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[Books] CRB: Giving up Darwin (Scott Johnson) We conclude our week-long preview of the new (Spring) issue of the Claremont Review of Books (subscribe here) this morning. I stretched our preview to from three days to five in part because of my indecision, in part because of my desire to give readers a glimpse of the many highlights on display in this issue. I think we have a good thing going. We conclude with a highlight of Published:5/10/2019 7:07:20 AM
[Markets] Global Stocks Rally Despite Trump Tariff Decision as Talks With China Continue Global stocks rebound despite the U.S. increasing tariffs on China-made goods as investors hope a narrow window in application will pave the way for a trade deal. Tariffs increased to 25% from 10% on $200 billion worth of Chinese imports, but wont' apply to goods already in transit, leaving a two week window during which Washington and Beijing can continue to negotiate. China stocks surge in a late-session rally, Asia books solid gains and Europe opens stronger on the trade optimism. Published:5/10/2019 3:08:57 AM
[Books] CRB: Tucker’s right (Scott Johnson) So far this week we have previewed three stellar review/essays from the new (Spring) issue of the Claremont Review of Books (subscribe here). It is an invaluable magazine for those of us who love penetrating essays on, and reviews of books about, politics, history, literature and culture. We continue this morning with Michael Anton’s review of Tucker Carlson’s book Ship of Fools. Tucker has a book? Well, yes, he does. Published:5/9/2019 6:30:36 AM
[Markets] Quantifying The Economic Effect Of Royal Babies

The Duke and Duchess of Sussex, Harry and Meghan, welcomed their first child to the world this week.

While you may have little to no interest in this, there are at least some substantial benefits to the UK economy when a royal baby is born.

Prince George's birth, for example, is estimated to have brought in £240 million from spending related to celebrations, souvenirs and books etc. Take a look at our infogaphic to learn more about the economic effect of royal babies.

This infographic was researched and designed by Statista Content and Information Design.

Infographic: The economic effect of royal babies | Statista

You will find more infographics at Statista

Published:5/9/2019 2:02:09 AM
[Markets] D Is For A Dictatorship Disguised As A Democracy

Authored by John Whitehead via The Rutherford Institute,

“When a population becomes distracted by trivia, when cultural life is redefined as a perpetual round of entertainments, when serious public conversation becomes a form of baby-talk, when, in short, a people become an audience and their public business a vaudeville act, then a nation finds itself at risk; a culture-death is a clear possibility.”

- Professor Neil Postman, Amusing Ourselves to Death: Discourse in the Age of Show Business

What characterizes American government today is not so much dysfunctional politics as it is ruthlessly contrived governance carried out behind the entertaining, distracting and disingenuous curtain of political theater. And what political theater it is, diabolically Shakespearean at times, full of sound and fury, yet in the end, signifying nothing.

Played out on the national stage and eagerly broadcast to a captive audience by media sponsors, this farcical exercise in political theater can, at times, seem riveting, life-changing and suspenseful, even for those who know better.

Week after week, the script changes (Donald Trump’s Tweets, Congress’ hearings on Robert Mueller’s Russia probe, the military’s endless war drums, the ever-widening field of candidates for the 2020 presidential race, etc.) with each new script following on the heels of the last, never any let-up, never any relief from the constant melodrama.

The players come and go, the protagonists and antagonists trade places, and the audience members are quick to forget past mistakes and move on to the next spectacle.

All the while, a different kind of drama is unfolding in the dark backstage, hidden from view by the heavy curtain, the elaborate stage sets, colored lights and parading actors.

Such that it is, the realm of political theater with all of its drama, vitriol and scripted theatrics is what passes for “transparent” government today, with elected officials, entrusted to act in the best interests of their constituents, routinely performing for their audiences and playing up to the cameras, while doing very little to move the country forward.

Yet behind the footlights, those who really run the show are putting into place policies which erode our freedoms and undermine our attempts at contributing to the workings of our government, leaving us none the wiser and bereft of any opportunity to voice our discontent or engage in any kind of discourse until it’s too late.

It’s the oldest con game in the books, the magician’s sleight of hand that keeps you focused on the shell game in front of you while your wallet is being picked clean by ruffians in your midst.

Indeed, while mainstream America has been fixated on the drama-filled reality show being televised from the White House, the American Police State has moved steadily forward.

Set against a backdrop of government surveillance, militarized police, SWAT team raids, asset forfeiture, eminent domain, overcriminalization, armed surveillance drones, whole body scanners, stop and frisk searches, roving VIPR raids and the like—all of which have been sanctioned by Congress, the White House and the courts—our constitutional freedoms have been steadily chipped away at, undermined, eroded, whittled down, and generally discarded.

Our losses are mounting with every passing day.

Free speech, the right to protest, the right to challenge government wrongdoing, due process, a presumption of innocence, the right to self-defense, accountability and transparency in government, privacy, press, sovereignty, assembly, bodily integrity, representative government: all of these and more have become casualties in the government’s war on the American people.

The American people have been treated like enemy combatants, to be spied on, tracked, scanned, frisked, searched, subjected to all manner of intrusions, intimidated, invaded, raided, manhandled, censored, silenced, shot at, locked up, and denied due process.

None of these dangers have dissipated.

They have merely disappeared from our televised news streams.

The new boss has proven to be the same as the old boss, and the American people, the permanent underclass in America, has allowed itself to be so distracted and divided that they have failed to notice the building blocks of tyranny being laid down right under their noses by the architects of the Deep State.

Frankly, it really doesn’t matter what you call the old/new boss—the Deep State, the Controllers, the masterminds, the shadow government, the police state, the surveillance state, the military industrial complex—so long as you understand that no matter who occupies the White House, it is a profit-driven, an unelected bureaucracy that is actually calling the shots.

In the interest of liberty and truth, here’s an A-to-Z primer to spell out the grim realities of life in the American Police State that no one is talking about anymore.

A is for the AMERICAN POLICE STATE. A police state “is characterized by bureaucracy, secrecy, perpetual wars, a nation of suspects, militarization, surveillance, widespread police presence, and a citizenry with little recourse against police actions.”

B is for our battered BILL OF RIGHTS. In the cop culture that is America today, where you can be kicked, punched, tasered, shot, intimidated, harassed, stripped, searched, brutalized, terrorized, wrongfully arrested, and even killed by a police officer, and that officer is rarely held accountable for violating your rights, the Bill of Rights doesn’t amount to much.

C is for CIVIL ASSET FORFEITURE. This governmental scheme to deprive Americans of their liberties—namely, the right to property—is being carried out under the guise of civil asset forfeiture, a government practice wherein government agents (usually the police) seize private property they “suspect” may be connected to criminal activity. Then, whether or not any crime is actually proven to have taken place, the government keeps the citizen’s property.

D is for DRONES. It is estimated that at least 30,000 drones will be airborne in American airspace by 2020, part of an $80 billion industry. Although some drones will be used for benevolent purposes, many will also be equipped with lasers, tasers and scanning devices, among other weapons—all aimed at “we the people.”

E is for ELECTRONIC CONCENTRATION CAMP. In the electronic concentration camp, as I have dubbed the surveillance state, all aspects of a person’s life are policed by government agents and all citizens are suspects, their activities monitored and regulated, their movements tracked, their communications spied upon, and their lives, liberties and pursuit of happiness dependent on the government’s say-so.

F is for FASCISM. A study conducted by Princeton and Northwestern University concluded that the U.S. government does not represent the majority of American citizens. Instead, the study found that the government is ruled by the rich and powerful, or the so-called “economic elite.” Moreover, the researchers concluded that policies enacted by this governmental elite nearly always favor special interests and lobbying groups. In other words, we are being ruled by an oligarchy disguised as a democracy, and arguably on our way towards fascism—a form of government where private corporate interests rule, money calls the shots, and the people are seen as mere economic units.

G is for GRENADE LAUNCHERS and GLOBAL POLICE. The federal government has distributed more than $18 billion worth of battlefield-appropriate military weapons, vehicles and equipment such as drones, tanks, and grenade launchers to domestic police departments across the country. As a result, most small-town police forces now have enough firepower to render any citizen resistance futile. Now take those small-town police forces, train them to look and act like the military, and then enlist them to be part of the United Nations’ Strong Cities Network program, and you not only have a standing army that operates beyond the reach of the Constitution but one that is part of a global police force.

H is for HOLLOW-POINT BULLETS. The government’s efforts to militarize and weaponize its agencies and employees is reaching epic proportions, with federal agencies as varied as the Department of Homeland Security and the Social Security Administration stockpiling millions of lethal hollow-point bullets, which violate international law. Ironically, while the government continues to push for stricter gun laws for the general populace, the U.S. military’s arsenal of weapons makes the average American’s handgun look like a Tinker Toy.

I is for the INTERNET OF THINGS, in which internet-connected “things” will monitor your home, your health and your habits in order to keep your pantry stocked, your utilities regulated and your life under control and relatively worry-free. The key word here, however, is control. This “connected” industry propels us closer to a future where police agencies apprehend virtually anyone if the government “thinks” they may commit a crime, driverless cars populate the highways, and a person’s biometrics are constantly scanned and used to track their movements, target them for advertising, and keep them under perpetual surveillance.

J is for JAILING FOR PROFIT. Having outsourced their inmate population to private prisons run by private corporations, this profit-driven form of mass punishment has given rise to a $70 billion private prison industry that relies on the complicity of state governments to keep their privately run prisons full by jailing large numbers of Americans for inane crimes.

K is for KENTUCKY V. KING. In an 8-1 ruling, the Supreme Court ruled that police officers can break into homes, without a warrant, even if it’s the wrong home as long as they think they have a reason to do so. Despite the fact that the police in question ended up pursuing the wrong suspect, invaded the wrong apartment and violated just about every tenet that stands between us and a police state, the Court sanctioned the warrantless raid, leaving Americans with little real protection in the face of all manner of abuses by law enforcement officials.

L is for LICENSE PLATE READERS, which enable law enforcement and private agencies to track the whereabouts of vehicles, and their occupants, all across the country. This data collected on tens of thousands of innocent people is also being shared between police agencies, as well as with fusion centers and private companies. This puts Big Brother in the driver’s seat.

M is for MAIN CORE. Since the 1980s, the U.S. government has acquired and maintained, without warrant or court order, a database of names and information on Americans considered to be threats to the nation. As Salon reports, this database, reportedly dubbed “Main Core,” is to be used by the Army and FEMA in times of national emergency or under martial law to locate and round up Americans seen as threats to national security. As of 2008, there were some 8 million Americans in the Main Core database.

N is for NO-KNOCK RAIDS. Owing to the militarization of the nation’s police forces, SWAT teams are now increasingly being deployed for routine police matters. In fact, more than 80,000 of these paramilitary raids are carried out every year. That translates to more than 200 SWAT team raids every day in which police crash through doors, damage private property, terrorize adults and children alike, kill family pets, assault or shoot anyone that is perceived as threatening—and all in the pursuit of someone merely suspected of a crime, usually possession of some small amount of drugs.

O is for OVERCRIMINALIZATION and OVERREGULATION. Thanks to an overabundance of 4500-plus federal crimes and 400,000 plus rules and regulations, it’s estimated that the average American actually commits three felonies a day without knowing it. As a result of this overcriminalization, we’re seeing an uptick in Americans being arrested and jailed for such absurd “violations” as letting their kids play at a park unsupervised, collecting rainwater and snow runoff on their own property, growing vegetables in their yard, and holding Bible studies in their living room.

P is for PATHOCRACY and PRECRIME. When our own government treats us as things to be manipulated, maneuvered, mined for data, manhandled by police, mistreated, and then jailed in profit-driven private prisons if we dare step out of line, we are no longer operating under a constitutional republic. Instead, what we are experiencing is a pathocracy: tyranny at the hands of a psychopathic government, which “operates against the interests of its own people except for favoring certain groups.” Couple that with the government’s burgeoning precrime programs, which will use fusion centers, data collection agencies, behavioral scientists, corporations, social media, and community organizers and by relying on cutting-edge technology for surveillance, facial recognition, predictive policing, biometrics, and behavioral epigenetics in order to identify and deter so-called potential “extremists,” dissidents or rabble-rousers. Bear in mind that anyone seen as opposing the government—whether they’re Left, Right or somewhere in between—is now viewed as an extremist.

Q is for QUALIFIED IMMUNITY. Qualified immunity allows officers to walk away without paying a dime for their wrongdoing. Conveniently, those deciding whether a police officer should be immune from having to personally pay for misbehavior on the job all belong to the same system, all cronies with a vested interest in protecting the police and their infamous code of silence: city and county attorneys, police commissioners, city councils and judges.

R is for ROADSIDE STRIP SEARCHES and BLOOD DRAWS. The courts have increasingly erred on the side of giving government officials—especially the police—vast discretion in carrying out strip searches, blood draws and even anal probes for a broad range of violations, no matter how minor the offense. In the past, strip searches were resorted to only in exceptional circumstances where police were confident that a serious crime was in progress. In recent years, however, strip searches have become routine operating procedures in which everyone is rendered a suspect and, as such, is subjected to treatment once reserved for only the most serious of criminals.

S is for the SURVEILLANCE STATE. On any given day, the average American going about his daily business will be monitored, surveilled, spied on and tracked in more than 20 different ways, by both government and corporate eyes and ears. A byproduct of this new age in which we live, whether you’re walking through a store, driving your car, checking email, or talking to friends and family on the phone, you can be sure that some government agency, whether the NSA or some other entity, is listening in and tracking your behavior. This doesn’t even begin to touch on the corporate trackers that monitor your purchases, web browsing, Facebook posts and other activities taking place in the cyber sphere.

T is for TASERS. Nonlethal weapons such as tasers, stun guns, rubber pellets and the like have been used by police as weapons of compliance more often and with less restraint—even against women and children—and in some instances, even causing death. These “nonlethal” weapons also enable police to aggress with the push of a button, making the potential for overblown confrontations over minor incidents that much more likely. A Taser Shockwave, for instance, can electrocute a crowd of people at the touch of a button.

U is for UNARMED CITIZENS SHOT BY POLICE. No longer is it unusual to hear about incidents in which police shoot unarmed individuals first and ask questions later, often attributed to a fear for their safety. Yet the fatality rate of on-duty patrol officers is reportedly far lower than many other professions, including construction, logging, fishing, truck driving, and even trash collection.

V is for VIPR SQUADS. So-called “soft target” security inspections, carried out by roving VIPR task forces, comprised of federal air marshals, surface transportation security inspectors, transportation security officers, behavior detection officers and explosive detection canine teams, are taking place whenever and wherever the government deems appropriate, at random times and places, and without needing the justification of a particular threat.

W is for WHOLE-BODY SCANNERS. Using either x-ray radiation or radio waves, scanning devices and government mobile units are being used not only to “see” through your clothes but to spy on you within the privacy of your home. While these mobile scanners are being sold to the American public as necessary security and safety measures, we can ill afford to forget that such systems are rife with the potential for abuse, not only by government bureaucrats but by the technicians employed to operate them.

X is for X-KEYSCORE, one of the many spying programs carried out by the National Security Agency that targets every person in the United States who uses a computer or phone. This top-secret program “allows analysts to search with no prior authorization through vast databases containing emails, online chats and the browsing histories of millions of individuals.”

Y is for YOU-NESS. Using your face, mannerisms, social media and “you-ness” against you, you can now be tracked based on what you buy, where you go, what you do in public, and how you do what you do. Facial recognition software promises to create a society in which every individual who steps out into public is tracked and recorded as they go about their daily business. The goal is for government agents to be able to scan a crowd of people and instantaneously identify all of the individuals present. Facial recognition programs are being rolled out in states all across the country.

