by bureaucratic globalists. They are becoming Deplorables.
Born in the still free parts of America, this new movement seems destined to chart the course for the whole world — for this century and beyond.
The Mandate of Heaven no longer rests with the condescending progressive bureaucratic establishment. It is passing back to the people. It is passing to Deplorables everywhere in the world.
Those following the news from Russia have probably heard that Russia’s only aircraft carrier, the Admiral Kuznetsov (official name: Admiral of the Fleet of the Soviet Union Kuznetsov), was put into dry dock for major repairs and retrofits. Things did not go well.
First, the dry dock sank (it was Russia’s biggest) and then a huge crane came crashing down on the deck. And just to make it even worse, a fire broke out on the ship killing 2 and injuring more. With each setback, many observers questioned the wisdom of pouring huge sums of money into additional repairs when just the scheduled ones would cost a lot of money and take a lot of time.
Actually, the damage from the fire was not as bad as expected. The damage from the crane was, well, manageable. But the loss of the only huge floating dry dock is a real issue: the Kuznetsov cannot be repaired elsewhere and these docks cost a fortune.
But that is not the real problem.
The real problem is that there are major doubts amongst Russian specialists as to whether Russia needs ANY aircraft carriers at all.
How did we get here?
A quick look into the past
During the Soviet era, US aircraft carriers were (correctly) seen as an instrument of imperial aggression. Since the USSR was supposed to be peaceful (which, compared to the USA she was, compared to Lichtenstein, maybe less so) why would she need aircraft carriers? Furthermore, it is illegal to transit from the Black Sea to the Mediterranean through the Bosphorus with an aircraft carrier and yet the only shipyard in the USSR which could built such a huge ship was in Nikolaev, on the Black Sea. Finally, the Soviets were acutely aware of how vulnerable US aircraft carriers are to missile attacks, so why built such an expensive target, especially considering that the Soviet Union had no AWACS (only comparatively slow, small and much less capable early warning helicopters) and no equivalents to the F-14/F-18 (only the frankly disappointing and short range Yak-38s which would be very easy prey for US aircraft).
Eventually, the Soviets did solve these issues, somewhat. First, they created a new class of warships, the “heavy aircraft carrying cruiser”: under the flight deck, these Soviet aircraft carriers also held powerful anti-ship missiles (however, this was done at the cost of capacity under the deck: a smaller wing and smaller stores). Now, they could legally exit the Black Sea. Next, they designed a very different main mission for their “heavy aircraft carrying cruiser”: to extend the range of Russian air defenses, especially around so called “bastion” areas where Russian SSBNs used to patrol (near the Russian shores, say the Sea of Okhotsk or the northern Seas). So while the Soviet heavy aircraft carrying cruiser were protecting Russian subs, they themselves were protected by shore based naval aviation assets. Finally, they created special naval variants for their formidable MiG-29s and Su-27s. As for the AWACS problem, they did nothing about it at all (besides some plans on paper). The collapse of the USSR only made things worse.
The Soviets also had plans for a bigger, nuclear, aircraft carriers, and on paper they looked credible, but they never made it into production. These supposed “super carriers” would also come with a truly “super” price…
So how good was/is the Kuznetsov?
Well, we will probably never find out. What is certain, however, is that she is no match for the powerful U.S. carriers, even their old ones, and that the USA has always been so far ahead of the USSR or Russia in terms of carriers and carrier aviation that catching up was never a viable option, especially not when so many truly urgent programs needed major funding. Did the Kuznetsov extend the range of Russian air defenses? Yes, but this begs the question of identity of the “likely adversary”. Not the USA: attacking Russian SSBNs would mean total war, and the U.S. would be obliterated in a few short hours (as would Russia). I don’t see any scenario in which US ASuW/ASW assets would be looking for Russian SSBNs anywhere near the Russian coasts anyway, this would be suicidal. What about smaller countries? This is were the rationalizations become really silly. One Russian (pretend) specialist even suggested the following scenario: the Muslim Brotherhood in Egypt takes power, thousands of Russian tourists are arrested and the Islamists demand that Russia give full sovereignty over to all Muslim regions of Russia, if not: then hundreds of Russians will get their throats slit on Egyptian TV. Can you guess how an aircraft carrier would help in this situation?
Well, according to this nutcase, the Russian carrier would position itself off the Egyptian coast, then the Russians would send their (pretty small!) air-wing to “suppress Egyptian air defenses” and then the entire Pskov Airborne Division would be somehow (how?!?!?!) be airlifted to Egypt to deal with the Ikhwan and free the Russian hostages.
It makes me wonder what this specialist was smoking!
Not only does it appear that the Egyptians are currently in negotiations with Moscow to acquire 24+ brand new Su-35s (which can eat the Russian airborne aircraft for breakfast and remain hungry for more), but even without these advanced multi-role & air superiority fighters the rest of the Egyptian air defenses would be a formidable threat for the relatively old and small (approx.: 18x Su-33; 6x MiG-29K; 4x Ka-31; 2x Ka-27) Russian airwing. As for airlifting the entire 76th Guards Air Assault Division – Russia simply does not have the kind of transport capabilities to allow it to do that (not to mention that Airborne/Air Assault divisions are NOT trained to wage a major counterinsurgency war by themselves, in a large and distant country). Theories like these smack more of some Russian version of a Hollywood film than of the plans of the General Staff of Russia.
Back to the real world now
Frankly, the Kuznetsov was a pretty decent ship, especially considering its rather controversial design and the appalling lack of maintenance. She did play an important role in Syria, not thanks to her airwing, but to her powerful radars. But now, I think that it is time to let the Kuznetsov sail into history: pouring more money in this clearly antiquated ship makes no sense whatsoever.
What about new, modern, aircraft carriers?
The short answer is: how can I declare that the USN has no rational use left for its aircraft carriers and also say that the Russian case is different and that Russia does need one or perhaps several such carriers? The USN is still several decades ahead of modern Russia in carrier operations, and (relatively) poor and (comparatively) backward Russia (in naval terms) is going to do better? I don’t think so.
Then, there is one argument which, in my opinion, is completely overlooked: while it is probably true that a future naval version of the Su-57s (Su-57K?) would be more than a match for any US aircraft, including the flying brick also knows as F-35, Russia STILL has nothing close to the aging but still very effective carrier-capable USN Northrop Grumman E-2 Hawkeye. Yes, Russians have excellent radars and excellent airframes, but it is one thing to have the basic capabilities and quite another to effectively integrate them. As always, for Russia, there is the issue of cost. Would it make sense to finance an entire line of extremely costly aircraft for one (or even a few) aircraft carriers?
We need to keep in mind that while Russia leads the world in missile technology (including anti-shipping missiles!), there are many countries nowadays who have rather powerful anti-ship missiles too, and not all are so friendly to Russia (some may be at present, but might change their stance in the future). Unless Russia makes a major move to dramatically beef-up her current capabilities to protect a high-value and very vulnerable target like a hypothetical future aircraft carrier, she will face the exact same risks as all other countries with aircraft carriers currently do.
A quick look into the future
Hypersonic and long range missiles have changed the face of naval warfare forever and they have made aircraft carriers pretty much obsolete: if even during the Cold War the top of the line U.S. carriers were “sitting ducks”, imagine what any carrier is today? The old saying, “shooting fish in a barrel” comes to mind. Furthermore, what Russia needs most today are, in my opinion, more multi-role cruise missile and attack submarines SSN/SSGN (like the Yasen), more diesel-electric attack submarines SSK (like the Petropavlovsk-Kamchatsky), more advanced patrol boats/frigates (like the Admiral Kasatonov), more small missile ships/corvettes (like the Karakurt), more large assault ships (like the Petr Morgunov) and many, many, more.
As for aircraft carriers, they are not needed any more to extend the (already formidable) Russian air defenses and in the power-projection role (operations far from Russia), the Russian Navy does not have the capabilities to protect any carrier far away from home shores.
Which leaves only three possible roles:
1) “Showing the flag”, i.e. make port calls to show that Russia is as “strong” and “advanced” as the US Navy. Two problems with that: i) the USN is decades ahead of Russia in carrier operations and 2) there are MUCH cheaper way to show your muscle (the Tu-160 does a great job of that).
2) “Retaining the carrier know-how”. But for what purpose? What naval strategy? What mission? Russia is the nation that made aircraft carriers obsolete – why should she ignore her own force planning triumphs?
3) Prestige and $$$ allocation to select individuals and organizations within and next to the Russian Navy. Since Russia does not have a money-printing-press or criminally bloated budgets, she simply cannot afford the capital outlay either for the Russian Navy, or for the nation of Russia, just to fill the pockets of some interested parties.
Conclusion:
If I have missed something, please correct me. I don’t see any role for carriers in the future Russian Navy. That is not to say that I am sure that they won’t be built (there are constant rumors about future Russian “super” carriers, no less!), but if they are built, I believe that it will be for all the wrong reasons.
The plight of the Kuznetsov might be blessing for Russia. She was a good ship (all in all), but now she should be viewed as an object lesson to (hopefully) kill any plans to build more carriers for the Russian Navy.
Hindsight is 20/20. It can be incredibly difficult to pick the “next big stock” in the moment, but, as Visual Capitalist’s Jenna Ross notes, looking back gives us clarity on where we could have reaped the highest rewards. While some of the decade’s chart-toppers – like Netflix and Amazon – are household names, other stocks may come as a surprise.
Today’s visualization reveals the best-performing stocks over the last 10 years, and shows how much an initial $100 investment would be worth today.
To compile the list, MarketWatch reviewed the current S&P 500 constituents and excluded any stocks that have traded in their present form for less than 10 years. The remaining companies were sorted based on their total return, with reinvested dividends, from December 31, 2009 to December 5, 2019.
So, which stocks come out on top? Here’s a full list of the top 20, organized by ranking:
Note: The final value of a $100 investment is based on the total return, with reinvested dividends, from December 31, 2009 – December 5, 2019.
In comparison, $100 in the S&P 500 index overall would have amounted to $344 over the same time period. Let’s take a closer look at these strong performers.
Household Names
Streaming giant Netflix takes the #1 spot. The company earned a staggering 3,767% return over the last ten years, meaning an initial $100 investment would now be worth almost $4,000. However, it remains to be seen whether Netflix’s first mover advantage will remain strong with new competitors entering the space.
One such rival, Amazon, takes its spot at #10 in the best-performing stocks of the decade. From its humble roots as an online bookseller, the company has transformed into an ecommerce leader. CEO Jeff Bezos credits Amazon’s admirable success to three key customer-centric factors: listen, invent, and personalize.
At #12 on the list, Constellation Brands—owner of several alcohol brands such as Corona—is also no stranger to invention. The company is protecting itself against cannabidiol (CBD) disruption with a $5 billion dollar investment in Canopy Growth, and future plans to create its own CBD-infused beverages.
Other well-known names on the top 20 list include discount department store chain Ross Stores (#15) and the credit card company Mastercard (#17), with the latter benefiting from an oligopoly in the industry.
Flying Under the Radar
Apart from the names you’d expect to see, there are also some lesser-known companies that made the list.
Well established among institutional investors and broker-dealers, MarketAxess Holdings takes the #2 spot. The fintech company operates a global electronic bond trading platform, vastly improving the process for investors who traditionally traded bonds “over-the-counter”.
In third place, healthcare technology company Abiomed develops medical devices that provide circulatory support. The company’s Impella® device—the world’s smallest heart pump— has been used to treat over 50,000 U.S. patients.
Fourth place company Transdigm Group gains its stronghold by developing specialized products for the aerospace industry. It has a strong acquisition strategy as well, having acquired over 60 businesses since its formation in 1993.
A Sector View
If we organize the top 20 by sector, information technology stocks appear in the list most frequently with five companies, followed by consumer discretionary (4 companies), and industrials and healthcare (3 companies each).
Sectors with less representation in the top 20 are communication services (2 companies), as well as consumer staples, financials, and real estate (1 company each).
The Bottom Line
While these stocks have performed extremely well over the last decade, they are not necessarily the best portfolio additions today. Some companies may have become overvalued, or be facing new competition in their industry—as is the case with Netflix. It’s best to consider all current information when building a portfolio.
However, the top 20 stocks do demonstrate the power of a buy-and-hold strategy. If you’re lucky enough to identify a winner early on, it’s possible to simply sit back and let your dollars grow.
The spacewalking astronaut, risking the abyss with only a slim tether to life, is a powerful trope. Gravity was an entire movie about that frisson of fear we get from these images, although for my money it doesn’t get better than Frank Poole’s murder by HAL in 2001: A Space Odyssey, with the looong shot of the body tumbling uncontrollably through space. Because it’s not just the aloneness and abandonment that sparks our hard-wired emotional response here, but the out-of-controllness of being truly untethered.
We’ve got happy-ending movies that use this trope (The Martian), Russian movies that use this trope (Spacewalker), and even haunted-house-in-space movies that use this trope (Event Horizon). So you’ll forgive me if I’m going to use this imagery, too, because it’s the best story-telling device I know to instill in you the fear and loathing I feel when I think through the consequences of the Long Now.
SNIP! is the Long Now’s destruction of the meaning of words that define our social connections.
Words like “war”.
This is a picture of the Predator drone firing a Hellfire missile.
It’s probably going to kill someone that we want dead, and almost certainly going to kill some other people that we don’t mind being dead … collateral damage and all that. As they say on Succession, you can’t make a Tomlette without breaking a few Greggs. This is war, and we fire these missiles all over the world, on the daily, both in countries we have officially invaded, like Afghanistan, and in countries we haven’t, like Pakistan and Yemen.
But we have redefined war to NOT mean things like drone and cruise missile attacks, to NOT mean things like “observer” or “training” missions. We have redefined war to ONLY mean American troops being shot at.
So politicians can speak the words “End the war in Country XYZ!” without actually meaning it. Because what they mean is preventing any American troops from being shot at. But the actual war of drones and missiles and killing … that continues. And it will continue forever in the Long Now.
Words like “capitalism”.
This is a picture of the billionaire CEO of a government-supported too-big-to-fail megabank, telling his 60 Minutes interviewer that he has no control over his compensation, as that’s determined by the CEO’s board of directors. Interestingly enough, this is also a picture of the billionaire Chairman of that board.
And it’s not just the billionaire CEO bank manager. It’s his centimillionaire lieutenant bank managers. It’s the dozens of decamillionaire sub-lieutenant bank managers. All of them made generationally rich from stock-based compensation in a company where the government guarantees their success. None of them entrepreneurs. None of them risk-takers with their own skin in the game. All of them … lifer managers of a too-big-to-fail bank.
But, hey, the stock is up! They’ve done a good job! What’s the problem, Ben?
That’s exactly the problem. The problem is that we have redefined capitalism to mean “the stock is up”. We have redefined capitalism to NOT mean Smith’s invisible hand or Schumpeter’s creative destruction or productivity-enhancing and risk-taking investments in the real economy. We have redefined capitalism to ONLY mean financial asset price inflation in the here and now. By any means necessary. So that’s what we get. From the Fed, from the White House, from corporate management … that’s what we get in the Long Now … an endless series of policies and decisions in service to capitalism-as-financialization, where capital markets are maintained as a political utility.
George Orwell, who called the Long Now an “endless present, where the Party is always right”, understood how the most powerful weapon of a totalitarian society is to control its language, so that War IS Peace, Freedom IS Slavery, and Ignorance IS Strength.
Why? Because control over the meaning of words is control over how we THINK. When we no longer remember what words mean, when we are TOLD over and over again a NEW meaning … we start to doubt ourselves. We start to doubt our own autonomy of mind. And that’s when they win.
Iakov Guminer, Arithmetic of an alternative plan (1931)
In the end the Party would announce that two and two made five, and you would have to believe it. It was inevitable that they should make that claim sooner or later: the logic of their position demanded it. Not merely the validity of experience, but the very existence of external reality, was tacitly denied by their philosophy. The heresy of heresies was common sense.
And what was terrifying was not that they would kill you for thinking otherwise, but that they might be right.
— George Orwell, 1984
The Long Now is the Fiat Worldof reality by declaration, where we are TOLD that inflation does not exist, where we are TOLD that wealth inequality and meager productivity and negative savings rates just “happen”, where we are TOLD that we must vote for ridiculous candidates to be a good Republican or a good Democrat, where we are TOLD that we must buy ridiculous securities to be a good investor, and where we are TOLD that we must borrow ridiculous sums to be a good parent or a good citizen.
And the most terrifying thing is that you start to think they might be right.
Hey, maybe the whole Ukraine thing really is Trump “fighting corruption” and maybe the whole Saudi thing really is Trump “bringing the troops home”. Maybe the really important thing about Jeffrey Epstein is whether or not he committed suicide. Maybe we should really try some “democratic socialism” in 2020 … how bad could it be?
Self-doubt is a biologically terrifying condition for a social animal like humans, and that’s why you see more and more of us becoming rhinoceroses. That’s why you see more and more well-meaning citizens willingly give over their autonomy of mind to the MAGA Train or the Bernie Bros … some sort of social Answer with a capital A … so that the torture of self-doubt can end.
That’s why, in the end, Winston loved Big Brother.
And make no mistake, the Answer is always totalitarian. Not merely authoritarian, but totalitarian. It brooks no dissent, in ANY aspect of your life. The Answer is a general closed-form solution, something we are hard-wired to want, but something that is impossible to find in a social system. Yes, this is the Three-Body Problem.
Unfortunately, I believe that the totalitarian Long Now is going to get a lot worse before it gets any better. I believe that we are going to doubt ourselves in new and profound ways over the next decade. I believe that our common sense will become even more the heresy of heresies.
Why?
Because the Long Nowhas redefined the meaning of “taxes”.
Because the tether between taxation and spending – the most important macroeconomic policy relationship for our lives as both investors and citizens – has been severed.
Oh, I know that this snip-of-no-return doesn’t feel bad. Yet. In fact, it probably feels pretty darn good to you right now.
Funny how fallin’ feels like flyin’For a little while
That’s from a song in the movie Crazy Heart, and that’s where we are right now. So yeah, you’re going to be told that 2 + 2 = 5, that it’s no big deal to cut the cord between taxes and spending, that in truth it’s good for you. And yeah, you’re going to start to think that they might be right.
The redefinition of taxation and the severing of the Tether of Meaning between taxes and spending isn’t something that I think WILL happen. This is something that I know HAS happened. We’ve had a steady fraying of this cord for about two decades now, ever since Al Gore’s idea of a Social Security “lockbox” (where those taxes could ONLY be used for Social Security spending and paying down the existing debt) was met with derision rather than acclaim by both parties. Yes, both parties. By steady fraying I mean over both Republican and Democrat administrations. The political beneficiaries of the fraying are different when it’s Republicans doing the snipping or Democrats doing the snipping, but the INTENT – to eliminate the tether between taxation and spending – is the same whether you’re George Bush or Barack Obama. Or Donald Trump. Destroying the relationship between taxation and spending is not a partisan thing. It’s a power thing. It’s a Management thing.
I mean, there are still people who believe that the money they pay in Social Security taxes is their money, that they’ve purchased some sort of old age income insurance plan with their money, like an annuity where their money is invested somewhere to support that income down the road.
But that’s a lie.
