- The Global Monetary System Has Devalued 47% Over The Last 10 Years
Authored by Paul Brodsky via Macro-Allocation.com,
We have argued the inevitability of Fed-administered hyperinflation, prompted by a global slowdown and its negative impact on the ability to service and repay systemic debt. One of the most politically expedient avenues policy makers could take would be to inflate the debt away in real terms through coordinated currency devaluations against gold, the only monetize-able asset on most central bank balance sheets. To do so they would create new base money with which to purchase gold at pre-arranged fixed exchange prices, which would raise the general price levels in their currencies and across the world to levels that diminish the relative burden of debt repayment (while not sacrificing debt covenants).
The odds of this occurring seem to have risen, judging by the gold prices. Table 1 looks at gold performance over one, five and ten years in terms of the fifteen currencies representing the fifteen largest economies (about 77% of global GDP). The bold figures at the bottom show gold’s performance weighted for GDP.
Gold is mostly quoted in US dollars, but it is also implicitly valued at each point in time in all currencies (as is everything that may be bought or sold across the world), simply by applying cross exchange rates to its USD price. Table 1 shows the experience of gold holders around the world has been quite different. A Russian would have had the currency he receives his wages in devalued to gold by almost 370% over the last ten years. Or, he could have generated a 370% gain by converting his ruble savings into gold. Anyone else in the world would also show a 370% gain by having owned gold and having been short the ruble.
Meanwhile, gold in dollar terms, as it is quoted for capital market participants given London and US exchange dominance over fungible gold trading, is up far less – about 94%. (This performance also represents gold performance for currencies pegged to the dollar, like the Saudi Arabian riyal.) Gold in Chinese yuan terms and Swiss franc terms are only about 57% higher over the last ten years.
The wide gap in gold’s performance is due to sharp differences in ongoing currency exchange rates. Gold is a currency hedge – the stable fulcrum around which fiat currencies fluctuate. Gold is not consumed and has no internal rate of return. Changing market quotes for gold – whether for spot gold, gold futures or gold bullion – merely represent currency exchange rates. The performance of gold in Table 1 is not the performance of gold at all, but rather the performance of the currencies in which it is quoted.
The last line of Table 1 shows gold price changes adjusted for the relative importance of currencies, as determined by GDP. It implies that the global monetary system has been devalued against gold by 46.88% over the last ten years (1/1.8824), which was in line with the MSCI ACWI World equity index over this time.) One who produced a good or service anywhere in the world over the last ten years would have been wise to save the fruit of his labor in gold terms.
Central Banks
If we were a central banker overseeing the fiat global monetary regime we would want to treat gold as a market-based indicator of inflation, not as a potential competitor to the currencies we established and promote. We would build econometric models in which we would define the relationships linking credit growth to demand growth, demand growth to production growth, and production growth to inflation and employment. We would establish economic mandates, like stable prices and full employment, and then we would model conditional scenarios and reaction functions in which to proceed.
We would be very transparent in our communications policies, sharing assumptions and data from our models and our economic projections based on them. It would appear to all the world that we would be applying thoughtful, best efforts science to the vagaries of irrational human animal spirits – the irrationality of mass consumption and investment or the irrationality of short term decision making over what would be more sustainable. We would blanket our science in pedantic academic rhetoric and debate nuance with others interested in the same discipline.
We would not question the moral nature of our pursuits because science is amoral. Nor would we question whether our models and actions might be unduly harmful because our position is clearly defined and its roadmap conditional and usually marked with precedent. We would not question our reason for being because we would be the very foundation upon which economies sit. We would not separate economics from finance because, well, because it would not reconcile with everything else we do.
When asked about gold, we would testify before our congresses and parliaments that we hold it on our balance sheets merely as tradition, and that its relevance in our scientifically managed domestic economies and coordinated, financial-centric global economies is de minimus. Gold would be an afterthought to us, and most serious economists, politicians, policy makers and market observers.
Those clinging to the relevancy of the barbarous relic would be generally perceived as sour pessimists, economic losers unwilling to change with the times, malcontents clinging to regressive social mores, Chicken Littles seeking to undermine centrist politics and policy in the face of contrary economic indicators, druids unwilling or incapable of using leveraged financial assets to save, provincial patriots unwilling to strive to live in a peaceful and prosperous international community.
Ironically, it is this last point that holds the key to gold’s relevancy in modern times. The fact that gold remains on the balance sheets of central banks and is being aggressively bought by them suggests it is gaining, not losing, relevancy as a monetary asset. The fact that it can be used as the fulcrum against which to devalue currencies gives it purpose. The fact that allocations to gold and gold-related assets remains less than 3% of investment portfolios makes it a superior risk-adjusted portfolio allocation.
Expectations
Graph 1, shows the relationship of US real yields and the USD gold price. Real (inflation adjusted) yields and gold have been tightly correlated. Non-income producing gold ebbs and flows inversely with yields available on financial assets. This is understandable, but ask yourself this: what happens now that global sovereign interest rates must go negative to give the impression that credit is becoming easier?
The sound reasoning behind the tight correlation should break down if/when no amount of central bank stimulus, other than QE, produces inflation, and that inflation is limited to asset inflation. Then, the system would break and global monetary authorities would have to re-work it.
Our view is that there will not be a switch to a fully-reserved banking system or even a reversion to a fixed exchange rate; however, there will be a significant increase in global currency devaluations against gold, and that it will be coordinated by monetary authorities.