Z is for ZERO TOLERANCE. We have moved into a new paradigm in which young people are increasingly viewed as suspects and treated as criminals by school officials and law enforcement alike, often for engaging in little more than childish behavior. In some jurisdictions, students have also been penalized under school zero tolerance policies for such inane "crimes" as carrying cough drops, wearing black lipstick, bringing nail clippers to school, using Listerine or Scope, and carrying fold-out combs that resemble switchblades. The lesson being taught to our youngest—and most impressionable—citizens is this: in the American police state, you’re either a prisoner (shackled, controlled, monitored, ordered about, limited in what you can do and say, your life not your own) or a prison bureaucrat (politician, police officer, judge, jailer, spy, profiteer, etc.).

As I make clear in my book Battlefield America: The War on the American People, the reality we must come to terms with is that in the post-9/11 America we live in today, the government does whatever it wants, freedom be damned.

We have moved beyond the era of representative government and entered a new age.

You can call it the age of authoritarianism. Or fascism. Or oligarchy. Or the American police state.

Whatever label you want to put on it, the end result is the same: tyranny.

Published:5/8/2019 11:01:41 PM
[Markets] How The American Culture Of Convenience Is Killing Us

Authored by Daisy Luther via The Organic Prepper blog,

In the United States, we are lucky to have massive convenience at our fingertips. I was talking to one of the instructors for the urban survival course, who is from Sweden, on a car ride. He was blown away by some of the things I told him about the levels of convenience and comfort in the United States. Things I completely took for granted don’t even exist there. I thought some of you might be interested in hearing about some of the insights we discussed.

Before I left for the course, I was walking my dogs a mile or two every day with my dogs, but that was about it. I thought it was enough but I learned during the field exercises that it wasn’t even close to the physicality required during an SHTF situation. But I digress. Let’s get back to convenience.

A caveat before people respond indignantly and tell me about all the inconvenience with which they deal every day: this is an opinion piece. Obviously many people in America still work out hard and have manual jobs. But when two-thirds of American adults and 30% of American children are overweight or obese, you have to see that you are not in the majority.

And it’s the majority here that I’m discussing. Between a combination of low-quality food and extremely sedentary lifestyles, the majority are killing themselves with convenience.

The American Culture of Convenience

The first thing that struck me when I landed in the Balkans was how different their lifestyle is from ours in the United States. But the longer I’ve been here, the more obvious it has become.

In the United States, depending on where you live, everything is dropped in your lap.

Food can be quickly acquired by shouting your order into a microphone and driving around a building, all without you having to leave your car. And if you live in a larger town or city, with the advent of services like GrubHub and DoorDash, the food delivered to your home is no longer the domain of pizza chains. You can have your choice of practically any restaurant in town brought right to your door within 45 minutes.

But it isn’t just about food. Instacart offers pick-up services from a wide variety of stores, including places like chain grocers, Wal-Mart, and Target. All you have to do is drive up, let them know by phone that you’ve arrived, and pop your trunk. Poof. Your shopping is done. In some cities, you can even use services like Instacart to have these things brought to your door.

Amazon has brought us practically anything else we could want with two-day shipping, regardless of where you live in the country. Gone are the days of scouring half a dozen stores to locate the whatchamacallit you needed. A quick search on Amazon and One-Click ordering and it’s yours within 48 hours and you never moved off your comfy chair.

If you need to go somewhere you don’t even have to drive yourself or take public transit. Uber or Lyft will happily send somebody to pick you up and drive you anywhere you need to go for a reasonable price, and you can watch the approach of your driver from the convenience of your phone.

Entire billion dollar industries are evolving to make our lives more convenient and easy every single day. Imagine how stunned our hunter-gatherer ancestors would be to discover we don’t even have to leave the house to be clothed and fed in epic abundance.

We don’t walk much, either.

And speaking of drive-thrus and driving to the store to get your Instacart packages, we drive everywhere. Part of this is because of the way suburbia is developed. It’s rare to live in a neighborhood where you can walk to the market, the bakery, and the wine store. So instead of walking to get our goods, we drive there, dash in, and get back in our cars. Those in big cities probably walk far more than those in suburbia, and for those in the country, it depends if they actually have a place to walk and whether they’re taking care of a large property.

And if we’re not walking to run our errands, we’re not carrying stuff. We get as close as possible with our cars if heavy groceries need to be lugged in and we carry as little as we can if we’re heading somewhere. When you walk the dogs, you might take your phone and some poop bags but you’re generally not taking it as a training opportunity and strapping on a pack.

Then there are the stairs.

Even two-story buildings in the United States have elevators much of the time because everything, by law, has to be easily accessible to every person. (And no, I’m not saying that people in wheelchairs need to try to haul themselves up the stairs. I’m discussing a trend.) But it goes even further than that. Adding elevators to your home is a growing trend in both the United States and Canada. New home builders are including elevators in the original design of some homes.

On the other hand, in Europe, they don’t have elevators in many buildings with fewer than five floors. I walked up and down more stairs in the past month than I have in the past year at home combined, and I live in a three-story house.

And the list of conveniences that would blow the minds of people I met in the Balkans goes on.

It’s an agoraphobic’s paradise in the United States.

You can get all sorts of mobile services that come to your door – everything from hairstyling to dog grooming. Other people mow our lawns, clean our homes, service our vehicles, and take care of us in general. There are even people who hire others to walk their dogs. Some people definitely need help with physical tasks but able-bodied people should be able to do a little yard work, shouldn’t we? Especially if we’re preparing for some kind of apocalypse.

In many areas, things are perfectly level, the sidewalks are carefully maintained (because who wants to ask for trouble in our litigious society), and a slight incline is considered a “hill” that people avoid to make their dog walk a little easier.

You can get meal kits brought to your door with every single ingredient you need to make a gourmet meal, right down to the seasonings accurately doled out in little packages. You can have fresh fruits and vegetables dropped off at your door by your local CSA. You can get subscription services of all types with the delivery of things like cosmetics, fitness gear, food from exotic locales, wine, candy, home decor items, socks, and dog paraphernalia.

Looking at it from the perspective of the area where I’ve been spending time, it’s simply mind-boggling that all of these riches are brought to you at the click of a button.

And it’s killing us.

As I mentioned earlier in this article, the obesity rate in the United States is staggering. A lot of it is our food. Thanks to subsidization by the USDA, many of the foods that are cheap are highly processed with low-quality ingredients. The NY Times reports:

At a time when almost three-quarters of the country is overweight or obese, it comes as no surprise that junk foods are the largest source of calories in the American diet. Topping the list are grain-based desserts like cookies, doughnuts and granola bars. (Yes, granola bars are dessert.)

That’s according to data from the federal government, which says that breads, sugary drinks, pizza, pasta dishes and “dairy desserts” like ice cream are also among Americans’ top 10 sources of calories.

What do these foods have in common? They are largely the products of seven crops and farm foods — corn, soybeans, wheat, rice, sorghum, milk and meat — that are heavily subsidized by the federal government, ensuring that junk foods are cheap and plentiful, experts say.

Between 1995 and 2010, the government doled out $170 billion in agricultural subsidies to finance the production of these foods, the latter two in part through subsidies on feed grains. While many of these foods are not inherently unhealthy, only a small percentage of them are eaten as is. Most are used as feed for livestock, turned into biofuels or converted to cheap products and additives like corn sweeteners, industrial oils, processed meats and refined carbohydrates. (source)

And even when we try to clean up our diets, foods are genetically modified, produce is doused in pesticides, and it’s packaged in all sorts of hormone-disrupting material that leaches in when you heat it up.

But it’s not just the crappy food. A lot of folks in the United States just do not get off their butts. And – I hate to say it – but I’m talking to a lot of people in the survival and preparedness world. Sitting at a keyboard or phone typing all day while Netflix plays in the background is sedentary to a deadly degree. On average Americans sit for 8.2 hours per day and this does not include the average 7-ish hours a day we’re sleeping. And when we’re not sitting, it doesn’t mean we’re doing things that are good for us. We spend a great deal of time standing in line and driving in our cars. And the trend toward inactivity is only increasing.

Meanwhile, obesity contributes to many diseases such as:

  • High blood glucose (sugar) or diabetes.

  • High blood pressure (hypertension).

  • High blood cholesterol and triglycerides (dyslipidemia, or high blood fats).

  • Heart attacks due to coronary heart disease, heart failure, and stroke.

  • Bone and joint problems, more weight puts pressure on the bones and joints. This can lead to osteoarthritis, a disease that causes joint pain and stiffness.

  • Stopping breathing during sleep (sleep apnea). This can cause daytime fatigue or sleepiness, poor attention, and problems at work.

  • Gallstones and liver problems.

  • Some cancers.

The National Institute of Health is incredibly concerned about the future of overweight, sedentary Americans.

More recent evidence points to differential roles for body fat distribution patterns, in addition to excess overall adiposity, in elevating risk of many major chronic diseases. The large numbers of children entering adulthood overweight, together with increased weight gain in adulthood, portend an enormous burden in terms of human suffering, lost productivity, and health care expenditure in the coming decades. (source)

And – since it’s the purview of this website – imagine if the SHTF and you were too overweight and sedentary to go out and acquire the supplies you need to survive. Imagine what will happen when your medication runs out and you have a preventable disease brought on by your sedentary lifestyle. Imagine how your family will feel watching you suffer.

You need to add more movement to your life.

Unless you are among the 23% of Americans who meet the national exercise guidelines, you need to add more movement to your life. I suspect that there are a lot of people who believe they are disabled because getting started on a movement program is hard. It really does hurt, I know. But there’s a very good chance as you begin to move more it will become far easier. Don’t give in to it if your doctor says, “Oh, you’re disabled” and hands you a sticker for your car unless you really, truly are. If there’s even a glimmer of doubt in your mind, try to move just a few more steps each day. Instead of using the scooter to shop, push a cart to give yourself something to lean on. You aren’t training for a marathon – 10 extra steps a day will add up if you keep on pushing. But, MOVE.

The best way to increase movement is to decrease convenience. I don’t mean that you need to suddenly become a hunter-gatherer but you need to get off your duff. (To get started, check out this article or Bug Out Boot Camp and of course, always contact your doctor before beginning an exercise program. Blah, blah, blah.)

You need to carry heavy things instead of getting them delivered. You need to climb the stairs instead of taking the elevator or escalator. You need to actually go inside the store to do your shopping instead of sitting in your car, waiting for stuff to get loaded into your trunk. Park at the back of the parking lot, or better yet, at a store further away. Quit ordering from Amazon and buy things locally so you can walk around the store. Look for the hills and walk up and down them instead of avoiding them. If you want to eat restaurant food, go to the dad-gum restaurant. Find a place to walk to every day – maybe the post office, a coffee shop, or the dog park – and make it part of your routine.

It’s not unusual in other parts of the world to walk 8, 10, or even more miles, every single day. You don’t need to start there but maybe you should strive to get there. Once you’re in your groove, it should only take an hour or so to walk a mile. Using your feet as transportation is one of the healthiest things you can do.

Don’t be a casualty of the culture of convenience.

Published:5/8/2019 9:27:57 PM
[World] BOOK REVIEW: "White' By Bret Easton Ellis


By Bret Easton Ellis

Knopf, $25.95, 272 pages

If there is something to be said about reading books for cultural awareness, then perhaps there is something to be said about Bret Easton Ellis' first non-fiction work, "White." Much like reading Tom Wolfe or Norman Mailer — fine writers each ... Published:5/8/2019 7:59:42 PM

[Entertainment] Kim Kardashian Explains How She Pleaded Alice Johnson's Case Over a Home-Cooked Meal on KUWTK Kim Kardashian, KUWTK 1606A dinner party for the books! In this clip from Sunday's new Keeping Up With the Kardashians, Alice Johnson brings a few family members with her to Kendall Jenner's house, where...
Published:5/8/2019 12:57:25 PM
[Free Speech] Not just another Google mistake (Scott Johnson) All this week we are featuring outstanding reviews and essays from the flagship publication of the Claremont Institute, the Claremont Review of Books. We are featuring one such essay in the adjacent post. It is one of the best magazines in the United States. I should probably add that I am a proud fellow of the Claremont Institute, in my case a purely honorific designation that I occasionally used with Published:5/8/2019 7:25:12 AM
[Europe] CRB: Hungary and the future of Europe (Scott Johnson) In the third installment of our preview of the new (Spring) issue of the Claremont Review of Books (subscribe here), Christopher Caldwell takes up Hungarian prime minister Viktor Orbán. We have featured Caldwell’s several CRB essays on the Muslim immigration that is transforming Europe. As the author of the 2009 book Reflections on the Revolution in Europe: Immigration, Islam, and the West, he knows what he is talking about. His Published:5/8/2019 6:42:11 AM
[Markets] Nuclear War Vs. Belt And Road Initiative: Why China Will Prevail

Authored by Federico Pieraccini via The Strategic Culture Foundation,

The global trend in international relations is often difficult to discern. But one can be helped in this task by looking at two events, organized in Washington and Beijing, comparing the different themes, participants, objectives, and broached for discussion. After all, we are talking about the two largest economies in the world, two colossi directing and shaping global culture, behavior and world opinion.

The last few weeks have offered the international community an opportunity to reflect. Two events took place in Washington and Beijing that, in terms of impact, depth, participation and issues discussed, are striking contrasts.

In Beijing at the Belt and Road Forum over 40 world leaders discussed the Belt and Road Initiative (BRI), a project that will transform the entire Eurasian continent, improving free trade between dozens of countries by investing in transport infrastructure as well as in energy and technological cooperation. The leader of this silent industrial revolution is China’s Xi Jinping, casting ancient ambitions and perspectives into the new millennium, anxious to once again acquire the leading role in global civilization.

The BRI is a gigantic project that will continue to expand in the years to come and at the rate the current technology allows, while of course remaining cognizant of the needs of the countries involved in the Chinese project. The numbers of participants at Beijing’s BRI event are astonishing, with more than 5,000 delegates, 37 heads of state (including that of G7 member Italy), and 10 of the most important members of ASEAN. A hundred and twenty-five countries have signed intentions to cooperate grand project, and 30 organizations have ratified 170 agreements that total a projected investment by the People’s Bank of China of over 1.3 trillion dollars from 2013 to 2027. This is what Robin Xing, Morgan Stanley’s Chief China Economist said:

“China’s investment in B&R countries will increase by 14% annually over the next two years, and the total investment amount could double to $1.2-1.3 trillion by 2027.”

It is a revolutionary project that will characterize the next few decades if not centuries. It will offer a stark contrast to the American drive for hegemonic domination by demonstrating the capacity of humanity to overcome conflicts and wars through cooperation and shared prosperity.

Washington is left demanding loyalty in exchange for nothing (but with Donald Trump, even this little is uncertain). Unable to inflict damage on Russia and China, the US focuses on pressuring her European allies through a trade war of duties, tariffs, technological bans ( Huawei’s 5G) and sanctions (against Iran and European banks) in order to favor US companies.

Reflecting the moral of Aesop’s fable “The North Wind and the Sun”, Beijing behaves in the opposite manner, offering in the BRI project win-win cooperation and the benefits that accrue from this. The project tends to improve people’s living standards through the huge loans extended to improve such basic infrastructure as railways, schools, roads, aqueducts, bridges, ports, internet connectivity and hospitals. Beijing aims to create a sustainable system whereby dozens of countries cooperate with each other for the collective benefit of their people.

