- California Has Never Experienced A Water Crisis Of This Magnitude – And The Worst Is Yet To Come
Submitted by Michael Snyder via The Economic Collapse blog,
Things have never been this dry for this long in the recorded history of the state of California, and this has created an unprecedented water crisis. At this point, 1,900 wells have already gone completely dry in California, and some communities are not receiving any more water at all. As you read this article, 100 percent of the state is in some stage of drought, and there has been so little precipitation this year that some young children have never actually seen rain.
This is already the worst multi-year drought in the history of the state of California, but this may only be just the beginning. Scientists tell us that the amount of rain that California received during the 20th century was highly unusual. In fact, they tell us that it was the wettest century for the state in at least 1000 years.
Now that things are returning to “normal”, the state is completely and total unprepared for it. California has never experienced a water crisis of this magnitude, and other states in the western half of the nation are starting to really suffer as well. In the end, we could very well be headed for the worst water crisis this country has ever seen.
When I said that some communities in California are not receiving any more water, I was not exaggerating. Just consider the following excerpt from one recent news report…
The community of Mountain House is days away from having no water at all after the state cut off its only water source.
Anthony Gordon saves drinking water just in case, even though he never thought it would come to this.
“My wife thinks I’m nuts. I have like 500 gallons of drinking water stored in my home,” he said.
The upscale community of Mountain House, west of Tracy, is days away from having no water. It’s not just about lawns—there may not be a drop for the 15,000 residents to drink.
So what are those people going to do?
And what is this going to do to the property values in that area?
Who in the world is going to want to buy a home that does not have running water coming to it?
Other communities throughout the state are pumping groundwater like crazy in a desperate attempt to continue with business as usual. In fact, it is being projected that groundwater will account for almost all water used in the entire state by the end of this year…
Underground aquifers supply 35 percent of the water used by humans worldwide. Demand is even greater in times of drought. Rain-starved California is currently tapping aquifers for 60 percent of its water use as its rivers and above-ground reservoirs dry up, a steep increase from the usual 40 percent. Some expect water from aquifers will account for virtually every drop of the state’s fresh water supply by year end.
But of course this creates a huge problem. When the groundwater is gone, it is gone for good. Those aquifers took centuries to fill up, and now they are being drained at a staggering rate. In some parts of the state, aquifers are being drained so fast that it is causing thousands of square miles of land to sink…
Californians have been draining water so rapidly from underground aquifers that tens of thousands of square miles of land reportedly are sinking — so drastically that the shifting surface is starting to destroy bridges and crack highways across the state, according to a recent report by the Center for Investigative Reporting.
So what is the solution?
Some of my readers have suggested that desalination is the answer. But the truth is that desalination is very expensive and it is really bad for the environment. The following comes from a recent Natural News article…
For those who are saying, “There’s no water problem in California! It has the entire Pacific Ocean right next door!”, you need to look into the catastrophic environmental destruction tied to ocean water desalination.
Not only does desalination use fossil fuels which emit the very same carbon emissions that the California government insists caused the drought in the first place, the desalination process itself pollutes the ocean with high concentration salt brine that kills marine ecosystems and destroys ocean life along the California coastline.
And that’s on top of all the Fukushima radiation that’s already causing a marine ecosystem collapse in many areas of the coast. Add more salt brine to the mix and you get a state where rich, self-entitled Hollywood celebrities demand their lush, green lawns at the expense of ocean life, climate change and the global ecosystem. If that happens, California will lose all credibility as a “green” state, and its wealthiest residents will be living an ecological lie.
Others have suggested that California can solve their water problems using “toilet to tap” technology…
Potable water reuse – or converting sewage effluent to heavily-treated, purified drinking water – is receiving renewed attention in California in the midst of the state’s four-year drought.
According to a report by the Los Angeles Times, “California water managers and environmentalists” are pushing the idea of recycled sewage water. Yet past efforts in the state to employ similar systems have stalled, as opponents have dubbed the concept “toilet to tap.”
How would you feel about that?
Would you be willing to have your family drink water that came from the toilets of your neighbors?
I don’t think that I could do that.
But something has to be done. It is not just the state of California that is experiencing a major water crisis. All over the world, underground aquifers are being drained rapidly. In fact, according to the Washington Post, 21 out of the 37 largest aquifers in the world “have passed their sustainability tipping points”…
The world’s largest underground aquifers – a source of fresh water for hundreds of millions of people — are being depleted at alarming rates, according to new NASA satellite data that provides the most detailed picture yet of vital water reserves hidden under the Earth’s surface.
Twenty-one of the world’s 37 largest aquifers — in locations from India and China to the United States and France — have passed their sustainability tipping points, meaning more water was removed than replaced during the decade-long study period, researchers announced Tuesday. Thirteen aquifers declined at rates that put them into the most troubled category. The researchers said this indicated a long-term problem that’s likely to worsen as reliance on aquifers grows.
Sadly, this is just the beginning. There is a reason why experts refer to fresh water as “the new oil”. Without fresh water, none of us can survive. But we are very quickly getting to the point where there simply won’t be enough of it for everyone on the planet.
As for the state of California, it was once a desert and now it is turning back into a desert. As I mentioned earlier, the 20th century was the wettest century that part of North America had seen in at least 1000 years. During that time, we built enormous cities all over the Southwest that currently support millions upon millions of people. But now we are learning that those cities are not sustainable.
- China Is Turmoiling
For the 2nd time in a month, China’s Shanghai Composite entered a correction, plunging 10% from local highs as headlines of delayed IPOs and large-scale steel ‘dumping’ at a loss combined with global monetary policy fireworks and European event risks. The rest of the more highly sensitive and manic Chinese equity markets are also plunging with CHINEXT and CSI-300 down over 7% in the last month (and 17% from the highs in the case of the former).
Chinese stocks have gone nowhere in a month…
Before you read on – STOP and look at the volatility we are talking about here… multiple 10 to 15% swings in major stock indices in the last month. Compare that to the US market’s idiocy where we have seen no vol whatsoever in the last six months.
Of course – as US equities roared to record highs today in the face of the most serious Grexit fears yet and a Fed that just admitted the economy is FUBAR – Chinese stocks are for once derisking responsibly (for now).