- Paul Craig Roberts: "Americans Are A Conquered People"
Authored by Paul Craig Roberts,
As readers know, I have seen some optimism in voters support for Trump and Sanders as neither are members of the corrupt Republican and Democratic political establishments. Members of both political establishments enrich themselves by betraying the American people and serving only the interest of the One Percent. The American people are being driven into the ground purely for the sake of more mega-billions for a handful of super-rich people.
Neither political party is capable of doing anything whatsoever about it, and neither will.
The optimism that I see is that the public’s support of outsiders is an indication that the insouciant public is waking up. But Americans will have to do more than wake up, as they cannot rescue themselves via the voting booth. In my opinion, the American people will remain serfs until they wake up to Revolution.
Today Americans exist as a conquered people. They have lost the Bill of Rights, the amendments to the Constitution that protect their liberty. Anyone, other than the One Percent and their political and legal servants, can be picked up without charges and detained indefinitely as during the Dark Ages, when government was unaccountable and no one had any rights. Only those with power were safe. In America today anyone not politically protected can be declared “associated with terrorism” and taken out by a Hellfire missile from a drone on the basis of a list of human targets drawn up by the president’s advisers. Due process, guaranteed by the US Constitution, no longer exists in the United States of America. Neither does the constitutional prohibition against the government spying on citizens without just cause and a court warrant. The First Amendment itself, whose importance was emphasized by our Founding Fathers by making it the First Amendment, is no longer protected by the corrupt Supreme Court. The Nine who comprise the Supreme Court, like the rest of the bought-and-paid-for-government, serve only the One Percent. Truth-tellers have become “an enemy of the state.” Whistleblowers are imprisoned despite their legal protection in US law.
The United States government has unaccountable power. Its power is not accountable to US statutory law, to international law, to the Congress, to the judiciary, to the American people, or to moral conscience. In the 21st century the war criminal US government has murdered, maimed, and dislocated millions of people based on lies and propaganda. Washington has destroyed seven countries in whole or part in order to enrich the American elite and comply with the neoconservative drive for US world hegemony.
Americans live in a propaganda-fabricated world in which a brutal police state is cloaked in nice words like “freedom and democracy.” “Freedom and democracy” is what Washington’s war machine brings with sanctions, bombs, no-fly zones, troops, and drones to countries that dare to cling to their independence from Washington’s hegemony.
Only two countries armed with strong military capability and nuclear weapons—Russia and China—stand between Washington and Washington’s goal of hegemony over the entire world.
If Russia or China falter, the evil ensconced in Washington will rule the world. America will be the Anti-Christ. The predictions of the Christian Evangelicals preaching “end times” will take on new meaning.
Russia is vulnerable to becoming a vassal state of Washington. Despite a legion of betrayals by Washington, the Russian government has just proposed a joint US/Russia cooperation against terrorists.
One wonders if the Russian government will ever learn from experience. Has Washington cooperated with the agreement concerning Ukraine? Of course not. Has Washington cooperated in the investigation of MH-17? Of course not. Has Washington ceased its propaganda about a Russian invasion of Crimera and Ukraine? Of course not. Has Washington kept any agreement previous US governments made with Russia? Of course not.
So why does the Russian government think Washington would keep any agreement about a joint effort against terrorism?
The Russian government and the Russian people are so unaware of the danger that they face from Washington that they let foreigners control 20 percent of their media! Is Russia unaware that Washington has Russia slated for vassalage or destruction?
China is even more absurd. According to the Chinese government itself, China has 7,000 foreign-financed NGOs operating in China! Foreign financed NGOs are what Washington used to destabilize Ukraine and overthrow the elected government.
What does the Chinese government think these NGOs are doing other than destabilizing China?
Both Russia and China are infected with Western worship that creates a vulnerability that Washington can exploit. Delusions can result in inadequate response to threat.
All of Europe, both western, eastern and southern, the British Pacific such as Australia and New Zealand, Japan and other parts of Asia are vassal states of Washington’s Empire. None of these allegedly “sovereign” countries have an independent voice or an independent foreign or economic policy. All of Latin America is subject to Washington’s control. No reformist government in Latin America has ever survived Washington’s disapproval of putting the interests of the domestic populations ahead of American corporate and financial profits. Already this year Washington has overthrown the female presidents of Argentina and Brazil. Washington is currently in the process of overthrowing the government in Venezuela, with Ecuador and Bolivia waiting in the wings. In 2009 Killary Clinton and Obama overthrew the government of Honduras, an old Washington habit.
As Washington pays the UN’s bills, the UN is compliant. No hand is ever raised against Washington. So why does anyone on the face of the earth think that an American election can change anything or mean anything?
We know that Killary is a liar, a crook, an agent for the One Percent, and a warmonger. Let’s now look at Trump.
Are there grounds for optimism about Trump? In the West “news reporting” is propaganda, so it is difficult to know. Moreover, we do know that, at least initially, the response of the Republican Establishment to Trump is to demonize him, so we do not know the veracity of the news reports about Trump.
Without belaboring the issue, two news reports struck me. One is the Washington Post report that the Zionist multi-billionaire US casino owner Sheldon Adelson has endorsed Donald Trump for President.
Other reports say that Adelson has mentioned as much as $100 million as his political campaign contribution to Trump.
Anyone who gives a political campaign $100 million dollars expect something in exchange, and the recipient is obligated to provide whatever is desired. So are we witnessing the purchase of Donald Trump? The initial Republican response to Trump, encouraged by the crazed neoconservatives, was to abandon the Republican candidate and to vote for Killary.