In truth there is ZERO relationship between social security taxes and social security benefits today, other than sharing the words “social security”. In truth they are two entirely separate government programs, the former a regressive tax on workers that goes into the big pot of the annual budget and the latter a wealth transfer program to old people that comes out of that budget.
SNIP!
So for twenty years Republicans and Democrats have gone back and forth to steer taxation and spending to their political advantage, with divided government being the only thing to keep the tether intact. But divided government vanished with Donald Trump’s election, and as a result we got the 2017 Tax Cuts and (LOL) Jobs Act, which I think was the final cut.
What did the TCJA do? It lowered taxes by trillions without reducing spending by a dime.
The TCJA levered up the United States of America.
Management levered up our country and used the proceeds to provide a windfall gain for corporations and the rich. You know … “returning capital to job creators”. In exactly the same way that Management might lever up a company and use the proceeds for a big stock buyback. You know … “returning capital to shareholders”.
Both of these narratives – “returning capital to job creators” and “returning capital to shareholders” – had a truth to them, an important truth. I believed in the important truth of both of these narratives for most of my adult life! And yes, I’m using the past tense.
Because in the Long Now, the meaning of both narratives has been perverted beyond all recognition.
Both are now part and parcel of the Trickle-Down Lie, that the crumbs that fall off massa’s table are crumbs that you wouldn’t get otherwise, so let’s celebrate all those extra crumbs. Yay, crumbs!
And yes, there’s an Epsilon Theory note or three for that.
The pecking order is a social system designed to preserve economic inequality: inequality of food for chickens, inequality of wealth for humans. We are trained and told by Team Elite that the pecking order is not a real and brutal thing in the human species, but this is a lie. It is an intentional lie, formed by two powerful Narratives: trickle-down monetary policy and massive student debt financing.
Time to add a fourth shift in the Zeitgeist: capitalist productivity, now 200+ years old, is becoming capitalist financialization. Wall Street gets something to sell, management gets stock-based comp, the Fed gets a (very) grateful Wall Street, and the White House gets re-election.
What do YOU get out of financialization? You get to hold up a card that says “Yay, capitalism!”.
Donald Trump has a vision of how to use taxes for HIS conception of justice, equity and retribution, a vision that – well, how about that! – advances his political power.
The primary beneficiaries of the TCJA are large public companies, particularly the multinationals that dominate the S&P 500. For example, in each of the past two years, Amazon has availed itself of the deductions and deferrals and lower corporate rates created by the TCJA to be a “net-negative US Federal cash taxpayer”. In English, that means that in each of the past two years, the US Treasury has written checks of more than $100 million to Amazon out of YOUR tax dollars. I know you think I’m making this up, but check out Amazon’s 10-K. It’s all there.
And before you @ me, I am NOT saying that Amazon doesn’t pay taxes. What I am saying is that I really don’t care how much Amazon pays in taxes to freakin’ Ireland. What I am saying is that Amazon is cashing checks from the US government instead of writing checks. As the kids would say, let that sink in.
How does this advance Trump’s political power? Because the windfall tax benefits that the TCJA created for large public companies like Amazon and Apple and Microsoft translate directly into higher stock prices. Because in Trump’s own words, “the stock market is my report card”. Because Trump realizes that you can politically argue to death whether the real economy is doing better or worse, but you can’t argue with a new high for the Dow Jones.
What does it mean to transform capital markets into a political utility, and use the tax code to do it?
This.
Similarly, Bernie Sanders and Elizabeth Warren and No Malarkey Joe and Mayor Pete and all the rest have a vision of how to use taxes for THEIR conception of justice, equity and retribution, a vision that – well, how about that! – advances their political power.
None of the “wealth tax” proposals you hear from the Left are being proposed to pay for anything in a budgetary sense. They are explicitly proposed so that the rich pay their “fair share”. In fact, when candidates make the mistake of expressing their wealth tax idea in a fiscal sense – as Elizabeth Warren did when she linked it to “paying for” Medicare-for-all – the narrative immediately shifts from “fairness” to “making the numbers add up” (Spoiler Alert: they don’t and they never will), and these candidates immediately take a hit in the polls.
Bernie gets it. He doesn’t even pretend to make this about budgets. He realizes that the political popularity of the wealth tax has nothing to do with making the rich pay for a government program, and everything to do with making the rich pay for theirsins. And yes, Bernie believes that great wealth is a sin. He believes that great wealth should not be allowed, not because it’s a source of unaccountable political power (my beef with great wealth), but because he believes it is fundamentally unfair. So do a lot of voters, maybe more than care about the Dow Jones.
If the meaning of spending is no longer constrained by taxation …
Then what is spending FOR?
In the Long Now, spending is ALSO for justice and equity and retribution … ALSO in whatever mode or measure fits the regime goals of whatever Management is in power at the time.
I think that whoever is elected in 2020, we will see a $2 trillion spending plan enacted in 2021.
If it’s a second term for Trump, it will be the 2021 Make America Great Again Act, and we will call them “Infrastructure Bonds”.
If it’s a first term for a Democrat, it will be the 2021 Take Back America Act or something like that (I suppose if it’s President Biden we can hope for the 2021 No Malarkey Act, although I’m rooting for the 2021 OK, Boomer Act), and we will call them “Green Bonds”.
I believe there are no limits to the retributive and malicious use of taxation as a political weapon.
I believe there are no limits to the retributive and malicious use of spending as a political reward.
Sometimes those political weapons and rewards will be used by the rich and the old against the non-rich and the non-old, as we saw with the TJCA and Trump. Sometimes it will the other way around, as we will see the day after a Democrat takes the White House, whenever that might be.
What’s to be done? Well, I suppose this is the point where I should tell you what I would do if I were given magic genie powers to change the world from the top down. And then you’d argue with me about my proposals and tell me what you would do if given magic genie powers.
How about we not do that? I don’t have magic genie powers. And neither do you.
It’s not that the severing of taxes from spending WILL happen. It’s not that the NEXT administration is going to make the cut. It’s ALREADY happened. It’s been happening for twenty years! This ship has sailed, and now there’s not a damn thing that you or I can do to turn it around. All we can do now is survive the voyage.
When I started this note, I said I wanted to instill an emotion of fear and loathing in you from the realization that the meaning of taxes had become untethered from the meaning of government spending. That phrase – fear and loathing – is of course a catchphrase for Hunter S. Thompson, who used it in the titles of his best-known works … Fear and Loathing in Las Vegas, Fear and Loathing on the Campaign Trail, etc. Thompson had lots of catchphrases, lots of mottos, lots of great quotes. My all-time favorite, though, is this:
I love it because there are so many plausible interpretations, and it just sounds so cool to take a tired inspirational quote about what to do when the going gets tough, blah blah blah … and turn it on its ear. Or foot, or whatever body part you think Thompson would have approved. Here’s what it means to ME.
“The going gets weird” = an economic and political environment that no one alive has experienced.
I think that the smiley-face totalitarian genie (and yes, I wrote ‘totalitarian’, not ‘authoritarian’) is going to be let out of the bottle as the meaning of taxes becomes justice, equity and retribution.
I think that the not-so-smiley-face inflation genie is going to be let out of the bottle as the meaning of spending in the real economy becomes untethered from any concern of paying for it.
To paraphrase Richard Nixon paraphrasing Milton Friedman, we’re all MMTers now. “Modern Monetary Theory” is here, firmly ensconced in BOTH political parties in the Long Now
If Trump is reelected in 2020, I think he pushes forward a $2 TRILLION bond issuance that is fully or partially monetized by the Fed. They’ll be called Infrastructure Bonds. If a Democrat is elected in 2020, I think she or he pushes forward a $2 TRILLION bond issuance that is fully or partially monetized by the Fed. They’ll be called Green Bonds. We’re all MMT’ers now.
Modern Monetary Theory is neither modern nor a theory. It’s a post hoc rationalization of politically expedient policy that makes us feel better about all the bad stuff we’ve done with money and debt in service to Team Elite. And all the bad stuff we’re going to do in the future.
A recession isn’t weird. Deflation isn’t weird. Authoritarian isn’t weird. I don’t think ANY of those things is coming down the pike, and you don’t need my help (or anyone else’s) if any of them does.
But smiley-face totalitarian stagflation where capital markets have been transformed into a propped-up-at-all-costs political utility?
Now THAT’S weird. And that’s what I think IS coming down the pike. And we’re all going to need all the help we can get. Which gets us to the second half of Hunter S. Thompson’s quote.
“The weird turn pro” = an all-in engagement for those who see the societal transformation; a recognition that the fundamental rules of the social game have changed, and a willingness to confront the implications of that change in every aspect of your life without surrendering to an Answer.
How do we confront the Long Now?
Personal courage
Leaders who act as stewards of the future, not managers of the Now.
Professional courage
Investors who take more risk with what’s Real, and less with what’s not.
Social courage
Citizens who take back their vote, and who refuse to play the Fool.
You know, in one of my twitter fights with Angry-Billionaires-and-their-Renfields™, I was called “a bizarre combo of Zerohedge and self-help guru”. It was meant as an insult, of course, but for me … man, I wear it like a badge. Because I DO believe, in Zerohedge-esque fashion, that “the system” is designed by and for a Team Elite that, in the immortal words of The Outlaw Josey Wales, pisses down our backs and tells us it’s raining. And I DO believe, in self-help guru-esque fashion, that the only effective resistance to the Nudging State and the Nudging Oligarchy is through a bottom-up grassroots social movement that is driven by one thing and one thing only: each individual’s courage and determination to maintain their autonomy of mind … the courage and determination to believe that 2 + 2 = 4.
The revolution will not be televised. The revolution will not be in the streets.
The revolution will be in our hearts.
It’s the hardest thing you’ll ever do, precisely because no one will be watching.
But you won’t be alone.
In 2020, we’re going to host an international conference to come together on this, an Epsilon Theory Forum. It’s intended to be the anti-Davos … a meet-up for those who still have a soul, who care about something bigger than the celebration and perpetuation of Team Elite. And I can promise you this … there won’t be a single billionaire on a panel at the ET Forum. But there will be plenty of real people … people with ideas and experiences that aren’t contingent on how many zeros they have after their name.
Clear eyes, full hearts, can’t lose.
Make / Protect / Teach.
As wise as serpents, and as harmless as doves.
We’ve got a lot of slogans. In 2020 you’ll have a chance to take action. You’ll have a chance to talk this through with like-minded truth-seekers, to figure out TOGETHER what a bottom-up grassroots social movement devoted to preserving each and every one of our autonomies of mind can do. It may be too late to prevent the SNIP! that severs the tether between taxation and spending, but it is high time to create new tethers, new personal bonds of association, loyalty and mutual support. Yep, it’s a Pack. And that’s how we survive the Long Now. Together.
Bipartisan Group Of NYC Lawmakers Pushing For "Gentrification Tax"
It’s almost as if New York politicians are deliberately trying to crash NYC’s housing market.
On Christmas Day, the New York Post reported that a bipartisan group of NYC lawmakers is pushing Albany to change state laws and close a loophole that extends tax breaks to homebuyers in gentrifying neighborhoods.
The “gentrification tax” law would require homebuyers to pay taxes at the market rate, rather than at the much-lower assessed value.
Presently, homebuyers across the five boroughs who buy multimillion dollar brownstones and other existing homes often pay less in taxes than those who buy more moderately priced homes.
Republican Staten Island City Council member Joe Borelli is spearheading the movement to end the tax loophole. He told the Post that New Yorkers are “just getting fed up” with the unfair treatment.
“My proposal would end the practice of charging more tax on $500k home on Staten Isl etc. than a $2m home in Park Slope,” Borelli tweeted on Thursday. “This can be done Jan. 1.”
Borelli also blamed Mayor de Blasio for creating the ‘yuppie tax’ loophole.
The Post calls it a gentrification tax or a ‘yuppie tax,’ but most NYers know it as the ‘de Blasio loophole.’
My proposal would end the practice of charging more tax on a $500k home on Staten Isl etc. than a $2m home in Park Slope. This can be done jan 1. https://t.co/SDCB4zFjLp
Borelli’s coalition also includes Park Slope Democrat Brad Lander and Bay Ridge Democrat Justin Brannan, two other members of the city council, which is controlled by Democrats.
The NY Post breaks down the impact of the gentrification tax thusly: A buyer who snapped up a Clinton Hill brownstone for $3 million in 2017 only pays taxes on a fraction of the buying price, leaving the building’s new owner with a tax bill of just $4,297 a year.
Meanwhile, the owner of a $500,000 Bergen Beach bungalow pays a nearly identical amount, even though the bungalow is worth roughly one-sixth of the brownstone.
The change to opaque state tax laws advocated by Borelli would raise the brownstone owner’s annual tax bill by $1,600, while the owner of the bungalow would see no increase.
Of course, the changes would come with drawbacks: Back in April, New York State passed a revised ‘mansion tax’. First passed in 1989 by New York Gov. Mario Cuomo, New York’s original mansion tax was a 1% tax on statewide sales of homes of $1 million or more. Under the original tax, if a house, co-op, or condo sold for $1.25 million, the buyer would have paid a tax of $12,500, in addition to whatever other taxes they would pay.
For fiscal year 2020, the statewide mansion tax will remain at 1% for property purchased for $1 million or more. For properties in NYC, however, the ‘progressive’ mansion tax will rise incrementally with purchase prices of $2 million or more, capping out at a total of 3.9% for properties sold at $25 million or above. Homes sold for $1 million+ outside of NYC but within New York state won’t be affected by the progressive taxes.
Homebuyers in New York state (including NYC) will also need to factor in the Republican tax plan’s rejection of the SALT deductions.
Borelli sent the proposed resolution to City Council Speaker Corey Johnson and state Assembly Speaker Carl Heastie earlier this month. Johnson spokeswoman Jennifer Fermino said the speaker is waiting for a preliminary report from a city property tax reform commission that he and Mayor de Blasio commissioned back in 2018.
With the new mansion tax, it’s hardly surprising that Manhattan home sales plunged in Q3. Will we see more housing market pain in Q4 and the new year? Investors don’t need a magic 8-ball to figure that one out.
There is evidence that US Treasury bond yields may continue to rise, exposing the debt trap in which the US government finds itself. Market participants don’t realise it yet, but the dollar-based monetary system is spinning out of control. This will become obvious as the crisis stage of the credit cycle, which we now appear to be entering, becomes evident.
The outlook for monetary inflation is dire. Not only will governments fund themselves through QE, but central banks will be forced to inflate even more to pay for government deficits significantly greater than currently forecast. And when markets stop taking government statistics on inflation as the Gospel Truth, the interest cost of government funding will rise and rise, reflecting an increasing rate of time preference for fiat currencies which will be losing their purchasing power at an accelerating rate.
In a world where all fiat currencies will face enormous challenges, using yardsticks such as trade weighted indices will be misleading. The best gauges of the slide in fiat currencies will be commodities, particularly commodity monies, gold and silver.
The chart above, of the US 10-year Treasury yield is shows that its yield bottomed at the end of August, when it had more than halved from the levels of October 2018. What, if anything, does it mean? Some would argue that it is good to see a positive yield curve again, implying the recession, or the risk of one, has gone away. But if US Treasury yields have bottomed out, then in the fullness of time they will continue to rise. Chartists might even claim it is setting up for a bullish golden cross, like the one earlier in the chart on 17 November 2016, which marked the beginning of a significant rise in bond yields.
That would be a worry, since equity markets have flown to places where bond yields don’t exist. But there are more solid concerns about the course of bond yields, other than charting ephemera. Despite the massive expansion of money and credit since the Lehman crisis, there is a shortage of liquidity, because the Fed is having to inject half a trillion dollars into the banking system to keep overnight levels suppressed at the Fed Funds Rate target.
Informed opinion suggests that there is indeed a liquidity crisis. The banking system in New York has become strained through banks loaded with US Government debt and providing repos to hedge funds who have shorted euros and yen to buy T-bills and short-dated government coupon debt. The shortage has occurred because the largest banks, designated globally systemically important banks (GSIBs) must demonstrate excess reserves to cover obligations thirty days out. The strains for this Basel III requirement are expected to increase at the next quarter-end, i.e. 31 December.
These strains first became evident in the repo market, which blew up three months ago, on the day Deutsche Bank completed the sale of its prime brokerage to BNP. We don’t know if these events were related, but as any investigating detective will tell you, pure coincidence must be dismissed until proven otherwise. In any event, the problems in the repo market have continued, so having noted that perhaps the Deutsche Bank sale did not go as planned, we must go with the GSIB excess reserves explanation.
Looked at in this light, the persistent rise in UST bond yields is threatening. Unless the Fed simply floods the markets with liquidity, they seem set to rise further. If the Fed does not, the GSIBs have two courses of action, and they may be forced to take both. First, they could be forced to sell down their US Treasuries in order to create intraday liquidity needs by releasing some of their required reserves to be categorised as excess. Second, they can refuse to roll hedge fund repos, forcing hedge funds to sell US Treasuries and T-bills and then sell their dollars to close their shorts in euros and yen. The withdrawal of liquidity could wipe out one or more major relative value (RV) funds, invoking the ghost of Long-Term Capital Management, which ran into trouble in 1998.
All this is now known, so it would be surprising if the Fed fails to act to contain a year-end crisis. But its actions are limited to providing liquidity for the banks. It will be up to the banks if they decide to use that liquidity to continue to accommodate the RV funds.
Foreign buyers hold the dollar key
Let us assume for a moment that we get through the year end without mishap. We will not have dealt with the underlying problem, which is who is going to buy the $1–1½ trillion of US government debt to be issued in 2020. In the past it has been principally foreigners, banks and RV hedge funds as described above. On a net basis the US saver has not been involved for a very long time, except passively through managed pension funds.
According to US Treasury TIC data, in the year to October major foreign holders added $580.5bn to their holdings of Treasury bills, T-Bonds and Notes. The balance will have come directly and indirectly from domestic credit expansion, including the banks and the RV hedge funds. But from August, foreign investors have been net sellers to the tune of $77.4bn. Until then, every successive month had seen an increase, so it appears foreign demand is stalling, which could have fed into the repo crisis as the GSIB banks in New York and RV funds ended up with too much US Government paper.
Foreign dollar demand is almost certainly affected by the sharp slowdown in global trade. This has happened for two reasons: President Trump’s tariff war against China and others has stalled international trade and at the same time, having been expanding for the last nine years, the credit cycle is due to run out of steam. Together they are recessionary headwinds, probably synergistic, which reduce the level of dollars in in the correspondent banking system foreigners need to hold for liquidity.
China is the second largest holder of US government paper and has been reducing her position in recent months. As to her future reserve policies, commercial considerations are being complicated by politics. She understands that America is desperate for global investment flows to finance US Government debt, and that China’s infrastructure plans would compete for them which explains America’s hidden agenda over Hong Kong. China bungled her management of that situation, and apparently is now exploring the use of Macau as an investment channel for foreign inward investment.
It is probably too late, the damage to investing in China having been done. But it is hard to see why China should just roll over on this issue and continue to buy US government bonds. More likely US Government debt will now be viewed as a source of funds to replace lost inward investment through Hong Kong.
We can now see a best and worst case for the dollar and US Treasury funding. The best case is stagnating demand from abroad, which throws the onus onto domestic investment, which, in the absence of an increase in savers, will be through QE and the inflation of bank credit.