But there are more troubles in big China as Reuters reports China steel exporters are dumping inventories at a a loss…
Some Chinese steelmakers are selling their output abroad at a loss, according to traders and a producer, as a group of global industry bodies urged governments to take action over rising shipments from China.
Chinese mills had sold steel overseas at a loss of up to 200 yuan ($32) a tonne and cut the export price of hot-rolled coil by 5 percent to $340-$350 a tonne, free-on-board basis, this week compared to last week, according to traders and a producer in Hebei, China’s top steel producing province.
These mills were also selling at a loss to the domestic market, they said.
“The domestic market is too weak to consume high output and our prices are competitive, so some mills are still keen to step up exports, hoping to ease high inventories and maintain market share,” said a senior official at a privately owned mill in Hebei.
China exports around 10 percent of its annual steel output from hundreds of steelmakers and it was unclear the quantity of steel the traders and official were referring to.
China’s steel exports rose 28 percent to 43.5 million tonnes in January-May, even as domestic crude steel output fell nearly 2 percent. In 2014, exports jumped 51 percent to a record 93.78 million tonnes.
Eight steel associations from Asia, the Americas and Europe said in a joint statement this week all regions were “suffering from a dramatic increase in unfair steel imports that is fueled by massive global overcapacity.”
“Looming over it all is China, whose massive and increasing overcapacity in an era of slowing growth has already destabilized the global steel market and trade flows,” the statement said.
Two words – malinvestment and over-capacity – sum up the entire farcical surge in China, and as George Soros warned, if the reforms Xi is pushing fail, his best last solution will be war to keep a nation united and working for a common ‘good’.
* * *
Another IPO delayed:
- *BANK OF JINZHOU IPO DELAY AS REGULATOR ASKS FOR INFORMATION
- *BANK OF JINZHOU HOPES TO RESCHEDULE H.K. IPO HEARING TO JULY
- *BANK OF JINZHOU SAID TO DELAY IPO ON LINKS TO HANERGY: REUTERS
And a bond sales canceled:
- *DRAGON CITY TOURISM CANCELS BOND SALE DUE TO MKT VOLATILITY
* * *
Which just adds to the IPO pain we noted earlier…
But it’s a “no brainer” remember…
- "The System Is Broken": Americans No Longer Believe In Its Institutions
Submitted by Mac Slavo via SHTFPlan.com,
It’s not difficult to see that the foundation is crumbling…
A new Gallup poll has found that already low “confidence” in our system of government, our economy, the media, banking, big business, religious institutions and watchdogs is further eroding.
“Americans’ confidence in most major U.S. institutions remains below the historical average for each one,” a Gallup spokesman said in a news release.
[…]
All in all, it’s a picture of a nation discouraged about its present and worried about its future, and highly doubtful that its institutions can pull America out of its trough.
There is plenty of good reason, with evidence uncovered daily, weekly and consistently throughout the years of the hypocrisy and failures of government, the failed promises of politicians, the lies and spin of the mainstream media and newspapers, the greed and exploitation of the financial sector and the “just us” mentality of above-the-law enforcers who are supposed to uphold justice.
Just check out how little faith remains in the structure of, well, just about any institution in America, by the numbers:
Only 8 percent have confidence in Congress, down by 16 points from a long-term average of 24 percent – the lowest of all institutions rated.
33 percent have confidence in the presidency, a drop from a historical average of 43 percent.
32 percent have confidence in the Supreme Court, down from 44.
28 percent have confidence in banks, down from 40 percent.
21 percent have confidence in big business, down from 24 percent.
24 percent have confidence in organized labor, down from 26.
24 percent have confidence in newspapers, down from 32 percent.
21 percent have confidence in television news, down from 30 percent.
52 percent of Americans […] are confident in the police [57 percent historically]
What else can be said, but that the system is broken?
Obviously it bears little resemblance to the one envisioned by the founding fathers and their emphasis on separation of powers and limited government.
None of the three branches of government are trusted by even close to a majority of the American populace… maybe that’s to be expected, with frequent media criticisms of political figures in a polarizing two party system.
But other pillars of society have lost their backing of the public, too – in astonishing numbers that show not only that the American dream is dead, but that private institutions are widely perceived as being just as corrupt as public ones (or worse).
To top it off – this perception is entirely deserved. The aftermath of the 2008 financial crisis consolidated the power and wealth of the big banks, and gave the Federal Reserve ultimate power over the economy, while average Americans suffered greatly.
Scandal after scandal revealed that corruption for what it is.
Media scandals – such as Brian Williams’ fabricated war zone stories and George Stephanopoulos’ attempt to conceal his conflicts of interest with the Clinton Foundation – have left a bad taste in the mouth of media consumers already facing fake news indigestion.
The factors are piling up beyond our capacity to excuse them away: fatigue from endless wars and threats of terrorism; cynically-false promises of hope and change; the repeated, brazen trampling of civil rights; a sharp decline of opportunity at the hands of economic recession; trade deals written in secret to enrich corporations; the rise of job-crushing technology and more have all sapped at the American spirit.
Whether most Americans follow these developments or not, they instinctually sense them. No one trustworthy is steering this ship – worse, no one may be at the wheel at all.
Who or what can turn things around?
That remains to be seen, but few will be willing to buy into the system if it remains on course.
The loss of confidence in the system ultimately relates to the loss of confidence in the freedom of the individual.
It is strong-willed and determined people who have always made this country, and any other, strong and vibrant.
The constant detriment of individual rights and the endless calls to transfer power to the collective – whether inside or outside of government – is the real source of the problem that this Gallup poll reflects.
Our best hope at a better world should start there. Is it still possible?
- Sweden's Largest Fund Manager Is Quietly Dumping Stocks Before The "Herd" Is Caught In A Selling Vortex
In a time of constant handwaving, hair-tearing and op-eds discussing the perils of the collapse in market liquidity due to central planning even as investing experts double down every single time there is a 1-2% “plunge” in the markets because, well, if you don’t BTFD your HFT competitor will, one firm has decided to put its money where everyone else’s mouth is. Actually, “pull.”