The Eurasian continent has struggled over the last few decades to attain the same level of wealth as the West as a result of wars of aggression and economic terrorism committed by countries in search of a utopian global hegemony.

The Chinese initiative aims to offer to all the countries involved equal opportunities for development based not on military and/or economic power but on a real capacity to improve the well-being of all parties involved.

As Asia Times explained in an excellent article on Beijing’s most recent BRI forum:

“BRI is now supported by no less than 126 states and territories, plus a host of international organizations. This is the new, truthful, realistic face of the “international community” – bigger, more diversified and more representative than the G20.”

This Chinese initiative could have only taken place in a post-unipolar world with multiple centers of power. Washington is perfectly aware of the changes that have occurred over the last 10 years, and the accompanying change in attitude of policy makers can be seen in the drafting of two documents that are fundamental for every US administration, namely, the Nuclear Posture Review (NPR) and the National Defense Strategy (NDS).

These two documents explain how the United States sees the world and what it intends to do to fight the emerging multipolar world order. Compared to Obama and his administration, Trump, Bolton and Pompeo are more anchored to the current reality, understanding well that Russia and China are their equal militarily. Obama, of course, infamously dismissed Russia as a regional power no more than five years ago.

Trump cannot afford a conflict with Venezuela, Iran or North Korea, whether militarily or politically. In the case of Venezuela, Colombia and Brazil do not seem too keen on sacrificing themselves on behalf of Washington; and there are no jihadists to arm and launch against defenseless civilians as happened in the Middle East, so there is no force in the field capable of defeating a strongly patriotic nation dedicated to resisting US imperialism. Attacking Iran would result in a devastating Iranian response targeting US troops deployed in dozens of bases scattered throughout the Middle East and inflicting losses that would be too costly for Washington, making any gains made pyrrhic. As for North Korea, Kim cannot be touched thanks to nuclear deterrence.

What remains for Trump and his neocons are empty threats of war, documents declaring Russia and China as opponents to be defeated, and a great deal of war propaganda for the purposes of filling up the coffers of US arms manufacturers.

And now we come to the event organized in Washington as Beijing was busy discussing how to revolutionize three-quarters of the globe. The Brookings Institute, a think tank, organized a meeting that lasted several hours to discuss “The future of US extended deterrence“, focussing on the tools needed to deal with an attack from America’s opponents.

Anyone who has any experience with such conferences knows that it is often companies linked to the arms industry that fund such events, thereby encouraging speakers, guests and politicians to take a very hawkish line for the purposes of scaring the population into justifying an increase in arms spending.

This is exactly what happened at the event organized by Brookings, where the Deputy Undersecretary of Defense from the Trump administration, David Trachtenberg, explained to the audience how the US nuclear deterrent is now coming to the end of its life cycle after a period of 30, 40 or 50 years. The Undersecretary did not mention the overall figure that would be needed to modernize Washington’s entire nuclear triad (estimates put the figure at around a trillion dollars) and preferred instead to speak about a general increase in the defense budget of $60-70 billion dollars to begin to address the problems.

Often the numbers do not prove everything but are nevertheless useful in helping us better understand certain events. Former US President Jimmy Carter provided a useful explanation for how the Chinese came to surpass the United States:

“The US is the most warlike nation in the world, forcing other countries to adopt our American principles. How many miles of high-speed railroads do we have in this country? China has around 18,000 miles (29,000 km) of high speed rail lines while the US has wasted, I think, $3 trillion on military spending; it’s more than you can imagine. China has not wasted a single penny on war, and that’s why they’re ahead of us. I think the difference is if you take $3 trillion and put it in American infrastructure, you’d probably have $2 trillion leftover; we’d have high-speed railroads that are maintained properly. Our education system would be as good as that of, say, South Korea or Hong Kong.”

Washington pressures its allies to join in seeking to damage Washington’s adversaries but ends up pushing allies and opponents closer together, as occurred when it walked away from the JCPOA (Joint Comprehensive Plan of Action) agreement with Iran while the Europeans remained committed to it. Washington may be able to lean on European allies for the time being, but with the vast BRI project increasingly attracting the attention of Europeans, these days may be numbered, especially with the BRI project bringing the prospect of doing away with the US dollar as a reserve currency necessary for trade between countries.

Trump and his administration are acting in a multipolar context as if they are still in a unipolar one, behaving like a hegemonic superpower that does not care about the consequences of its actions, even against allies. This arrogant attitude will come back to bite the United States, not only undermining its economy but also the viability of the US dollar remaining as the global reserve currency.

By Trump behaving like a bull in a china shop, friends and enemies alike are forced to seek ways to counterbalance the United States economically and militarily. Of course Europe still remains subservient to the US, but other countries not in Washington’s good books seem to have understood the historical period we are going through, preferring dialogue and balancing between powers (a typical example being Erdogan’s Turkey, which is in neither camp but uses both for its own purposes) rather than an absolute declaration of loyalty to one side or the other.

China and Russia are perfectly comfortable operating in today’s fluid geopolitical environment, as this gives them the opportunity to offer countries resisting Washington’s hegemony the military and economic means to persevere and eventually prevail. It is an extremely effective strategy as it places before Washington red lines that cannot be crossed, reducing or eliminating the possibility of a new conflict (something that perhaps even Trump basically appreciates, given that this remains the last election promise that he has not yet broken).

Observing these two conferences held in Beijing and Washington within a week of each other, with their contrasting emphases, only highlights the differences between these two countries.

On one side, China seeks integration, cooperation and development for the collective benefit of almost three billion people.

On the other side, we see the US discussing the modernization of its nuclear triad, whose only contribution to humanity is its ability to wipe it out, only there to bully and intimidate those not prepared to kowtow to Washington’s diktats.

Published:5/7/2019 11:40:33 PM
[Barack Obama] CRB: True believers (Scott Johnson) We continue our preview of the new (Spring) issue of the Claremont Review of Books hot off the press. It went into the mail on Monday and is accessible online to to subscribers now. Buy an annual subscription including immediate online access here for the modest price of $19.95. If you love trustworthy essays on, and reviews of books about, politics, history, literature and culture, the CRB may be for Published:5/7/2019 7:11:09 AM
[Markets] More Alarm Bells As Banks Report Lowest Loan Demand Since Financial Crisis

The latest alarm signal that the US economy remains on collision course with a recession, and that the US consumer remains especially burdened by debt and challenged by cash flows despite the record high in the stock market, came after today's release of the latest Senior Loan Officer Opinion Survey (SLOOS) by the Federal Reserve, which was conducted for bank lending activity during the first quarter of 2019, and which reported that while lending standards and terms for commercial and industrial loans remained largely unchanged from already generously easy levels, demand for those loans tumbled to levels not seen since the financial crisis. Even more concerning is that banks also reported weaker demand for both commercial and residential real estate loans for the second quarter in a row, echoing the softer housing data in recent months.

First, the good news: three months after we reported that banks had continued to tighten lending standards in the last few months of 2018, potentially risking a feedback loop of tighter standard and declining demand, banks managed to break the first negative trend, and lending standards for commercial and industrial (C&I) loans remained essentially unchanged over the first quarter of 2019 for both large- and medium-sized firms as well as small firms, and on net terms for large and medium-sized firms eased slightly while terms were basically unchanged for small firms.

Some more details, via Goldman, which notes that relative to the last survey which we profiled here, standards on commercial real estate (CRE) loans tightened on net over the first quarter of the year, if more modestly than last quarter:

  • 14% of banks reported tightening standards for construction and land development loans; 10% of banks reported tightening standards on loans secured by nonfarm nonresidential properties, and 8% of banks reported tightening credit standards on loans secured by multifamily residential properties.
  • Banks reported that lending standards for residential mortgage loans remained largely unchanged on net in Q1 relative to the prior quarter.
  • Banks reported that lending standards on auto loans remained largely unchanged, and about 20% of large banks tightened standards and terms for credit cards.
  • 33% of banks surveyed reportedly narrowed spreads of loan rates over the cost of funds, while 6% widened spreads. 15% on net reported easier loan covenants. Other terms, such as collateralization requirements and premiums charged on riskier loans, remained largely unchanged. Demand for loans reportedly weakened on balance.

And while the lack of further tightening in lending standards was largely unchanged from the prior quarter, despite some instances of tightening, where there was s disturbing trend continuation was in what loan officers responded described as loan demand from large and medium corporations: here, as the chart below shows, the percentage of domestic respondents (i.e., banks) reporting stronger demand for C&I loans tumbled to the lowest level since the financial crisis, which suggests that either nobody needs debt to fund growth, expansion and new projects any more (unlikely), or potential US creditors are so worried about the future and their ability to repay, they refuse to take out any loans in the current business climate.

Digging into the data, banks reported that demand for CRE loans across all categories weakened on net, and demand for construction loans reportedly declined at 27% of banks on net. Similarly, demand for auto loans was basically unchanged, while demand for credit card loans and other consumer loans was moderately weaker. Banks also reported weaker demand across all surveyed residential loan categories, including home equity lines of credit.

It goes without saying, that such a sharp decline in loan demand is not what one would expect in what the BEA would represent is an economy that is growing at a 3%+ annualized rate.

Finally, responding to special questions on C&I lending to firms exposed to developments in Asia or Europe, a "moderate net fraction of banks reported they expect the quality of loans to exposed firms to deteriorate over the remainder of 2019. As a result, banks that have taken steps to mitigate risk of loan losses from such exposures reported the tightening of lending policies on new credit to exposed firms as the most frequently used action over the past year.

* * *

Here would be a good time to remind readers that according to a Reuters investigation conducted in mid-December, when looking behind headline numbers showing healthy loan books, "problems appear to be cropping up in areas such as home-equity lines of credit, commercial real estate and credit cards" according to federal data reviewed by the wire service and interviews with bank execs.

Worse, banks are also starting to aggressively cut relationships with customers who seem too risky, which is to be expected: after all financial conditions in the real economy, if not the markets which just enjoyed the best January since 1987, are getting ever tighter as short-term rates remain sticky high and the result will be a waterfall of defaults sooner or later. Here are the all too clear signs which Reuters found that banks are starting to prepare for the next recession by slashing and/or limiting risky loan exposure:

  • First, nearly half of the applications from customers with low credit scores were rejected in the four months ending in October, compared with 43 percent in the year-ago period, according to a survey released by the Federal Reserve Bank of New York.
  • Second, banks shuttered 7 percent of existing accounts, particularly among subprime borrowers, the highest rate since the Fed started conducting surveys in 2013.
  • Third, home-equity lines of credit declined 8 percent across the industry, with growth slowing in areas such as credit cards and commercial-and-industrial loans, the survey showed.

Then there are the bank-specific signs, starting with Capital One - one of the biggest U.S. card lenders - which is restricting how much it lends to each customer even as it aggressively recruits new ones, CEO Richard Fairbank said last December.

We have been more cautious in the extension of credit, initial credit lines, the broad-based credit line increase programs," he said. "At this point in the cycle, we’re going to hold back on that option a bit."

Regional banks have become more cautious lately as well, as they avoid financing riskier projects like early-stage construction loans and properties without pre-lease agreements (here traders vividly recall the OZK commercial real estate repricing fiasco that sent the stock crashing). New Jersey’s OceanFirst Bank also pulled back on refinancing transactions that let customers cash out on their debt, and has started reducing exposure to industrial loans, CEO Chris Maher told Reuters.

“In a downturn, industrial property is extremely illiquid,” he said. “If you don’t want it and it’s not needed it could be almost valueless.”

What happens next?

While a recession is looking increasingly likely, especially as it becomes a self-fulfilling prophecy with banks slashing loans resulting in even slower velocity of money, while demand for credit shrinks in response to tighter loan standards and hitting economic growth, the only question whether a recession is a 2019 or 2020 event, bankers and analysts remain optimistic that the next recession will look much more like the 2001 tech bubble bursting than the 2007-09 global financial crisis.

We wonder why they are so confident, and statements such as this one from Flagship Bank CFO Schornack will hardly instill confidence:

“I lived through the pain of the last recession. We are much more prudent today in how we underwrite deals.”

We disagree, and as evidence we present Exhibit A: the shock write down that Bank OZK took on its commercial real estate, which nobody in the market had expected. As for banks being more "solid", let's remove the $1.5 trillion buffer in excess reserves that provides an ocean of artificial liquidity, and see just how stable banks are then. After all, it is this $1.5 trillion in excess reserves that prompt Powell to capitulate and tell the markets he is willing to slowdown or even pause the Fed's balance sheet shrinkage.

Published:5/6/2019 4:02:01 PM
[Markets] The Most Powerful Woman On Wall Street Is In Talks To Become Wells Fargo's Next CEO: WSJ

Wells Fargo is reportedly in talks to hire Bridgewater Associates co-CEO Eileen Murray - one of the most powerful women on Wall Street, if not the most powerful - to take the open CEO job, according to WSJ. If the bank succeeds in recruiting Murray, it would both fulfill Charlie Munger's and Warren Buffett's urging to hire its next CEO from outside the Wall Street banking milieu, while also potentially neutralizing the bank's arch-nemesis, Elizabeth Warren, who has successfully scalped the bank's last two leaders. 


Wells, which is still subject to a cap on its balance sheet imposed by the Fed and is still reeling from its infamous cross-selling scandal - where an 'insane incentives regime', as Munger described it during a Monday morning interview on CNBC, inspired branch managers to open millions of fraudulent accounts - as well as a string of other abuses, has been searching for a new CEO since Tim Sloan abruptly quit in March after Warren demanded he resign during a Congressional hearing.

Per WSJ, Murray has had conversations with several people inside the firm about leaving - in keeping with Bridgewater's 'radical transparency' ethos, she has been fully forthcoming - though the prospect of her departure has reportedly filled her co-CEO David McCormick with dread.

In a sign of just how exhausting Bridgewater's culture can be, WSJ reports that Murray has grown 'weary' of leading the world's largest hedge fund, and has discussed jumping ship several times in the recent past. Companies with which she has reportedly been in talks with include Uber, MetLife, BNY Mellon and Northern Trust, among others. Even Murrray, one of Bridgewater's top executives, has shared that according to the firm's internal ranking system she has scored high on creativity, but poorly on organization.

Wells is still in the early stages of its CEO search, but Murray's background would make her an ideal candidate. In addition to being a powerful woman on Wall Street, Murray boasts an inspiring rags-to-riches background, having grown up one  of nine children in a  NYC public housing project. She majored in accounting at Manhattan College before embarking on a storied Wall Street career.

Murray has increasingly taken on duties like meeting with top clients as Bridgewater founder Ray Dalio has shifted his focus to promoting his  books and - oh yeah - trying  to save the American capitalist system from itself.

Should Murray jump ship, Dalio might once again need to step in and help steer the firm on a day-to-day basis, something he was forced to do a few years back after another leadership shakeup.







Published:5/6/2019 11:01:40 AM
[Books] CRB: A kinder, gentler Gulag (Scott Johnson) The Claremont Review of Books is of course the flagship publication of the Claremont Institute. I find in every issue an education in the true understanding of politics, public policy, and statesmanship. It is my favorite magazine. Purchase an annual subscription here for $19.95 and get immediate online access to the whole thing. The Spring 2019 issue of the CRB has just been placed in the mail. The editors have Published:5/6/2019 6:31:56 AM
[Markets] Ending The Pentagon's Long Con

Authored by William Astore via,

Six Ways to Curb America’s Military Machine

Donald Trump is a con man. Think of Trump University or a juicy Trump steak or can’t-lose casinos (that never won). But as president, one crew he hasn't conned is the Pentagon. Quite the opposite, they've conned him because they've been at the game a lot longer and lie (in Trump-speak) in far biglier ways.