The worst case will see not only stagnant foreign demand, but active selling down of current positions, due to slumping economies and China in particular selling actively. American investors seem generally complacent about this possibility, arguing that foreigners will always need dollars, and more so in a credit crisis. While there is some force in this argument, it ignores the fact that foreign ownership of dollars and dollar investment is already very high at roughly $23 trillion of which over $4 trillion is in deposit accounts, while US ownership of foreign currency liquidity is a relatively trivial figure.
Bearing all this in mind, we must assume that at a minimum US banks and hedge funds between them will be funding all the budget deficit and may even have to absorb existing stock from foreigners. But surely, one imagines a critic asking, in the absence of a change in the savings ratio, a budget deficit is a matter of an accounting identity and will give rise to a similarly sized balance of payments deficit, and so long as dollars accumulate in foreign hands, they must form the capital inflows that finance the budget deficit. Therefore, dollars will continue to accumulate in foreign hands, and they must be invested.
The accounting identity argument is correct, but there is more than one way to skin a rabbit. Dollars received by foreigners can always be sold in the foreign exchanges instead of being reinvested, which given the relative lack of foreign currency liquidity in the hands of domestic Americans, could have a dramatic effect on the exchange rates.
Alternatively, the gap can be closed by the inflation of money through quantitative easing and the expansion of bank credit. In effect, the existing stock of dollar deposits is diluted to bridge the shortfall between a budget deficit and the lack of inward capital flows recorded in the balance of payments.
In this context, the chart below of the dollar’s trade-weighted index appears to show the dollar is struggling to advance and may be losing the bullish momentum that developed shortly after President Trump was elected.
If, as the chart suggests, the dollar could be heading lower, it would fit in with a diminution of foreign capital inflows. But the major component of this index is the euro, so it is not an accurate representation of the dollar’s weighting with respect to trade imbalances, which are the normal source of capital flows. But in the case of the euro, it has already been sold down by RV hedge funds to strip out the interest differential by selling euros short and buying dollars. According to Hedgeweek.com, six months ago this form of hedge fund arbitrage stood at $865.6bn, a truly significant sum, most of which will have accumulated since 2018 Q1, when the dollar’s bull phase commenced.
Not all of it would have involved selling down the euro, because in the past the Japanese yen has been the short leg of choice in an interest rate arbitrage. It is clear that the repo crisis tells us that by financing this speculation the US GSIBs have expanded their balance sheets too much and will need a substantial increase in their excess reserves to continue to finance this trade, thereby avoiding a crash in both the US bond market and the dollar. While this problem has surfaced at this year-end, it will be a continuing problem thereafter.
This brings us back to our first chart, of the 10-year T-bond yield. The reasons why it may have bottomed and will rise further are becoming clear. If a rising bond yield is accompanied by a falling dollar it will be because markets recognise an acute funding crisis is upon the US government, reminiscent of the 1970s in sterling markets.
A falling dollar will be the signal, so we must watch the trade-weighted index and, more importantly, the gold price.
The gold price particularly acts as the canary in a coal mine, and in that context Comex open interest is hitting record levels, which without the price rising indicates a suppression operation is already in place. It is therefore reasonable to suggest the combination of the lack of excess reserves in the GSIBs and the suppression of gold is circumstantial evidence that a financial crisis is already on its way.
Markets will take control from central banks
When the funding difficulties of the US Government become more obvious, investment strategists are bound to rethink the course of interest rates in other fiat currencies, which face similar pressures from increasing budget deficits. Being aware that monetary policies are not working as intended, central banks have already encouraged their governments to deploy additional fiscal stimulus. Even before welfare costs rise and tax income falls due to a developing global recession, it appears that government borrowing world-wide is set to accelerate.
With the credit cycle on the turn, one thing is for sure, and that is what central banks call the business cycle will follow. The mistake made by all mainstream commentators and economists is to not appreciate that the problem is one of the central banks’ own making, and that once the credit cycle is set in motion it cannot be simply stopped by reducing official interest rates. We saw this proved ten years ago, when the Fed and other central banks had to inflate the quantity of money by however much base money was required and by taking failing institutions into public ownership. In the UK the only significant bank which successfully resisted needing a government bail-out was Barclays, and executive directors at the time are still having to answer for their actions in the courts. It seems that not only is failure rewarded, but a major bank not failing has become a criminal act.
The fact that some central banks have unsuccessfully imposed negative rates has not yet led to a realisation that attempting to control the cycle in this way simply does not work. The periodic credit and systemic crises are increasingly destabilising and the dynamics behind the next one indicate it will be on a scale significantly greater than the Lehman crisis eleven years ago. The banking scene is set for a reversion from incautious greed to abject fear, fear of lending to anyone and to any other bank. And the weakest banks are to be found in the Eurozone. Even in the EU’s strongest economy, the two largest private banks, Deutsche Bank and Commerzbank, by their share prices are signalling a slidetowards bankruptcy.
At some stage, and it could only be a matter of weeks or even days, the global outlook will cause all GSIB banks to become considerably more cautious, withdrawing lending facilities from smaller banks, financial speculators (hedge funds), and businesses alike. Lending to the last category ceases in two ways. In capital markets banks begin to cut their high levels of exposure to sub-investment grade bonds and syndications, and they withdraw working capital facilities for medium and small businesses. The crisis phase of the credit cycle is then irreversible.
The credit-induced recession will be proportional to the scale of the preceding credit expansion. It feeds through to an escalation of government borrowing in all welfare-dependent nations, because of the fall in tax receipts and the increase in welfare costs.
If US bond yields rise, they will do so either because foreigners are selling the dollar, or because domestic prices, reflecting a fall in the dollar’s purchasing power, begin to rise at a faster pace. It is already an open secret that official price inflation figures bear no relation to reality and only financial markets are wedded to the CPI myth. In fact, not only are government statistics inaccurate, but all statistics are reported in funny money. When US dollar markets wake up, the same will be true of markets in other currencies, and the greater the level of interest rate distortion the more severe the crisis is likely to be.
How it plays out in different nations and their currencies is not so much down to the scale of government borrowing in deteriorating circumstances, but whether savers respond to the financing demands of their governments. For this reason, monetary inflation rates will be offset by a tendency for Japanese and Chinese savers to increase their bank deposits rather than spend. In the Eurozone and Britain, this is less the case. Increasing monetary inflation will end up fuelling rising eurobond and sterling bond yields more rapidly than their equivalents in Japan and probably China.
Commodities and commodity money
The point has been already made in this article that measuring the dynamics behind a credit crisis is distorted by government statistics not fit for the purpose and by the elastic nature of fiat currency. Furthermore, monetary planners, portfolio managers and the commentariat inhabit a Keynesian fantasy land and only understand rising prices to be directly related to increased demand, and falling prices to falling demand. Presumably, this explains why they associate a CPI rising at two per cent with a healthy economy.
The key to understanding the error is that money is only objective in its value for the purpose of individual transactions. But give money a temporal context and it becomes clear that money’s purchasing power varies as well as the cost of anything.
If it is expected that the rate at which a currency loses purchasing power is about to increase, then commodity prices measured in that currency will rise without any improvement in demand. Demand can even fall, and prices rise, if the purchasing power of the currency declines sufficiently. This condition can be temporarily overcome by an investors’ panic when they sell assets, such as bonds and equities, in order to escape falling prices, but once that initial effect has quickly worn off, the relationship between money and goods will adjust to the public’s general desire to hold money as opposed to goods.
We have a contemporary example. At the time of the Lehman crisis the price of gold declined from $1,000 in March 2008 to $700 the following October, before rising to $1,920 three years later. But this time is likely to be different, because the rate of monetary inflation before the Lehman crisis varied little in the preceding few years, compared with subsequently. Following Lehman, all major central banks expanded money quantities very rapidly, so the next crisis comes against a background of already inflated currencies before a further acceleration in supply. Depending how the next credit crisis evolves, there may not be a dip in the gold price at all.
Instead, gold and other commodity prices, precious or otherwise, will be bought and sold against a background of rapidly debasing currencies. We know this, because renewed monetary expansion in the form of quantitative easing is taking place even before any crisis materialises. And when we hear luminaries such as Christine Lagarde at the ECB talking about QE to finance eco-friendly infrastructure developments directly, we know that central bankers and their governments now view monetary inflation much as it was in the Weimar Republic: an infinite source of funds.
Despite attempts by the bullion banks to suppress the evidence from the gold price of what is likely to turn out to be the early stages of a widespread fiat currency collapse, if matters progress on the lines described in this article, gold, silver and other commodities will rise priced in fiat. Initially it is likely to reflect the fact that such assets are under-owned. But then another effect is likely to take over, as the public begins to realise what is going on and start dumping fiat currencies for gold, silver and even bitcoin.
Ninety years ago, it was called a crack-up boom, the last dash out of currency for anything not printed by the government. It will happen differently this time, because it always does. But now that inflationary financing is not only required to balance governments’ books but to finance the expansion of their spending, happen it will.
Last year, 125 people got together to participate in trying to figure out new insights about the game from poring over mountains of NFL data. This year, 2,038 teams made 32,000 submissions to the event, according to the Wall Street Journal.
And like baseball, which caught analytics fever some years back around the time that Moneyball was released, the NFL now seems set for its own analytics boom.
The numbers are already starting to shift the game, too. More teams are going for it on fourth down and teams are throwing more out of the shotgun, among other decisions being dictated by “rudimentary math”.
At the same time, some GM’s still mock “eggheads and their spreadsheets”, leading to a bit of friendly competition between those who rely on analytics and those who don’t.
To some degree, it seems like a foregone conclusion: this is already the third year that the NFL is using its Next Gen Stats, which collects “granular data about movements on the field that is enabling analyses that were never before possible.”
And because data research is so new, there’s still many inefficiencies that can be taken advantage of when discovered by quants.
Momin Ghaffar, manager of strategic research and development for the Jacksonville Jaguars said: “There’s a lot of low-hanging fruit to be had.”
Ghaffar’s career path has followed the trend: first as manager of analytics for the San Antonio Spurs before defecting to the Jaguars after submitting a paper on analytics to the team.
At last year’s competition, he was one of 11 people hired by NFL teams or other companies looking for analysts.
Prior to Next Gen stats, each game had about 160 rows of data, with each representing one play. Now, tracking data makes 10 observations per second, per player. So instead of 160 rows, there’s about 600,000.
Lopez said: “There’s some knowledge in those 600,000 rows. And teams are trying to figure that out.”
Charlie Gelman, whose work at last year’s Big Data Bowl landed him with a job with the Ravens said: “That’s why I wanted to get into football originally, much more than any other sport. Right now, there’s a huge rush of people trying to get in.”
He was only a sophomore at Duke when he submitted his paper. He also started doing analytics for Duke’s wrestling team and football team.
“Football is huge, but there’s still so few analytics in it,” he said.
The Philadelphia Eagles have the league’s most progressive front office when it comes to analytics, and it helped lead the team to a Super Bowl two years ago against the Patriots. This year, the Ravens have been the most effective with going for it on fourth down, a key centerpiece in the Eagles’ aggressive Super Bowl strategy.
There’s no doubt about it: tracking data can exponentially expand insights for teams. For this year’s “Big Data Bowl”, participants are asked to calculate how many yards a running back should get on any given play. Participants had to create models based on complex factors like position of all players on the field, their speed and other attributes.
Nate Sterken, who previously worked in data science for the federal government and President Obama’s reelection campaign in 2012, is now working on models on how to identify every route a receiver ran on every play so he could analyze which combinations worked best together. And come 2020, he’ll be working for the Cleveland Browns.
Christian Post Politics Editor Napp Nazworth said he resigned from the publication after it published an editorial in defense of President Donald Trump.
Christian Post editor Napp Nazworth resigned after the publication of a pro-Trump editorial. He says aligning with President Trump would “destroy the reputation of The Christian Post… We’d reached an impasse. I really had no other choice but to leave.” https://t.co/SQkrAE1jKFpic.twitter.com/qzPIVVXUQJ
In an interview with CNN Thursday, Nazworth said his issue was with the Post ‘aligning with the interests of President Trump.’ That was the straw that broke the camel’s back for Nazworth.
Nazworth resigned on Monday. He announced his decision in a Twitter thread.
“Announcement: Today, rather abruptly, I was forced to make the difficult choice to leave The Christian Post. They decided to publish an editorial that positions them on Team Trump. I can’t be an editor for a publication with that editorial voice….” Nazworth wrote.
I’m saddened by what happened for many reasons. I’ve been with CP for over 8.5 years, made many friendships, and had lots of exciting opportunities along the way. …
When the editors had disagreements, we would work through them, letting those discussions and debates inform and improve our coverage. Now, CP has chosen to go in a different direction. Like so many other media companies, they’ve chosen to silo themselves. …
… it’s bad for Democracy, and bad for the Gospel. It means there will be one more place where readers can go for bias confirmation, but one less place where readers can go to exercise their brains on diversity of thought. {end}
The controversy began when the former Editor-in-Chief of Christianity Today Mark Galli penned an op-ed arguing for President Trump’s removal from office as the U.S. House of Representatives deliberated and later voted to impeach him.
“The president of the United States attempted to use his political power to coerce a foreign leader to harass and discredit one of the president’s political opponents. That is not only a violation of the Constitution; more importantly, it is profoundly immoral,” Galli wrote.
Galli further argued that the President’s removal is consistent with evangelical teachings and principles.
“That he should be removed, we believe, is not a matter of partisan loyalties but loyalty to the Creator of the Ten Commandments.”
The Christian Post later responded with a scathing piece titled “Christianity Today and the problem with ‘Christian elitism.’” Those elites included Galli, as the piece notes.
“Mr. Galli asks evangelicals supporting Trump to consider how continued support for the president will impede and compromise evangelical witness for Jesus to an unbelieving world. One might well ask Mr. Galli how his obvious elitist disdain and corrosive condescension for fellow Christians with whom he disagrees, as ignorant, uneducated, “aliens in our midst” might well damage evangelical witness to an unbelieving world. Unbelievers might well conclude, “These Christian preach love for neighbor, but they certainly don’t seem to practice what they preach!”” editors John Grano and Richard Land wrote.
That defense of President Trump was enough for Nazworth.
Indian IPOs Plunge To Four-Year Low Amid "Great Slowdown"
Several months ago, we reported how the global IPO market went bust in 2019. Now a new report via Reuters provides more insight into the trend, more specifically, taking a look at the IPO bust in India.
Indian IPOs plunged to a four year low by value in 2019 as the global and domestic economy continues to slow.
Refinitiv data shows funds raised by Indian IPOs fell to $2.8 billion this year, the lowest since about 2016. IPO proceeds soared in 2017 to $11.7 billion and $5.5 billion in 2018 during a synchronized recovery across the world.
With a synchronized downturn across the world and an Indian economy in crisis, investors have been pulling back on speculative IPOs:
“2019 has been the worst year from an IPO market perspective,” said Sandip Khetan, a partner at consultancy EY.
“Because of different types of disruptions, such as corporate failures and bankruptcies, things have slowed down considerably,” he said.
Over the weekend, Arvind Subramanian, the former chief economic adviser to the Narendra Modi government, told NDTV that “this is not an ordinary slowdown… it is India’s great slowdown.”
India’s GDP has fallen for seven consecutive quarters, dropping to 4.5% in 2Q19; it stood at 8% in 1Q18.
“…they (key indicators) are either in negative growth or barely positive growth territory… the comparison is to the real sector of the economy… growth, investment, export, and import… which matter for jobs. It is also a matter of how much revenue the government has to spend on social programs,” Subramanian said during the interview, adding, “The real sector economy is slowing… jobs, you know, people’s incomes, people’s wages and of course government revenues”.
Indian investors are ditching speculative IPOs as the global and domestic economy continues to falter. So far, there are no “green shoots” in India — likely continued deceleration into early 2020.
"We're Heading For Very, Very Bad Places": Dave Collum's 'Pandemonium' Podcast
The only thing nearly as enlightening (and time-consuming) as reading David Collum’s epic Year In Review is listening to him and Chris Martenson discuss its highlights. So strap in, grab some eggnog, and listen to this year’s recap:
We are so close to a financial crisis now that we may be way, way past the fail-safe.
We’ve got all these unfunded liabilities that we have to pay or face the consequences of — and they are fantastically enormous.
The pensions are all underfunded — at the top of a financial asset price bubble, mind you.
Social Security is a disaster. And we’re promising so much medical help for everyone that is now profoundly expensive.
There are so many things out there that are unmoored. The Fed is unmoored. The digital world is taking us to this digital gulag, in my opinion — I don’t think I’m being hyperbolic.
I think we’re heading for very, very bad places.
Click the play button below to listen to Chris’ interview with David Collum (84m:24s).
China Turns To Shocking Solution To Curb Pig Ebola
China is the world’s top producer and consumer of pork. So when 50% of its pig herd was wiped out in 2019 from African Swine Fever (ASF), it caused pork prices in the back half of the year to hyperinflate. The immediate response by the government was to consolidate pig farms and release pork from its strategic reserves. Other measures included sourcing pork from South American countries, like Brazil and Argentina, along with reestablishing trade with the US in the last several weeks.
Now the Chinese government is working to limit the spread of ASF through a high-voltage electricity experiment installed in pig barns, reported South China Morning Post (SCMP).
The new device will be installed at a medium-sized hog farm in Chengdu, in one of China’s top pig producing regions.
The goal of the test is to see whether an electric field around a barn can limit the transmission of deadly viruses.
Professor Liu Binjiang, a government scientist in northeastern China, is responsible for the “electro culture” program that has already been a huge success for increasing crop yields and reducing plant viruses.
Binjiang and his team are creating a static electric field of 50 kilovolts around a barn that holds thousands of pigs.
He believes the high-voltage discharges will break down chemicals, reduce biological aerosol by 50-90%, kill germs, and stop the spread of viruses that are transmitted through the air.
“The air quality [for the pigs] should improve when the device is powered up,” Binjiang said. “Electricity is one of the many ways to improve living conditions for farm animals. We have a long to-do list.”
Binjiang claims that high-voltage electricity was used to create an electric field around a barn in the Hubei province, one of the hardest-hit ASF areas; he claims that none of the pigs died from the virus.
“It had been deployed to enhance animal welfare and prevent airborne diseases such as foot and mouth, but the lack of African swine fever cases was a surprise. It led the team to hypothesize that the electric field had caused a change in the environment that prevented the virus thriving,” SCMP noted.
Electrifying pig farms to create force fields that scrub the air of deadly viruses could be the next big breakthrough China needs to restrict the spread of ASF.
Just because society experiences turmoil doesn’t mean your personal life has to. And a depression doesn’t have to be depressing. Most of the real wealth in the world will still exist – it will just change ownership.
We’re now at the tail end of a very long, but in many ways a very weak and artificial, economic expansion. At the same time we’ve had one of the strongest securities bull markets in history. Both are the result of trillions of new dollars created over the last decade. Right now very few people are willing to consider the possibility of tough times—let alone The Greater Depression.