According to Bloomberg, Sweden’s largest fund manager, Swedbank Robur which oversees $138 billion in assets, has slashed its equity exposure in half at some funds “to avoid being caught on the wrong side of markets once the herd realizes stocks are over-valued.“
In the funds with the broadest equity mandates, Sweden’s biggest fund manager reduced its equity exposure to about 30 percent in April from 80 to 85 percent in the second half of last year, Head of Multi Asset Per Storfaelt said in a June 11 interview in Stockholm, as reported originally by Bloomberg.
The reason for the stealthy liquidation: a diametrically opposing view to the prevailing conventional wisdom, according to which a “Grexit is contained”, and certainly in complete disagreement with what Norway’s Finance Minister Sigbjoern Johnsen who said in 2010 the reason why Norway’s SWF invests in Greek debt is because it is “investing for infinity” namely that there is massive future risk threatening to drive losses in Europe as a result of the ongoing Greek drama, according to Robur.
“In April, the majority of the market participants assumed that the drama in Greece was going to be solved in the end,” Storfaelt said. “How did we play it? We took down risk more than we would otherwise have done. We still judge it will play out worse than the market expects.”
It’s not just the underpriced risks from a Greek contagion: according to Storfaelt the current environment has a far bigger inherent risk: a dumb “herd” of complacent bulls, who will one day realize just how massive the disconnect between fundamentals and valuations is, and run in the opposite direction. However, with zero liquidity on the other side of the market, there will be no escape.
Storfaelt says going with the flow is starting to look risky. “There are clear advantages to going against the herd at the moment,” he said.“You get more return taking less risk by not joining a herd that goes for an asset without fundamental backing.” Ultimately, investors are aware of the disconnect between fundamentals and valuations, so they’re “trigger-happy.” That means they’re ready to “reverse as soon as things shake a little,” he said.
Storfaelt says central bank stimulus in Europe has propped up markets and encouraged investors to expect a helping hand even though stocks are over-valued. But the question is whether the disbelief that ought to be kicking in can continue to be suspended.
The punchline, and a conclusion we absolutely agree with since it is something we have said since 2009: “he says the shortage of liquidity is a sign people are starting to doubt the sustainability of the current price environment.“
Well, people have been doubting it for about 5 years, but with central banks always on the other side of the trade, and with Fear Of Missing Out, or FOMO, equivalent to career risk, nobody had a choice. The problem is that if one takes out the central banks from the backstop equation, the market has never been more one-sided and once the selling begins, there will be nobody to step in with the bid of first or last resort (the natural buyers in liquidations, the shorts, have long since been eviscerated). In fact, the only option will be to simply halt the market indefinitely. Just see Hanergy or CYNK as a case study of what is coming.
But back to Robur, which has made money on its contrarian stance in the past. In mid-2011, the fund bought up European equities, even though “everyone believed Europe was finished,” Storfaelt said. We “took a clear stance and aggressively increased the equity weight.” The deal ultimately paid off. Since the end of June 2011, the Stoxx Europe 600 index has gained more than 40 percent. “It is kind of the same situation now, but the reverse,” he said.
Storfaelt said Swedbank Robur sees a higher probability of a Greek default than the rest of the market. The risk “that it ends badly is higher than 50 percent,” he said. Pressure on Greece grew on Thursday as International Monetary Fund chief Christine Lagarde said the country won’t be given a grace period if it fails to make a payment at the end of the month.
“Market participants often make the mistake of assuming that everybody else — for instance when it comes to Greece — is driven by economic considerations,” Storfaelt said.“In Greece, the end-game will be much more driven by ideological beliefs and the question is where this will lead.”
Events today showed he was absolutely correct. For the sake of the bulls who looked at the market – which was being pushed up solely due to central bank intervention from the first moment of trading to crush any Greek negotiating leverage a red close may bring – and assumed that there is nothing at all that can dent the artificial, illiquid “bull market” now in its 6th year, let’s hope that that is all Storfaelt is correct about, because otherwise the countdown to the next massive market crash, not to mention the next, and probably final global QE involving all central banks, has already begun.
- Tell This To The Next Idiot Who Thinks You're "Unpatriotic"
Submitted by Simon Black via Sovereign Man blog,
I’ll never forget the Oath of Office I took when I was commissioned as an Army Intelligence Officer all those years ago.
The most important part is where you swear to “support and defend the Constitution of the United States against ALL enemies, foreign and domestic.”
That was the part that kept ringing in my head as George W. Bush went on TV in the run-up to the Iraq war talking about weapons of mass destruction.
We had been on the ground in Kuwait since late 2002, months before the invasion of Iraq kicked off. And every time Bush told that lie, I thought about my oath.
I’m disappointed to admit that, back then, I didn’t have the courage to go up against the big Army machine… to march into my Battalion Commander’s office and say, “Sir, we must defend the Constitution against the President of the United States.”
I knew I would get crushed.
When I left the military, I started noticing all the other ways in which the government turned the Constitution into a punchline. And that practice has only accelerated.
I came up with a different solution. Instead of fighting some faceless machine, I voted with my feet and left the country.
That, coupled with my drastically reduced tax bill thanks to being an overseas expat, has prompted a lot of use of the word ‘unpatriotic’ since I started writing this letter six years ago.
I find this appallingly ignorant.
The American Revolution itself was predicated on the inequity of taxation without representation.
Are your interests represented when they buy bombs and body scanners? Mine certainly aren’t.
Yet people who define patriotism by the frequency and rapidity of their flag-waving think that we all have some collective duty to ignorantly believe whatever we’re told by the government.
I disagree. So does the New Oxford American Dictionary, which defines ‘patriot’ as
“a person who vigorously supports their country and is prepared to defend it against enemies or detractors.”
There’s that phrase again– ‘defending against enemies.’
Who exactly are these ‘enemies’, by the way? Are they men in caves who hate us for our freedom? Arab teenagers with intense sexual angst and a collection of firearms?
No. The real enemies are not foreign… but domestic. It is the apparatus of government itself that has collapsed upon the founding document of the nation.
It’s not unpatriotic to lament how far a government’s practices have diverged from its Constitution.
It’s not unpatriotic to want to be free.
And it’s not unpatriotic to take steps to make that happen.
In fact, people who think it’s everyone’s patriotic duty to pay taxes are only feeding the beast that makes them less free.
And it’s entirely delusional to think that all of this can change by going to a voting booth.
There’s no politician that’s going to change this.