People condemn President Trump for his incessant lying and his con games -- and rightly so. But few Americans condemn the Pentagon and the rest of the national security state, even though we’ve been the victims of their long con for decades now. As it happens, from the beginning of the Cold War to late last night, they’ve remained remarkably skilled at exaggerating the threats the U.S. faces and, believe me, that represents the longest con of all. It’s kept the military-industrial complex humming along, thanks to countless trillions of taxpayer dollars, while attempts to focus a spotlight on that scam have been largely discredited or ignored.

One thing should have, but hasn’t, cut through all the lies: the grimly downbeat results of America’s actual wars. War by its nature tells harsh truths -- in this case, that the U.S. military is anything but “the finest fighting forcethat the world has ever known.” Why? Because of its almost unblemished record of losing, or at least never winning, the wars it engages in. Consider the disasters that make up its record from Vietnam in the 1960s and 1970s to, in the twenty-first century, the Iraq War that began with the invasion of 2003 and the nearly 18-year debacle in Afghanistan -- and that’s just to start down a list. You could easily add Korea (a 70-year stalemate/truce that remains troublesome to this day), a disastrous eight-year-old intervention in Libya, a quarter century in (and out and in) Somalia, and the devastating U.S.-backed Saudi war in Yemen, among so many other failed interventions.

In short, the U.S. spends staggering sums annually, essentially stolen from a domestic economy and infrastructure that’s fraying at the seams, on what still passes for “defense.” The result: botched wars in distant lands that have little, if anything, to do with true defense, but which the Pentagon uses to justify yet more funding, often in the name of “rebuilding” a “depleted” military. Instead of a three-pointed pyramid scheme, you might think of this as a five-pointed Pentagon scheme, where losing only wins you ever more, abetted by lies that just grow and grow. When it comes to raising money based on false claims, this president has nothing on the Pentagon. And worse yet, like America’s wars, the Pentagon’s long con shows no sign of ending. Eat your heart out, Donald Trump!

Eternal MADness

"So many lies, so little time" is a phrase that comes to mind when I think of the 40 years I’ve spent up close and personal with the U.S. military, half on active duty as an Air Force officer. Where to begin? How about with those bomber and missile “gaps,” those alleged shortfalls vis-à-vis the Soviet Union in the 1950s and 1960s? They amounted to Chicken Little-style sky-is-falling hoaxes, but they brought in countless billions of dollars in military funding. In fact, the “gaps” then were all in our favor, as this country held a decisive edge in both strategic bombers and nuclear-tipped intercontinental ballistic missiles, or ICBMs.

Or consider the 1964 Gulf of Tonkin Resolution that served to authorize horrific attacks on Vietnam in retaliation for a North Vietnamese attack on U.S. Navy destroyers that never happened. Or think about the consistent exaggeration of Soviet weapons capabilities in the 1970s (the hype surrounding its MiG-25 Foxbat fighter jet, for example) that was used to justify a new generation of ultra-expensive American weaponry. Or the justifications for the Reagan military buildup of the 1980s -- remember the Strategic Defense Initiative (aka “Star Wars”) or the MX ICBM and Pershing II missiles, not to speak of the neutron bomb and alarming military exercises that nearly brought us to nuclear war with the “Evil Empire” in 1983. Or think of another military miracle: the “peace dividend” that never arrived after the Soviet Union imploded in 1991 and the last superpower (you know which one) was left alone on a planet of minor “rogue states.” And don’t forget that calamitous “shock and awe” invasion of Iraq in 2003 in the name of neutralizing weapons of mass destruction that didn’t exist or the endless global war on terror that still ignores the fact that 15 of the 19 September 11th terrorist hijackers came from Saudi Arabia.

And this endless long con of the Pentagon’s was all the more effective because so many of its lies were sold by self-serving politicians. Exhibit one was, of course, John F. Kennedy’s embrace of that false missile gap in winning the 1960 presidential election. Still, the Pentagon was never shy in its claims. Take the demand of the Air Force then for 10,000 -- yes, you read that right! -- new ICBMs to counter a Soviet threat that then numbered no more than a few dozen such missiles (as Daniel Ellsberg reminds us in his recent book, The Doomsday Machine).

To keep the Air Force happy, Secretary of Defense Robert McNamara settled on a mere 1,000 land-based Minuteman missiles to augment the 54 older Titan II ICBMs in that service’s arsenal, a figure I committed to memory as a teenager in the 1970s. And don’t forget that some of those missiles were MIRVed, meaning they had multiple nuclear warheads that could hit many targets. It all added up to the threat of what, in those years, came to be called “mutually assured destruction,” better known by its all-too-apt acronym, MAD.

And the Pentagon’s version of madness never ends. Think, for instance, of the planned three-decade $1.7 trillion “modernization” of the U.S. nuclear triad now underway, justified in the name of “overmatching” China and Russia, “near-peer” rivals in Pentagon-speak. No matter that America’s current triad of land-based, submarine-based, and air-deployed nukes already leave the arsenals of those two countries in the shade.

Reason doesn’t matter when the idea of a new cold war with those two former enemies couldn’t be more useful in justifying the through-the-ceiling $750 billion defense budget requested by President Trump for 2020. The Democrats have pushed back with a still-soaring budget of $733 billion that accepts without question the “baseline” minimum demanded by Pentagon officials, a level of spending Trump once called “crazy.” Talk about resistance being futile!

In other words, when it comes to spending taxpayer dollars, the Washington establishment of both parties has essentially been assimilated into the Pentagon collective. The national security state, that (unacknowledged) fourth branch of government, has in many ways become the most powerful of all, siphoning off more than 60% of federal discretionary spending, while failing to pass a single audit of how it uses such colossal sums.

All of this is in service to what’s known as a National Defense Strategy (NDS) whose main purpose is to justify yet more prodigious Pentagon spending. As Vietnam War veteran and professor at National Defense University Gregory Foster wrote of the latest version of that document:

In the final analysis, the NDS is an unadulterated call for a new Cold War, with all its attendant appurtenances: more gluttonous defense spending to support escalatory arms races in all those ‘contested domains’ of warfare; reliance on bean-counting input measures (weapons, forces, spending) for determining comparative ‘competitiveness’; reinforcement and reaffirmation of the sacrosanct American way of war; and the reassuring comfort of superimposing an artificially simplistic Manichean worldview on the world’s inherent complexity and thereby continuing to ignore and marginalize actors, places, and circumstances that don’t coincide with our established preconceptions.”

Such a critique is largely lost on Donald Trump, a man who models himself on perceived tough guys like Andrew Jackson and Winston Churchill. During the 2016 presidential campaign, he did, at least, rail against the folly and cost of America’s wars in Iraq, Syria, and Afghanistan. He said he wanted better relations with Russia. He talked about reinvesting in the United States rather than engaging in new wars. He even attacked costly weapons systems like the sky’s-the-limit $1.4 trillion Lockheed Martin F-35 fighter.

Suffice it to say that, after two-plus years of posing as commander-in-chief, strong man Trump is now essentially owned by the Pentagon. America’s wars continue unabated. U.S. troops remain in Syria and Afghanistan (despite the president’s stated desire to remove them). Relations with Russia are tense as his administration tears up the Cold War-era Intermediate-Range Nuclear Forces Treaty negotiated by Ronald Reagan and Mikhail Gorbachev.

What to make of the president’s visible capitulation to the Pentagon? Sure, he’s playing to his conservative base, which is generally up for more spending on weaponry and war, but like so many presidents before him, he’s been conned as well. The con-man-in-chief has finally met his match: a national security state that, when you consider its record, has had far greater success at lying its way to power than Donald J. Trump.

The Biggest Lie of All

Now, let’s take a hard look at ourselves when it comes to weaponry and those wars of “ours.” Because the most significant lies aren’t the ones the president tells us, but those we tell ourselves. The biggest of all: that we can continue to send young men and women off to war without those wars ever coming home.

Think again. America’s shock-and-awe conflicts have indeed come home, big time -- with shocking and awful results. On some level, many Americans recognize this. PTSD (post-traumatic stress disorder) is now a well-known acronym. A smaller percentage of Americans know something about TBI, the traumatic brain injuries that already afflict an estimated 314,000 troops, often caused by IEDs (improvised explosive devices), another acronym it would have been better never to have to learn. Wounded Warrior projects remind us that veterans continue to suffer long after they’ve come home, with roughly 20 of them a day taking their own lives in a tragic epidemic of suicides. Meanwhile, surplus military equipment -- from automatic weapons to tank-like MRAPs -- made for the mean streets of Iraq are now deployed on Main Street, USA, by increasingly militarized police forces. Even the campus cops at Ohio State University have an MRAP!

Here, Americans would do well to ponder the words of Megan Stack, a war correspondent for the Los Angeles Times who drew on her own “education in war” when she wrote: “You can overcome the things that are done to you, but you cannot escape the things that you have done.” She was undoubtedly thinking about subjects like the horrors of Abu Ghraib prison in Iraq, torture at the CIA’s “black sites,” cities rubblized in the Greater Middle East, and refugees produced by the tens of millions. Somehow, sooner or later, it all comes home, whether we as Americans admit it, or even realize it, or not.

“Here is the truth,” Stack notes:

“It matters, what you do at war. It matters more than you ever want to know. Because countries, like people, have collective consciences and memories and souls, and the violence we deliver in the name of our nation is pooled like sickly tar at the bottom of who we are. The soldiers who don’t die for us come home again. They bring with them the killers they became on our national behalf, and sit with their polluted memories and broken emotions in our homes and schools and temples. We may wish it were not so, but action amounts to identity. We become what we do... All of that poison seeps back into our soil.

And so indeed it has. How else to explain the way Americans have come to tolerate, even celebrate, convenient lies: that, for instance, Tomahawk missile strikes in Syria could make a feckless figure like Donald Trump presidentialor even that such missiles are beautiful, as former NBC Nightly News anchor Brian Williams once claimed.  Imagine if leading media and political figures boasted instead of taking on the Pentagon, reining in its ambitions, and saving taxpayers trillions of dollars, as well as countless lives here and overseas.

Ending the Pentagon’s Long Con

War is the ultimate audit and, as any American should know, the Pentagon is incapable of passing an audit. Sadly, even when Congress acts to end U.S. support for a near-genocidal war that has nothing to do with any imaginable definition of national defense, in this case in Yemen, President Trump vetoes it. Remember when Candidate Trump was against dumb and wasteful wars? Not anymore. Not, at least, if it involves the Saudis.

The best course for this country, unimaginable as it might seem today, is to fight wars only as a last resort and when genuinely threatened (a sentiment that 86% of Americans agree with). In other words, the U.S. should end every conflict it’s currently engaged in, while bringing most of its troops home and downsizing its imperial deployments globally.

What’s stopping us? Mainly our own fears, our own pride, our own readiness to believe lies. So let me list six things Americans could do that would curb our military mania:

1. Our nuclear forces remain the best in the world, which is hardly something to brag about. They need to be downsized, not modernized, with the goal of eliminating them -- before they eliminate us.

2. The notion that this country is suddenly engaged in a new cold war with China and Russia needs to be tossed in the trash can of history -- and fast.

3. From its first days, the war on terror has been the definition of a forever war. Isn’t it finally time to end that series of conflicts? International terrorism is a threat best met by the determined efforts of international police and intelligence agencies.

4. It's finally time to stop believing that the U.S. military is all about deterrence and democracy, when all too often it’s all about exploitation and dominance.

5. It's finally time to stop funding the Pentagon and the rest of the national security state at levels that outpace most of the other major military powers on this planet put together and instead invest such funds where they might actually count for Americans. With an appropriate change in strategy, notes defense analyst Nicolas Davies, the U.S. could reduce its annual Pentagon budget by 50%.

6. Finally, it's time to stop boasting endlessly of our military strength as themeasure of our national strength. What are we, Sparta?

The Pentagon will never be forced to make significant reforms until Americans stop believing in (and consenting to) its comforting lies.

Published:5/5/2019 10:59:52 PM
[Markets] How The 'Real' America Is In Harmony With China's Belt And Road Initiative

Authored by Matthew Ehret via The Strategic Culture Foundation,

The new rules proposed by Xi Jinping and expressed by the BRI’s political economic practices are exactly what the best American patriots fought for...

Since Donald Trump’s 2016 election, waves of strange paradoxes have presented themselves to the world. With the blatant collaboration of nominally “American” forces from the CIA, FBI, NSA, the Pentagon, and MSM who conspired directly with international agencies such as the Five Eyes and MI6 to overthrow Trump, it has become evident that there isn’t one single America, but rather two opposing forces within America acting against each other. So what really is the “real” America? When Donald Trump calls for US-China-Russia collaboration, is that just an anomaly or is something truly American being expressed?

In reviewing some history, you might be shocked to discover that the Belt and Road Initiative is more American than the America which the world has come to know over the past 50 years.

The American Revolution as an International Struggle

The fact that the American Revolution was an international affair is made evident by the fact that without the collaboration of the leadership of Russia, France, as well as many powerful forces in Poland, Spain, Germany the revolution could never have succeeded. Catherine the Great led the League of Armed Neutrality ensuring arms and funding to the rebelling colonies while the great Polish general Kosciusko working with German and French military officers were organized to help train and lead the American farmers during this battle.

American support was not limited to Europe however, as the South Indian Mysore rebellion against the British East India Company was organized by pro-American Muslim leader Hyder Ali which tied up British troops from being deployed to America. Ali was so admired that American poems were written about him and in 1780 a sixteen gun war ship was set from Philadelphia to do battle with the British Navy named the Haidar Ali. In Africa, under Emperor Sidi Mohammed’s direction, Morocco was the first nation to recognize American independence in 1777. The nation also harbored American ships, protecting them from British-controlled Barbary pirates with George Washington later writing letters of thanks to the Sultan of Morocco.

Many of these international forces were organized over decades by the brilliant planning of Benjamin Franklin who wrote extensively that America should model itself on the best principles of Confucianism and even argued for the modelling of America’s civil service upon China’s meritocracy. Franklin’s discoveries in electricity were directly tied to his concept of natural law and statecraft earning him the reputation of the “Prometheus of America”. Even the greatest artists of Europe such as Mozart, Schiller, and Beethoven were inspired by the idea that the American experience was merely the precursor to a new age of reason that would soon liberate Europe from the shackles of oligarchism. Not only was Schiller’s great poem Ode to Joy an homage to this hope for a brotherhood of mankind, but so was Beethoven’s later musical expression of it in his 9th Symphony.

The Sabotage of the New Paradigm

While some United Empire Loyalists left the USA to set up English-speaking Canada (creating a British-controlled beachhead in the Americas ever since), some traitors such as Aaron Burr (VP under Jefferson) chose to stay behind and work to undermine America from within by killing American System founder Alexander Hamilton and setting up Wall Street as a Junior partner to the City of London. These networks are the roots of today’s anglophile Deep State.