But, perverse though it may seem, this is the very best time to think about it. The U.S. economy is a house of cards, built on quicksand, with a tsunami on the way. I urge everyone to read up on the topic. For now, I’ll only briefly touch on the nature of depressions. There are at least three good definitions of the term:
A period of time when most people’s standard of living drops significantly.
A period of time when distortions and misallocations of capital are liquidated.
A period of time when the business cycle climaxes.
Using the first definition, any natural disaster can cause a depression. So can living above your means for long enough. But the worst kind of depression has not just economic effects, but economic causes. That’s where definitions 2 and 3 come in.
What can cause distortions in the way the market operates, causing people to do things they’d otherwise consider unreasonable or uneconomic? Only government action, i.e., coercion. This takes the form of regulation, taxes, and currency inflation.
Always under noble pretexts, government is constantly directly and indirectly inducing people to buy and sell things they otherwise wouldn’t, to do things they’d prefer not to, and to invest in things that make no sense.
These misallocations of capital subtly reduce a society’s general standard of living, but the serious trouble happens when such misallocations build up to an unsustainable degree and reality forces them into liquidation. The result is bankrupted companies, defaulted debt, and unemployed workers.
The business cycle is caused mainly by currency inflation, which is accomplished today by the monetization of government debt through the banking system; essentially, when the government runs a deficit, the Federal Reserve buys its debt, and credits the government’s account at a commercial bank with dollars. Using the printing press to create new money is largely passé in today’s electronic world.
Either way, inflation sends false signals to businessmen (especially those who get the money early on, as it filters through the economy), making them overestimate demand for their products. That causes them to hire more workers and make capital investments—often with borrowed money. This is called “stimulating the economy.”
Inflating the currency can actually drive down interest rates for a while, because the price of money (interest) is lowered by the increased supply of money. This causes people to save less and borrow more, just as Americans have been doing for years. A lot of that newly created money goes into the stock market, driving it higher.
It all looks pretty good, until retail prices start rising as a delayed consequence of the increased money supply, and interest rates skyrocket to reflect the depreciation of the currency.
That’s when businesses start failing. Stocks fall. Bond prices collapse. Large numbers of workers lose employment.
Rather than let the market adjust itself, government typically starts the process all over again with a new and larger “stimulus package.” The more often this happens, the more ingrained become the distortions in the way people consume and invest, and the nastier the eventual depression.
This is why I predict the Greater Depression will be … well … greater. This is going to be one for the record books. Much different, much longer lasting, and much worse than the unpleasantness of 1929-1946.
* * *
A financial depression far greater than any crisis America has seen could soon strike. For some it could completely wipe out their savings… and for others it could be the fortune-building opportunity of a lifetime. Legendary speculator Doug and the International Man team just released a new report with all the details on how it could all unfold, and what you can do about it. It’s not something you’re likely to hear about in the mainstream financial media, or anywhere else. Click here to download it now.
Huawei Benefited From Billions Of Dollars In State Support During Its Rise To Global Dominance
The Wall Street Journal continued its string of reports on the Chinese government’s shadowy campaign to support mission-critical companies in the private sector on Christmas Day by exposing for the first time to totality of government support for Huawei.
Billions of dollars in credit facilities backed by state-controlled “policy banks”, coupled with pro-business tax breaks, allowed Huawei to cement its position as the world’s leading telecoms giant, according to WSJ.
Huawei’s grants, credit facilities, tax breaks and other forms of financial assistance details for the first time how Huawei had access to as much as $75 billion in state support as it grew from a little-known vendor of phone switches to the world’s largest telecom-equipment company—helping Huawei offer generous financing terms and undercut rivals’ prices by some 30%, analysts and customers say.
Around the world, Huawei is vying to build next-generation 5G telecom networks, much to Washington’s chagrin. In a well-documented campaign, the US has struggled to convince it allies to exclude Huawei equipment from their 5G infrastructure, claiming that Huawei parts would compromise security and allow the Chinese government to tap into civilian and military communications.
But thanks in part to all of this government support, Huawei is able to offer telecoms equipment at world-beating prices. Its biggest competitors, Nokia and Ericsson, can’t even come close.
This government support also undermines Huawei’s claims that it operates independent of Beijing, and that it would under no circumstances cooperate with state intelligence against its customers.
Nevermind that multiple investigations have uncovered evidence that Huawei builds backdoors into its equipment to allow easy access by Chinese intelligence forces.
It’s important to remember that Huawei’s commercial interests align with those of the Chinese government in more ways than one.
“While Huawei has commercial interests, those commercial interests are strongly supported by the state,” said Michael Wessel, a member of a U.S. congressional panel that reviews U.S.-China relations, in an interview. The U.S. has raised concerns that use of Huawei’s equipment could pose a security risk, should Beijing request network data from the company. Huawei says it would never hand such data to the government.
According to WSJ’s investigation, the biggest source of state support for Huawei, about $46 billion, comes from loans, credit lines and other support from state lenders. Huawei saved about $25 billion in taxes between 2008 and 2018 due to state incentives for Chinese tech firms. It also benefited from $2 billion in land discounts, and another $1.6 billion in government grants.
In a statement, Huawei said it benefited from “small and non-material” grants to support its research, but otherwise denied WSJ’s claims that the Chinese state played a critical role in Huawei’s development.
In its research, WSJ used public records in China including company statements and land registration documents. The paper said it “verified” its analysis with subsidy analysts, including a professor at Wichita State University, and Good Jobs First, a Washington DC-based organization that analyzes tax incentives.
Setting the money aside for a moment, it’s important to remember that state support can’t always be quantified. In 1999, China’s central government arranged an unusual rescue from allegations of tax fraud.
The grants Huawei received from the Chinese government between 2008 and 2018 were 17x larger than similar subsidies received by Nokia, the world’s second-largest telecoms equipment maker, while Ericsson received no subsidies during that period.
Back in 2010, the European Commission ruled that Chinese modem exporters, including Huawei, benefited from unfair subsidies, according to a confidential report leaked to WSJ.
But that investigation was cut short after the unnamed “complainant” dropped their claims against China.
In addition to providing cheap loans to Huawei which lower operating costs compared with foreign rivals, Beijing-backed banks also extend cheap credit to Huawei’s customers.
Financial support helped the company undercut rivals. In 2010, the European Commission found that Chinese modem exporters including Huawei had benefited from subsidies, according to a confidential report reviewed by the Journal. The commission cut short its probe after the complainant prompting it reached a “cooperation agreement” with the company. Huawei denied receiving such subsidies.
Besides subsidies, Huawei since 1998 has received an estimated $16 billion in loans, export credits, and other forms of financing from Chinese banks for itself or its customers, the Journal found.
China’s state-controlled banking system underpins cheap loans that lower costs for Huawei and its customers to buy its products on credit. State lending facilities for Huawei were among the largest in history.
Two of China’s biggest banks extended more than $30 billion in credit to Huawei customers over the last 20 years.
Mega-lenders China Development Bank and Export-Import Bank of China in the last two decades made available more than $30 billion in credit lines for Huawei’s customers. World Bank and official data indicate these banks were lending to the company’s clients in developing economies at some 3% in at least Huawei’s first decade abroad, around half of China’s five-year benchmark rate in since 2004.
A Huawei spokesman told WSJ that this customer credit facility was rarely more than 10% subscribed. He added that lenders, who were mostly non-Chinese banks, accounted for only 10% of Huawei’s ongoing financing needs as of the end of last year. Most of Huawei’s working capital comes from its own cash flows.
“If you’re going to buy a house, and if you are able to say you got backing of a half-million-dollar line of credit, that’s going to make you a much stronger bidder,” said Fred Hochberg, former chairman of U.S. Export-Import Bank. “What Huawei did, cleverly, is to make sure that, when they made a bid, it came with financing terms” that surpassed those of competitors.
Of course, China’s whole state capitalist model is based on the idea that government policy and corporate achievement are inseparable. This is made clear in a statement from China’s foreign ministry, which told WSJ that “like many others in China,” Huawei is a private company whose achievements “are inseparable from a good policy environment.”
WSJ found an example of how China’s export-import financing for Huawei customers has influenced foreign governments’ decision to pick Huawei over other telecoms providers.
In summer 2009, Huawei pitched to Pakistan a surveillance system for its capital, Islamabad. Pakistan’s prime minister accepted, but Islamabad lacked funds and its procurement rules required competitive bidding, Pakistan court filings say.
The Chinese offered a solution. China Ex-Im would lend Pakistan $124.7 million for the project and waive most of the 3% annual interest on the 20-year loan. There was a condition, Pakistan Supreme Court filings show: Pakistan could choose only Huawei. Pakistan’s government decided to proceed without competitive bidding.
“On the recommendation of Ex-Im Bank, the prime minister of Pakistan selected Huawei,” then-interior minister Ahsan Iqbal told Pakistan officials.
A Chinese embassy report showed Beijing’s then-ambassador to Islamabad officiating at the project’s inauguration in 2016 alongside Pakistan’s interior minister, standing before an array of glowing security monitors.
“The Chinese government funded it and Huawei built it,” the embassy said.
And there are probably dozens of other examples like this one. Ultimately, Huawei’s expansion explains only part of China’s growing influence across the emerging world. Their two missions are deeply intertwined.
Rachel Maddow Called Out By WaPo Columnist For Shamelessly Peddling Fake News
Conspiracy theorist and MSNBC host Rachel Maddow has been called out by Washington Post columnist Erik Wemple for breathlessly peddling the Steele Dossier – becoming a “clearinghouse” for the largely debunked opposition research funded by the Hillary Clinton campaign and the DNC in 2016 (and fed to the MSM six weeks before the 2016 US election by the former British spy who wrote it).
Wemple has been writing about the media’s coverage of the Steele dossier since it was significantly undercut earlier this month by Michael Horowitz, the DOJ Inspector General. Thursday’s feature details how Maddow spewed Russophobic propaganda to the American public based on Steele’s fabricated claims.
Horowitz absolutely shredded the dossier, writing in his report on FBI FISA abuse that “The FBI concluded, among other things, that although consistent with known efforts by Russia to interfere in the 2016 U.S. elections, much of the material in the Steele election reports, including allegations about Donald Trump and members of the Trump campaign relied upon in the Carter Page FISA applications, could not be corroborated; that certain allegations were inaccurate or inconsistent with information gathered by the Crossfire Hurricane team; and that the limited information that was corroborated related to time, location and title information, much of which was publicly available.”
Maddow began using the dossier to smear Trump in March of 2017 – when both CNN and the New Yorker falsely claimed that US authorities had loosely confirmed ‘some of the details’ from the dossier. An emboldened Maddow claimed that while the “baseline” dossier claim that Trump colluded with Russia to win the 2016 election had yet to be proven, “all the supporting details are checking out,even the really outrageous ones. A lot of them are starting to bear out under scrutiny. It seems like a new one each passing day.”
Based on the conclusions reached by both the FBI and DOJ Inspector General Michael Horowitz, Maddow was peddling conspiracy theories.
“When small bits of news arose in favor of the dossier, the franchise MSNBC host pumped air into them,” writes Wemple. “At least some of her many fans surely came away from her broadcasts thinking the dossier was a serious piece of investigative research, not the flimflam, quick-twitch game of telephone outlined in the Horowitz report.”
“She seemed to be rooting for the document.“
In April, Maddow ignored that the Mueller report debunked the dossier’s key allegation a literal conspiracy theory – namely that the Trump campaign coordinated with Russia to influence the 2016 US election. Instead, the MSNBC host grasped at straws – trying to suggest various claims in the dossier were corroborated.
Several days after the Mueller report emerged, Maddow addressed not the dissonance between Mueller and the dossier, but a point of possible corroboration. In perhaps its most famous allegation, the dossier claimed that Trump had rented a suite at the Ritz Carlton in Moscow and “employed” prostitutes to perform a perverted ritual for him. It suggested that there were tapes of the show, the better to amass kompromat against Trump.
A footnote in the Mueller report, noted Maddow, bore a possible connection to this part of the dossier. It turned out that Russian businessman Giorgi Rtskhiladze had sent a text message to Cohen on Oct. 30, 2016, saying, “Stopped flow of tapes from Russia but not sure if there’s anything else. Just so you know…” Those tapes were “compromising,” Rtskhiladze told the special counsel. However, he also said “he was told the tapes were fake, but he did not communicate that to Cohen.”
Seizing on the revelations, Maddow commented: “[According] to Mueller, Cohen then told Trump about that before the election. So that means Trump knew that somewhere in the former Soviet Union, a business buddy of his had taken action to make sure tapes, supposedly from Trump’s trip to Russia, those tapes weren’t getting out. Don’t worry, all taken care of. I took care of that for you, right?” she said. –Washington Post
Maddow pumped the brakes on the dossier following the Mueller report. When Horowitz published his report’s comprehensive dressdown of the dossier, there was no mea culpa from Maddow – instead, she said “The inspector general debunks that there was any anti-Trump political bias motivating these decisions. They debunked the idea that the Christopher Steele dossier of opposition research against Trump was the basis for opening the FBI’s Russia investigation. It absolutely was not, and ‘Oh, by the way, no, there was no spying on the Trump campaign.”
And while Wemple says these are legitimate points, Maddow’s track record on the dossier is abysmal.
The case for Maddow is that her dossier coverage stemmed from public documents, congressional proceedings and published reports from outlets with solid investigative histories. She included warnings about the unverified assertions and didn’t use the dossier as a source for wild claims. There is something fishy, furthermore, about that Mueller footnote regarding the “tapes.” In their recent book on the dossier, “Crime in Progress,” the Fusion GPS co-founders wrote that Steele believes the document is 70-percent accurate.
The case against Maddow is far stronger. When small bits of news arose in favor of the dossier, the franchise MSNBC host pumped air into them. At least some of her many fans surely came away from her broadcasts thinking the dossier was a serious piece of investigative research, not the flimflam, quick-twitch game of telephone outlined in the Horowitz report. She seemed to be rooting for the document. –Washington Post
One of Russia’s overall goals, according to ex-KGB agent Yuri Bezmenov, is to weaken the West by dividing America. With MSM hosts like Maddow peddling disinformation to an outrage-hungry audience that still hasn’t accepted the results of the 2016 election, they hardly have to try.
Boeing Executive In Charge Of 737 MAX Legal Response Has Been Fired
Boeing shareholders just can’t catch a break.
Barely three days after now-former Boeing CEO Dennis Muilenburg’s termination at the hands of the company’s board of directors, another top-ranking company official has retired been pushed out.
According to a press release published shortly after American markets closed on Thursday, Boeing revealed that the company’s top legal official, former federal judge J Michael Luttig, has decided to “retire” after just over six months in a position that was created by Muilenburg specifically for Luttig.
The Boeing Company announced today that J. Michael Luttig, 65, valued Counselor and Senior Advisor to the Boeing Board of Directors, has informed the Board of his long-considered retirement at year end.
Luttig, who served as Boeing’s General Counsel from 2006 until assuming his current responsibilities in May 2019, has been managing legal matters associated with the Lion Air Flight 610 and Ethiopian Airlines Flight 302 accidents, and advising the Board on strategic matters.
Boeing interim President and CEO Greg Smith praised Luttig in a quote included with Boeing’s press release.
“Judge Luttig is one of the finest legal minds in the Nation and he has expertly and tirelessly guided our company as General Counsel, Counselor, and Senior Advisor,” said Interim Boeing President and CEO Greg Smith. “We are deeply indebted to Judge Luttig for his extraordinary service to Boeing over these nearly 14 years, especially through this past, challenging year for our company,” said Smith. “The Board and I will always be grateful for the Judge’s remarkable service to The Boeing Company – and I will personally always be grateful for his friendship.”
According to the Seattle Times, during his brief tenure at Boeing, Luttig assembled a deeply connected defense team of outside lawyers to represent Boeing executives and employees in a criminal investigation launched by federal authorities after the second 737 MAX crash, which occurred just minutes after a Ethiopian Airlines flight 302 took off from Addis Ababa Bole International Airport on March 10, 2019.
Luttig’s appointment signaled that Boeing was planning to aggressively combat any criminal charges or civil lawsuits tied to the two 737 crashes, which killed 346 people, including all of the passengers and crew.
Luttig was named to the newly created position in May, as the Chicago-based company faced an onslaught of lawsuits and a federal criminal investigation arising from the crashes. Until then, Luttig had served as Boeing’s general counsel since 2006.
His duties regarding the 737 MAX will now fall to Brett Gerry, who replaced Luttig as general counsel.
Luttig’s appointment to the new position last spring reflected the complex and costly fallout stemming from the crashes, coming on the heels of statements indicating Boeing planned to take an aggressive stance in responding to lawsuits and any potential criminal allegations
The Department of Justice, aided by the Department of Transportation’s Inspector General and the FBI, is investigating the design and certification process for the MAX to try and determine whether the FAA’s decision to certify the 737 MAX 8 amounted to criminal negligence.
It’s possible that Luttig’s departure is simply a natural consequence of Muilenburg’s ouster. It’s also possible that his departure is tied to recent revelations that Boeing withheld critical internal text messages from the FAA.
Still, given Luttig’s crucial role within Boeing’s legal department, something about the timing of Luttig’s departure doesn’t sit right. And with Boeing shares on track to finish the year above the 2019 lows reached in March, we imagine shareholders will soon be asking themselves: ‘what does this guy know that I don’t?’
When I was asked to write an article about the impact of negative interest rates and negative yielding bonds, I thought it was a chance to look at the topic from a broader perspective. There have been lots of articles speculating about the possible implications and focusing on their impact in the short run, but it’s not very often that an analysis looks a bit further into the future, trying to connect money and its effect on society itself.
Let us begin with a basic question, that lies at the heart of this issue: Who profits from a loan that is guaranteed to pay back less than the amount borrowed? Obviously, it is the borrower and not the lender, which in our case is the government and those closely connected to it. Negative rates and negative-yielding bonds by definition favor the debtors and punish the savers. In addition, these policies are an affront to basic economic principles and to common sense too. They contradict all logical ideas about how money works and they have no basis and no precedent in any organic economic system. Thus, now, in addition to the hidden tax that is inflation, we also have another mechanism that redistributes wealth from the average citizen to those at the top of the pyramid.
Thus, this very concept of a central authority being able to bend and twist the rules, even when the result is illogical, has implications that extend way beyond daily economic activities. In fact, it ultimately divides society into two classes, those who profit from this arbitrary and unilateral rewriting of the rules and those who are forced to pay the price even though they never agreed to it. In fact, they weren’t even asked.
A System of Collective Corruption
Of course, we can also look at it from the collective perspective of the so-called social contract of Rousseau and argue that this system of overt (taxation) and covert (monetary policy) redistribution is legitimate, or even benign. You might still believe that the state will take care of you in the future, and thus you are willing to sacrifice a part of your wealth and savings today to make sure that happens. In that case, it is useful to remember that the current central banking system is not that old. It’s only been around for about hundred years, or two long-term debt cycles combined. The first cycle ended when President Nixon officially tried to demonetize gold in 1971, empowering a centralized system whereby a few decide who receives the currency first and at what interest rate, allowing them to create bubbles in certain asset classes, protect different key industries and to use it to finance wars and enrich politicians and those close to them.