Nobody is going to stand on stage and say, “My plan is to eliminate entire departments of government, fire half of all government workers, terminate social security, and default on the debt.”
Elections are pointless charades. But rather than vote for new people, we can simply vote to restrict the resources they have available.
Yes, there are legal obligations to pay tax. And everyone should abide those obligations or risk pointless imprisonment.
But with proper planning, tax obligations can be minimized.
In my case, I left the country.
This provides up to $100,800 in tax-free income based on the Foreign Earned Income Exclusion, and that’s before taking into account additional deductions, allowances, and exclusions.
Recently I used my tax savings to finance a new prosthetic leg for an amputee war veteran that had been abandoned by the US government, and to buy food for earthquake victims here in Nepal.
Had I not taken steps to reduce my tax bill, a big chunk of my income would have paid for more soldiers to get their legs blown off, and more bombs to be dropped by remote control on brown people.
Instead, now I get to decide how my income and savings can best have an impact on the interests that I believe in.
Let’s call it “representation without taxation”. And it’s completely legal as long as you follow the rules.
Sure, not everyone has the ability to leave the country. But there are options to fit any lifestyle and circumstance.
In addition to taxes, for example, it’s important to consider moving a portion of your savings abroad where it can’t be confiscated or frozen by capital controls.
Safeguarding your wealth is a huge part of this strategy, in fact.
The larger point is that taking steps to preserve your wealth and freedom is not unpatriotic.
And for anyone who truly cares to defend your country from its domestic enemies, starving the beast is one of the most powerful tools you have available.
- RenTech Uses "Amazing" Legal Trick To Help Employees Dodge Retirement Taxes
Jim Simons’ Renaissance Technologies and its internal HFT fund Medallion are no strangers to questions about tax avoidance. Last July, a Senate subcommittee report alleged that Renaissance, with the help of Deutsche Bank (of course) and Barclays, skirted leverage limits and avoided paying ordinary income tax on billions in trading profits by using basket options. Here, from the Senate report, is how the scheme worked:
The basket option contracts examined by the Subcommittee investigation were used by at least 13 hedge funds to conduct over $100 billion in securities trades, most of which were short-term transactions and some of which lasted only seconds. Yet the resulting short-term profits were frequently cast as long-term capital gains subject to a 20% tax rate (previously 15%) rather than the ordinary income tax rate (currently as high as 39%) that would otherwise apply to investors in hedge funds engaged in daily trading. While the banks styled the trading arrangement as an “option” under which profits from short-term trades would be treated as long term capital gains, in essence, the banks loaned the hedge funds money to finance their trading and allowed them to trade for themselves in highly leveraged positions in the banks’ proprietary accounts and reap the resulting profits. The banks offering the “options” benefited from the financing, trading, and other fees charged to the hedge funds initiating the trades. In the end, the trading conducted by the hedge funds using the basket option accounts was virtually indistinguishable from the trading conducted by hedge funds using their own brokerage accounts, and provided no justification for treating the resulting short-term trading profits as long-term capital gains.
There you go. And while it sounds (and looks) complicated, it was all, as we explained at the time, motivated by a very simple desire to reclassify short-term capital gains into long-term profits, in the process saving about 25% of the absolute profit from any transaction.
How much did this 17X leveraged, “fictional derivatives” scheme cost taxpayers, you ask? Around $6 billion apparently, and as it turns out, Renaissance wasn’t done coming up with creative and technically legal ways to avoid paying the Treasury because as Bloomberg reports, the firm’s employees will now get to invest their retirement in Medallion (the firm’s internal HFT high-flyer) tax free:
It’s one of the sweetest employee perks in the hedge-fund world: a chance to invest in Medallion, the wildly profitable fund created by market legend James Simons.
Now, with deft legal maneuvers and a blessing from Washington, the firm Simons started is giving its employees an even richer opportunity — a tax-advantaged, fee-free ticket to one of the world’s top-performing hedge funds.
In a series of unusual moves, Renaissance Technologies abolished its 401(k) plan and won the government’s permission to put pieces of Medallion fund inside Roth IRAs. That means no taxes — ever — on the future earnings of a fund that averaged a 71.8 percent annual return, before fees, from 1994 through mid-2014.
How is this possible? Well, the first step was to eliminate 401(k)s and move everyone into IRAs, which Renaissance did in 2010. Next, Renaissance’s lawyers told the Labor Department that in their view, it wasn’t entirely fair that the firm’s employees were stuck investing their retirement savings in traditional funds offered through the likes of Fidelity because after all, carbon-based portfolio managers have a tough time replicating HFT-like returns. Two years, and a lot of paperwork later, Renaissance was granted a waiver which allowed for the inclusion of Medallion fund in employees’ IRAs. Renaissance has since set up another 401(k) which, thanks to a second government waiver, also includes Medallion. More from Bloomberg:
After questioning that yielded a foot-high stack of public records, the Labor Department granted the exemption in 2012.
As of the end of 2013, Renaissance was running an employer IRA plan that attracted $86.6 million in initial investments and had 259 active participants.
Assets in the plan jumped 49 percent to $153 million during its first full year of existence in 2013, and almost all of that came because of growth in the funds, rather than new contributions or rollovers. The fee-free version of Medallion returned about 47 percent that year, compared with about 25.5 percent for the fee-paying version.
While seeking the IRA exemption, Renaissance also set up a new 401(k). (Such plans permit greater annual contributions than IRAs.)
Renaissance then returned to the Labor Department to ask for permission for the new 401(k) to invest in Medallion, too. In November 2014, the Labor Department said yes..
For Renaissance employees, the results of the firm’s maneuvers are fee-free, tax-advantaged investments and the prospect of ballooning balances in their Roth IRAs.
For those wondering exactly what all of this means in real money terms, consider this:
From 2001 through 2013, the fund’s worst year was a 21 percent gain, after subtracting fees. Medallion reaped a 98.2 percent gain in 2008, the year the Standard & Poor’s 500 Index lost 38.5 percent.
If Medallion repeats that 13-year performance, a $300,000 taxable investment would turn into $4.7 million. A Roth IRA funded with $300,000 would be worth $26.3 million — and a no-fee version would be even bigger.