Is Adelson’s endorsement a signal that Trump can be bought and brought into the establishment?
Additional evidence that Trump has sold out his naive supporters is his latest statement that Wall Street should be deregulated.
It is extraordinary that Trump’s advisers have not told him that Wall Street was deregulated back in the 20th century during the Clinton regime. The repeal of Glass-Steagall deregulated Wall Street. One source of the 2008 financial crisis is the deregulated derivative market. When Brooksley Born attempted to fulfill the responsibility of the Commodity Futures Trading Commission and regulate over-the-counter derivatives, she was blocked by the Federal Reserve, the US Treasury, the SEC, and the US Congress.
Nothing has been done to correct the massive mistake of financial deregulation. The Dodd-Frank legislation did not correct the massive financial concentration that produced banks too big to fail, and the legislation did not stop Wall Street’s reckless casino gambling with the US economy. Yet Trump says he will dismantle even the weak Dodd-Frank restrictions.
The American print and TV media are so corrupt that these reports could be false stories, the purpose of which is to demoralize Trump’s supporters. On the other hand, should we be surprised if a billionaire aligns with the One Percent?
Elections are an unlikely means of restoring government that is accountable to the people rather than to the One Percent. Even if Trump is legitimate, he does not have the experience in foreign and economic affairs to know who to appoint to his government in order to implement change. Moreover, even if he knew, unless Trump candidates also replace the Senate, Trump could not get his choices confirmed by a Senate accountable only to the One Percent.
Americans are a conquered people. We see this in the appeal from RootsAction to the rest of the world to come to the aid of the American people. Unable to stop the lawlessness of their own “democratic” government, Americans plea for help from abroad.
The plea from RootsAction indicates that committed activists now acknowledge that change in America cannot be produced by elections or be achieved internally through peaceful means.
- Currency War Resumes – China Devalues Yuan To 5-Year Lows
After a brief hiatus from the ongoing currency wars, China fired another salvo at The Fed tonight by devaluing the Yuan fix to 6.5693 – its weakest against the USD since March 2011. After eight days higher in a row for The USD Index, it seems PBOC has turned its currency liberalization plan off, stabilizing the broad Renminbi basket (which has been steadily devalued) and turning its attention to devaluing against the USD. Having unleashed turmoil in August (pre-Sept FOMC) and January (post Dec rate-hike), it appears the rising rate-hike probabilities jawboned by The Fed are decidedly disagreeable to "authoritative persons" in China.
The Yuan Fix was driven down to March 2011 lows…
Front-running?
“It could be because the authorities want to alleviate some of the depreciation pressure before the Fed interest rate decision in June," said Christy Tan, head of markets strategy at National Australia Bank Ltd. in Hong Kong. "If there are signs of panic dollar buying, the PBOC will step in."
As it seems maintaining some 'stability' against the USD has lost its appeal as the USD surges once again…
What the chart above shows is that the Chinese currency (red) has been devaluing in an orderly and quiet manner for much of the year while maintaining the appearance of stability against the USD (blue). That appears to have changed now and the last time turmoil started to ripple through the CNHUSD markets – it didn't stop until Tom Cook lied to Jim Cramer and The PPT rescued the world.
The irony of the apparent stability in the broad-based Renminbi basket (while devaluing against the USD) is that it comes after a desperate China has reportedly given up on its liberalization goals. As The Wall Street Journal notes,
Behind closed doors in March, some of China’s most prominent economists and bankers bluntly asked the People’s Bank of China to stop fighting the financial markets and let the value of the nation’s currency fall.
They got nowhere. “The primary task is to maintain stability,” said one central-bank official, according to previously undisclosed minutes of the meeting reviewed by The Wall Street Journal.
The meeting left little doubt China’s top leaders have lost interest in a major policy shift announced in a surprise move just nine months ago. In August 2015, the PBOC said it would make the yuan’s value more market-based, an important step in liberalizing the world’s second-largest economy.
In reality, though, the yuan’s daily exchange rate is now back under tight government control, according to meeting minutes that detail private deliberations and interviews with Chinese officials and advisers who spoke with The Wall Street Journal about the country’s currency policy.
On Jan. 4, the central bank behind closed doors ditched the market-based mechanism, according to people close to the PBOC. The central bank hasn’t announced the reversal, but officials have essentially returned to the old way of adjusting the yuan’s daily value higher or lower based on whatever suits Beijing best.
The flip-flop is a sign of policy makers’ deepening wariness about how much money is fleeing China, a problem driven by its slowing economy. For now, at least, officials believe the benefits of freeing the yuan are outnumbered by the number of threats… though we note that a 3% depreciation of the yuan could add $25.6 billion to Chinese companies’ annual interest payments on dollar debts, according to estimates by analysts at BNP Paribas.
So the question is – will the Yuan turmoil ripple through markets enough to spook The Fed once more and dissolve what little credibility they have left or will Janet and her henchmen stand up to the foreign forces, hike rates to spit their own face, and deal with the aftermath through some more Citadel-driven VIXtermination? With VIX futures near record shorts and S&P futures at their longest in almost 2 years – there's not much easy leveraged money to squeeze there – like there was in August.
- Here's The Full List Of Organizations That Paid Hillary Clinton From 2013-2015
Submitted by Michael Krieger via Liberty Blitzkrieg blog,
In its article titled, How Corporate America Bought Hillary Clinton for $21M, The New York Post details the companies and organizations that paid Hillary in speaking fees from 2013-2015.
The total comes to $21.7 million, which is a remarkable sum for one of the least charismatic and unimaginative orators the world has ever known.