So far, total credit on a global scale stands around $240 trillion. It’s hard to conceive of such a number, but if you consider that 1 trillion seconds are equal to 31,709 years, you might begin to wrap your head around just how leveraged the system has become. We should never forget that debt is always consumption brought forward. That being said, debts need to be paid back or forgiven — there is no other outcome. In addition, the amount of debt that a system can take on is limited, and when a credit-based system can’t grow any further, the logical outcome is the collapse of the whole system. As Ludwig von Mises described this a long time ago,
There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.
This is the reason why central banks started trying to avoid this systemic collapse by taking interest rates below zero and allowing the big players to take on debt for free and to reduce their debt burden at the same time. This, of course, is something that we already witnessed extensively during the past decade and it is just a matter of time until more central banks, including the Federal Reserve, use the same fraudulent tactic to let some air out of the balloon, and to deleverage the debtor at the cost of the saver. However, it is very questionable whether this can be successfully managed, especially since demographics have been a problem for decades in the West, making growth a problem too. Governments enforced a mass-immigration policy to fight this aging population trend, yet its execution has been disastrous; instead of rejuvenating nations and spurring productivity, it has ended up crushing the national welfare systems.
It is thus clear that the current path that governments and central bankers have selected is utterly unsustainable and that their attempts at short-term “patches” have little hope of stopping the inevitable implosion, which has already been decades in the making. Pretending otherwise is as futile as it is naïve. As Ayn Rand put it,
We can ignore reality, but we cannot ignore the consequences of ignoring reality.
The “De-Civilization” Effect
Negative interest rates are a great example of these short-term patches, only in this case, they are not just useless as a cure for our economic ills, but they actually do more harm than good.
The outcome of this policy is that time becomes worthless. As one’s hard-earned money, set aside for a rainy day or for one’s children’s education, instead of appreciating, as logic would dictate, diminishes day by day, it does not make sense any longer to produce and to save. The basic motivation for each individual to get up in the morning and to work hard to achieve a higher living standard is removed, and time, therefore, turns into a dimension without any value. If people can’t save any longer, by government decree, then there is no other way than to consume. And with all traditionally safe investment options gone, they are only left with the option of speculating in rigged financial markets, and the massive risk that comes with it, especially now, when we’re nearing the end of a long-term debt cycle.
The individual is thus turned more and more into a state dependent, as the basis for a free life is financial independence and the ability have savings on the side that keep you self-reliant. The fundament of a successful system requires individuals that live a decent life, knowing that they must first produce before they can consume.
The masses are trained and forced to consume and spend money they don’t have to buy things they don’t need. Our monetary system in combination with this kind of public policy causes mass overconsumption, the destruction of wealth, capital consumption, and the destruction and exploitation of nature.
People significantly add value to society if they are able to save, as this allows them to invest at a later stage, once they have accumulated as much as needed, and thereby aid others in their own efforts to succeed and to reach financial independence. Parents can help their children and investors can help budding new companies that bring innovative ideas that benefit the economy and society as a whole. As this virtuous cycle continues, based on productivity, long-term thinking, and responsible financial management, “the rising tide lift all boats”.
To the contrary, when this natural process is forcibly disrupted and reversed, the effects are deleterious and far-reaching: mass overconsumption, the destruction of wealth, and the exploitation of nature and the environment are all symptoms of this institutional and massive push towards short-term thinking and of being forced to focus just on today, at the expense of tomorrow.
Wider Implications
Thus, what is at stake is not only the world economy, but the accelerating decline of Western culture, which, based on liberalism (personal freedom and private property rights) and Christianity (personal responsibility), laid the foundation for a decentralized Europe that allowed for competition of goods and services but especially the competition of ideas. This dangerous decline is nothing new, either, as it began after World War I, when Europe turned towards a more centralized approach, with all sorts of collectivist ideas causing all kinds of schisms that we still see today in modern societies. Today, we see a rapid acceleration of this decline, as our economic system can barely remain standing, and as our politics and our societies devolve even faster into tribal or more precisely into political identity groups, fighting each other over meaningless feuds. All the while they are distracted from the real threat, the one that governments and central banks pose to their future and to their children’s future.
As long as people are afraid of liberty and falsely delegate their self-responsibility to a central authority, hope is dim. It’s time to think independently about whether today’s centralized system really makes sense, if it is sustainable, and for how much longer. If the answers to these questions scare you, it is pointless to expect solutions to come from above. It is then time to act directly and responsibly, with a solid plan, hard physical assets privately owned, and a long-term strategy that does not depend on the whims and caprices of those in charge.
'Love Trump, Hate The Wall': Texas Landowners Stymie Border Barrier Plans
The biggest obstacles to the construction of President Trump’s border wall aren’t blue-state politicians like California Gov. Gavin Newsom. Rather, Texas landowners who have refused to fork over their border plots are creating the biggest problems for the Trump Administration, according to the New York Times.
Richard Drawe, the owner of a border plot in Progreso, Texas, told the NYT that he decided to capitulate and accept the government’s offer for his land rather than engage in a drawn-out legal battle.
Two days after signing over his land to the federal government, Drawe paused with his wife and mother on a levee that his family had owned for nearly a century.
A border wall that he reluctantly agreed to put on his land will soon divide this Texan family from the whole scene: the levee, a lake, an onion field and all of those birds.
Mr. Drawe, 69, doubts the wall will do much to stop illegal immigration, and though he supports the president who ordered it, he believes that the construction will “ruin” his life. But selling the land early on seemed better and cheaper than facing the government in court, only to have it take the land anyway, he reasoned. The wall, the lights and the roads will be built on about a dozen acres that his grandfather bought in the 1920s, and that will cut him off from the priceless views of the Rio Grande that he cherishes.
“We just finally gave up,” he said. “If they offered me a million dollars to build the wall, I would refuse it if I knew they wouldn’t build it. I don’t want the money. This is my life here.”
With the election less than a year away, President Trump is scrambling to fulfill his promise to build 450 miles of border wall by the end of next year.
The other challenges still facing Trump’s “big, beautiful” wall include an ongoing investigation into government contracts and a legal ruling blocking emergency access to Defense Department funds that Trump tried to re-allocate to the wall.
The nationwide injunction has, for now, curtailed work on 175 miles of wall from Laredo to El Paso, and from Yuma to El Centro.
According to Customs and Border Protection, the administration has thus far only built 93 miles of the wall, nearly all of it on federal land where dilapidated barriers once stood. Mark Morgan, the acting commissioner of the CBP, insisted that the government will meet its goal for the wall.
“It’s hard right now to say whether we’re still going to meet that goal,” Mr. Morgan said of building the wall by 2021. “But I’m confident we’re going to be close.”
The US brought more than 300 cases against landowners for their property after President George W. Bush signed a bill to begin installing fencing along the border in 2006, according to a Texas nonprofit. Some 46 of those cases are still ongoing.
Years ago, the government reached a settlement to acquire the land of most of the other property owners, and some of the fencing is now being reinforced to transform it into a veritable wall. The Trump Administration picked up where Bush left off, filing 48 lawsuits to help it begin work on other parcels of property.
Even if landowners decide to put up a fight, their odds of success aren’t great, thanks to a little something called “Eminent Domain,” as one attorney who spoke to the NYT pointed out.
“They’re going to acquire the land for their wall, whether you negotiate with them upfront or they end up filing a lawsuit and taking it by a declaration of taking,” said Roy Brandys, an attorney specializing in eminent domain who represented Mr. Drawe.
For Drawe and his family, the worst part of the deal is that the government isn’t building the wall directly on the border; instead, the wall will be situated well within US territory, cutting Drawe and his family off from even more of their land, while also spoiling the family’s view of the Rio Grande.
If the wall goes up, it’ll be the new border, Drawe reckons, meaning cartel members will likely continue raining down packages of drugs and other contraband across his property.
Becky Jones, a property owner in California who has decided to fight the federal government, put it this way: “Forget deplorable Americans,” she said, “you’re disposable Americans if you happen to be on the south side of the wall.”
The west coast never stops shaking, but lately the shaking has gone to an entirely new level, and this has many people deeply concerned about what may be coming. Last summer, a series of alarming foreshocks immediately preceded the two historic quakes that shook the Ridgecrest area in southern California. But those quakes were nothing compared to “the Big One” that scientists assure us is way overdue. Someday an earthquake that is hundreds of times stronger will absolutely devastate the California coastline, and it may be arriving a lot sooner than many people think. Farther north, the Cascadia subduction zone is a ticking time bomb that could literally unleash an unprecedented disaster at any moment. What I am talking about is an event that will completely wipe out entire cities and that the region will never recover from. As I have detailed repeatedly, authorities have warned us that “everything west of Interstate 5 will be toast” when an absolutely massive seismic event along the Cascadia subduction zone sends a gigantic tsunami sweeping inland.
Because of the extreme damage that a major west coast seismic event would do to our economy and to our Internet infrastructure, all of our lives will dramatically change the moment it happens. So it is understandable why so many people are alarmed by the tremendous shaking that we have witnessed over the past few days. As Americans all over the country were celebrating Christmas, the state of California was shaken by 9 significant earthquakes, and farther north the city of Vancouver was rattled by a magnitude 6.3 quake…
A series of earthquakes on Christmas Eve and before dawn Christmas morning hit around California, and a much bigger 6.3 quake shook off Vancouver.
At least nine earthquakes in 24 hours reaching up to 3.2 magnitude shook California from the Los Angeles area north to Chico, the U.S. Geological Survey reports.
The other quakes in the swarm ranged from 2.5 to 3.0 magnitude and stretched the length of the state, according to the USGS.
The large earthquake that shook Vancouver was preceded by five other large earthquakes that hit the region on Monday…
There were no reports of damage or injuries after five earthquakes struck within seven hours off the northwest end of Vancouver Island on Monday.
The tremors began as minor quakes, but grew stronger as the morning turned to afternoon.
According to the CBC, those five large earthquakes ranged in size from magnitude 4.8 to magnitude 6.0…
5.1 (8:44 a.m. PT).
5.6 (11:13 a.m.).
5.8 (11:49 a.m.).
6.0 (12:56 p.m.).
4.8 (3:38 p.m.).
Hopefully this earthquake swarm off the coast of Vancouver will turn out to be nothing.
But scientists tell us that an enormous rupture of the Cascadia subduction zone has the potential to produce a giant tsunami hundreds of feet tall, and the death and destruction such a tsunami would cause in Vancouver, Seattle, Tacoma, Portland and other coastal communities in the Northwest would be absolutely off the charts.
Meanwhile, we have also witnessed more than 30 significant earthquakes over last 30 days in the vicinity of Mt. Rainier, and anyone that is familiar with my work knows how concerned I am about the potential for a major eruption of that volcano.
Because there is always at least a little bit of shaking going on along the west coast, many residents have been lulled into a false sense of security. Yes, a major disaster has not happened in a long time, and as a result many believe that there is nothing to be concerned about. But someday a major event will strike very suddenly, and the devastation will be unimaginable. Just consider what Steve Quayle recently told Greg Hunter…
“The amount of damage, and I am going to choose my words carefully, is going to be precedent setting. It’s going to be the combination of volcanos going off that are inland from the subduction zone where the plates meet, coupled with tsunamis. . . . When this happens, you will lose eight million to twenty million people. When it happens, you will lose all productivity in the electronic field, obviously Silicon Valley, and all food production in all of California, Oregon and Washington. When it happens, you will have a State of Emergency unlike any other. How about the refugees? There will be 3.5 million refugees to take care of. When this happens, what happens to the underground aquifers, and where does everybody go for fresh water? There will be years of drought, years of famine and years of water, water where did it all go? It is a very dire situation painted by computer models. This is not a sensational thing. It is a reality based, scientific study with the application of what happens.”
Hopefully such an event will be delayed for as long as possible.
But each day it gets a little closer.
Before I get back to California, there is one more little tidbit from the Northwest that I wanted to share with you. On Friday, the city of Seattle experienced “its darkest day in recorded history”…
Seattle, the city known for its rainy weather and overcast, saw its darkest day in recorded history Friday due to several factors, including shorter days and dense cloud coverage.
Pyranometers are devices installed in buildings on campus at the University of Washington that help scientists gauge just how dark the days actually get in the city, the Seattle Times reported. Scientists there monitor how much solar radiation reaches the ground during a 24-hour span.
Overall, there have been more than 1,200 earthquakes in the United States over the past week, and the majority of those quakes have happened in the state of California.
Prior to the earthquake swarm that we witnessed on Christmas Eve and Christmas Day, a series of moderate quakes rattled the Ridgecrest area on Thursday and Friday…
Five months after the biggest earthquake in two decades, a swarm of smaller quakes rattled a secretive Navy base in the Mojave Desert Thursday afternoon and before dawn on Friday, according to the US Geological Survey.
Five quakes magnitudes over 2.5 struck Naval Air Weapons Station China Lake between 3 p.m. Thursday and 3.30 a.m. Friday in Ridgecrest, CA, according to the Fresno Bee.
That is the exact same area where two large earthquakes made headlines all over the globe last July.
Could it be possible that another major event is on the way?
As I repeatedly stress, we live at a time when our planet is becoming increasingly unstable.
Maybe it won’t happen this week, and maybe it won’t happen this month, but scientists assure us that major seismic disasters are coming to the west coast.
It is simply a matter of time, and time may be running out a whole lot more rapidly than most people would dare to imagine.
El Chapo's Son Gives Away Cars To Sinaloa Locals At Christmas Party
Ivan Archivaldo Guzmán, the son of jailed drug kingpin Joaquín “El Chapo” Guzmán, took a page right out of the infamous drug lord Pablo Escobar’s handbook of how to run a successful drug cartel, with generous giveaways at a lavish Christmas party for locals in his home state of Sinaloa, reported the Daily Mail.
The Daily Mail said locals were thankful for the gifts and shouted, “Thank You Ivan Archivaldo Guzmán.”
A tag on one of the gift bags read: “May this season be full of happiness … [may] the light provide you faith and love. Iván Archivaldo wishes you a Merry Christmas and a Happy New Year.”
Iván is one of six sons of El Chapo, the founder of the Sinaloa Cartel. El Chapo was captured by Mexican authorities in 2016, then extradited to the US a year later. He now awaits trial in New York.
Mississippi community college is defending itself against allegations from the DOJ and Betsy DeVos that it positions itself as a “police state” and threatens the free speech rights of its students.
In September, the Foundation for Individual Rights in Education filed a lawsuit against Jones College after the school threatened to arrest student members of Young Americans for Liberty for their efforts to initiate a conversation about marijuana legalization on campus. The campus police stopped the YAL members from tabling to raise awareness about this issue. FIRE sued the school on behalf of YAL and student Michael Brown.
Now the Department of Justice is weighing in on the matter, releasing a statement insisting that “College campuses should not be mini police states.”
“The United States of America is not a police state,” said assistant attorney general for the Civil Rights Division Eric Dreiband, adding “Repressive speech codes are the indecent hallmark of despotic, totalitarian regimes. They have absolutely no place in our country.”
US secretary of education Betsy DeVos also weighed in on the free speech of students at Jones County Junior College saying that the situation is “yet another concerning example of students encountering limits on what, when, where, and how they learn.”
“This is happening far too often on our nation’s campuses. This Administration won’t let students be silenced. We stand with their right to speak and with their right to learn truth through the free exchange of ideas—particularly those with which they might disagree,” DeVos added.
Jones County Junior College told Campus Reform that it “has reviewed the statement of interest filed by the federal government on this matter,” and that “At this time a preliminary motion to dismiss certain claims against certain defendants is pending before the court.”
The school disputed the legitimacy of the allegations, telling Campus Reform that “the only alleged facts in the record come from the unproven statements contained in the plaintiffs’ complaint,” and complains that the DOJ’s statement “broadly accepts those allegations and the merits of plaintiffs’ claims. The College looks forward to the Court’s ruling on the motion to dismiss and to developing the facts of this case through the discovery process.”
The institution assured Campus Reform that its “goal has always been to ensure that all students have equal and safe access to an environment free from hate speech; racial, gender, national origin, religious affiliation; and disability discrimination.”
“The plaintiffs’ allegations require the College to actively defend itself, its employees, and the Trustees from the position that no harm was done to the plaintiff by the College. Our mission is to teach the ideals of a democratic society. We focus every effort to ensure our students have access to their future through advanced affordable education that stands not only on free inquiry but promotes learning, advances knowledge, and promotes economic growth for the American family,” the college added.
At the end of the nineteenth century, Lord Palmerston stated what he thought was obvious, that “England has no eternal friends, England has no perpetual enemies, England has only eternal and perpetual interests.” Palmerston was saying that national interests should drive the relationships with foreigners. A nation will have amicable relations most of the time with some countries and difficult relations with some others, but the bottom line should always be what is beneficial for one’s own country and people.
If Palmerston were alive today and observing the relationship of the United States of America with the rest of the world, he might well find Washington to be an exception to his rule. The U.S., to be sure, has been adept at turning adversaries into enemies and disappointing friends, and it is all done with a glib assurance that doing so will somehow bring democracy and freedom to all.
Indeed, either neoliberal democracy promotion or the neoconservative version of the same have been seen as an overriding and compelling interest during the past twenty years even though the policies themselves have been disastrous and have only damaged the real interests of the American people.
The U.S. relationship with Israel is, for example, driven by a powerful and wealthy domestic lobby rather than by any common interests at all yet it is regularly falsely touted as being between two “close allies” and “best friends.” It has cost Americans hundreds of billions of dollars in subsidies for the Jewish state and Israeli influence over U.S. policy in the Middle East region has led to catastrophic military interventions in Afghanistan, Lebanon, Iraq, Syria, Mogadishu and Libya. Currently, Israel is agitating for U.S. action against the nonexistent Iranian “threat” while also unleashing its lobby in the United States to make illegal criticism of any of its war crimes, effectively curtailing freedom of speech and association for all Americans.
Far more dangerous is the continued excoriation of the Kremlin over the largely mythical Russiagate narrative. Congress has recently approved a bill that would give to Ukraine $300 million in supplementary military assistance to use against Russia. The money and authorization appear in the House of Representatives version of the national defense authorization act (NDAA) that passed last week.
The bill is a renewal of the controversial Ukraine Security Assistance Initiativethat Donald Trump allegedly manipulated to bring about an investigation of Joe Biden’s son Hunter. The new version expands on the former assistance package to include coastal defense cruise missiles and anti-ship missiles as offensive weapons that are acceptable for export to Kiev. It also authorizes an additional $50 million in military assistance on top of the $250 million congress had granted in last year’s bill, “of which $100 million would be available only for lethal assistance.”
Ukraine sought the money and arms to counter Russian naval dominance in the Black Sea through its base at Sevastopol in the Crimea. One year ago the Russian navy captured three Ukrainian warships and Kiev was unable to push back against Moscow because it lacked weapons designed to attack ships. Now it will have them and presumably it will use them. How Russia will react is unknowable.
Dmytro Kuleba, Ukraine’s Deputy Prime Minister for European and Euro-Atlantic Integration, has been in Washington lobbying for the additional military assistance. He has had considerable success, particularly as there is bipartisan support in Congress for aid to Kiev and also because the Trump Departments of Defense and State as well as the National Security Council are all on board in countering the “Russian threat” in the Black Sea. President Trump signed the NDAA last week, which completed the process.