So, while America’s policemen, firemen, and school teachers are subjected to daily headlines trumpeting billions in underfunded pension liabilities, hedge fund employees (especially those who work for HFTs) are going to do just fine.
Who loses as a result of all of the above? Well frankly, you do…
“This is an issue of fairness, and taxpayers end up paying the price” — Senator Ron Wyden
- Pope Francis Calls For A New Global Political Authority To Save Humanity
Submitted by Michael Snyder via The End of The American Dream blog,
Pope Francis says that global warming is a fact and that a new global political authority is necessary in order to save humanity from utter disaster. The new encyclical that was scheduled to be released on Thursday has been leaked, and it is being reported that this new global political authority that Pope Francis envisions would be in charge of “the reduction of pollution and the development of poor countries and regions”.
The funny thing is that this sounds very much in line with the new sustainable development agenda that is going to be launched at the United Nations in September.
This radical new agenda is already being called “Agenda 21 on steroids” because it goes so much farther than Agenda 21 ever did. The new UN agenda does not just address the environment – it also addresses issues such as poverty, agriculture, education and gender equality. It is essentially a blueprint for governing the entire planet, and that sounds very much like what Pope Francis also wants. In fact, Pope Francis is going to give the speech that kicks off the UN conference in September where this new sustainable agenda will be launched. For some reason, this Pope has decided to make the fight against climate change the central pillar of his papacy, and he is working very hard to unite as much of humanity as possible to get behind that effort.
It is not an accident that this new encyclical is coming out now. An article from the Guardian even states that the release was intended “to have maximum public impact” prior to the Pope’s major speech at the UN in September…
The rare encyclical, called “Laudato Sii”, or “Praised Be”, has been timed to have maximum public impact ahead of the pope’s meeting with Barack Obama and his address to the US Congress and the UN general assembly in September.
It is also intended to improve the prospect of a strong new UN global agreement to cut climate emissions. By adding a moral dimension to the well-rehearsed scientific arguments, Francis hopes to raise the ambition of countries above their own self-interest to secure a strong deal in a crucial climate summit in Paris in November.
Much of the encyclical is not that surprising. But what is raising eyebrows is the Pope’s call for a new global political authority. Here is more from the Guardian…
Pope Francis will this week call for changes in lifestyles and energy consumption to avert the “unprecedented destruction of the ecosystem” before the end of this century, according to a leaked draft of a papal encyclical. In a document released by an Italian magazine on Monday, the pontiff will warn that failure to act would have “grave consequences for all of us”.
Francis also called for a new global political authority tasked with “tackling … the reduction of pollution and the development of poor countries and regions”. His appeal echoed that of his predecessor, pope Benedict XVI, who in a 2009 encyclical proposed a kind of super-UN to deal with the world’s economic problems and injustices.
What is even more alarming is who will be on the stage with the Pope when this encyclical is formally released. John Schellnhuber is a German professor that has some very radical views on climate change. For instance, he believes that our planet is overpopulated by at least six billion people…
Professor John Schellnhuber has been chosen as a speaker for the Vatican’s rolling out of a Papal document on climate change. He’s the professor who previously said the planet is overpopulated by at least six billion people. Now, the Vatican is giving him a platform which many expect will result in an official Church declaration in support of radical depopulation in the name of “climate science.”
And Schellnhuber also happens to believe that we need a new global political authority. If he had his way, there would be an “Earth Constitution”, a “Global Council” directly elected by the people of the planet, and a “Planetary Court” that would be above all other courts on the globe. The following is an excerpt from a very disturbing piece that he authored…
Let me conclude this short contribution with a daydream about those key institutions that could bring about a sophisticated – and therefore more appropriate – version of the conventional “world government” notion. Global democracy might be organized around three core activities, namely (i) an Earth Constitution; (ii) a Global Council; and (iii) a Planetary Court. I cannot discuss these institutions in any detail here, but I would like to indicate at least that:
– the Earth Constitution would transcend the UN Charter and identify those first principles guiding humanity in its quest for freedom, dignity, security and sustainability;
– the Global Council would be an assembly of individuals elected directly by all people on Earth, where eligibility should be not constrained by geographical, religious, or cultural quotas; and
– the Planetary Court would be a transnational legal body open to appeals from everybody, especially with respect to violations of the Earth Constitution.
Does the Pope want something similar?
It is quite telling that Schellnhuber was invited to stand with the Pope as this major encyclical is released to the world. Did Schellnhuber play a role in drafting it? Has he been advising the Pope on these matters? Does the Pope share his vision of the future?
And does the Pope share Schellnhuber’s belief that our planet is currently overpopulated by six billion people? If so, how would the Pope solve that “problem”?
Without a doubt, most of those that make up the “global elite” would love to see the number of people on earth decline precipitously. This is something that I covered in my previous article entitled “46 Population Control Quotes That Show How Badly The Elite Want To Wipe Us All Out“. Of course the Pope is not going to publicly advocate for getting rid of six billion people, but clearly he is extremely concerned about the impact that all of us are having on this planet.
The funny thing is that the earth is not even warming. In fact, there has been no sign of global warming at all for the past ten years…
Over the years the government and the scientific community have largely stood their ground when it comes to climate change. They’ve been adamant in their assertion that the planet is gradually warming due to human activity, and that we all need to do our part to stop climate change. However, the data provided by the scientific community doesn’t always jibe with their claims.
At least, that seems to be the case with the data coming out of NOAA’s climate monitoring stations. They have a series of 114 stations across all 50 states, which is known as the US Climate Reference Network. For the past 10 years they’ve shown no sign of global warming. In fact, there’s been a very slight cooling in temperatures across the US.
But at this point, most of the world has bought into the propaganda. In most industrialized nations, a solid majority of the population actually believes that climate change is the greatest threat that humanity currently faces.
And since just about all forms of human activity produce “carbon emissions” or affect the environment in some way, it gives control freaks that dream of global government a good excuse to grab more power. They will always say that it is about “saving humanity” or “saving the planet”, but ultimately everything that they are trying to accomplish would mean more power in their hands.
- Is This What The New $10 Bill Will Look Like?
Treaaury Secretary Jack Lew revealed last night that Alexander Hamilton – he of The Federalist Papers and first central bank of America – will be ousted from the $10 Bill in favor of a woman (as yet unnamed).