As the spirit of American republicanism in Europe was crushed under the British-sponsored Jacobin Terror, Napoleonic wars and then the iron fist of monarchism with the 1815 Congress of Vienna, British-Deep State puppets increasingly dominated America, advancing a program of imperial thinking and slavery throughout the 1830s-1850s leading into the Civil War. A leading proponent of the true American spirit was Lincoln’s bodyguard William Gilpin, who played an instrumental role as Governor of Colorado during the Civil War. With a vision of Lincoln’s transcontinental railway extended to Asia, Gilpin famously said:

“Salvation must come to America from China, and this consists in the introduction of the “Chinese constitution” viz. the “patriarchal democracy of the Celestial Empire”. The political life of the United States is through European influences, in a state of complete demoralization, and the Chinese Constitution alone contains elements of regeneration. For this reason, a railroad to the Pacific is of such vast importance, since by its means the Chinese trade will be conducted straight across the North American continent. This trade must bring in its train Chinese civilization. All that is usually alleged against China is mere calumny spread purposefully, just like those calumnies which are circulated in Europe about the United States”.

China’s “founding father” Sun Yat-sen, an avowed follower of Abraham Lincoln composed his International Development of China (1920) calling for international construction of rail, ports and resources from China throughout Eurasia connecting to Europe and Russia (a precursor to today’s BRI). In his work he echoed Gilpin’s vision by saying “The nations which will take part in this development will reap immense advantages. Furthermore, international cooperation of this kind cannot but help to strengthen the Brotherhood of Man.”

The Spirit of the New Paradigm Sabotaged Again and Again and Again…

In the wake of the Civil War, (and British orchestrated murder of Lincoln from Montreal Canada), Gilpin and other Lincoln allies such as William Sumner, and Ulysses S. Grant fought to spread the “American System of Political Economy” across the world and nearly succeeded in fulfilling what the American Revolution failed to do with Russia’s Alexander II applying this system to build the Trans-Siberian rail, American statesmen helping to build rail and national credit under the Meiji Restoration in Japan, and pro-American forces in Germany, France and beyond industrializing themselves with rail, national credit, protective tariffs and industrial growth programs. Gilpin went the furthest in illustrating this grand design with his 1890 book “The Cosmopolitan Railway” uniting all continents in railways and calling for something which looks a lot like the Belt and Road Initiative today.

Envisioning this new just world order of sovereign republics cooperating on the common aims of humanity, Gilpin wrote: “The civilized masses of the world meet; they are mutually enlightened, and fraternize to reconstitute human relations in harmony with nature and with God. The world ceases to be a military camp, incubated only by the military principles of arbitrary force and abject submission. A new and grand order in human affairs inaugurates itself out of these immense concurrent discoveries and events”

British-orchestrated assassinations and wars aborted the birth of this new era however. The 20th century was shaped by a battle between opposing forces within America. On the one side were true patriots fighting to return to the global vision of win-win cooperation and on the other side, anglophile traitors of the Deep State.

Although valiant efforts to end the cold war and usher in this new paradigm were made by John F. Kennedy, Charles De Gaulle and later Robert Kennedy, the Anglo-American alliance grew over their dead bodies and a hellish growth of empire unfolded from 1968 onward. While bold opposition to this New World Disorder occasionally arose from nationalist leaders in Africa, Asia and Latin America, very little was done to keep this torch alive from within America itself aside from the considerable efforts of American economist Lyndon LaRouche. As the British-Deep State gained dominance of the Trans-Atlantic during the NAFTA-1990s and Post-911 world, a new system had been quietly forming to finalize what the American Revolution had sought to do in 1776.

A New Opportunity with the BRI

Surprisingly, it was at one of the darkest hours in humanity’s experience that this new hope began to show its full power. As the collapsing bubble of a banking system was compelling a desperate elite to risk nuclear war with the newly formed alliance of Russia and China, the New Silk Road (Belt and Road Initiative) was announced presenting an incredible opportunity to avoid thermonuclear extinction by changing the “rules of the game”. Echoing the spirit of William Gilpin and Sun Yat-sen, China’s President Xi Jinping recently said:

“To respond to the call of the times, China takes it its mission to make new and even greater contribution to mankind. China will work with other countries to build a community with a shared future for mankind, forge partnerships across the world, enhance friendship and cooperation, and explore a new path of growing state-to-state relations based on mutual respect, fairness, justice and win-win cooperation. Our goal is to make the world a place of peace and stability and life happier and more fulfilling for all.”

These new rules proposed by Xi Jinping and expressed by the BRI’s political economic practices are exactly what the best American patriots fought for, and so the question becomes: will America finalize the intention of the American Revolution by work by joining the New Silk Road or fail to recognize its own destiny?

Published:5/5/2019 9:57:43 PM
[Markets] The Fed Will Give Banks A $36 Billion Taxpayer-Funded Subsidy This Year

Submitted by Elliott Middleton

Before 2009, the Fed did not pay interest on banks' excess reserves held at the Fed. This practice was introduced as a taxpayer-funded subsidy to the banks during the crisis (taxpayer-funded because the Fed turns over any profit at the end of the year to the Treasury).

After beginning this practice, the Fed's chief trader, Simon Potter, realized it could be used to raise interest rates without expelling excess reserves from the Fed, by sucking liquidity out of the short-term markets. In fall 2015, it began raising the interest rate on excess reserves, with the anticipated effect.

At a current rate of about $36 billion a year, this is a cost to the Treasury that is indefensible. This amount is about half the budget for food stamps, for example, which politicians want to cut. There is no provision for these funds ever to be paid back. It is welfare for the bankers.

If the banks had been required to take excess reserves back onto their books it would have required financial disclosure of their quality, which is probably toxic for many. However, with the Financial Accounting Standards Board recently promulgating Financial Accounting Statements 56 and, previously, 157, the "extend and pretend" statement, it would seem they feel less and less need for financial disclosure of any kind. FAS 56 states that the government does not have to disclose what it spends taxpayers' money on because of national security concerns.

Finally, much akin to the situation in Europe, where trillions of dollars are held at negative interest rates (which are supposed to make people "spend," but which in fact are an abomination and a crime against nature, IMHO), the Fed's recent interest rate increases represent a far-from-equilibrium situation, that, much like a currency peg, may be subject to abrupt reversal.

Until a modicum of transparency is returned to financial accounting, both monetary and fiscal policy are flying blind. The world staggers under its load of bad (i.e., unpayable) debt being carried on banks' books.

I provide a wonky exploration of these comments in "A Partial Equilibrium Analysis of Current US Monetary Policy with a Prediction"

Published:5/4/2019 5:50:59 PM
[Markets] "Big Money Coupled With Cheap Money" Never Ends Well...

Authored by Chris Martenson via,

'The Company Store'... leaving almost nothing to live on

In the song Sixteen Tons by Merle Travis (and made famous by Tennessee Ernie Ford), the idea of the ‘company store’ referred to a system of debt bondage that effectively trapped workers within an unfair system designed to harvest all of their labor at very low cost.

You load sixteen tons, what do you get?

Another day older and deeper in debt

Saint Peter don’t you call me ’cause I can’t go

I owe my soul to the company store

       Sixteen Tons – Merle Travis

How exactly did the company store system operate?

Under a scrip system, workers were not paid cash; rather they were paid with non-transferable credit vouchers that could be exchanged only for goods sold at the company store. This made it impossible for workers to store up cash savings.

Workers also usually lived in company-owned dormitories or houses, the rent for which was automatically deducted from their pay.

(Source – Wiki)

This model was simple enough to understand.  “Pay” your workers with scrip vouchers, then sell them your marked up goods at the company store, pocketing a nice profit. On top of that, force your employees to live in company housing, too,  also at terms very favorable to the company.

Add it all up and the workers found themselves in perpetual service to their employer. No matter how hard and long they toiled, there was nothing left for their own private benefit after all was said and done.  The company succeeded in skimming off any and all  ‘excess’ for itself.

This vast unfairness eventually led to the formation of unions as well as to regulations providing protection to the workers.

However, capital never sleeps; and the human temptation to skim and take what they can for themselves is a constant in every hierarchical, post-agriculture society.  If the idea of “the company store” was too obvious, then a better method of achieving the same outcome had to be hatched.  Something with sufficient additional complexity to defeat the ability of the average worker to detect the nature of the scam.

The Financialization Of The Company Store

Which brings us to today’s so-called financial markets.  Or ““markets”” as I prefer to refer to them, because they don’t actually represent a free and fair system where prices are set fairly.  The scam today that’s enabled by these ““markets”” is every bit as egregious as the company store of old; only today’s victims are mostly blind to the way that the system is rigged against them.

It’s just sophisticated enough that it mostly evades detection.  Or is diffuse enough that even if the scam were detected by a participant, whom would they protest against?  The markets?  The exchanges? Any of the thousands of funds or private money institutions that are feasting off of the system?

It’s a genius set-up.  The harvesting is every bit of a violation as the old model, but it’s almost impossible to prosecute.

The main losers in this battle, as before, are the primary producers of value: those who labor to extract the primary wealth of the Earth and bring it to market.  The farmers, the ranchers, the fishermen, the loggers, the miners, and the refiners.


Let’s illustrate how this works for farmers. Or, rather, works against them.

The price of any commodity is now set in the financial markets, principally within the futures market where paper contracts are bought and sold by three main participants: producers (the farmers), consumers (ag and food companies) and speculators.

In a free and fair world, the price of a commodity should reflect the actual supply and demand for its derived products.  We should observe some sort of relationship between the primary source of wealth – the corn, wheat and soybeans for example – and the end food products that consumers buy in the store.

I’m going to show you a bunch of commodity data that goes back to the late 1990’s.  So let’s start here: inflation has advanced 56% since 1998 according to the BLS and has increased by 60% for food as a subcomponent:

This is a low-end estimate of how far food has actually advanced in price due to inflation over the past 20 years, as the CPI persistently underestimates inflation.

Turning now to the farmer, how have the prices received for their products fared over that same stretch of time?  In the case of corn, not one single bit.  A bushel of corn sells for the exact same (nominal!) price today as it did back in 1996:

Now think of all the input costs a farmer has to pay to run his or her farm.  In 1998, oil traded at $11.61 per barrel.  Today its cost is 390% higher than that.  At our recent annual seminar (April 26-28, Sebastopol CA, replay video available), a gentleman from Nebraska informed me that the cost of a bushel of seed corn has advanced from $40 to over $400 today.

Fertilizers are much more expensive versus 20 years ago. So are tractors, farm land itself, water…you name it.  Every single farm input cost has risen strongly over the few decades, but the price of corn is exactly the same as it was 23 years ago.

Meanwhile, the consumer has seen the price of a box of cornflakes increase by 44% on average since 1998, from $2.29 per 18-ounce box to $3.28:

How do the farmers survive this squeeze on their (already tiny) profit margins?  How do they cope with flat prices for corn and huge increases in input costs?

One way is by abusing their soil — using GMOs, heavy fertilizer and herbicide applications and other tricks to squeeze as much short-term productivity out of every acre they can.

But beyond these productivity improvements, which eventually hit a point of diminishing return, what else can a producer do with rising costs and flat revenue?

Well, they can go deeper into debt:

The above chart is of farm mortgage debt.  Total farm debt across all credit instruments hit a new record in 2018 of more than $409 billion.

Today’s remaining farmers are forced to take on more and more risk.

Here’s a table for Nebraska that details the plight.  Note that while net farm income remained relatively flat between 2002 and 2015, family living expenses exploded in parallel with total farm debt:


Expressed as a percentage of revenue, the net profit margins of farms have plunged from 6.3% to just 3.0%.  That’s a very skinny margin which leaves very little room for error. One bad season and all reserves are chewed up (and then some):

More than half of U.S. farm households lost money farming in recent years, according to the USDA, which estimated that median farm income for U.S. farm households was negative $1,548 in 2018.

Farm incomes have slid despite record productivity on American farms, because oversupply drives down commodity prices.


See the narrative in play?  “There’s farm oversupply”. If that were the case then food prices would come down to bring supply and demand into equilibrium. But that’s not happening.

Instead, the farmers eat the losses. But the rest of the food delivery chain keeps its prices intact and pockets the difference.

Our farmers work exceptionally hard, labor-intensive jobs to produce an absolute essential input to human life. And yet somehow, when all is said and done, they’re left with barely more for their efforts than the coal miners trapped in the system of the company store.

Take away a bit of complexity and it’s the same exploitative system as before. It’s just a little less obvious. And instead of a company foreman or owner to rail against, the perpetrators are much more obscure and shadowy.

The Scam

The principle of any scam is the same as for any successful parasite: take as much as you can but leave the host somewhat alive.

Here’s how the modern ‘company store’ scam works.

First, you have to convince everyone that money has value, and that that value is very real.  Make people crave it and work for it, and take away all of their property and belongings if they run out of it.  Do this long enough to reinforce the idea that money is everything. You either have it or you don’t. It need to be regarded as tangible and essential .

At the other end of the spectrum, for the big players, print up and distribute as much digital money as needed by the big players to run their various schemes and scams.  If they ever get in big trouble, make up a fancy sounding name like TARP or TALF or QE and then talk about how you ‘had to do it’ to save the system and prevent a systemic crisis.

Next, be sure that your regulators are unable (though incompetence and/or neglect) to detect price manipulation in the financial markets under even the most egregious of circumstances.  No matter how obvious such manipulation is, it’s vital that no investigations be undertaken and, if they are, that they take many years to conduct and come to the conclusion that no wrongdoing happened.

Finally, allow an unmanageable swamp of high frequency computer algorithms to take over securities trading, creating a system that is so complex, so secretive and so ripe for fraud and abuse that nobody can unravel the complexity to detect that a scam is even happening.

Using this ecosystem of legalized theft, then have the various crooks involved monkey the prices of key commodities to levels that — surprise! — leave hardly any breathing room for the farmers, miners, loggers and refiners to live within.

Now that the scam has been exposed, the appropriate question to ask is, “if the producers aren’t getting the benefit of their labor, then who is?”  The people running this scam — the financiers, the bankers and their moneyed clients — are the beneficiaries.  They make oodles of money, while performing no real work, and taking very little real risk, same as any other natural-born parasite.

The Abuse Is Widespread

In case you think that I cherry-picked corn as an example particularly favorable to my case, I assure you I didn’t.  Here are several key commodities suffering the same abuse:

Regarding the above chart of silver, there are two important factors to note.

First, it’s practically impossible to ‘get better’ at mining silver because the ore grades have been declining each year as companies burn through their very best ores in a quest to remain alive. From that alone, we’d expect to see prices climbing higher over long stretches of time like this.

Second, the business is very energy and capital-intensive.  Yet silver is now at the same price as it was back in 2006, 13 years ago.

The orange oval in that chart reveals a decade of pure price suppression that many miners did not survive. This tells us that these scams have been alive and well for a long time.

The Bitter Conclusion

Run this scam long enough and one day we’ll discover that the banks and their proxy agents - private equity funds, hedge funds, endowments, and family offices, etc - own all of the productive farmland, all of the mines, all of the oil wells, all of the timberland, and every other means of primary wealth production.

The former farm and mine owners will be offered roles as “managers” or other types of tenant-farmer arrangements, essentially working for whatever income the labor market can see fit to provide.  It won’t be much.

At that point, the entire economy will have become a “company store”.

We’re well on our way there.  The Federal Reserve prints up oodles of money and it goes into “the financial system” which is a code phrase for “to the big banks and big money outfits.”  They in turn use these funds to make loans to the primary producers on the one hand, and to drive down the price of commodities with the other hand.

Eventually, the farmer has a bad couple of years and his farm is foreclosed on.  The land goes up for auction and bought by the highest bidder…which means the buyer with the most money.  That increasingly means a big-money type that feasts at the trough of the banking system/money-printing machine.