Far more ominously, Kuleba and his interlocutors in the administration and congress have been revisiting a proposal first surfaced under Bill Clinton, that Ukraine and Georgia should be admitted to the NATO alliance. Like the $300 million in military aid, there appears to be considerable bipartisan support for such a move. NATO already has a major presence on the Black Sea with Bulgaria, Romania and Turkey all members. Adding Ukraine and Georgia would completely isolate the Russian presence and Moscow would undoubtedly see it as an existential threat.
The NDAA also provides seed money to initiate the so-called Space Force, which President Trump inaugurated by describing it as “the world’s newest war-fighting domain. Amid grave threats to our national security, American superiority in space is absolutely vital. We’re leading, but we’re not leading by enough, but very shortly we’ll be leading by a lot. The Space Force will help us deter aggression and control the ultimate high ground.”
If that isn’t bad enough, the new defense budget ominously also requires the Trump administration to impose sanctions “with respect to provision of certain vessels for the construction of certain Russian energy export pipelines.” Last week the House of Representatives and Senate approved specific sanctions relating to the companies and governments that are collaborating on the construction of the Nord Stream 2 pipeline that will cross the Baltic Sea from Vyborg to Greifswald to connect Germany with Russian natural gas. President Trump has signed off on the legislation.
The United States has opposed the project ever since it was first mooted, claiming that it will make Europe “hostage” to Russian energy, will enrich the Russian government, and will also empower Russian President Vladimir Putin to be more aggressive. Engineering companies that will be providing services such as pipe-laying will be targeted by Washington as the Trump administration tries to halt the completion of the $10.5 billion project.
Now that the NDAA has been signed, the Trump administration has 60 days to identify companies, individuals and even foreign governments that have in some way provided services or assistance to the pipeline project. Sanctions would block individuals from travel to the United States and would freeze bank accounts and other tangible property that would be identified by the U.S. Treasury. One company that will definitely be targeted for sanctions is the Switzerland-based Allseas, which has been contracted with by Russia’s Gazprom to build the offshore section of pipeline. It has suspended work on the project while it examines the implications of the sanctions.
Bear in mind that Nord Stream 2 is a peaceful commercial project between two countries that have friendly relations, making the threats implicit in the U.S. reaction more than somewhat inappropriate. Increased U.S. sanctions against Russia itself are also believed to be a possibility and there has even been some suggestion that the German government and its energy ministry might be sanctioned. This has predictably resulted in pushback from Germany, normally a country that is inclined to go along with any and all American initiatives. Last week German Foreign Minister Heiko Maas asked Congress not to meddle in European energy policy, saying “We think this is unacceptable, because it is ultimately a move to influence autonomous decisions that are made in Europe. European energy policy is decided in Europe, not in the U.S.”
German Bundestag member Andreas Nick warned that “It’s an issue of national sovereignty, and it is potentially a liability for trans-Atlantic relations.” That Trump is needlessly alienating important countries like Germany that are genuine allies, unlike Israel and Saudi Arabia, over an issue that is not an actual American interest is unfortunate. It makes one think that the wheels have definitely come off the cart in Washington.
The point is that Donald Trump, Mike Pompeo, Mike Pence and Mike Esper (admittedly too many Mikes) wouldn’t know a national interest if it hit them in the face. Their politicization of policy to “win in 2020” promoting apocalyptic nonsense like war in space has also reinforced an existing tunnel vision on what Russia under Vladimir Putin is all about that is extremely dangerous. Admittedly, Team Trump throws out sanctions in all directions with reckless abandon, mostly aimed at Russia, Iran, North Korea and, the current favorite, Venezuela. No one is immune. But the escalation going from sanctions to arming the Kremlin’s enemies is both reckless and pointless. Russia will definitely strike back if it is attacked, make no mistake about that, and war could easily escalate with tragic consequences for all of us. That war is perhaps becoming thinkable is in itself deplorable, with Business Insiderrunning a recent piece on surviving a nuclear attack. New homes in target America will likely soon come equipped with bomb shelters, just like in the 1950s.
With estimated wingspans of six-feet, the aircraft have been covering 25-square-mile plots of Phillips and Yuma counties every night between 7 – 10 p.m. for around a week, Phillips County Sheriff Thomas Elliott said Monday, adding that they have received nine calls about the drones since last week.
“They’ve been doing a grid search, a grid pattern,” he said “They fly one square and then they fly another square.
Nobody knows who’s flying them
Several agencies, including the sheriff’s office, the Army, the Air Force, the Federal Aviation Administration (FAA) and the Drug Enforcement Agency (DEA), say they have no knowledge of the mysterious aircraft or who is operating them, however Undersheriff William Meyers suggested that “The estimated size and number of drones makes it unlikely that they’re being flown by hobbyists.”
Drone pilots aren’t required to submit flight plans unless planning to operate in controlled airspace, such as an airport.
UAV and Drone Solutions monitoring aircraft (via AOPA.org)
Meyers says he watched eight of the large drones flying along the Yuma County border, while a single drone was spotted simultaneously hovering around 25 miles away over the town of Paoli. According to the report “it didn’t move all night, just hovered over the town,” while eight more drones flew 10 miles away over the town of Haxtun, Meyers added.
“Overhead they were probably doing 30, 40 mph,” he said. “They weren’t racing or flying around with speed.”
One resident who spotted a drone last week gave chase, Elliott said, driving behind it at about 50 mph, but lost the drone when he ran out of gas in Washington County.
The machines fly too high to be heard from the ground but can be seen by their strobing white lights along with red, blue and green lights, Myers said.
Myers suspects the drones might be operated by a private company, although the machines haven’t targeted any obvious landmarks or features — sometimes they fly over towns, other times over empty fields.
“They do not seem to be malicious,” Elliott said. “They don’t seem to be doing anything that would indicate criminal activity.” –Denver Post
Denver-based commercial photographer Vic Moss, a drone pilot and owner of an online drone school (Drone U), said on Monday he thinks either a company or government agency is behind the flights.
“We have a number of drone companies here in Colorado, and they’re very innovative,” said Moss, adding “So maybe they’re testing something of theirs out in that area because it is very rural. But everyone that I know of, they coordinate all that stuff with local authorities to prevent this very situation. They all very much want people to understand drones and not cause this kind of hysteria.”
Moss suggests that the grid pattern may indicate some type of mapping or searching operation, adding that perhaps they are flying at night in order to use infrared cameras – which are sometimes used to examine crops.
He also says that the pilots are unlikely to be breaking any laws, as “The way Colorado law is written, none of the statutes fit for harassment or trespassing.”
“Colorado hasn’t gotten on board with identifying the airspace around your property as the actual premises, so we don’t have anything we could charge.”
The FAA does say that drones weighing under 55 lbs must be flown during daylight hours, within sight of the pilot, under 400 feet, and not directly over people. Pilots can apply for waivers.
It’s also not clear whether the drones over Phillips and Yuma counties would be governed by those regulations. A drone the size of the ones spotted over the counties likely would weigh more than 55 pounds, Moss said. That means the drone operator would be flying commercially and would likely need to be a “manned aviator” — an actual pilot, Moss said.
Chuck Adams, CEO of 1Up Aerial Drone Services in Golden, said that he wasn’t sure who might be flying the drones, but said his company does offer “drone defense” systems that can help people on the ground discover where drones are being flown from. –Denver Post
“It’s something we put up with radio frequency and acoustics, and you can tell where the operator is and where the drones are,” said Adams. “We can’t take them out of the sky, but we can give awareness.”
And according to Sheriff Elliott, people can stop calling about the drones.
“We just want to know if one lands, if we can get our hands on it, or if they see someone operating them, that’s what we’re looking for now,” he said. “We know they exist.“
The story of Christmas begins with a 90-mile trek in a dangerous world of robbers both private and public. It was the first imposition of a head tax in that generation, by the tyrannical Caesar Augustus, who ruled the Roman Empire from 27 BC until AD 14.
And you know he had major ego issues. He changed the name of the month Sextillia to name it after himself: August. The calendar still pays him homage.
His major ambition in his reign was to restore a centralized empire. Raising revenue was a major priority of the regime, and this tax was a means of accomplishing that goal.
Few people give voluntarily to any state. The state must rely on enforcement via coercion, including beatings and imprisonment. A state needs a standard by which to judge compliance, which means that taxation always and everywhere begins with accounting for all the people, their income and jobs.
It was precisely this with the Edict of Caesar Augustus.
Eugene W. Seraphin, writing for The Catholic Biblical Quarterly (January, 1945) explains as follows:
In the days of the Republic, no one had ever tried to settle how much money was needed to carry on the government, and how much of this sum each province ought justly to pay in the form of taxes. Augustus proceeded to put together huge census lists and property assessments, by which to determine the population and the total value of the property in each province
Suidas, a Greek lexicographer of the tenth century, wrote that
Augustus, having become the sole master, chose twenty men distinguished for integrity and probity, and sent them through all the earth subject to him, to make a census of persons and goods, in order to apportion justly the contributions which should be paid into the public treasury. This was the first census. That which had preceded The Edict of Caesar Augustus was sort of a spoliation of the rich, as though the state regarded the possession of property as a public crime.
The entire process was incredibly invasive and reminds us that state surveillance is nothing new. The emperor wanted the name, age, profession, and an accounting of the personal wealth of every person over the age of 14. All this was recorded in official records.
Getting revenue always and everywhere begins with accounting for all the people, their income and jobs. For every Roman, compliance meant registering in the town in which he or she lived.
For Jews, it was different. They had to return to their home of heritage, which in the case of Joseph was Bethlehem, the “land of the Jews.” Thus began the journey with his bride-to-be Mary who was already very much with child. To be clear, this was not a trip they undertook willingly; it was forced on them by the state. Augustus was effectively drafting people into his taxing regime.
And here too we see an early implementation of identity politics. Joseph and Mary were not just counted and taxed; they were counted and taxed as Jews. The state in these pre-liberal days considered it public business to assign everyone a tribe – a collective identity whether or not he or she felt an attachment to that tribe. No one could escape. They were forced to return to a homeland that the state defined for them.
Joseph had to leave his business behind. Mary, who should have been resting in bed, risked her life and that of a child to travel on dangerous roads for days, to comply with the edict.
As the couple arrived in Bethlehem, we are told that they were unable to find a place to stay, which today we render as some kind of discrimination. This is ridiculous. There were no commercial hotels in Bethlehem. There were only places to stay based on the kindness of strangers in exchange for small gifts. The whole place was overcrowded because everyone was rushing to avoid the penalties of law.
It was typical in those days, scholars tell us, that the living quarters of places were above where the animals stayed so that the animals could be a source of heat for the house. Mary and Joseph were generously given a place on the lower floor.
The actions of the “innkeeper” here were generous and benevolent in a way in which the state that was bludgeoning these travelers was not. The state dragged an expecting woman and her plus one, based on their Jewishness, across dangerous terrain for three days solely so they could be counted and taxed. Meanwhile, the private sector provided them with shelter, safety, and love.
What a paradigm of truth here! The story of Mary and Joseph on their journey sets up the essential conflict of our own time: compulsion vs choice, the former being the brutal, something we all must deal with and work around in service to the state, and the latter being the compassionate and loving, enabling new life and light to be born into the world.
As the story continues, recall that they were not safe there either. Face with a murderous order from King Herod, they had to leave again, this time for Eygpt.
Think about this story as you contemplate the surveillance, the identity politics, the impending internal passports, and the demographic controls of modern statism. These are tools of oppression. And think too of the beautiful opportunities afforded to us today by the benevolent hands of commerce and private charity. These are truly the saviors of the world.
US Sends 4 Spy Planes Over N.Korea, But Ominous Christmas 'Gift' Didn't Come
Given it’s now Dec. 26 in Korea, it looks like Kim Jong Un’s promised “Christmas gift” — or what many thought would be a long-range missile test — never arrived. Perhaps this was the actual gift in the most optimistic scenario: a softening of tensions and willingness to back down in the hope that nuclear talks would warm in this holiday season headed into 2020.
However, it’s not too late for some kind of “late present” brought by ‘Santa Kim’ given the following provocative US action on Christmas Day no less, as the Pentagon was likely closely monitoring to see if a ‘gift’ was being readied on the ground, via The Hill:
…The U.S. flew four aircraft, the RC-135W Rivet Joint, E-8C, RQ-4 Global Hawk and RC-135S Cobra Ball, over the country between Tuesday and early Wednesday. The planes were believed to have carried out missions in and around the Korean Peninsula, Yonhap reported.
Military sources confirmed to the news outlet that South Korea and the U.S. have strengthened efforts against the possibility of North Korea firing an ICBM or other weapons.
“We’re keeping a close watch over military moves in North Korea,” said one of the sources, who the outlet declined to name.
On Tuesday just ahead of Christmas celebrations at Mar-a-Lago, President Trump held out hope the ‘gift’ could turn out to be something positive.
“Let’s see what happens. Everybody’s got surprises for me, but let’s see what happens. I handle them as they come along,” Trump told reporters.
Illustration via Bulletin of the Atomic Scientists
“We’ll see what happens,” Trump added. “Maybe it’s a nice present. maybe it’s a present where he sends me a beautiful vase as opposed to a missile test.”
But who knows just how North Korea will interpret the Christmas Day spy plane flyover? Perhaps Kim will take it as a sign of bad faith and will determine a potential belated holiday gift accordingly.
A decade or more ago, I began to discuss with associates the possibility of governments and banks colluding to eliminate physical cash. Back then, the idea struck most everyone as poppycock, that governments could never get away with it.
I didn’t write on the subject until 2015, when several countries had begun to limit the amount of money a depositor could extract from his bank account. At that point, the prospect that central banks might conceivably eliminate cash was looking less like an alarmist fantasy, and it became possible to write on the nascent issue.
In a nutshell, today, in most of the world’s most prominent countries, the people who control banking are the same people who pull the strings in government. A cashless system therefore seemed to me to be a natural, as it dramatically increased both profit and power for both banking and government – an opportunity that can’t be passed up.
Some banks have been delving into negative interest rates, which is a euphemism for charging you to keep your money in the bank, so that they can loan it out for their own profit. You actually lose money annually by having it on deposit.
Of course, some people accept negative interest rates in order to retain the imagined safety of having their cash in a bank vault, rather than at home. Others tolerate it because they value the convenience of using ATMs and chequing.
But what if cash were eliminated? No one would have a choice. They’d have to have a bank account and use it for all transactions, or they couldn’t purchase goods or pay bills.
Once everyone accepted the concept that bankers had total control of transactions, that this was “normal,” banks would be in the catbird seat. They could raise the transaction fees considerably over time and the depositors would be unable to exit the system.
The Benefit to Governments
Governments would thoroughly endorse the idea, because it would mean that, for the first time, they’d have access to all information on your economic activity. The necessity of allowing people to file for income tax would vanish. In future, they could assess your annual tax themselves and take it from your account by direct debit. They could also begin taxing you monthly rather than annually, “for your convenience.”
And in the bargain, we could anticipate that the charges would be numerous, confusingly worded on the monthly statement and difficult to figure out. That would allow both the banks and the government to periodically effect incremental increases.
Once all your transactions were monitored, those that are “suspect” could be noted and even refused. Purchases at gun shops could be classified as “terrorist-related.” A transfer to a realtor in Panama could be classified as “money-laundering.”
Since the War on Cash has become recognized in the last few years, many people have turned to cryptocurrencies as a means of retaining monetary freedom.
However, as the future of financially pillaging the populace depends on ensuring that the populace have no option other than banks, will governments allow cryptos to flourish?
Not if they can stop it. But can they?
It’s been my contention that banks will at some point, launch their own cryptos, whilst doing all they can to discredit non-central bank cryptos as being potentially criminal.
The Bank of Canada is now considering launching a digital currency that it says would help it combat the “direct threat” of cryptocurrencies. It would initially coexist with paper money, but would eventually replace it completely.
They state further that banknotes are becoming obsolete as a means of payment, creating problems for the banking system as a whole: “The time may come that merchants/banks find it too costly to accept banknotes.”
Translate that to mean that, if you insist on using banknotes, the bank will have no choice but to charge you a premium for their use.
This has come on the heels of the plan by Facebook to release libra, its own cryptocurrency. The Bank of Canada states that “Facebook’s digital offering is losing key backers and facing scrutiny from regulators worldwide, including the Bank of Canada.”
It suggests that central bank digital currencies allow banks to collect more information on Canadians than is possible when people use cash. “Personal details not shared with payee, but could be shared with police or tax authorities.”
And if there are any remaining uncertainties to the benefits of non-central bank cryptos, they added, “Cryptocurrencies may become a direct threat to our ability to implement monetary policy and lender of last resort role.”
On the surface, the statement from Bank of Canada appears to be an announcement of banking progress, for the betterment of depositors. But it’s the first report, to my knowledge, in which a bank declares bitcoin and other non-central bank cryptos as a “direct threat.”
The above statement is a forerunner to declaring non-bank cryptos to be criminal in nature. Cryptos offer the hope of monetary freedom and that can’t be allowed.
At some point, we can expect banks to disallow any payment for cryptos such as bitcoin through central bank cryptos and refuse accounts to anyone who has a history of dealing in non-central bank cryptos. The objective will be to eliminate the possibility that your grocer or gas station, along with any other bank depositor, might accept bitcoin. The intent will be to send bitcoin to the crypto graveyard.
Unlike gold, bitcoin is intangible and cannot simply be stuffed in the mattress until such time as it regains its acceptance for convertibility, as gold has in the past. It doesn’t exist in physical form and only has a perceived value if another party is prepared to accept it in payment.
The War on Cash is a war on your economic freedom. At present, most people still retain the ability to remove their wealth from the system, move it to a more wealth-friendly jurisdiction and hold it to forms that will retain value in the future.
That window may close sooner, rather than later.
* * *
It’s no secret that governments are eager to eliminate cash. Part of the reason is that it would enable them to devalue their currencies faster. That’s precisely why, as the calls to eliminate cash grow louder, we’ve seen a massive increase in currency creation and inflation all around the world. It’s created an economic situation unlike we’ve ever seen before, and it’s all building up to a severe crisis on multiple fronts. That’s exactly why NY Times bestselling author Doug Casey and his team just released an urgent report on how to survive and thrive during an economic collapse. Click here to download the PDF now.
Colleges Track Hundreds Of Thousands Of Students Using Their Phones
“Graduates will be well prepared … to embrace 24/7 government tracking and social credit systems.”
An app created to track the attendance of ‘less academically inclined’ college athletes is under fire, after over 40 schools have begun using the technology to monitor students campus-wide, according to the Washington Post.
Syracuse professor Jeff Rubin says his lectures have never been so full
Developed by former college basketball coach Rick Carter (who is currently under a restraining order by DePaul University for allegedly threatening the athletic director and head basketball coach), the Chicago-based SpotterEDU app uses Bluetooth beacons to ping a student’s smartphone once they enter a lecture hall. About the size of a deck of cards, they are installed in covert locations on walls and ceilings.
School officials give SpotterEDU the students’ full schedules, and the system can email a professor or adviser automatically if a student skips class or walks in more than two minutes late. The app records a full timeline of the students’ presence so advisers can see whether they left early or stepped out for a break. –Washington Post
Syracuse University IT instructor Jeff Rubin uses the app to encourage his students to attend lectures – awarding “attendance points” to those who show up. Rubin is also notified when students skip classes.