"We are going to be open to many ideas as we go forward consistent with theme of democracy," Lew said. "Our thinking is to select a woman who has played a major role in our history who represents the theme of democracy."
The bills with Hamilton in it, which were first introduced in 1929, will continue to be used for as long as those bill last, Lew said.
This of course, is not a populist move as Jack lew explains…
One wonders just who they will choose?
Given Lew's comment s that:
"America’s currency is a way for our nation to make a statement about who we are and what we stand for," Lew said. "Our paper bills — and the images of great American leaders and symbols they depict — have long been a way for us to honor our past and express our values."
We suspect the new tran, pardon ten dollar bill will look as follows:
One final question – did anyone think to ask Alexander Hamilton if he "identifies as a woman" or "a black woman"?
- Middle Class Incomes Yet To Recover From Crisis As Wealth Gap Widens
“First, widening inequality is a very long-term trend, one that has been decades in the making. The degree of inequality we see today is primarily the result of deep structural changes in our economy that have taken place over many years, including globalization, technological progress, demographic trends, and institutional change in the labor market and elsewhere. By comparison to the influence of these long-term factors, the effects of monetary policy on inequality are almost certainly modest and transient.”
That’s what Blogger Ben Bernanke (who is of course distinct from PIMCO advisor Ben and Citadel co-conspirator Ben) had to say earlier this month about the idea that the Fed’s post-crisis policies have contributed to income inequality in America.
The above-cited Bernankespeak can be translated as follows: poor people have been getting poorer for a long, long time, so sure, maybe the Fed contributed a little bit, but probably not a whole lot.
A common sense appraisal of QE tells a different story.
Deliberately inflating the assets most likely to be concentrated in the hands of the rich quite clearly increases the wealth divide and indeed, even the St. Louis Fed acknowledges that the American Middle Class is effectively dying a slow death in the post-crisis world.
For proof, look no further than the latest data on US household income which shows that while the 0.001%, the 0.01%, the 0.1%, and the 1% have all nearly recovered their pre-crisis share of the national income, the bottom 50% of US filers’ share is not only lower than it was in 2007, but is in fact lower than it was in the depths of the crisis:
More color from Bloomberg:
The IRS recently released its latest income data on U.S. households. The numbers, which go through 2012, show that the top sliver of taxpayers recovered quickly from the recession. That’s not what happened for everyone else.
U.S. household income is getting increasingly concentrated at the top. That was especially true in 2012, when there was a race to sell valuable assets before the top capital gains tax rate jumped to 23.8 percent from 15 percent.
* * *
Perhaps Blogger Ben will help to explain the above — which seems to contradict his assessment — in a forthcoming Brookings post.
- The Logic Of Interventionism (Or How To Wake Up In A Prison)
Submitted by Pater Tenebrarum via Acting-Man.com,
Archaic Financial Freedom
The mainstream press is still full of articles about the alleged evils of cash, which we regard as a typical “trial balloon” launched by the powers-that-be. The way this works is that they get a repressive measure they indent to implement out there, not only to propagandize in its favor, but also to gauge the reaction of the serfs. Is there an outcry? Does anyone care? If not, they quietly go forward with putting the measure into practice. If there is a great deal of pushback, they will simply wait for a better opportunity. A useful emergency always comes along after all. The Charlie Hebdo attack in France is a pertinent recent example: Under the false pretext that this is needed to “fight terrorism”, all cash transaction exceeding €1,000 have been banned in France.
German daily Frankfurter Allgemeine Zeitung, has recently published an article about the “hoarding of cash” by citizens of Switzerland and the euro zone. With interest rates either at zero or negative, the cash currency component of the money supply has increased significantly, as more and more citizens prefer to hoard money under the proverbial mattress. The new European “bail-in” regime, so vividly demonstrated in Cyprus, is a major motive as well. Most recently, Greek citizens have resorted to withdrawing their deposits, with mainly small savers withdrawing cash (large depositors are more likely to simply transfer money to other parts of the euro area that seem safer).
While the article is written in a fairly value-neutral tone, it does mention that the negative interest rate policy of the SNB is hampered by people withdrawing their money from banks. And of course, “hoarding” is always regarded as an unmitigated evil, so the use of this term alone indicates that one should disapprove of this attempt by the citizenry to escape wanton confiscation (we have posted an article a while back in which we explain why contrary to the current Keynesian economic orthodoxy, “hoarding” is not a problem for the economy at all. See “Are US Consumers Evil Hoarders?” for details). So there is a subtle propaganda undertone pervading even this seemingly sober report.
We recently reminisced about the 1980s, when we once opened an account with a German bank. We queued at the cashier’s desk, and when it was our turn, we offered to show our passport to the cashier. He asked: “What do you want to show me your passport for?” “Well”, we replied, “we want to open an account with you.” The cashier remarked to this: “We are not the customs office. There is no need to show us your passport, just fill in the form.” The form was about half a page long and asked for the most rudimentary information. It turned out that it wouldn’t even have been necessary to show up at a bank branch office in person – we could have opened the account by mail as well. Today such a degree of financial freedom appears positively archaic. One almost feels like a criminal just reminiscing about how things once worked.
One Intervention Never comes Alone
Thinking about the ever-growing burden of government intervention in the economy and the increasing regimentation of the citizenry with ever more draconian laws to allegedly ensure its “safety”, we were reminded of Ludwig von Mises’ book Omnipotent Government, published in the mid 1940s. In it, Mises inter alia explains how price controls – unless the government abandons them upon realizing that they don’t work as intended – will inevitably lead to socialism:
“Under a market not manipulated by government interference there prevails a tendency to expand the production of each article to the point at which a further expansion would not pay because the price realized would not exceed costs. If the government fixes a maximum price for certain commodities below the level which the unhampered market would have determined for them and makes it illegal to sell at the potential market price, production involves a loss for the marginal producers. Those producing with the highest costs go out of the business and employ their production facilities for the production of other commodities, not affected by price ceilings. The government’s interference with the price of a commodity restricts the supply available for consumption.
This outcome is contrary to the intentions which motivated the price ceiling. The government wanted to make it easier for people to obtain the article concerned. But its intervention results in shrinking of the supply produced and offered for sale.