The New York Post reports:
So are you ready?
- All You Need To Know About The China Boom-Bust Cycle In One Chart
If anyone is still confused about the not so subtle dynamics between markets and monetary policy in China, or the country’s bipolar, and ever more frequent boom and bust cycles, you won’t be after seeing this chart from Socgen.
If still unclear, here is SocGen’s explanation:
Our economists expect China’s structural deceleration to continue over the coming years and it should thus remain a major source of uncertainty for commodity prices and equity markets alike. The recent recovery in Q1 16 was based on a sharp rebound in the property sector and significant credit injections.
This stimulus can only be temporary, as it increases debt in the system, keeps zombie companies alive, and defers reforms, at the cost of higher risk for financial stability in the future. Policymakers are aware of the risks coming from an overheating housing market and excessive debt build-up. As long as the recovery in the property keeps going, the economy could perform more or less in line with market expectations.
But, as Chinese authorities will eventually reduce credit easing, we expect the economy to return on its deceleration path in the coming quarters. The economy is thus likely to continue suffering from a series of mini boom-and-bust-cycles that will create repeated periods of volatility.
We just had a 3 months period of stability. Following the latest Yuan fixing released moments ago, which at 6.5693 was the lowest since March 2011, it sounds like we are about to have some volatility.
- What It Takes To Be President Of The American Police State
Submitted by John Whitehead via The Rutherford Institute,
“The qualifications for president seem to be that one is willing to commit mass murder one minute and hand presidential medals of freedom to other war criminals in the next. One need only apply if one has very loose, flexible, or non-existent morality.”—Author and activist Cindy Sheehan
Long gone are the days when the path to the White House was open to anyone who met the Constitution’s bare minimum requirements of being a natural born citizen, a resident of the United States for 14 years, and 35 years of age or older.
Today’s presidential hopefuls must jump through a series of hoops aimed at selecting the candidates best suited to serve the interests of the American police state. Candidates who are anti-war, anti-militarization, anti-Big Money, pro-Constitution, pro-individual freedom and unabashed advocates for the citizenry need not apply.
The carefully crafted spectacle of the presidential election with its nail-biting primaries, mud-slinging debates, caucuses, super-delegates, popular votes and electoral colleges has become a fool-proof exercise in how to persuade a gullible citizenry into believing that their votes matter.
Yet no matter how many Americans go to the polls on November 8, “we the people” will not be selecting the nation’s next president.
While voters might care about where a candidate stands on healthcare, Social Security, abortion and immigration—hot-button issues that are guaranteed to stir up the masses, secure campaign contributions and turn any election into a circus free-for-all—those aren’t the issues that will decide the outcome of this presidential election.
What decides elections are money and power.
We’ve been hoodwinked into believing that our votes count, that we live in a democracy, that elections make a difference, that it matters whether we vote Republican or Democrat, and that our elected officials are looking out for our best interests. Truth be told, we live in an oligarchy, and politicians represent only the profit motives of the corporate state, whose leaders know all too well that there is no discernible difference between red and blue politics, because there is only one color that matters in politics—green.
As much as the Republicans and Democrats like to act as if there’s a huge difference between them and their policies, they are part of the same big, brawling, noisy, semi-incestuous clan. Watch them interact at social events—hugging and kissing and nudging and joking and hobnobbing with each other—and it quickly becomes clear that they are not sworn enemies but partners in crime, united in a common goal, which is to maintain the status quo.
The powers-that-be will not allow anyone to be elected to the White House who does not answer to them.
Who are the powers-that-be, you might ask?
As I point out in my book Battlefield America: The War on the American People, the powers-that-be are the individuals and corporations who profit from America’s endless wars abroad and make their fortunes many times over by turning America’s homeland into a war zone. They are the agents and employees of the military-industrial complex, the security-industrial complex, and the surveillance-industrial complex. They are the fat cats on Wall Street who view the American citizenry as economic units to be bought, sold and traded on a moment’s notice. They are the monied elite from the defense and technology sectors, Hollywood, and Corporate America who believe their money makes them better suited to decide the nation’s future. They are the foreign nationals to whom America is trillions of dollars in debt.
One thing is for certain: the powers-that-be are not you and me.
In this way, the presidential race is just an exaggerated farce of political theater intended to dazzle, distract and divide us, all the while the police state marches steadily forward.
It’s a straight-forward equation: the candidate who wins the White House will be the one who can do the best job of ensuring that the powers-that-be keep raking in the money and acquiring ever greater powers. In other words, for any viable presidential candidate to get elected today that person must be willing to kill, lie, cheat, steal, be bought and sold and made to dance to the tune of his or her corporate overlords.
The following are just some of the necessary qualifications for anyone hoping to be appointed president of the American police state. Candidates must:
Help grow the military–industrial complex: Fifty-five years after President Dwight D. Eisenhower warned about the growth of the “military-industrial complex” in his farewell address, the partnership between the government, the military and private corporations has resulted in the permanent militarization of America. From militarized police and the explosive growth of SWAT teams to endless wars abroad, the expansion of private sector contractors, and never-ending blowback from our foreign occupations, we have become a nation permanently at war. As the New York Times pointed out, “the military is the true ‘third rail’ of American politics.” The military-industrial complex understands the value of buying the presidency, and has profited from the incessant warmongering of Obama and his predecessors. If money is any indicator of who the defense industry expects to win this November, thus far, Hillary Clinton is winning the money race, having collected more campaign contributions from employees with the 50 largest military contractors.