“They want those points,” said Rubin. “They know I’m watching and acting on it. So, behaviorally, they change.“
According to Rubin, his 340-student lecture has never been so full at around 90% attendance.
Double Secret Dystopia
Understandably, not everyone is thrilled with the intrusive new technology, which many argue breaches students’ privacy rights on a massive scale.
“We’re adults. Do we really need to be tracked?” said sophomore Robby Pfeifer, a student at Commonwealth University in Richmond, which recently began using the campus’ WiFi network to track students. “Why is this necessary? How does this benefit us? … And is it just going to keep progressing until we’re micromanaged every second of the day?“
School and company officials, on the other hand, argue that monitoring students is a powerful motivator and will encourage students to adopt habits geared towards success.
“If they know more about where students are going, they argue, they can intervene before problems arise,” according to the Post.
That said, some schools have taken things further – assigning “risk scores” to students based on factors such as whether they are going to the library enough.
The dream of some administrators is a university where every student is a model student, adhering to disciplined patterns of behavior that are intimately quantified, surveilled and analyzed.
But some educators say this move toward heightened educational vigilance threatens to undermine students’ independence and prevents them from pursuing interests beyond the classroom because they feel they might be watched.
“These administrators have made a justification for surveilling a student population because it serves their interests, in terms of the scholarships that come out of their budget, the reputation of their programs, the statistics for the school,” said Kyle M. L. Jones, an Indiana University assistant professor who researches student privacy.
“What’s to say that the institution doesn’t change their eye of surveillance and start focusing on minority populations, or anyone else?” he added. Students “should have all the rights, responsibilities and privileges that an adult has. So why do we treat them so differently?” –Washington Post
“It embodies a very cynical view of education — that it’s something we need to enforce on students, almost against their will,” said UCSD digital scholarship librarian Erin Rose Glass. “We’re reinforcing this sense of powerlessness … when we could be asking harder questions, like: Why are we creating institutions where students don’t want to show up?“
Hilariously, creators of the dystopian surveillance app have tried to make things ‘more fun,’ by ‘gamifying students’ schedules with colorful Bitmoji or digital multiday streaks.’
That said, “the real value may be for school officials, who Carter said can split students into groups, such as “students of color” or “out-of-state students,” for further review.”
When asked why an official would want to segregate out data on students of color, Carter said many colleges already do so, looking for patterns in academic retention and performance, adding that it “can provide important data for retention. Even the first few months of recorded data on class attendance and performance can help predict how likely a group of students is to” stay enrolled.
Students’ attendance and tardiness are scored into a point system that some professors use for grading, Carter said, and schools can use the data to “take action” against truant students, such as grabbing back scholarship funds. –Washington Post
Meanwhile, another app from Austin-based start-up Degree Analytics uses WiFi check-ins to track around 200,000 students across 19 state universities, private colleges and other schools, according to the Post.
Founded in 2017 by data scientist Aaron Benz, the company claims that every student can graduate with “a proper environment and perhaps a few nudges along the way.”
According to Benz, his system can solve “a real lack of understanding about the student experience” by using campus WiFi data to measure and analyze 98% of students.
But the company also claims to see much more than just attendance. By logging the time a student spends in different parts of the campus, Benz said, his team has found a way to identify signs of personal anguish: A student avoiding the cafeteria might suffer from food insecurity or an eating disorder; a student skipping class might be grievously depressed. The data isn’t conclusive, Benz said, but it can “shine a light on where people can investigate, so students don’t slip through the cracks.”
To help find these students, he said, his team designed algorithms to look for patterns in a student’s “behavioral state” and automatically flag when their habits change. He calls it scaffolding — a temporary support used to build up a student, removed when they can stand on their own.
At a Silicon Valley summit in April, Benz outlined a recent real-life case: that of Student ID 106033, a depressed and “extremely isolated” student he called Sasha whom the system had flagged as “highly at-risk” because she only left her dorm to eat. “At every school, there are lots of Sashas,” he said. “And the bigger you are, the more Sashas that you have.” –Washington Post
The Chief-of-Staff for the Israeli Armed Forces, Aviv Kochavi, said on Wednesday that Israel cannot allow Iran to station militarily in Iraq. According to Ynet News, Kochavi stated on the seventh anniversary of the death of the former Chief-of-Staff, Amnon Lipkin Shahak, that the Israeli army would never allow Iran to be stationed in Iraq.
“The Quds Force of the Iranian Revolutionary Guards in Iraq… transfer advanced weapons there monthly. We cannot leave this situation without interference,” he said.
File image: Iranian Revolutionary Guard members attend a ceremony in Tehran.
Furthermore Kochavi said that “there is an opportunity in the Gaza Strip, after the results of the ‘Black Belt’ operation, to develop a secure reality and make it more stable.”
“In the coming war, we will have to attack with great force in populated areas and also target the state structure or the entity that allows terrorism to act against us,” Kochavi continued.
The Israeli military official said that “in the coming war with Lebanon or with Hamas, the internal front in Israel will be subject to major rocket attacks, most of which are inaccurate, but will have an impact,” adding that “Israel will target everything that helps in combat operations, such as electricity, fuel, bridges, if the state of Lebanon, Syria or Hamas and others allow terrorism from its lands to be used against us.”
Prime Minister Benjamin Netanyahu and IDF Chief of Staff Aviv Kochavi (right), via Ynet News.
Israel has accused Iran of transferring long-range weapons and missiles to Iraq, and from there to Syria and Hezbollah in Lebanon.
The Popular Mobilization Units (Hashd Al-Shaabi) came under attack in July after a suspected Israeli drone carried out a devastating assault on a base in the Salaheddine Governorate.
According to The New York Times, citing data from Yelp, the share of Chinese restaurants has dramatically fallen across major US metropolitan areas in the last five years.
Yelp data shows the share of Chinese restaurants in the top 20 metros has been in free fall since about 2014.
Five years ago, 7.3% of all restaurants in the top 20 metros were Chinese, compared with 6.5% today. The declining trend has resulted in over 1,200 fewer Chinese restaurants while these metros added over 15,000 more restaurants.
The Times notes that the oldest Chinatown in the US is located in San Francisco, and even there, the share of Chinese restaurants shrank to 8.8% from 10% in 2014.
Mass closings of Chinese restaurants show no signs of abating, Indian, Korean, and Vietnamese restaurants continue to hold a steady market share or increase nationwide.
One big reason for the rash of closings “seems to be the economic mobility of the second generation,” said The Times.
“It’s a success that these restaurants are closing,” said Jennifer 8. Lee, a former New York Times journalist. “These people came to cook so their children wouldn’t have to, and now their children don’t have to.”
The children of Chinese immigrants have integrated into the economy and are less likely to take over their parent’s restaurant.
While the wave of closings has been underway for at least a half-decade, some restaurants, instead of closing, are selling operations to incoming first-generation immigrants who want the chance to cook Kung pow chicken to an overweight baby boomer.
The holiday season has a way of bringing out both the best and the worst in people. As holiday consumption increases, unfortunately theft does as well from a host of places like porches, donation bins, stores, and even banks.
But it isn’t often that the stolen goods are immediately redistributed in such an extremely noticeable fashion.
Just after noon on Monday, a 65-year-old man walked into a downtown Colorado Springs, Colorado bank and stole thousands of dollars before running outside and tossing the cash up into the air while yelling “Merry Christmas!”
“He robbed the bank, came out, threw the money all over the place,”Dion Pascale, a witness of the strange ordeal, toldKKTV.
“He started throwing money out of the bag and then said, ‘Merry Christmas!’”
According to Pascale, when the robber was done tossing the cash in the air, he walked from outside of the Academy Bank and onto the patio of a nearby Starbucks, sat down, and waited for police to arrive and arrest him. He reportedly did not order a drink.
The man, David Wayne Oliver, was arrested without incident. Police didn’t find a weapon on the man despite his having claimed that he was armed during the robbery.
According to witnesses, bystanders retrieved some of the money and returned it to the bank but The Denver Post quoted police as saying “thousands of dollars” remained unaccounted for.
"Like Watching A Car Crash In Slow Motion": Turkey Balks At US Sanction Threat, Warns It May Evict US Forces From Military Bases
Despite mounting political and diplomatic pressure by the US and its NATO allies, Turkey has again balked at US attempts of intimidation and dug into its refusal to abandon a new Russian missile defense, saying it won’t bow to the threat of crippling US sanctions or trade the S-400s for an American system.
“They said they would not sell Patriots unless we get rid of the S-400s. It is out of question for us to accept such a precondition,” said Ibrahim Kalin, a spokesman for President Recep Tayyip Erdogan, late on Tuesday after a cabinet meeting, quoted by Bloomberg.
Parts of Russian S-400 defense system unloaded from a Russian plane at Murted Airport near Ankara in August; Photo: Turkish Defense Ministry
“An irrational anti-Turkish sentiment has prevailed in the Congress and it is not good for Turkish-American relations,” Kalin added, noting that Congress “should know that such language of threat would push Turkey exactly toward places that they don’t want it turn to.” Namely, right into the hands of Vladimir Putin, who is on even better terms with Erdogan than Trump, despite Turkey taking down a Russian fighter jet over its territory several years back.
Separately, as the WSJ reported this morning, Erdogan once again warned that he would evict U.S. forces from two military bases in his country if Washington imposes new sanctions on his government, creating a bitter quandary for NATO as it seeks to cope with Ankara’s deepening ties to Russia.
In a television interview this month, President Recep Tayyip Erdogan said if the U.S. punishes Turkey for its purchase of a Russian air-defense system, then, “if necessary, we may close Incirlik and Kureci,” installations where the U.S. keeps approximately 50 B61 nuclear weapons, and operates critical radar.
Erdogan’s declaration elicited an anxious reaction from U.S. Defense Secretary Mark Esper, who said it raised questions about Turkey’s dedication to the North Atlantic Treaty Organization: “They have that inherent right to house or to not house NATO bases or foreign troops,” Esper said. “But again, I think this becomes an alliance matter, your commitment to the alliance, if indeed they are serious about what they are saying.”
“It feels like watching a car crash in slow motion,” a Western diplomat in Turkey told the WSJ.
The main bone of contention is Turkey’s purchase of the S-400 system, which the Pentagon views as a security threat to NATO. The U.S. has suspended deliveries of the F-35 Joint Strike Fighter to Turkey and excluded Turkish aerospace companies from a contract to supply fuselage and other parts, saying Russia could use the system’s radar to spy on and assess the stealthy aircraft’s capabilities.
As has been duly covered here for the past two years, US Congress has been pushing for sanctions against Turkey, which has NATO’s second biggest standing army after the US, over the country’s purchase of the Russian S-400 despite the objection of President Donald Trump, who has developed a particularly close relationship with Turkey’s Erdogan in the past year, and who says such a move could drive Turkey closer to Moscow.
And just to make sure Congress is really furious, Turkey intends to purchase a second Russian S-400 battery and pursue a joint-development agreement with Moscow in order to be able to produce its own sophisticated ballistic missiles, a move that will spark chaos among NATO member nations; as a reminder, NATO only exists to feed the US military-industrial complex with organic customers for advanced weapon systems. By using Russia for its most advanced military needs, Turkey has taken that old maxim and flipped it on its head.
The Trump administration has sought to cajole Erdogan in a bid to prevent Ankara from knitting closer ties with Moscow amid concerns that treating him like a pariah would push Turkey further into Russia’s orbit, U.S. officials said. But Trump has had to contend with angry U.S. lawmakers, who have voted through a string of bills aimed at punishing Turkey.
The US president has so far refrained from using a piece of legislation that allows the U.S. president to slap sanctions on any country that makes a sizable arms purchase from Russia. But a Senate committee recently approved a bill that would enforce the legislation, which could freeze Turkish assets in the U.S., restrict visas and limit access to credit.
In response to growing Western anger, Turkish officials proposed setting up an expert committee with the U.S., or under NATO supervision, to look into the S-400 issue and propose remedies. But US officials told the WSJ, Washington would rather pay substantial compensation than deliver a single F-35 to Turkey and jeopardize the integrity of the multibillion-dollar program.
Highlighting the impasse, Turkey carried out a test of the S-400 system, deployed at an airbase near Ankara, against U.S.-made F-16 jets in late November, and it said it might order Russian combat aircraft if the F-35 delivery ban wasn’t lifted.
“Turkish national-security interests must be regarded as one of the primary issues for the U.S. and NATO,” said Ahmet Berat Conkar, a Turkish lawmaker affiliated with Mr. Erdogan’s ruling AK Party, and the deputy head of Turkey’s delegation to the NATO Parliamentary Assembly. “If this cannot be openly guaranteed and maintained by concrete action for Turkey, new cracks may open inside the NATO alliance.”
The biggest irony is that in effecting its de facto breach from NATO, Turkey is also exposing the hypocrisy that runs through the heart of the military alliance. As the Journal notes, “some European allies bristle that NATO uses language similar to Turkey’s, which says that its invasion of northern Syria is for national security interests, and voice concerns that the West’s alliance gave Turkey too much leeway to expand its military partnership with Russia.”
Turkey, which is already coordinating with Russia in northern Syria, is now also seeking to cooperate with Russia in war-torn Libya.
“Turkey is playing a showdown and it is winning,” a senior European diplomat at NATO said.
It is indeed, and the only recourse the West has is to slap crippling sanctions on its economy in hopes of forcing Erdogan to realign his attitude. As Bloomberg reminds us, the last time the U.S. sanctioned Turkey last summery, to pressure it to release a detained U.S. pastor, the lira crashed and sent the Turkish economy into a recession from which it is still recovering.
The irony, of course, is that only those punters who sold on the way up will escape the devastation of the collapse into a bidless “market.”
All I want for Christmas is an unmanipulated market, because manipulated markets always crash big and crash hard. Virtually every market in America is heavily manipulated by the Federal Reserve, which creates currency out of thin air to either buy assets (outright market manipulation) or distribute to financiers, banks and corporations, which then manipulate the markets with their own profiteering (stock buybacks, leveraged buyouts, derivatives, etc.).
The Fed decided long ago that the housing and stock markets were too critical as signals that all is well to remain real markets, because real markets fluctuate and on occasion crash, especially if participants are playing fast and loose with debt, leverage and speculative bets placed with zero collateral (or fake collateral, which is the same thing).
To make sure no decline could ever collapse the happy-happy euphoria of ever-rising markets, the Fed turned markets into simulations of real markets, controlled “markets” masquerading as real markets in which price and value are set by participants, not central banks and proxies of central banks.
The key characteristics of markets are price discovery and the free flow of information about prices, supply, demand, quality, cost of credit, creditworthiness of buyers, etc.
Without a free flow of information and transparent-to-all-participants bids and asks (the price being offered by buyers and sellers), the market can’t discover the price (value) of credit, goods, services, collateral, assets, etc.
Once markets have been stripped of the ability to discover price, nobody can trust the values being presented as “real” are actually based on reality. In the current simulacrum of a real market, the “price” is set by the Fed or its proxies, and there is a purposeful / profitable information asymmetry between high frequency traders and other insiders and everyone outside the inner circles who are kept in the dark while insiders skim billions in no-risk profits from the victims of this information asymmetry.
Right now market participants are euphorically confident that value no longer matters; the only thing that matters is the Fed wants stocks and housing to move higher, and they can move markets at will with their firehouse of trillions of dollars.
In other words, participants are confident the Fed is the market, but it’s no longer a market at all. This mirage market has worked splendidly for the Fed, since it continues to signal all is well by rising year after year.
But manipulated markets are a mile wide and an inch deep. Everyone thinks selling won’t happen or can’t happen because the Fed is essentially guaranteeing that “buy the dips” will reward buyers. This was precisely what happened in 2008: The Fed reckoned the system had plenty enough liquidity to absorb any selling, but the liquidity was only an inch deep; once real selling hit the “market,” it collapsed, as buyers dried up and blew away.
Manipulating markets into “signaling” mechanisms insures the eventual crash will not be stopped by applying the same manipulations that destroyed price discovery and trust. Everyone knows the price has lost connection with reality, and so every punter and algo is one second away from hitting “sell” and locking in the gains from a manipulated bubble.
The irony, of course, is that only those punters who sold on the way up will escape the devastation of the collapse into a bidless “market.”
Iran Again Blocks Internet & Mobile Service Ahead Of Protesters' Funerals
Fearing the potential for renewed protests and violent clashes with police, Iran has again blocked internet and mobile access to broad section of the country on Wednesday.
This as several funerals will be held over the coming days for protesters killed last month amid a severe government crackdown, which also witness an unprecedented nationwide internet blockage which lasted for a week or more in some provinces.
Citing Iranian state media, Bloomberg reports, “The mourning services are scheduled to begin on Thursday. The independent Shargh newspaper said five unidentified provinces will be subject to the blackout, while ILNA said internet users in those areas will have access to a limited number of state-approved Iran websites and applications.”
Protesters last month torched gas stations and banks, angry at a sudden massive gas price hike, which turned anti-government, via The Guardian.
Government authorities are reportedly acting in response to relatives of some among the killed who have posted to social media calling for renewed protests to be held on Thursday in conjunction with ceremonies commemorating the victims (various estimates put those killed from the November protests ranging from 200 to over 300, with the US State Dept. claiming multiple times that number).
The US as well as various human rights organizations have accused Tehran authorities of quelling protests — initially sparked by a huge gas price hike when subsidies were slashed — with live ammunition and other brutal tactics.
Thus it appears the government is making a move to prevent large-scale protests before they gain momentum. State-run ILNA said of the mobile and internet blockage: “According to this source, it is possible that more provinces will be affected by the shutdown of mobile international connectivity,” after it appeared to spread on Wednesday.
Confirmed: Evidence of mobile internet disruption in parts of #Iran beginning ~6:30 a.m. (03:00 UTC); real-time network data show two distinct drops in connectivity this morning amid reports of regional outages; incident ongoing 📉 #Internet4Iran
And internet blockage observatory NetBlocks said, according to Reuters: “Confirmed: Evidence of mobile internet disruption in parts of #Iran …real-time network data show two distinct drops in connectivity this morning amid reports of regional outages; incident ongoing.”
Washington has condemned such attempts to dramatically restrict communications; however, Iran’s leadership has said it is taking efforts to thwart external US-Saudi-Israeli regime change efforts to hijack and guide the protests.
Local Moms Furious About Las Vegas Strip Club's Decision To Hand Out Tents To The Homeless
Like they say: No good deed goes unpunished.
A Las Vegas strip club has created a furor in the community after it handed out tents and clothing to the homeless bearing the club’s name and logo.
Club Deja Vu, which advertises itself as the “No. 1 topless strip club in the US,” decided to spend $50,000 on the merchandise and hand it out to the homeless in what appears to be a kind of political statement: The city recently passed an ordinance making it illegal for people to camp out on the sidewalk if there are still beds available in city shelters.
But it appears the club’s true aim in all of this is to try and exploit the homelessness crisis in Vegas for a bit of publicity.
The club, on the other hand, tried to spin its decision to hand out tents and clothes as an act of compassion.
“While some seem to think that the solution is a camping ban, we think that the solution is one that includes decency and kindness,” the club said in a statement to a local TV station.