If this unpleasant experience does not teach the authorities that price control is futile and that the best policy would be to refrain from any endeavors to control prices, it becomes necessary to add to the first measure, restricting merely the price of one or of several consumers’ goods, further measures. It becomes necessary to fix the prices of the factors of production required for the production of the consumers’ goods concerned. Then the same story repeats itself on a remoter plane. The supply of those factors of production whose prices have been limited shrinks. Then again the government must expand the sphere of its price ceilings. It must fix the prices of the secondary factors of production required for the production of those primary factors.
Thus the government must go farther and farther. It must fix the prices of all consumers’ goods and of all factors of production, both material factors and labor, and it must force every entrepreneur and every worker to continue production at these prices and wage rates. No branch of production must be omitted from this all-around fixing of prices and wages and this general order to continue production. If some branches were to be left free, the result would be a shifting of capital and labor to them and a corresponding fall in the supply of the goods whose prices the government has fixed. However, it is precisely these goods which the government considers as especially important for the satisfaction of the needs of the masses.
But when such a state of all-around control of business is achieved, the market economy has been replaced by a system of centralized planning, by socialism. It is no longer the consumers, but the government who decides what should be produced and in what quantity and quality.”
(emphasis added)
In short, the interconnectedness of the economy’s structure of production means that an intervention in the price system can never remain isolated. Its inevitable failure must lead to further consequences. Ideally, the intervention is abandoned. However, government rarely works that way. Thus, if price controls are introduced for a consumer product, price controls must also be introduced for the products made in the stages of production preceding this consumer product. But even if the entire chain of production involved in the making of a specific consumer product is thereby put under government control, the problem is still not solved from the interventionist perspective.
If prices in one sector are administered by the bureaucracy, more and more capital will leave this sector and seek out opportunities elsewhere. In the end, the bureaucrats will administer an empty shell, and shortages of the good that was the initial target of price controls will be worse than ever. The only logical next step is once again to either abandon the price controls, or expand government controls over industry even further. In the end, there will no longer be a market economy: government will control everything and full-scale socialism will have been imposed – if not in name, then certainly in practice.
Waking Up in a Fascist Prison
Today we can observe this “logic of interventionism” at work in practically every sphere of life. Think about the NSA and its ubiquitous spying. Once upon a time, intelligence agencies tried to obtain specific information by specific means largely in line with legal, above all constitutional, constraints (violations of these constraints undoubtedly occurred, but at least it was clear that they were violations). Today these agencies have arrived in their on version of full-scale socialism.
The STASI – buttonhole camera – a little inconvenient in situations when you had to take off your coat …
Photo credit: W.D.Roth
Not unlike the Stasi of Eastern Germany, they assert that they need to know everything about everybody. Hence, they must put the whole world under constant surveillance in order to “keep us safe”, and in an example of an Orwellian perversion of language, to allegedly “preserve our freedom”. Somehow they have neglected to mention who will keep us safe from them.
Every year, a veritable avalanche of laws and regulations is enacted in the countries of the so-called “free world”. Much of this legislation comes in the form of so-called administrative law. First parliaments vote in favor of a new law – with legislators usually not even finding the time to read the contents of the bills they are voting for – and then the State’s bureaucracies are tasked with formulating the detailed regulations, which of course have the force of law as well. There is no democratic oversight of these processes, because that is physically impossible. How does one “democratically oversee” the creation of tens of thousands of pages of new regulations? Consider e.g. the telephone directory-sized Dodd-Frank Act, which we have previously discussed in these pages. At the time the detailed regulations were about 40% finished, they comprised nearly 14,000 pages. By the time this thing is “ready for action”, it will amount to an entire library of telephone directories. Will it make the financial markets safer? It will likely do the exact opposite, by creating an unwarranted sense of complacency.
Cartoon by Nate Beeler
The constant avalanche of regulations has seeped into every nook and cranny of our lives. Whether it is the amount of water that is allowed to pass through a shower-head every minute, or the emasculation of toasters and vacuum cleaners – we are in the middle of a process of bureaucratic de-civilization. There are now so many laws and regulations on the books, that not even highly specialized experts are able to interpret them anymore, even within their own field of expertise (one can easily test this by asking ten different experts about the same topic. Chances are one will end up with ten different opinions). This obviously opens the door wide for abuse, since not even knowledge of the law can ensure that one will be able to obey its intent – and ignorance of the law is in any event not accepted as a defense. As Bill Bonner recently pointed out, these days “everybody is a criminal”.
The most pernicious trend has been set into motion in the context of allegedly keeping us safe from terrorists, who in terms of the actual danger they represent might as well not exist. It is of course terrible when a terror attack occurs and there are a handful of cases when the toll has been high, but as a rule, our perceptions are skewed by the fact that these events are getting enormous media attention. By contrast, the far higher death toll from e.g. simply crossing the street, drowning in one’s own bathtub, or falling over a misplaced piece of furniture is getting no attention whatsoever. In most cases, terrorism is of course only a pretext anyway, especially in the context of the ever more comprehensive loss of financial privacy.
How did we progress to the point at which even the banning of cash currency is discussed? As Robert Prechter correctly remarked in his assessment of Willem Buiters screed (in which the latter argued that cash should be banned to make it easier for central banks to steal the funds of savers by imposing negative interest rates):
“He says libertarians–people who champion the far-out-of-fashion value of liberty–should “take one for the team.” But central bankers and governments are not some team. They are grasping, corrupt, dissolute, self-interested rulers. This is like slave-owners telling their newest acquisitions to turn in all their production to the slave-master for the good of the team. Go, Slaves! America’s Team!”
(emphasis added)
The very same principle holds true for all other efforts that end up curtailing liberty under the pretext of making society safer or improving it by assorted social engineering measures. Those enacting such laws represent the State, and “we” are definitely not the State. As Prechter says, it consists of “grasping, corrupt, dissolute, self-interested rulers”. Their main interest these days is apparently in creating all-encompassing Orwellian control over the serfs, all the while pretending that this is in the latter’s “best interest”.
The imposition of all the these laws and regulations hasn’t happened all at once. Similar to Mises’ example of how price controls, if pursued to their logical conclusion, must lead to the adoption of socialism, one or two new laws intended to improve our safety can never be enough. There will always be some things that remain out of control, spheres of freedom that criminals might abuse to their advantage. One could always make life easier for the executive if one were to restrict those as well.