Police the rest of the world using U.S. troops: The U.S. military empire’s determination to police the rest of the world has resulted in more than 1.3 million U.S. troops being stationed at roughly 1000 military bases in over 150 countries around the world, including 48,000 in Japan, 37,000 in Germany, 27,000 in South Korea and 9800 in Afghanistan. That doesn’t include the number of private contractors pulling in hefty salaries at taxpayer expense. In Afghanistan, for example, private contractors outnumber U.S. troops three to one. Now comes the news that the U.S. is preparing to send troops to Libya on a long-term mission to fight ISIS.
Sow seeds of discord and foment wars among other nations under the guise of democracy: It’s not enough for the commander-in-chief to lead the United States into endless wars abroad. Any successful presidential candidate also needs to be adept at stirring up strife within other nations under the guise of spreading democracy. The real motive, of course, is creating new markets for the nation’s #1 export: weapons. In this way, the U.S. is constantly arming so-called “allies” with deadly weapons, only to later wage war against these same nations for possessing weapons of mass destruction. It happened in Iraq when the U.S. sold Saddam Hussein weapons to build his war machine. It happened in Syria when the U.S. provided rebel fighters with military equipment and munitions, only to have them seized by ISIS and used against us. Now comes the news that President Obama has agreed to sell weapons to Vietnam, lifting a decades-long embargo against the nation whose civil war claimed the lives of more than 90,000 Americans.
Speak of peace while slaughtering innocent civilians: Barack Obama’s campaign and subsequent presidency illustrates this principle perfectly. The first black American to become president, Obama was awarded the Nobel Peace Prize long before he had done anything to truly deserve it. He has rewarded the Nobel committee’s faith in him by becoming one of the most hawkish war presidents to lead the nation, overseeing a targeted-killing drone campaign that has resulted in thousands of civilian casualties and deaths. Ironically, while Obama has made no significant effort to de-escalate government-inflicted violence or de-weaponize militarized police, he has gone to great lengths to denounce and derail private gun ownership by American citizens.
Prioritize surveillance in the name of security over privacy: Since 9/11, the Surveillance State has undergone a dramatic boom, thanks largely to the passage of the USA Patriot Act and so-called “secret” interpretations of the mammoth law allowing the NSA and other government agencies to spy on Americans’ electronic communications. What began as a government-driven program under George W. Bush has grown under Obama into a mass surveillance private sector that makes its money by spying on American citizens. As Fortune reports, “In response to security concerns after 9/11, Americans witnessed the growth of a massive domestic security apparatus, fueled by federal largesse.” That profit-incentive has opened up a multi-billion dollar video surveillance industry that is blanketing the country with surveillance cameras—both governmental and private—which can be accessed by law enforcement at a moment’s notice.
Promote the interests of Corporate America and Big Money over the rights of the citizenry: Almost every major government program hailed as benefiting Americans—affordable healthcare, the war on terror, airport security, police-worn body cameras—has proven to be a Trojan Horse aimed at enriching Corporate America while leaving Americans poorer, less secure and less free. For instance, the so-called “affordable” health care mandated by Congress has become yet another costly line item in already strained household budgets for millions of Americans.
Expand the powers of the imperial president while repeatedly undermining the rule of law: George W. Bush assumed near-absolute power soon after the September 11, 2001, attacks. Unfettered by Congress or the Constitution, Bush led the “war on terror” abroad and championed both the USA Patriot Act and Homeland Security Department domestically. This, of course, led to the Bush Administration’s demand that presidential wartime powers permit the President to assume complete control over any and all aspects of an international war on terrorism. Such control included establishing military tribunals and eliminating basic rights long recognized under American law.
When Barack Obama ascended to the presidency in 2008, there was a sense, at least among those who voted for him, that the country might change for the better. Those who watched in awe as President Bush chipped away at our civil liberties over the course of his two terms as president thought that perhaps the young, charismatic Senator from Illinois would reverse course and put an end to some of the Bush administration’s worst transgressions—the indefinite detention of suspected terrorists, the torture, the black site prisons, and the never-ending wars that have drained our resources, to name just a few. As we near the end of Obama’s two terms in office, that fantasy has proven to be just that: a fantasy. Indeed, President Obama has not only carried on the Bush legacy, but has taken it to its logical conclusion. Obama has gone beyond Guantanamo Bay, gone beyond spying on Americans’ emails and phone calls, and gone beyond bombing countries without Congressional authorization. As journalist Amy Goodman warned, “the recent excesses of U.S. presidential power are not transient aberrations, but the creation of a frightening new normal, where drone strikes, warrantless surveillance, assassination and indefinite detention are conducted with arrogance and impunity, shielded by secrecy and beyond the reach of law.”
Act as if the work of the presidency is a hardship while enjoying all the perks: The race for the White House is an expensive, grueling horse race: candidates must have at a minimum $200 or $300 million or more just to get to the starting line. The total cost for this year’s election is estimated to exceed $5 billion and could go as high as $10 billion. However, for the winner, life in the White House is an endless series of star-studded dinner parties, lavish vacations and perks the likes of which the average American will never enjoy. The grand prize winner will rake in a $400,000 annual salary (not including $100,000 a year for travel expenses, $19,000 for entertaining, $50,000 for “general” expenses and last but not least, $1,000,000 for “unanticipated” expenses), live rent-free in a deluxe, 6-storey, 55,000 square foot mansion that comes complete with its own movie theater and bowling alley, round-the-clock staff, florists, valets and butlers. Upon leaving the White House, presidents are gifted with hefty pensions, paid staff and office space, travel allowances and lifetime medical care. Ex-presidents can also expand upon their largesse by writing books and giving speeches (Bill Clinton was given a $15 million advance for his memoir and routinely makes upwards of $100,000 per speech).