The next thing you know, vast swaths of farmland magically end up in the hands of those with money, which – surprise! – usually turn out to be the same entities feasting on the central bank/free-money machine that’s been operating ever since Alan Greenspan set this slow motion train wreck in process in the late 1990s:

Who really owns American farmland?

July 31st, 2017

The answer, increasingly, is not American farmers.

Today, the United States Department of Agriculture (USDA) estimates that at least 30 percent of American farmland is owned by non-operators who lease it out to farmers. And with a median age for the American farmer of about 55, it is anticipated that in the next five years, some 92,000,000 acres will change hands, with much of it passing to investors rather than traditional farmers.

But what about the people—often tenant farmers—who actually work the land being acquired? During the same period that farmland prices started gaining steam, many crop prices have stagnated or fallen. After hitting highs above $8 a bushel in 2012, corn prices today have fallen back to less than $4 a bushel—about what they were ten years ago, in 2007, when farmland prices first started to soar.

It’s a tenuous predicament, growing low-cost food, feed, and fuel (corn-based ethanol) on ever-more-expensive land, and it raises a host of questions. Is this a sustainable situation? What happens to small farmers?


Ageing farmers, increasing ownership of farmland by financial investors, and utterly dismal economics – what’s not to love?

The sorry conclusion to all this is that one day, not too far away, we’ll wake up and discover that the majority of US farmland belongs to mega corporations and financial interests, most of whom came across their vast gobs of wealth as a consequence (and a predictable one at that), of the Federal Reserve policy that spurred today’s great wave of financialization.

An explosion in farmland prices really kicked into high gear with the Fed’s quantitative easing (QE) programs following the Great Recession – freshly printed money that wound up in the hands of financial firms and interests with few good ideas of where to put it.  So some of it leaked over into farmland.

The same dynamic has seen firms like Blackrock tap into ultra-cheap Fed money to buy up vast swaths of US housing stock —  just to rent back to the same people who couldn’t compete against this leviathan’s all-cash offers, using money that was 75% cheaper than the terms regular borrowers receive.

Big Money coupled to Cheap Money leads to this outcome.  Every time.

Eventually you wake up and discover, with a few clicks on a keyboard, that the bankers and financiers have taken possession of every productive asset. And everybody else has to pay into the company store.

This isn’t an accident either, which is why it really galls me to have Janet Yellen, the former Fed Chair, out there for years making the ludicrous claim that the Federal Reserve is ‘not political.’

What could possibly be more political than enabling the removal of the productive assets of a nation – it’s land, its houses, and its mineral rights – and facilitating and cheering their acquisition by a very tiny financial elite?

That’s practically the most political act there is.

More tragically, it’s just a gussied-up version of working for the company store.  We’ve gone backwards. And not in a good way.

As one tragic story in a recent article goes:

It was a Sunday in April 2017 when a queasy feeling in Darrell Crapp’s stomach sent him rushing home. He found his wife, Diana, lying crumpled on the floor of their Lancaster, Wis., bathroom. She had swallowed a handful of pills.

Overwhelmed with debt and with little prospect of turning a profit that year, the Crapps knew BMO Harris Bank NA wouldn’t lend them money to plant. The bank had frozen the farm’s checking account.

Mrs. Crapp managed the fifth-generation corn, cattle and hog farm’s books. She had stayed up nights drafting dozens of budgets to try to stave off disaster, including 30-day, 60-day and 90-day budgets.

“It was too much for her,” Mr. Crapp, 63, said of his wife, who survived the incident.

Crapp Farms filed for chapter 11 bankruptcy the next month, with a total debt of $36 million.

In a written statement, Patrick O’Herlihy, a BMO spokesman, said the bank doesn’t comment on specific customer relationships but strives to “approach every situation with empathy, and to help our customers manage challenging financial situations.” He said the bank had been working in the agricultural sector for more than a century and was committed to the industry.

At its height, Mr. Crapp and his two sons had grown crops on 17,000 acres. The farm’s last 197 acres, homesteaded by Mr. Crapp’s ancestors in the 1860s, will likely be auctioned this month.

Mr. Crapp now sells farmland for a regional realty company and helps run the family’s trucking business, which transports grain and livestock feed for area farmers. His younger son drives trucks for the company. His older son repairs grain storage bins. Mr. Crapp said he would have to file bankruptcy again—likely under chapter 12—to discharge his remaining debts.

“We haven’t won very many battles,” said Mr. Crapp. “The bank pretty much owns us.”


That’s straight up the 2019 version of the Sixteen Tons refrain: “I owe my soul to the company store”.

What the politicians, financial institutions, and Federal Reserve are defending and supporting is a system that utterly lacks in integrity and is strikingly heartless.

If we want to create a world worth inheriting, that means we cannot afford a system that forces farmers to fight for their very livelihoods each and every year, barely hanging on, and forced to cut costs to even survive.

Cutting costs and boosting productivity means more pesticides, less soil building and a resting, fewer crop varieties, and every other measure of health and complexity upon which our very survival as a species depends.

All in service of money.

In Part 2: It’s Time To Respond, we detail why it’s so pressing right now to mobilize into action.

The opportunity, such as it is, is for us to first recognize this game for what it is (rigged), to take steps to escape the smothering squeeze of financialization being applied to all of us in today’s economy, and then to realign our own actions with the future we wish to see.

Click here to read Part 2 of this report (free executive summary, enrollment required for full access).

Published:5/4/2019 10:47:47 AM
[Donald Trump] Seven books in May: The Mueller Report (Scott Johnson) I want to bring several books to the attention of Power Line readers this month. I would have to push to get to seven books, and I may get there if I stretch it, but I am doubtful. The number comes to mind because the first such book is the Mueller Report and the attempted coup from which it derives. I just received the edition published by Skypole Books, with Published:5/3/2019 8:43:02 AM
[World] BOOK REVIEW: 'The Enchanted Hour' by Meghan Cox Gurdon


By Meghan Cox Gurdon

Harper, $26.99, 304 pages

To develop a true passion of reading, it's important to consume books with your inner and outer voice. The former is taught to us in our homes and ... Published:5/2/2019 8:08:57 PM

[Politics] Baltimore Mayor Pugh Resigns Amid Children’s Book Scandal

Catherine Pugh, who took an indefinite leave of absence last month as Baltimore's mayor, resigned Thursday amid a scandal involving lucrative deals of her self-published children's books.

The post Baltimore Mayor Pugh Resigns Amid Children’s Book Scandal appeared first on Washington Free Beacon.

Published:5/2/2019 5:08:48 PM
[World] 'The Mueller Report' is now officially a best-selling book Two published versions of the report found their way onto USA TODAY's Best-Selling Books list.
Published:5/2/2019 4:38:27 PM
[Markets] Baltimore Mayor Resigns As 'Healthy Holly' Corruption Scandal Snowballs

Barely a week after FBI and IRS agents raided her two homes, office at city hall and a non-profit belonging to a friend, Baltimore Mayor Catherine Pugh's lawyer said Thursday that his client would resign, making her the second Baltimore mayor to leave office under a cloud of corruption in the past decade.

Pugh, who has been on a leave of absence since April 1, the same day that Gov. Larry Hogan said he would call for a criminal investigation into allegations of self-dealing, reportedly tried to make a run for it after the raids. Shortly beforehand, members of the city council signed a letter asking her to resign.


According to the Washington Post, Pugh's resignation brings her more than two-decade career in politics to an end. Her candidacy for mayor was championed by Elijah Cummings (yes, that Elijah Cummings) one of Maryland's most influential politicians, and she initially triumphed in a hotly contested primary as the city reeled from the aftermath of the Freddie Gray riots.

A scandal erupted in March when the Baltimore Sun revealed that Pugh, who sat on the board of the University of Maryland Hospital System, was paid half a million dollars for 100,000 copies of her "Healthy Holly" children's books (there's suspicion that half of these books were never even delivered, yet Pugh was paid in full).

But more galling, Pugh was also paid $100,000 by Kaiser Permanente, the managed care consortium that was in the process of securing a $48 million contract with the city.

Her departure will usher in another era of political instability in a city that's struggle with high levels of violent crime and deep mistrust of the police following the Gray killing and several other corruption scandals.

Council President Bernard C. "Jack" Young, 64, who has been serving as acting mayor in Pugh's absence, will replace Pugh at the helm of city government until next year’s election, where he said he would not seek another term.

Utilizing language favored by President Trump, Pugh initially derided the "Healthy Holly" scandal as a "Witch Hunt" before issuing a public apology.

Though facing potential criminal charges, Pugh's position as mayor was relatively secure: According to the city charter, there is no way for the council or the governor to remove her from office.

Which suggests to us that she got the tap from prosecutors that they wanted her to resign as the investigation ramps up.

Published:5/2/2019 4:38:27 PM
[Politics] Baltimore Mayor RESIGNS after the feds raided her home and offices… The Democratic mayor of Baltimore has just resigned less than a week after the FBI and IRS raided her home and offices over a scandal involving self-published children’s books: REUTERS – Baltimore . . . Published:5/2/2019 4:08:19 PM
[Politics] Baltimore Mayor RESIGNS after the feds raided her home and offices… The Democratic mayor of Baltimore has just resigned less than a week after the FBI and IRS raided her home and offices over a scandal involving self-published children’s books: REUTERS – Baltimore . . . Published:5/2/2019 4:08:19 PM
[World] BOOK REVIEW: 'Lasers, Death Rays and the Long, Strange Quest for the Ultimate Weapon' by Jeff Hecht


By Jeff Hecht

Prometheus Books, $25, 295 pages

According to ancient — and highly dubious — mythology, a laser beam was first used as a weapon around 215 BCE, when Roman invaders threatened the Grecian city of Syracuse. ... Published:5/1/2019 7:02:00 PM

[Markets] Real Money Post-Industrial Average Leaves Major Indices in the Dust Tuesday we closed the books on the month of April and even as signs of a slowing global economy rolled in, the so far better-than-expected tone of the March-quarter earnings season lifted all the major domestic stock market indices, furthering their year-to-date gains. Entering May, RMPIA is up more than 20% year to date, well ahead of the S&P 500 and the DJIA. What's been driving RMPIA's impressive gains of late? Published:5/1/2019 6:31:30 PM
[Markets] Blast From The Past

Authored by Sven Henrich via,

“Those who cannot remember the past are condemned to repeat it.” – George Santayana

Are market participants poised to learn this lesson the hard way? Perhaps they should listen to a blast from the past, the lessons of Richard Wyckoff.

Who was Richard Wyckoff?

“Richard was an active trader and analyst in the early 1900s, his career coincided with other Wall Street greats including Jesse Livermore, Charles Dow and JP Morgan. Many have called this the “golden age of technical analysis.”

“Richard Wyckoff began his Wall Street career in 1888 as a runner, scurrying back and forth between firms carrying documents. As with Jesse Livermore in the bucket shops, Wyckoff learned to trade by watching the action firsthand. His first trade occurred in 1897, when he bought one share of St. Louis & San Francisco common stock. After successfully trading his own account several years, he opened a brokerage house and started publishing research in 1909. The Magazine of Wall Street was one of the first, and most successful, newsletters of the time.  As his stature grew, Wyckoff published two books on his methodology: Studies in Tape Reading (1910) and How I Trade and Invest in Stocks and Bonds (1924).”

Why may market participants of today want to listen to Richard Wyckoff?  Because he developed this market cycle pattern:

A period of accumulation/consolidation a massive mark-up run, then a bunch of back and forth called distribution, and then note the final new high at the end there, followed by a reversal markdown process that reverses it all.

Does this structure look at all familiar to you? If not, it really should:

Let me overlay lines outlining the larger moves of the past few years onto the chart and you get this:

Remove price and you get this structure:

Now compare this to Wyckoff’s market cycle structure:

Are there some differences? Sure there are, smaller deviations have to be allowed for, the key is the larger structure and it fits the larger $SPX structure quite closely.

The structure suggests that the 2014-2016 time frame was the accumulation phase, the run between 2016 into early 2018 was the mark-up phase and the period since January 2018 has been the distribution phase.

What phase are we in now? Here’s a bit more detail on the final topping phase:

If the pattern is applicable it suggests with current new highs we’re in phase C, the UTAD (upthrust after distribution) test.

The definition:

“Upthrust after Distribution.  This last gasp rally from support occurs occasionally, and will drive the stock price above resistance and the prior price peaks in the distribution trading range. Price rallies with conviction and often has big leaping bars and volume. Once at new highs, price can stay above the resistance area for days to weeks. The conviction of this rally and breakout will attract a following of buyers. After a series of tests, price begins to sink back below the prior peaks and in short order is heading back to the Support area. After a UTAD, price becomes persistently weak to and through support and into a confirmed downtrend”.

Key takeaways:

Phase C is much shorter compared to the previous phases and any new highs will not sustain suggesting that prices above the September 2018 highs are ultimately a selling opportunity.

This process of new highs could be short lived, a matter of days or it could drag out for weeks perhaps even months, but any price advances from here would be limited.

For reference I offer 2015. Prices peaked early in May, frustrated for 3 months and then dropped fast:

But the Wyckoff pattern is suggestive of something more sustained than a quick August 2015 move to come. Rather is suggests not only new lows versus December it suggests an ultimate move back to the accumulation price range meaning back to the 2015 highs or around 2100-2150 $SPX.

What’s the upside risk to stocks here and still fit the pattern? Ironically the price risk range I outlined with the broadening top pattern in Combustion:

Wyckoff’s pattern however does not require for the upper trend line in the chart above to be reached. It can reverse at any time, but strongly suggests some back and forth probing and testing at new highs first before a confirmed breakdown.

The main message of the pattern goes to the question of sustainability of new highs which I recently discussed in my most recent video analysis:

How will we know if the pattern applies to our markets today?

When we see evidence that the break above the September 2018 highs on $SPX does not sustain and price falls back below the 2940 area and then fails to regain it. Then the pattern suggests that the 2019 gains will not only be given back, but that new lows are to come. A price destination that the broadening top pattern is also suggesting.

Until then: Party hardy at your own risk. But remember: “Those who cannot remember the past are condemned to repeat it.” – George Santayana

*  *  *

For the latest public analysis please visit NorthmanTrader. To subscribe to our market products please visit Services.

Published:5/1/2019 12:59:26 PM
[Markets] "Workarounds" Galore: How Real Americans Deal With "Real" Inflation

Authored by Charles Hugh Smith via OfTwoMinds blog,

It’s the list of workarounds - always growing, never shrinking - that’s telling us the true story of inflation in America.

Today I'm publishing a guest post by writer Bill Rice, Jr., on "real inflation,"which as everyone knows far exceeds the "official" inflation rate of 2%. Bill and I corresponded earlier this year when he was researching and writing his recent article What Does Your Toilet Paper Have to Do With Inflation? Manufacturers have been engaging in "shrinkflation," leaving consumers paying more for less, but stealthily. (The American Conservative magazine)

Bill's extensive list of links (50 Dots...) follows his essay. Thank you, Bill, for sharing your insightful research with Of Two Minds readers.

‘Workarounds’ galore: How real Americans deal with ‘real’ inflation By Bill Rice, Jr.

While working on a story on inflation and shrinkflation, I quickly zeroed in on the concept of “workarounds” as an alternative, perhaps superior, way to gauge the true state of our economy. I define workarounds as the changes individuals or families (or businesses) must make in their daily living to adapt to a world of rising prices. If nothing else, these examples, taken in the aggregate, challenge the conventional wisdom that inflation is “low” or “contained,” or that the economy is just fine, thank you.