Photo credit: Igor Normann
A salami tactic is therefore employed, not least because this ensures that there will be little protest. A new law or regulation may not be seen as overly onerous in isolation. The average citizen may well think – if he or she is even aware of the adoption of a new law: “Oh well, it is a bit creepy” or “it does make life a bit more difficult”, but “if it helps to keep us safer/more prosperous/more free/saves the planet, I can put up with it”. And so one freedom after another is taken away. If pursued to its logical conclusion, no freedom will be left in the end.
Conclusion:
Eventually it won’t even be necessary anymore to put anyone in prison for having violated this or that law; instead, one can simply build a wall around the whole country and put a roof atop, and let the newly militarized police patrol it. At least we will be perfectly safe at that point.
- Moscow Furious After Both Belgium And France Freeze Russian State Assets
Russia has summoned the Belgian ambassador to Moscow and threatened to “respond in kind” after bailiffs instructed nearly 50 Belgian companies to disclose Russian state assets, a move which reportedly sets the stage for the seizure of Russian property in connection with the disputed $50 billion Yukos verdict. Essentially, Russia was required to submit a plan for a €1.6 billion payment pursuant to the ECHR decision by June 15, and because Moscow did not do so, Belgium will attempt to extract the payment on its own.
As a refresher, here’s what we said last year regarding the arbitration:
The Hague is not Vladimir Putin’s favorite place today. Following the “war crime” comments earlier, the arbitration court’s decision to rule in favor of Yukos shareholders (and thus against the allegedly “politically motivated” confiscation of the firm’s assets by the Russian government) with a $50 billion settlement (half what was sought) has prompted a quick and angry response from the Russian government. Blasting the “one-sided use of evidence,” and re-iterating the massive tax evasion that the leadership were involved in, Russia slams “the puzzling unprecedented amount of damages” awarded, claiming the process is “becoming increasingly politicized.”
Here’s RT on Belgium’s move to freeze Russian assets:
The bailiffs were reportedly acting at the behest of the Isle of Man-based Yukos Universal Limited, a subsidiary of the Russian energy giant, dismantled in 2007. They have given the target companies a fortnight to comply..
Russia will appeal the court’s arrest of Russian property, Russian presidential aide Andrey Belousov said. According to the official, “the situation with the arrest of the property is politicized, [and] Moscow hopes to avoid a new escalation in relations.”
A letter accompanying the notice, reportedly drafted by the law firm Marc Sacré, Stefan Sacré & Piet De Smet, accused Moscow of a “systematic failure to voluntarily follow”international legal judgments.
The addressees included not just local offices of Russian companies, but international banks, a local branch of the Russian Orthodox Church, and even Eurocontrol, the European air traffic agency headquartered in Brussels. Only diplomatic assets, such as embassies, were exempt.
The situation was not unexpected, and Russia is considering a number of measures to deal with possible asset seizures both in Belgium and in other countries, said Andrey Belousov, an aide to Russian President Vladimir Putin.
Yukos Universal Limited was awarded $1.8 billion in damages by the Permanent Court of Arbitration in The Hague in July 2014, as part of a total settlement for approximately $50 billion, owed to its former shareholders and management. The court concluded that the corporation, once headed by Mikhail Khodorkovsky, who spent more than a decade in prison for embezzlement and tax evasion from 2003 to 2013, “was the object of a series of politically motivated attacks.”
Russia has not accepted the ruling, saying it disregards widespread tax fraud committed by Yukos, and constitutes a form of indirect retribution for Russia’s standoff with the West over Ukraine.
And more, from Interfax (Google translated):
Russian institutions in Belgium, except for diplomatic missions, received on Wednesday by bailiffs arrest warrants in their possession of the State Property of the Russian Federation.
The document stated that the arrest is made on the basis of the decision of the Belgian Court of Arbitration of 18 July 2014 to the claim of “Yukos Universal Limited.”
The specified amount of the claim in it – 1.6 billion euros.
Bailiffs indicate that the plaintiff has demanded such a measure, “because it has serious concerns about the possibility to receive the sum due, in particular, due to a systematic failure of the Russian Federation to fulfill handed down judgments against it and considering the attitude of the Russian Federation to the decision.”
As explained by “Interfax” the representative offices of bailiffs’ Marc Sacre – Stefan Sacré – Piet De Smet “listed in the organizations are obliged to declare within two weeks at their disposal cash, property of the Russian Federation and the debt to the Russian Federation.
The list covers almost all the major banks, registered in Belgium, and even organizations such as “Eurocontrol”, which regulates air traffic over Europe. In it – all Russian representative, except for the protected diplomatic immunity until the Archbishopric of Brussels and Belgium ROC, including the representation of non-governmental organizations and the media.
But it’s not just Belgium. France also froze the accounts of Russian companies on Thursday, targeting Russian firms run by a French subsidiary of the country’s second largest lender, VTB. Here’s RT again:
French law enforcement has frozen the accounts of Russian companies operated by the French subsidiary of VTB, Russia’s second-largest bank, CEO Andrey Kostin told RBC. Diplomatic accounts were briefly frozen as well, but have since been unlocked. “As of this morning [diplomatic accounts] were unfrozen… The sums are small, some dozens of thousands of euros, [but] Russian companies’ accounts are still frozen,” the bank chief was cited as saying. “We are working on the problem with our lawyers now.”
And the response from the Kremlin:
- RUSSIA SUMMONS BELGIAN AMBASSADOR OVER FREEZES OF RUSSIA ASSETS
- RUSSIA: FREEZES OF ASSETS IN BELGIUM `UNFRIENDLY ACT’
- RUSSIA MAY RESPOND IN KIND TARGETING BELGIAN ASSETS IN RUSSIA
“[Remove the violations], otherwise, the Russian side will be forced to consider taking adequate response measures against properties of the Kingdom of Belgium, including properties of the Belgian embassy in Moscow, as well as of its legal entities”
We imagine this will only serve to further inflame tensions between Russia and Europe amid escalating violence in Ukraine and an increasingly aggressive stance towards the Kremlin on the part of Washington and NATO.
Digest powered by RSS Digest
Saving...