Clearly, it doesn’t matter where a candidate claims to stand on an issue as long as he or she is prepared to obey the dictates of the architects, movers and shakers, and shareholders of the police state once in office.
So here we are once again, preparing to embark upon yet another delusional, reassurance ritual of voting in order to sustain the illusion that we have a democratic republic when, in fact, what we have is a dictatorship without tears. Once again, we are left feeling helpless in the face of a well-funded, heavily armed propaganda machine that is busily spinning political webs with which the candidates can lure voters. And once again we are being urged to vote for the lesser of two evils.
Railing against a political choice that offers no real choice, gonzo journalist Hunter S. Thompson snarled, “How many more of these stinking, double-downer sideshows will we have to go through before we can get ourselves straight enough to put together some kind of national election that will give me and the at least 20 million people I tend to agree with a chance to vote for something, instead of always being faced with that old familiar choice between the lesser of two evils?”
Remember, the lesser of two evils is still evil.
- Eurogroup Agrees To Disburse €7.5BN To Greece Which Will Be Used To Repay Creditors
Once upon a time, markets trembled when Greek bailout implementation headlines were announced, which is what just happened if slightly ahead of our forecast schedule…
Kazimir Says Eurogroup Meeting Won’t Be an Easy One: translation – Greece will agree to everything some time around 4am
— zerohedge (@zerohedge) May 24, 2016
… and this time nobody cares. Well maybe the Greeks do, but by now even they realize that most of the “money” they receive will be used to repay creditors and especially the ECB, and they will see virtually none of it.
So, for them, or anyone else who cares, here are the key headlines and details as they come in. Few surprises from what had been leaked previously.
EUROGROUP MEETING ENDS, DEAL ALLOWS LOAN DISBURSEMENT
EU DIJSSELBLOEM: REACHED FULL STAFF LEVEL AGREEMENT ON GREECE* * *
DIJSSELBLOEM: ESM TO APPROVE E10.3 BLN IN SEVERAL DISBURSEMENT
DIJSSELBLOEM: INSTITUTIONS TO HAVE FINAL CHECK ON LEGISLATION
DIJSSELBLOEM: NEED TO MAKE SURE GREECE STAYS ON FISCAL PATH
DIJSSELBLOEM: AGREED ON METHODOLOGY OF GREECE DEBT SUSTAINBLTY
DIJSSELBLOEM: ASKED ESM TO LOOK AT MEASURES IN DEBT REPAYMENTS
DIJSSELBLOEM: DEBT MID-LONG MEASURES INTO EFFECT JULY 2018
DIJSSELBLOEM: SMP, ANFA PROFITS ALSO PART OF DEBT DEAL
DIJSSELBLOEM: UNUSED ESM FUNDING COULD BE USED TO SWAP GR DEBT
DIJSSELBLOEM: AGREED ON MECHANISM FOR DEBT MEASURES IN L-TERM
DIJSSELBLOEM: IMPORTANT THAT IMF ON BOARD WITH GREECE
DIJSSELBLOEM: IMF TO RECOMMEND NEW PROGRAMME FOR GREECE BY YR END
DIJSSELBLOEM: BUT IMF WILL DECIDE ON NEW DEBT SUSTAINABILITY
DIJSSELBLOEM: DEBT RELIEF WILL BE DELIVERED AT END PROGRAM* * *
MOSCOVICI: GREECE SHOWED POLITICAL RESPONSIBILITY
MOSCOVICI: ESSENTIAL THAT IMF REMAINS IN GREECE PROGRAM
MOSCOVICI: GREECE WILL BE ABLE TO REPAY STATE ARREARS NOW* * *
REGLING: LOAN TRANCHES LINKED WITH GR PROGRAM IMPLEMENTATION
REGLING: FIRST GREECE LOAN TRANCHE OF E7.5 BLN IN JUNE
REGLING: SECOND LOAN TRANCHE TO BE GIVEN IN AUTUMN
REGLING: GREECE NOW TO IMPLEMENT OUTSTANDING PRIOR ACTIONS* * *
According to Bloomberg, the First set of measures includes:
- Smoothening the EFSF repayment profile under the current weighted average maturity
- Use EFSF/ESM diversified funding strategy to reduce interest rate risk without incurring any additional costs for former program countries
- Waiver of the step-up interest rate margin related to the debt buy-back tranche of the 2nd Greek program for the year 2017
- “Decision on the smoothening of the EFSF repayment profile and the reduction of interest rate risks should be taken as a matter of priority”
For the medium term, the Eurogroup expects to implement a possible second set of measures following the successful implementation of the ESM program:
- Abolish the step-up interest rate margin related to the debt buy-back tranche of the 2nd Greek program as of 2018
- Use of 2014 SMP profits from the ESM segregated account and the restoration of the transfer of ANFA and SMP profits to Greece (as of budget year 2017) to the ESM segregated account as an ESM internal buffer to reduce future gross financing needs.