As decades have passed, the list of workarounds families have utilized to deal with rising prices has rapidly grown.

Women and mothers entering the workforce in massive numbers - the disappearance of families where one income was sufficient to maintain a “constant standard of living” - might be the earliest and most important workaround on my list. Other trends from this expanding list include:

Shoppers switching to less expensive store or private-label brands, families “substituting” hamburger or chicken for steak, buying from “value” menus, couponing, shopping at discount or “dollar” stores more often, buying in bulk to get the lowest unit-cost (think Costco), buying more items at yard sales or from Internet swap meets, “cutting the cord,” cancelling the land line, getting fewer haircuts per year, taking clothes to the dry cleaners less often, cutting out the maid service or paying for it fewer times each month, attending sporting events less often (here, here, here and here), going to the movies less frequently, playing golf or hunting less frequently, dropping out of country clubs and civic clubs, going to the dentist less often, cancelling newspaper and magazine subscriptions …

Cremation instead of burial, casual instead of (more expensive) “business” attire, eliminating or “rationing” prescription medications, moving from high cost-of-living states (or cities) to lower-cost-of-living communities, adult children moving back in with their parents (and aging adults moving in with their grown children), car-pooling and now “car sharing," the growth of “do-it-yourselfers,” delaying or “reversing” retirement, taking on a part-time job … the list of “workarounds” goes on and on.

Americans have always resorted to workarounds to counter rising prices or help “make ends meet.” However, the list of necessary workarounds has “absolutely” been increasing Ron Paul told me, a trend he said is “going to continue to grow.”

As it always has, the market place has rewarded businesses that helped families save money.

Then again, lower prices do not necessarily equal a higher standard of living, a point made by John Williams, the creator of ShadowStats, the best known “alternative” measure of inflation.

To illustrate the difference between simply compiling prices without taking into account reductions in the quality of goods (or of “buying experiences”), Williams cited the example of his long-time tailor, who eventually had to close his haberdashery as customers fled to the mall and more affordable prices.

Yes, Williams could still buy clothes (in fact for a lower price), but the quality had diminished; so too had the level of service. The experience of acquiring clothes was not as satisfying or memorable. His question: Had he in fact maintained a “constant standard of living” by “substituting” suits from, say, JC Penney for the finer suits and richer experiences he had grown accustomed to?

Walmart assuredly saves consumers money. However, it also helped kill the downtown merchant, and with it our Norman Rockwellish memories of downtown America. “Self serve” killed the neighborhood “full-service” filling station, saving customers 40 cents a gallon on a fill-up, but also taking away our grandmother’s ability to get her tires and oil checked and her windshields cleaned on a regular basis (not to mention eliminating a popular first-time job for many males).

Netflix killed the neighborhood video store. Clothes that don’t require pressing, as well as employers allowing casual attire in the workplace, thinned the ranks of dry cleaners. iTunes largely killed the record store. Craigslist helped kill the (more expensive) newspaper classified section, expediting the slow death of the journalism industry. Barnes & Noble placed the independent book store on the extinction list, before Amazon threatened this same retailer.

Today, Uber is killing the taxi driver. Hulu and streaming video services threaten cable and the TV networks. TD Ameritrade threatens the traditional stock broker. Aldi (with its more affordable private label brands) threatens Kroger. Walmart, once unchallengeable, is today threatened by Amazon and Dollar General. People choosing to make their own turkey sandwich probably contributed to Subway closing more than 1,100 of its stores.

Most of these innovations/trends/changes kept CPI lower than it would have been otherwise, but did they actually allow people to maintain the same “standard of living” they enjoyed in prior years? Some innovations probably did; others probably did the opposite.

And how exactly did families from prior periods of time (often with just one income) afford to pay those full-service gas prices, or trade with the downtown hardware store instead of Home Depot?

Today it’s uncomfortable to think about, but in working on this story, a question I’d never thought about suddenly occurred to me. Namely, how did so many middle and upper-middle class families (families with just one income from the “poor” South) actually afford the full-time domestic “help” depicted in the movie and book of the same title?

Was everyone richer back then? Or is inflation higher today? Or, in “real” terms, is it possible the answer is “both?”

Labeled by Ron Paul as the “cruelest tax,” inflation is not a trivial topic, especially for the poor and those on fixed incomes. Even if people manage to “get by,” their new “standard of living” cannot be described as improved, superior or welcome.

Yes, the “Ten Percent” are doing better than ever, but is this really the case for the bottom 50 or 60 percent? If real standards of living were rising would it be this easy to identify so many “workarounds?”

All of these workarounds and business trends have been noticed. Details have been provided in journalism, academic papers, books and seminars.

What’s missing from much of this coverage is any effort to connect all the dots. That is, for some reason, the elephant in the room is too often ignored. The “elephant?” Practically every trend mentioned above shares one common antecedent - prices that, in the minds of consumers, had become unaffordable.

Perhaps we never pause to add up all the workarounds we are using. We might think about our decision to drop out of the civic club (and save on those membership dues), but we don’t tally up the other 10 changes we made for the exact same reason. If more people did this, inflation might become a bigger political issue than it is.

In fact, this might already be happening. In a country where so many people are forced to employ so many workarounds to make ends meet, politicians of a certain ideological bent might see a grand opportunity. In such a nation, for example, one might see a surge in presidential candidates suddenly espousing more liberal or even socialist “solutions.”

At least at the micro level of the economy, families are increasingly forced to deal with a reality they’ve been told is not a reality. Today’s economic conventional wisdom tells us that rising prices are no big deal. Indeed, we’re told what the economy really needs is more inflation.

But in a country where 46 million Americans rely on charity food banks to supplement their food intake, and 42 million qualify for food stamps, and millions more Americans are forced to max out credit cards to purchase necessities, do we really need higher prices?

Another trend I identified was the proliferation of payday and title loan businesses. Montgomery, AL (population 200,000) has nearly 100 such businesses, according to one city councilman. (By way of comparison, the city has 11 McDonald’s restaurants.)

One council member proposed an ordinance to limit the growth of such “stores.”

"If you see 18 of them on a main thoroughfare going into our city, it makes you think that the people who live around here must be desperate,” he said.

Well... yes. Apparently providing “quick cash” is another workaround created by entrepreneurs to serve (some say exploit) “desperate” people.

In researching this topic, I read dozens of stories on inflation. I also read the Reader Comment sections that followed these stories. As a measure of “Man on the Street” sentiment, these message boards were often more illuminating than the articles proper.

While Fed governors, academics and the business press declare that inflation is “low” and “contained,” real, live Americans are calling BS.

If one is seeking to determine whether inflation is a bigger deal than we are being told, simply read the Reader Comments. And then add up all the changes Americans have been forced to make in their lives to keep up with rising prices.

At least in my opinion, it’s this list of workarounds - always growing, never shrinking - that’s telling us the true story of inflation in America.

Bill Rice, Jr. is a freelance writer in Troy, Alabama. He can be reached at

Connecting 50 dots...

Do headlines, presented in aggregate, reveal a story that’s not being fully told?

The 50 headlines listed below support the thesis that - perhaps more than ever - families and individuals must adopt “workarounds” to deal with rising prices and an economy that may not be as robust as portrayed in the media. The list is not comprehensive. Others can certainly identify trends or workarounds not immediately identified by the author. (Research by Bill Rice, Jr.)

Women enter workforce...

“Women enter workplace in massive numbers, death of 1-income family” (source)

Private label and store brands...

“Surge in customers buying Private Label brands described as retail ‘revolution’"(source)

Chicken, it’s what’s for dinner...

Chicken vs. Beef Consumption Comparison 1960 to 2018 - Chicken catches, blows past beef (source)

“2014: (Cheaper) Chicken more popular than beef for first time” (source)


“Coupon use (traditional and digital) soars, trend expected to grow” (source)

Shopping at ‘discount’ stores...

“Dollar General now has more stores than McDonald’s” (source)

Buying in bulk...

“Costco crushed it in 2018” (source)

‘Value’ menus...

“Fast food prices are rising, but so are deals” (source)

Yard sales, Swap meets...

“Why an old-school tradition is more popular than ever” (source)

“550 million people visit formal ‘buy-and-sell’ Facebook Groups each month” (source)

Cutting the cord...

“Cord-cutting keeps churning, 33 million people abandon pay TV in 2018” (source)

Cancelling the landline...

“Most households have given up the landline” (source)

Fewer haircuts...

Number of people getting 4 or more haircuts a year declines by 10 million (59 million in 2018 compared to 71.X million (?) in 2011) - Statista chart (source)

Using dry cleaners less often...

“In Illinois: Dry cleaning establishments decline by 50 percent over last 20 years”(source)

Declining attendance at sporting events...

      - NFL:

“Empty seats galore at NFL games” (source)

     - College Football:

“The Growing Problem of College Football Attendance” (source)

     - MLB:

“MLB attendance down 4 percent” (source)

     - NASCAR:

“NASCAR, Daytona numbers continue to sag” (source)

Movie theater attendance...

“Domestic movie theater attendance hit 25-year low in 2017” (source)

Golf anyone?...

“Why are we playing less golf?” (source)

Hunting ...

“Hunting participation numbers continue to drop - and it’s a sorry situation” (hunters drop from 18 million to 10.5 million) (source)

Country club memberships...

“Money-losing country clubs adapt to changing times” (source)

Civic club memberships...

“Are service clubs dying?” (Rotary memberships decline by 70,000) (source)

Dentist office visits...

“Survey: More Americans want to visit the dentist (but visits drop by 4 percent)(source)

Cancel my subscription...

“Paid circulation at newspapers declines by 11 percent in 2017” (source)

“Time was giving magazines away for free” (source)

Slow death of newspaper industry ...

“Newspaper crisis is growing: More than 1 in 5 local newspapers have closed since 2004” (source)


“In 16 states studied: Homeschooling grew by 25 percent in 4 years” Note: I deleted this one from story for for space reasons. (source)

Cremation over burial...

“Why is cremation becoming more popular in the U.S.?” (Growth described as ‘astronomical’) (source)

Casual is fine...

“Why Americans now dress so casually?” (source)

Voting with feet, plenty of Americans are moving out...


“41 percent of New Yorkers say they are going to leave” (source)


“Why are so many people moving out of the Northeast?” (source)

Rationing or eliminating prescription medications...

“How to pay less for your meds?” (source)

Moving back in with parents (or parents moving in with children)...

“More than 1/3 of young adults live at home (up from 26 percent)” (source)

“Aging adults moving in with children” (source)

Car pooling...

“Car pooling on the rise again?” (source)

And now car sharing...

“The big trends shaping the future of the car-sharing industry” (source)

Do It Yourself (DIY)...

“Why the huge do-it-yourself market is just getting started” (source)

Delaying retirement...

“More than half of 60-somethings say they are delaying retirement” (source)

Reverse retirement...

“Many retirees (one third) are going back to work” (source)

Part-time employment...

“America’s part-time worker problem is permanent, San Francisco Fed says” (source)

“More Americans need a second job to make ends meet” (source)

Making our own sandwich...

“Subway closed 1,100 restaurants in 2017” (also: 500 more in 2018) (source)

Self-serve took Gomer’s job...

“‘They’re like dinosaurs:’ But at least one full-service gas station still exists” (source)

Deflation fears... Wanted: More inflation

“Why is deflation a Central Bank’s worst nightmare?” (source)

Do we really need higher prices?...

“Feeding America serves 46 million people” (source)

“Food Stamp recipients number 42 million in 2017” (source)

“Credit card balances at all-time highs” (source)

Payday, title loan stores proliferate in many states...

"Payday lending has blossomed over past 20 years" (source)

“Number of Americans who took out title loans doubled in recent years” (source)

“Councilmen seek moratorium on payday lenders” (source)

*  *  *

If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via New benefit for subscribers/patrons: a monthly Q&A where I respond to your questions/topics.

Published:5/1/2019 10:35:16 AM
[Media] Ben Shapiro has the perfect caption for Jim Acosta’s photo of Jim Acosta recording Jim Acosta’s audiobook

It's a dangerous time for journalists to record the audio versions of their books, but Jim Acosta is forging ahead.

The post Ben Shapiro has the perfect caption for Jim Acosta’s photo of Jim Acosta recording Jim Acosta’s audiobook appeared first on

Published:4/30/2019 4:23:35 PM
[] Was Game of Thrones Disappointing, or a Disaster? I actually thought it was all right, but then, 1, I haven't really cared very much about the show since it got bad during season 5, or the books since they got bad in books 4 and 5, and 2,... Published:4/30/2019 4:23:35 PM
[Markets] All That's Missing Is A Black Swan...

Authored by Jeff Thomas via,

"There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved."
- Ludwig von Mises

The chart above only goes back to 1960, but its message is clear, nevertheless. The velocity of money has dropped below that which was necessary to maintain a productive economy in 2009 and has never recovered.

The velocity of money can be defined as, “the rate at which money circulates or is exchanged in an economy in a given period.” It’s generally measured as a ratio of gross national product (GNP) to a country's total money supply.

No money turnover… no economy.

But, if that’s so – if the chart is correct and the money turnover is by far the lowest since 1970 - why did the economy recover after 2010 and why are we in a bull market? Surely, the quantitative easing programme initiated by the Fed corrected the problem and happy days are here again.

Well, actually, neither of those commonly-held assumptions is correct. Quantitative easing didn’t pump money back into the failing economy and, more to the point, it wasn’t intended to. Most of the money that was created through quantitative easing never actually hit the streets.

To back up a bit, in 1999, the Fed, then under Alan Greenspan, convinced the US government, then under President Bill Clinton, to repeal the Glass Steagall Act, an act created in 1933 to assure that banks would never again recklessly create loans to the public that could never be repaid. Mr. Greenspan argued that the Great Depression was long over and there would not be a reoccurrence but that, if the Clinton Administration would repeal Glass Steagall, it would usher in an era of investment of borrowed money that would create the greatest surge in business since World War II.

And he was correct in his argument. The repeal ushered in a period of reckless loans that accomplished two things – it allowed the Clinton Administration to end on a positive note – one in which the economy appeared to be vibrant. However, it also created a mammoth debt bubble.

As is always true, the creation of massive debt is like a shot of economic heroin in an economy. The euphoria is very real. Unfortunately, so is the withdrawal. This withdrawal kicked in with the real estate crash of 2007.

The Fed (which, if you remember, had created the bubble) recommended that, although the bankers had benefitted enormously through the creation of the debt, they were now in trouble. Rather than have them pay for their misdeeds, the Fed Chairman put forward the concept of quantitative easing (QE). Through QE, the government would pump money into the banks to bail them out. Therefore the banks benefitted hugely from the reckless loans, then benefitted hugely again, through the debt-funded QE.

The pretense was that QE would be used to pay off bad loans, re-energising the economy. And, interestingly, enough money was pumped into the banks through QE1, 2 and 3 to literally write off every mortgage in the country. Had that been done, those cleared of debt would indeed have had the ability to re-invest in the economy.

But that isn’t what happened. Very little of the money that was created actually hit the street. It was simply gobbled up by the banks.

A by-product of the crash is that it brought on the Greater Depression. Real income has not increased since 2007, but inflation has. Although the US government claims inflation to be at 1.52%, it’s actually far higher – over 5%.

Likewise, unemployment is claimed to be at 3.8%, yet the real unemployment rate (as calculated by John Williams’ Shadowstats) is over 21%.