“This just seems like the right thing to do during the holidays.”
Police will start enforcing the new city ordinance on Feb. 2.
The woman said she was surprised by the sight of the “disgusting” and “immoral” tents.
Fortunately for Deja Vu, it looks like that $50,000 it spent on merchandise was marketing money well spent. Because according to another old saying: there’s no such thing as bad publicity.
In fact, we imagine the club was deliberately courting this kind of controversy when it decided on the campaign.
Recent legislation to halt unwanted robocalls may be the best thing to come out of Washington in over a decade. This is providing it proves effective in stopping or at least substantially reducing those annoying calls that cause our phones to ring several times a week. The House of Representatives approved the Telephone Robocall Abuse Criminal Enforcement and Deterrence Act, or the TRACED Act, earlier this month. Now with the Senate voting unanimously to pass it, the bill is on its way to President Donald Trump’s desk for a signature.
The TRACED Act (Telephone Robocall Abuse Criminal Enforcement and Deterrence Act)was sponsored by Senators John Thune (R-SD), Ed Markey (D-MA), and Roger Wicker (R-MS). Its purpose is to combat robocalls with stronger deterrents. As the volume of illegal calls has increased, so has the attention of regulators. They are especially concerned about calls from scammers who target vulnerable people, such as the elderly, to steal their personal information.
In a piece titled; “Nobody Wants Your Robocall, Louie! – Stop Calling Me!” published in the middle of 2017 I bashed Washington for not taking action to end the robocall assault on the American people. Like many people, after being constantly bothered by nuisance calls and machine-generated messages I was past angry. Even a lying politician would have difficulty presenting an argument giving any merit to allowing people’s lives to be disrupted by such calls. Adding injury to insult is the fact is that we are paying for this intrusion into our lives every time we pay our phone bill.
This legislation placing as much $10,000 per call.fine upon those behind what are obviously unwanted robocalls will reduce the incentive for companies to widely cast upon society their self-serving agenda. Before I declare this a significant win for consumers I want to see whether the Federal Communications Commission will or can actually enforce this law and get the job done.
The TRACED Act requires phone companies to block robocalls at no charge to customers. They must also adopt call authentication technologies so carriers can verify that incoming calls are legitimate before they reach consumers’ phones. This builds on preventative measures taken by the FCC under Chairman Ajit Pai, who recently announced that the commission would move to criminalize international robocalls and spam texts.
You would think that even a few high profile convictions would reduce the number of unwanted calls generated by machines. These calls are designed not to inform but to benefit a few at the expense of the many. Like many Americans, I have found that even being registered on the “no-call list” has proven ineffective in halting this intrusion into my life. I sill continue to get annoying recordings from Heather, Sara, or Rachael claiming she represents a credit card service center or inquiring about my student loan that doesn’t exist.
After spending hundreds of billions of dollar on agencies such as the NSA it is difficult to think America does not have in place the expertise and apparatus to track down and identify the perpetrators of these calls. Considering Washington is filled with elected officials that do little but annoy, debate, pander, and suck the blood out of us, trying to stop these calls is the least they can do. We should remember that both politicians and those who support them have used robocalls as a way to get their message to a public who they see as only a phone call away. Here, I’m referring to the calls during elections that sport political campaign messages.
I find little comfort in knowing I’m not the only person suffering this barrage of unwanted calls. On average, about 167 million robocalls per day were made from January to November of this year, according to the YouMail Robocall Index. That totals more than 50 billion robocalls. Sen. John Thune (R-S.D.) said, “This bill represents a unique legislative effort that is not only bipartisan at its core, but it’s nearly unanimously supported in Congress.” Please forgive me if I remain dubious of whether anything will change. I will consider this legislation successful only after the calls have stopped. My question is why in the hell did it take so long to write such legislation and get it passed?
China's Imports Of US Soy Soar To 20 Month High As Food Inflation Explodes
One year after China did not import even one ounce of US soybeans as the trade feud was escalating at the end of 2018, in November 2019, China – which has found itself roiled by soaring food prices – saw its imports of US soybeans surge to the highest in 20 months after more American cargoes cleared customs ahead of the alleged signing of the Phase One trade deal in January.
According to data from China’s Customs Administration, China’s inbound shipments from the U.S. more than doubled to 2.6 million tons, the highest since March 2018, and up from about 1.1 million tons in October. As noted above, in November of 2018 – when the trade war between the two nations was escalating rapidly – China imported no U.S. soybeans.
As Bloomberg notes, citing USDA data, China’s total commitments in the current marketing year hit 10.5 million tons, compared with just 2 million tons the previous year.
That said, the surge in US soybean imports was not some trade war concession aimed at the US because as US imports jumped, so did China’s imports from its top Latin American markets: specifically, in November, China bought bought 3.9 million tons of soybeans from Brazil, Beijing’s largest supplier, up from 3.8 million tons in October and 5.1 million tons in November last year; imports from Argentina also rose from 959,936 tons in October to 1.4 million tons, and up from a tiny 36,119 tons in November last year.
According to China’s National Grain and Oils Information Center, December imports may climb to about 9 million tons following more shipments from U.S., which could ease supply shortages at some crushers.
And while China is unlikely to order less soybean from either Brazil or Argentina any time soon as the two nations have emerged as the two key supply chain alternatives to the US, where any trade goodwill may be undone with stroke of a tweet, Bloomberg notes that Chinese companies are likely to continue purchasing American soybeans especially if the two countries sign the partial trade deal in early January, in line with the market’s expectations.
There is also China’s desperation to repopulate its decimated pig population and to do that, Beijing needs access to all the soybeans it can get. It explains why China has been issuing regular tariff waivers (which cover 30% of the retaliatory tariffs on US soybeans) for domestic firms to buy U.S. soybeans.
That said, China was quick to pretend like the surge in US soybean purchases was in fact some concession, and shortly after the news of the import jump hit, China’s infamous twitter troll, Global Times editor Hu Xijin, tweeted “congrats to US farmers” adding a tacit threat that US farmers should “prod” the US government to sign the Phase One deal if they want China’s vital goodwill to continue, to wit: “meanwhile please prod the US government, making sure the two countries can sign phase one deal smoothly and the next trade talks continue to make progress. This is vital to stabilize China’s purchase of US farm products.”
Congrats to US farmers. Meanwhile please prod the US government, making sure the two countries can sign phase one deal smoothly and the next trade talks continue to make progress. This is vital to stabilize China’s purchase of US farm products. https://t.co/cPycSBlNSQ
What he really meant was that China, where we will soon need a bigger chart to show soaring food hyperinflation (and middle-class anger at surging good prices) is desperate to buy US agricultural products to keep prices lower, and with every passing months, Trump’s negotiating leverage rises in lockstep with Chinese food inflation.
He also really meant “congrats to Chinese farmers” for procuring the soybeans they so urgently need if they are to have any hope of restocking China’s most popular protein: pork.
After all, it takes place during a holiday office party, there’s Christmas music and it snows at the end. But then again, as Statista’s Maria Vultaggio notes, “Die Hard” is an action movie, was released as a summer blockbuster and centers around an extremist who was recently excommunicated from a West German political terrorist group.
According to a poll by YouGov, barely 20 percent of people polled said “Die Hard” was a Christmas movie. The survey, conducted December 15, 2017, questioned 4,340 U.S. adults.
As far as the stars are concerned, Willis said the film wasn’t a Christmas movie during a Comedy Central Roast in 2018, while screenwriter Steven E. de Souza tweeted the opposite in 2017.
The world over people are told that central banks pursue “price stability” by making sure that consumer goods prices do not rise by more than 2 percent per annum. This is, of course, a big sham. If the prices of goods rise over time, it does not take that much to understand that prices do not remain stable. And if the prices of goods increase over time, it necessarily means that the purchasing power of the money unit declines.
As money loses its purchasing power, income and wealth are stealthily redistributed. Some individuals and groups of people are enriched at the expense of others. Savers and workers are swindled out of their deserved income and retirement benefits, while those who own goods that rise in value or who borrow money typically reap a windfall profit. Clearly, the banking industry is a major beneficiary of monetary debasement.
“Inflation” Is a Rise in the Quantity of Money
Central banks are the very source of the phenomenon that all prices of goods tend to rise over time. They hold the money production monopoly and increase — in close cooperation with commercial banks — the outstanding quantity of money through credit expansion, an increase in the supply of credit that is not backed by real savings. It goes without saying that it is rather profitable to be active in the money-production business.
The increase in the quantity of money results, and necessarily so, in higher prices compared to a situation in which the quantity of money has not been increased. This is no arbitrary assertion but stems from logical reasoning: a rise in people’s money holding lowers the marginal utility of the additional money unit, meaning that the marginal utility of other goods that can be exchanged against money rises.
Consider the case in which the quantity of money in the hands of market agents rises. People will then exchange money balances (which have, from the viewpoint of the money holder, lost in marginal utility) against other vendible items (which have gone up in marginal utility). As people exchange money units against other goods, money prices go up (compared to a situation in which the quantity of money has not been increased).
The Mainstream Explanation and Its Problems
Of course, in real life additional factors (such as, for instance, demand changes, market introduction of new products, etc.) interfere with the link between the increase in the quantity of money and the rising prices of goods. This, however, by no means refutes the economic insight that a rise in the quantity of money in the economy leads to goods prices that will be higher than if the quantity of money not been increased.
The increase in the quantity of money is what deserves to be called inflation; rising prices are just a possible symptom of an increase in the quantity of money. However, mainstream economists typically define inflation as rising consumer goods prices. This, however, is problematic for at least two reasons. First, by equating inflation with rising prices, the real reason for higher prices, namely the rise in the quantity of money, is obscured.
This, in turn, gives rise to arbitrary explanations of why goods prices may go up: sheikhs who force up oil prices, unions that cause wages to rise, an overall buoyant economy that creates shortages in production factors, and so forth. All these pseudo-explanations deflect from the real culprit — the central bank, in cooperation with commercial banks, which issues new money, so that people no longer understand who, in fact, harms them.
Asset Price Inflation
Second, changes in consumer goods prices do not tell us the entire story, for they do not take into account asset prices such as, for instance, stock prices, housing prices, and land prices. However, the newly injected money can be expected to not only push up consumer goods prices, but also drive up asset prices. And like rising consumer prices, rising asset prices diminish the purchasing power of money.
In other words: asset price inflation destroys the purchasing power of money in the same way that price inflation of consumer goods does. Take, for instance, stock market prices. If prices rise from, say, $100 to $200, the purchasing power of the money unit would drop by 50 percent. The owner of the stock becomes richer, while the holder of dollars become poorer. In fact, this is precisely what has been happening in the last decades.
For illustrative purposes, let us take a look at the chart above. It shows the development of the US quantity of money, nominal GDP, and stock prices from 1996 to autumn 2019. In the period under review, the US nominal GDP increased by 4.3 percent per annum on average. The quantity of money rose by 6.1 percent, while stock prices expanded by 8.1 percent. To the attentive observer, these numbers contain an important message.
The increase in the money supply does not only raise prices of consumer goods, but also tends to raise all prices. For instance, in the period under review, on average, the real GDP in the US rose around 1.9 percent per year while prices of goods and services that are included in US GDP went up by 2.4 percent. The remaining “excess money” obviously pushed up stock prices and other asset prices such as for instance, housing prices.
Don’t Put Your Trust in Today’s (Fiat) Money
The lessons to learn are these: always think of inflation as a rise in the quantity of money. Be aware that central banks and commercial banks provide a kind of money that does not keep its purchasing power — that most people suffer losses when holding it for the purpose of storing wealth. Better not to put your trust in today’s money and keep your transaction balances as small as possible. Don’t be taken in by the inflation sham.
The insights outlined above should encourage all of us to join the call for better, sound money — money that lives up to the highest economic and ethical standards. This can be achieved by simply creating a free market in money, where people are free to choose the kind of money they would like to use, and where entrepreneurial spirits are free to make their fellow people sound-money offers.
A free market in money — which would be tantamount to putting an end to central banks’ money production monopolies — is actually easy to establish. Just strip the official currency of its privileged “legal tender” status and remove all capital gain and sales taxes on all media that stand an excellent chance to compete for becoming currency — most notably gold and silver but potentially also crypto units.
A free market in money will work wonders. Many of the evils that haunt our world today — be they chronic price inflation, financial and economic crises, boom-and-bust cycles, and even over-funded governments and aggressive wars, would be greatly reduced. One of the biggest challenges of our time is to reform our money. The solution is to open up the market in money.
Watch Rapper Make It Rain On Skid Row Homeless – An Important Lesson For The Fed
The Federal Reserve might want to take some pointers from Rapper Blueface of how to preform helicopter drops in low-income neighborhoods ahead of the next downturn.
The 22-year old rapper was seen standing on top of a black Mercedes-Benz G-Class in the middle of Los Angeles’ Skid Row, injecting money into the local economy via a direct transfer to low-income folks and the homeless.
The rapper was seen in the video throwing wads of cash into the air, with dozens of people scouring around the vehicle to collect as many bills as they could.
According to RT News, it wasn’t entirely clear what domination the bills were and or how much cash the rapper gave away in the helicopter drop.
The video first surfaced on Blueface’s Twitter account on Dec. 23.
The video received mixed reviews with one Twitter user saying, “Way to demean them. You could have handed it out in a decent way that wasn’t so dehumanizing. Someone could have been seriously injured because of your stunt.”
Another user said, “damn bruh you could’ve made it look a little less ghetto.”
One user said, “Handing them the money wasn’t an option? Instead, you literally stand on top of them and throw it at them and make them scavenge for it….bro your buggin.”
Apparently, it’s the season of giving, something the Fed will be doing once the next recession strikes. They will be financing People’s Quantitative Easing in the form of direct transfers to citizens that will hopefully thwart a Hong Kong-style revolt against elites.
Some time ago, I resigned myself to the fact that economists are the wet blankets of the world. We can ruin almost any proposal and almost any situation with just a couple of analytical tools and the words “unintended consequences.” Rent control? It causes shortages and hurts poor people. Minimum wages? They reduce employment and hurt poor people. Laws against “price gouging?” They also cause shortages and hurt poor people. Interventions, regulations, and subsidies that were supposed to make housing and higher education more affordable and thereby make the world a kinder, gentler, more prosperous place? We’re seeing how that’s working out right now. You get the idea: the list of dreams that have been dashed upon the rocks of the principles of economics is long indeed.
Not content to ruin the dreams of a few idealists, economists turned their attention to Christmas a few years ago. Here are a few thoughts from the Dismal Science that rain on the holiday parade.
1. You Shouldn’t Have. No, Really. You Shouldn’t Have.
The classic salvo in the literature on the economics of Christmas is Joel Waldfogel’s “The Deadweight Loss of Christmas,” which provides a bit of evidence that people would be happier if you gave them cash instead of an equally-expensive present. Yes, it’s the thought that counts, but how many of us have given (or gotten) gifts that have ended up in an end-of-year Goodwill donation or a Spring yard sale?Today In: Business
We learned this first-hand at a family holiday party that involved a white elephant gift exchange. Everyone went home happy, but one participant (an Alabama fan) opened a box of Auburn stuff, another (an Auburn fan) opened Alabama stuff, and one of the gifts I (an Alabama fan) opened was an LSU cap. Again, everything worked out in the end, but the initial distribution was incredibly inefficient.
The spectacular wealth we enjoy today has created the epitome of a first-world problem: over-gifting. It used to be that giving a gift required a meaningful material sacrifice. Today, baubles are so cheap that our problem isn’t a lack of generosity. It’s poorly-channeled generosity. You have probably heard people joke that kids are usually more interested in the boxes the toys come in than the toys themselves.
You might have seen this Wired article listing “the 5 best toys of all time:” boxes, string, cardboard tubes, sticks, and dirt. As a father of a three-year-old and an 18-month-old, I can attest that this is most definitely true. At the end of How the Grinch Stole Christmas, the Grinch learns that Christmas doesn’t come from a store. The Grinch learns that Christmas means a little bit more. As we head down the Christmas stretch, it’s a lesson we should take to heart.
2. Your Church or Civic Organization Should Probably Cancel Next Year’s Holiday Food and Toy Drives.
In a post that made my economist’s heart grow three sizes, Matt Yglesias explains “Why food drives are a terrible idea.” Most importantly, there’s no free lunch. Actually going out and getting the food is itself costly, sorting it is costly, and distributing it is costly. As Yglesias explains, charities can probably alleviate a lot more hunger if you give them $20 in cash rather than $20 worth of creamed corn.
Throughout his research, F.A. Hayek emphasized the knowledge problem and explained how markets utilize and disperse knowledge that can’t be known or articulated by a single mind. Collecting and distributing canned comfort and joy runs into the same problem. People know their own preferences better than you do. The creamed corn might be a nice gesture, but what if the recipient is allergic to corn?
3. Economics is Like The Transformers: There’s More Than Meets the Eye.
No doubt, someone reading this is and saying “well, if you looked in the eyes of the people who are being helped, you would understand.” Hear me out, though. Economics emphasizes the unintended and unseen consequences of different actions. Suppose you could feed two hungry children with the same effort you’re currently using to feed one. Would you want to know how?
If we’re honest with ourselves, we will see some of the ways in which Christmas lays bare our hypocrisy. You’ve probably heard someone say “don’t give until it hurts; give until it feels good,” and again, I think that if we’re really honest with ourselves a lot of our charitable endeavors have less to do helping the least of these among us than with showing that we’re the kind of people who care about the least of these among us. I’ve written before that “let not your left hand know what your right is doing” is not merely a sound Biblical injunction regarding our giving. It’s also excellent economics. If you haven’t read about people anonymously paying off others’ layaway accounts at Kmarts around the country, it’s an excellent example of what I’m talking about.
4. That Impulse Purchase won’t “Help the Economy.”
We consume about two-thirds of national output every year, and it is true that production takes place with the goal of generating goods and services that make people happy. At the same time, consumption per se does not create sustainable economic growth. “Spend more” is an intuitive-but-wrong prescription for what ails the American economy. While purchasing a greater assortment of trinkets and baubles might pad retailers’ and manufacturers’ bottom line in the short run, they leave us with fewer unconsumed resources with which to build the economy of tomorrow.*
5. Peace on Earth and Goodwill To Men Can Be Enjoyed and Deployed More Effectively.
Intending to help people isn’t the same as actually helping people. Good intentions and a few dollars will get you a cup of coffee, if you’re lucky: “good intentions” channeled through pathological institutions might leave you saddled with a body count. In one of the most provocative books I read this year, Timothy Keller explains how Generous Justice is more than just giving stuff away. It’s a lifestyle decision that requires getting meaningfully involved in the lives of others. Over the long run, this is likely to be far more effective than simply bunching all of our benevolence into a few frenzied weeks.
As a mentor has told me, economics shows us that it is very difficult to be charitable in ways that actually benefit the people we’re trying to help. Some people might find this sad–dismal, even. I actually think it’s kind of liberating because it suggests that–at the risk of being dramatic–a better world is possible. A new paradigm for charity and justice will require a lot of thinking outside the donation box. With Christmas 2019 and a brand new year right around the corner, it’s a challenge I look forward to meeting head-on.
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