- Liability management – early partial repayment of existing official loans to Greece by utilizing unused resources within the ESM program to reduce interest rate costs and to extend maturities
- If necessary, some targeted EFSF reprofiling (e.g. extension of the weighted average maturities, re- profiling of the EFSF amortization as well as capping and deferral of interest payments) to the extent needed to keep GFN under the agreed benchmark in order to give comfort to the IMF and without incurring any additional costs for former program countries or to the EFSF
For the long term, the Eurogroup also agrees on a contingency mechanism on debt which would be activated after the ESM program to ensure debt sustainability in the long run in case a more adverse scenario were to materialize
- Such mechanism could entail measures such as a further EFSF reprofiling and capping and deferral of interest payments
Eurogroup mandated finance ministry officials from the currency bloc “to verify in the next few days the full implementation of the outstanding prior actions,” for the conclusion of the Greek bailout review, according to e-mailed statement following meeting of euro area finance ministers in Brussels.
EWG of finance ministry officials have been mandated to verify “in particular the corrections to the legislation on the opening up of the market for the sale of loans, and on the pension reform, as well as the completion of all prior actions related to the government pending actions in the field of privatization”
Following full implementation of all prior actions and subject to the completion of national procedures, governing bodies of the euro area’s crisis fund ESM will approve EU10.3b disbursement of bailout loans to Greece
- First sub-tranche of EU7.5b to cover debt servicing needs and to allow a clearance of an initial part of arrears as a means to support the real economy
- “Subsequent disbursements to be used for arrears clearance and further debt servicing needs will be made after the summer”
- “Disbursements for arrears clearance will be subject to a positive reporting by the European Institutions on the clearance of net arrears”
Eurogroup “recalls” Greece’s medium-term primary budget surplus target of 3.5%/GDP as of 2018
Ministers set benchmark of Greek debt sustainability:
- Country’s gross debt financing needs, or GFN, “should remain below 15% of GDP during the post program period for the medium term, and below 20% of GDP thereafter”
* * *
And again, here is the punchline:
First sub-tranche of EU7.5b to cover debt servicing needs and to allow a clearance of an initial part of arrears as a means to support the real economy
In other words, virtually all the €7.5 billion Greece just got as part of its first tranche… will promptly be used to repay its creditors, as has been the case from day one
* * *
The short summary: Greece has promised to implement even more Draconian measures (which may or may not happen) in order to get money that was already promised to it, while the Eurogroup disburses just enough cash to cover the immediate funding needs of the creditors with a little left over to pay for government arrears while demanding even more austerity; future tranches may or may not be paid out if Greece complies with its promises (which will not happen) and meanwhile the Eurogroup says it may someday provide debt relief, once Greece ends its bailout program… which will never happen.
- Political Polarity Shift – "Trigger Happy Hillary" Making Dems The War Party
Authored by Justin Raimondo via AntiWar.com (h/t Contra Corner blog),
Americans are rejecting imperialism – on both sides of the political spectrum
As Bob Dylan put it, “the times they are a changing!” – and that is certainly the case when it comes to the debate over US foreign policy this election season. A recent article in the Boston Globe, summarizing the observations of a group of Brown University students who tracked the foreign policy discourse of the candidates, underscored what is happening on both sides of the partisan divide:
“As we watched, Republican voters rejected every candidate who favored their party’s traditional hardline foreign policies, including Lindsey Graham, Chris Christie, Jeb Bush, and Marco Rubio…. Trump, the presumptive nominee, has broken with foreign policy dogma on a host of issues. He asserts that decades of foreign wars have not been good for the United States – hardly a traditional Republican view.”
The Democratic party, too, is experiencing what these youthful observers describe as a “foreign policy identity crisis”:
“Clinton, the likely nominee, is an activist by nature and supports escalation from Afghanistan to Syria to Ukraine. Her opponent, Senator Bernie Sanders, has condemned her ‘very aggressive policy of intervention’ and said he does not believe the United States should be ‘the world’s policeman.’ Yet though Sanders effectively pushed Clinton further left in terms of domestic policy, he was unsuccessful in changing her deeply held foreign policy views.”
The two parties are undergoing a process of “role reversal,” as these students put it, right before our eyes. Trump is now attacking “trigger happy Hillary,” while Mrs. Clinton is parrying these thrusts with accusations that “dangerous Donald” lacks the steadiness of an Establishment politician who sticks with the familiar script that casts America in the role of “the indispensable nation” destined to police the world.
With the fall of the Soviet Union and the evaporation of the international communist movement as a credible threat to US national security, American conservatives have been steadily moving – in fits and starts – back to their historic position of nonintervention in the affairs of other nations. Neoconservatism was an anomaly, a tangent occasioned by the alleged necessities of the cold war: its life was prolonged by the 9/11 attacks, but as the effect of that signal event wore off, and as the country exhausted itself in a futile (and losing) military campaign to make the Middle East into an Arabic version of Kansas, the rebellion against the neocons gathered strength and finally triumphed. No matter what the fate of Trump’s candidacy, and in spite of his other controversial views, he has succeeded in overthrowing the old GOP foreign policy orthodoxy and replacing it with what he calls a policy of “America First.”
And while this inward-looking nationalism has its problems and contradictions, the direction the Right seems to be moving is an unmistakable victory for anti-interventionists: the terms of the foreign policy discourse have been shifted in a fundamental way, and – much to the neocons’ chagrin – there is no going back.
On the left, too, the anti-interventionists are on the offensive. Although they have not succeeded in overthrowing the Establishment – thanks to a rigged primary system, Mrs. Clinton has all but clinched the nomination – Sanders has directly challenged Clintonian interventionism and he is taking his fight all the way to the Democratic party national convention. Sanders’ critique of the bipartisan foreign policy “consensus” springs from the same roots as Trump’s: correctly perceiving an economic and even a spiritual crisis on the home front, Bernie wants America to come home and concentrate on solving our domestic problems – which threaten to overwhelm us even as we go marching off to “liberate” the world.
This turmoil is cause for optimism – and, indeed, in researching this column, I took at look back at one of my old columns, “The Case for Optimism,” in the course of which I wrote the following:
“To be sure, the military-industrial complex gets rich off our wars, but the fact is that their rising stock values are making the rest of us poorer – and, increasingly, the American people (and people all over the world, for that matter) are well aware of it. Which brings us to the third major factor limiting the War Party’s future prospects: technological advances that make the acquisition of knowledge much easier.
“It used to be that we had to rely on government officials and their journalistic camarilla for information about America’s far-flung military interventions: back in 1914, for example, very few Americans could place Sarajevo on a map, and even fewer knew of the complex political and social factors that led to the fateful assassination of an Austrian archduke in that city, an event that eventually dragged us into the Great War. It was easy to fool the people into believing a conflict that would destroy European civilization at its zenith was really a war to ‘make the world safe for democracy.’
“Today the job of the war propagandist is much harder, and the reason is the Internet. While most Americans still probably couldn’t place Sarajevo on a map, they could easily choose to do so with a few keystrokes – and therein lies the big problem faced by warmongers these days.”
The case for optimism has never been stronger. The War Party is beleaguered, besieged, and beside itself with panic because the American people are finally waking up. A lot of this is due to the Internet – and the existence of Antiwar.com has played a part in all this.
For twenty years we’ve been debunking the lies of the War Party and building up a slow but steady momentum on behalf of a real movement to change American foreign policy. And now the big breakthrough is coming, with a real mass rebellion against the bipartisan “consensus” that insists America’s proper role is to police the world. With our country facing a growing internal crisis, and the foreign wars we’re engaged in turning into disasters on every front, the American people are rising up and demanding an end to the Empire.
The part Antiwar.com plays in all this is key – because the voters don’t necessarily have the facts on hand. Ordinary folks don’t have the time or the inclination to research what’s really going on in Syria, or what the facts are about who’s paying the lion’s share for NATO. They have jobs, families, lawns to mow and kids to take to soccer practice – they don’t have time to become foreign policy experts!
So when some bought-and-paid for “expert” is cited in the media as being absolutely certain that some tinpot despot has “weapons of mass destruction,” or that Vladimir Putin is definitely plotting to march on Paris tomorrow, they may be skeptical of the need for Uncle Sam to intervene – but they don’t know enough to contest “expert” opinion. This is how the Beltway crowd pulls the wool over people’s eyes every time. Yet there is an antidote for the poisonous lies being spread by the War Party – and that’s Antiwar.com.
- CNN Lashes Out At Trump Over Vince Foster "Conspiracy", Rushes To Hillary's Defense
Following Trump’s bombardment of Bill and Hillary Clinton over the past 24 hours, first with a video clip featuring Bill rape accusers Kathleen Willey and Juanita Broaddrick, and shortly thereafter by digging up the most sensitive skeleton in the Clintons’ closet, that of Vince Foster, whose death Trump said he found “very fishy“, we wondered briefly if and how Hillary would respond.
We got our answer moments ago when the response came, only not from Hillary, but from one of her favorite TV outlets, CNN whose Jake Tapper valiantly stepped up to the Clintons’ defense.”
“Once again, journalists are in the unhappy predicament of trying to decide whether and how to cover false allegations raised by a candidate for president of the United States,” Tapper said at the start his show, “The Lead.” He continued: “The notion that this was a murder is a fiction born of delusion and untethered to reality and contradicted by evidence reviewed in at least six investigations, one of them by Ken Starr, hardly a Bill Clinton defender. To say otherwise is ridiculous, and, frankly, shameful.”
Tapper claims reiterating that his scrutiny of Trump’s comments wasn’t “pro-Clinton” or “anti-Trump” but a “pro-truth position.” Some would beg to differ.
Tapper continued: “Trump called the circumstances surrounding Foster’s death “very fishy” in an interview with The Washington Post, saying the aide had “intimate knowledge” of events surrounding the Clintons. Trump has recently launched personal attacks at Hillary Clinton, the Democratic presidential front-runner.
“I don’t bring [Foster] up because I don’t know enough to really discuss it,” Trump told the newspaper. “I will say there are people who continue to bring it up because they think it was absolutely a murder. I don’t do that because I don’t think it’s fair.”
Tapper’s meltdown at Trump continued for having “lent credence to a bizarre and unfounded conspiracy theory,” saying Trump was “right to say it wasn’t fair to bring up the conspiracies. You’re right, it’s not fair that you did that, certainly not to Mr. Foster’s widow or their three children.”
His conclusion: “The notion that this was a murder is a fiction borne of delusion and untethered to reality and contradicted by evidence in at least six investigations. To say otherwise is ridiculous and frankly shameful. This is not a pro-Clinton position or an anti-Trump position, it is a pro-truth position.“
Which, of course, anyone rushing to Hillary’s defense would conclude with.
* * *
We doubt Tapper has brought this, or any other issue to a close, in this most remarkable presidential race in history.
In fact, judging by the speed and severity of his response, the CNN anchor, one of many who still hasn’t grasped how Trump operates, has merely assured that Trump will not only continue to irritate the Tappers of the world by bringing up Foster, but will also push deeper until he penetrates through the thick shield of media defenders surrounding Hillary and forces her to confront demons she was confident has been buried decades ago.
Full clip below.
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