By any of these measures, the US is unquestionably in a depression.

But, hang on, what about the markets? The stock market is booming. Yes, quite so. It has become the norm for companies to buy back their own stocks. Although, this is economically dangerous, it does temporarily inflate the apparent value of the stocks and politicians do point to the stock market boom as proof of their sound fiscal management.

And, of course, there’s the bond market. It’s at an all-time high.

But bonds are debt, plain and simple. And a bond is merely a promise to pay the lender back with interest on a future date. The more bonds in the market, the more debt.

And so, we see a boom in markets that’s a false-reading. It was created entirely through debt and that debt is now in a bubble of historic proportions.

All of the other indicators (if we use the correct figures, not the ones the government has helpfully ginned up) confirm that the US is decidedly in a depression.

But, if that’s so, why doesn’t it feel like a depression?

Well, the answer to that is, once again, the economic heroin. At this point, the regular injections of heroin are massive enough to provide a euphoric high. The only problem is that, when the heroin runs out, the withdrawal will be one for the record books.

Global debt has reached $100 trillion, up from $13 trillion in 1990. Debt now represents 57% of global financial assets. At $18.4 trillion, the US has the largest treasury debt in the world, close to 40% of the total.


What goes up must come down. And, if there remains any doubt as to whether, this time around, the Keynesian tooth fairies have some sort of pixie dust that will make the problem go away, we need only have a look at the chart above, which was produced by the Fed itself.

In the real world of Main Street, the velocity of money has declined dramatically since 2009 and has tanked in 2017, unable to recover.

Conditions overall could not be worse for a crash more massive than any the US has ever seen in its 243 year history.

At present, all that’s holding up the house of cards is the mistaken faith that the average citizen has that the false numbers are correct – that his country is bumping along nicely. When he figures out that that was a lie, it’s game over.

All that’s required to eliminate the notion and to send the economy into a tailspin is a black swan event.

Will it be the dumping of treasuries back into the US system, as is now on the increase? Will it be the full implementation of CIPS, the Chinese interbank payment system? Will it be the elimination of the dollar as the petrodollar, as is now underway?

Any one of these and perhaps another dozen other black swans are waiting in the wings. All that’s needed is for one of the swans to walk onto the world stage.

*  *  *

Clearly, there are many strange things afoot in the world. Distortions of markets, distortions of culture. It’s wise to wonder what’s going to happen, and to take advantage of growth while also being prepared for crisis. How will you protect yourself in the next crisis? See our PDF guide that will show you exactly how. Click here to download it now.

Published:4/29/2019 10:19:03 PM
[Markets] Measles Cases Highest In 25 Years...And It's Only April

As more than 1,000 students have been quarantined in California and New York State has begun issuing expensive summons to at least 12 unvaccinated people who have dared to defy its mandatory vaccination order, the CDC on Monday confirmed that the number of measles cases documented in the US since the beginning of the year has climbed to 704 cases in 22 states, the largest number of cases documented in a single year since 1994...and it's only April.

The outbreaks are a huge setback for public health officials in the US, who had declared that measles had been eliminated back in 2000.


The worst outbreaks have been documented in Orthodox Jewish communities in Brooklyn and New York's Rockland County. Some 88% of cases have been associated with these religious communities. To combat the outbreak, NYC has instituted a policy of mandatory vaccinations, and Rockland County has threatened a $2,000-a-day fine for any unvaccinated individuals who mix with the general public.

In a statement Monday, Health and Human Services Secretary Alex Azar underscored the seriousness of the outbreaks: "We have come a long way in fighting infectious diseases in America, but we risk backsliding and seeing our families, neighbors, and communities needlessly suffer from preventable diseases. We are very concerned about the recent troubling rise in cases of measles. Vaccine-preventable diseases belong in the history books, not in our emergency rooms. The suffering we are seeing today is completely avoidable. Vaccines are safe because they are among the most studied medical products we have."

Currently, the US leads the developed world in the number of unvaccinated children.

Infographic: Measles: Unvaccinated Children in Developed Countries | Statista You will find more infographics at Statista

Outside New York, the worst outbreaks have been documented in California, Washington and Michigan.


Here are key facts about measles:

  • Public health officials blame the measles resurgence on the spread of misinformation about vaccines. A vocal group of parents opposes vaccines, believing that ingredients in them can cause autism. Social networks have resorted to censorship to prevent the spread of any related postings.
  • The largest outbreaks are concentrated in Orthodox Jewish communities in New York City’s Williamsburg neighborhood, where some 390 cases have been confirmed, and Rockland County north of New York City, which has recorded 201 cases. Those figures include infections from last year and are not directly comparable to the CDC numbers.
  • Other outbreaks have been reported in Washington state, New Jersey, California’s Butte County and Michigan.
  • The disease is highly contagious and can be fatal, killing one or two of every 1,000 children who contract it, according to the CDC. It can also cause permanent hearing loss or intellectual disabilities. It poses the greatest risk to unvaccinated young children.
  • The United States’ 2000 declaration that measles was eradicated meant that the disease was no longer present in the country year round. Measles remains common in some countries in Europe, Asia and Africa, and unvaccinated travelers to those countries can bring it back to the United States. The current outbreaks are believed to trace back to visits to Israel and Ukraine.
  • New York City officials said some 21,000 people have received the measles-mumps-rubella vaccine in affected areas since the outbreak began in October. The city has begun fining unvaccinated adults.
  • Lawmakers in Oregon, California and Washington state are considering bills to eliminate nonmedical exemptions that allowed unvaccinated children to attend public schools.
  •  In order to achieve herd immunity that protects those unable to get the measles vaccine, such as infants and people with compromised immune systems, 90% to 95% of the population needs to be vaccinated.
Published:4/29/2019 11:58:03 AM
[Markets] Annihilation Of Christian Life And People: Where Is The Outrage In The West?

Authored by Giulio Meotti via The Gatestone Institute,

  • Islamic extremists have seen that the West has not mobilized to prevent them from repressing Christians, as if unconsciously there were a strange convergence between our silence and the ethnic cleansing project of the Islamic State, aimed at erasing Christians.

  • "Religious liberty, the core value of western civilisation, is being destroyed across large parts of the world. Yet the West, myopically denying this religious war, is averting its gaze..." — Melanie Phillips, British journalist, The Times, November 17, 2014.

  • The Duke of Cambridge, Prince William, just visited the Muslim survivors of the attack on the mosques in Christchurch, New Zealand. Why does the same compassion not spur the British royal family to stop in Sri Lanka, their former colony, to meet the Christian survivors, before going back to England?

  • The appeal of Asia Bibi's daughters to help her mother met a deaf West. The UK refused to offer asylum to this persecuted Pakistani Christian family.

Sri Lanka after the jihadist massacre of Christians is not just a terrible succession of crying mothers and little coffins. Unfortunately, it also tells us a lot about the discouraging state of the West. Pictured: The funeral of one of the victims of the April 21 Easter Sunday attack in Sri Lanka. (Photo by Carl Court/Getty Images)

"Where is the solidarity for the Sri Lanka's Christians?" asked the British scholar Rakib Ehsan, a Muslim.

"The differences in tone and nature between the condemnations of the Christchurch and Sri Lanka terrorist attacks are striking. After Christchurch, there was no hesitation about stating the religious backgrounds of the victims and directing emotion and affection towards Muslim communities. Politicians took no issue with categorising the events in Christchurch as terrorism.

"In contrast, the words 'terrorism' and 'Christianity', along with their associated terms, have so far failed to feature in much of the reaction to the attacks in Sri Lanka.

"What is evident is not only a clear reluctance to specify the religious background of Christians who were killed in Sri Lanka, but also an absence of heartfelt solidarity with Christian communities across the world, which continue to suffer grave forms of persecution on the grounds of their faith."

Rakib Ehsan asked the right question. But it might be rewritten as: Where is the Western solidarity for the Sri Lanka's murdered Christians?

This is a drama in three acts. The first act consists of the Christians and other non-Muslim indigenous peoples being violated and murdered. The second act consists of Muslim extremists who create this genocide. And the third act consists of the indifferent West, which looks everywhere else.

The number of murdered victims in the April 21 Easter Sunday jihadist attacks in Sri Lanka is too terrible even to think about: 253 dead. Among the victims, 45 children were murdered. Their small faces and stories have begun to emerge. The Islamic terrorists knew there were many children in the three churches, and they deliberately targeted them with their bombs. Footage shows one of the bombers patting a young child on the head before he enters the St. Sebastian's Church in Negombo, where "everyone has lost someone".

The Fernando family had taken a photograph at the baptism of their third child, Seth. In Negombo they were all buried together. Father, mother and three children aged 6, 4, and 11 months. According to the New York Times:

"Fabiola Fernando, 6, was an elementary school student. In a photo posted to her mother's Facebook page, she showed off a gold medal, a small smile on her face. Leona Fernando, 4, the middle child in her family, was learning to read and was holding a copy of "Sleeping Beauty" in the picture. Seth Fernando, 11 months, was the newest addition to the Fernando family. He was buried alongside his parents and two sisters."

The silence of the Western intellectual world and the media is particularly deafening. The new humanitarian conscience seems to see only two groups: those who have the right to the compassion and protection of the international community, and those, such as Christians, unworthy of help or solidarity.

The deliberate murder of an 8-month-old baby, Matthew, in a Sri Lankan church apparently did not upset or chill the West, did not go viral on social media, did not to become a hashtag, did not to push the Europeans to crowd into their public squares, did not press the Islamic world to examine its conscience, did not to induce Western politicians and opinion-makers seriously to reflect on who killed that child, or on those who foment and finance the Islamist anti-Christian hatred.

Sudesh Kolonne was waiting outside St. Sebastian's Church when he heard the blast. He then ran inside and searched for his wife and daughter. It took him a half hour to find their bodies.

The attacks also killed three children of a Danish billionaire. Another woman losther daughter, son, husband, sister-in-law and two nieces. A British father had to make a choice over which of his two children to save. Another British family was destroyed. To add horror to horror, the pregnant wife of one of the terrorists, when police raided her home, detonated a suicide vest, killing her own children.

The Duke of Cambridge, Prince William, just visited the Muslim survivors of the attack on the mosques in Christchurch, New Zealand, including children recovering in the hospitals. It was a gesture of humanity and compassion. Why does the same compassion not spur the British royal family to stop in Sri Lanka, their former colony, to meet the Christian survivors, before going back to England? Entire Christian families were decimated in the attack.

Where is the outrage in the West for the annihilation of Christian life and people? It feels as if there is no indignation, only silence, interrupted by bombs and "Allahu Akbar". The history books of the future will not condone this Western betrayal. If the West had taken seriously the persecutions of Christians, now the bell would not toll for the death of the Christian presence -- not only in historic lands of Christianity, but also for the West. Islamic extremists have seen that the West has not mobilized to prevent them from repressing Christians, as if unconsciously there were a strange convergence between our silence and the ethnic cleansing project of the Islamic State, aimed at erasing Christians.

The British author Melanie Phillips has called this persecution of Christians "our guilty secret."

"Religious liberty, the core value of western civilisation, is being destroyed across large parts of the world. Yet the West, myopically denying this religious war, is averting its gaze from the destruction of its foundational creed in the Middle East and the attempt to eradicate it elsewhere. It is therefore no surprise that, faced with jihadist barbarities abroad and cultural inroads at home, the free world is proving so ineffectual".

The jihadist attack in Sri Lanka was not only "the deadliest attack on Christians in South Asia in recent memory." It was also the largest massacre of Christian children. But no newspaper has launched a campaign to raise awareness of European public opinion, no pro-Christian solidarity movement has arisen, no Western leader appears to have visited a church in solidarity, no Western church leaders had the courage to point out the culprits by calling them by name, no Western mayors hung photographs of the 45 children torn to pieces, no public square was filled in thousands saying "Je suis chrétien".

A few years ago, at the height of the migrant crisis in Europe, a photograph conquered public opinion in the West. It was the famous picture of the three-year-old Syrian boy, Alan Kurdi, who drowned off the coast of Bodrum, Turkey. That little migrant moved the West. His image went viralThe New York Times called it "Aylan Kurdi's Europe".

"For historical reasons, Angela Merkel feared images of armed German police confronting civilians on our borders," wrote Robin Alexander, Die Welt's leading journalist, in his book, Die Getriebenen ("The Driven Ones"). If photographs of migrant children spurred Europe's leaders to open their borders, the photographs of murdered Christian children -- such as the 45 in Sri Lanka -- apparently left them indifferent.

The appeal of Asia Bibi's daughters to help her mother met a deaf West. The UK refused to offer asylum to this Pakistani Christian family and take persecuted Christians.

"It is with indifference that we witness a catastrophe of civilization with no precedent"wrote the French scholar historian Jean-François Colosimo, commenting on the destruction of Eastern Christianity. No religion, no community, is today more persecuted than Christians. Why, then, this silence by the West? Have we become so foreign to ourselves, to our roots and to our history, that we can contemplate this outbreak of jihadi violence without blinking an eye? Or are we so short-sighted that we hoped to buy "peace" with the Muslim extremists at the cost of abandoning those Christians? The same jihadi ideology that murdered Christian children in Sri Lanka, targeted European children in NiceManchester and Barcelona.

Sri Lanka after the massacre is not just a terrible succession of crying mothers and little coffins. Unfortunately, it also tells us a lot about the discouraging state of the West.

Published:4/29/2019 1:15:34 AM
[Markets] Central Banking Is Central Planning

Authored by Richard Ebeling via The American Institute for Economic Research,

At a time when the appeal of and demands for a new “democratic” socialism seem to have caught the imagination of many among the young and are reflected in the promises of a good number of political candidates running for high office, there is one already-existing socialist institution in America with few opponents: the Federal Reserve System.

The fact is, central banking is a form of central planning. The Federal Reserve has a legal monopoly over the monetary system of the United States. It plans the quantity of money in circulation and its availability for lending purposes; and it sets a target for the annual rate of price inflation (currently around 2 percent), while also intentionally influencing interest rates, affecting investment spending, and supporting full employment. Almost all discussions and debates concerning the Federal Reserve revolve around how it should undertake its monetary central planning: which policy tools should be used, what target goals should be aimed for, and who should be in charge of directing America’s central bank.

Federal Reserve Independence in the Trump Era

A complementary issue that has received renewed attention concerns the question of how much “independence” the Federal Reserve and other central banks should have to determine and implement monetary and interest rate policy. This has recently come to the fore due to comments made by President Donald Trump concerning Federal Reserve interest rate policy and the individuals he has recently proposed for positions on the Federal Reserve Board of Governors.

Several times over the last year, President Trump has expressed irritation and frustration with increases in market rates of interest under the Federal Reserve Board leadership of Jerome Powell, who Trump nominated for Fed chairman and who has held that position since February 2018. Trump has publicly pouted and whined that while Barack Obama  was president he had a central bank that gave him rock-bottom low interest rates. Fed Chairman Powell, on the other hand, has raised interest rates several times over the last year, preventing America from being as “great” as Trump thinks it can be because of the higher costs of borrowing for both the private sector and the federal government.

Being informed that he really cannot just fire Chairman Powell because he doesn’t like Federal Reserve policies, Trump wants to get around the Powell problem by nominating for open positions on the Fed Board those he thinks will more likely direct Federal Reserve policies in the way he wants. Thus, he has put up as names for Senate approval those of Stephen Moore, a policy analyst at the Heritage Foundation and a former Trump campaign advisor; and Herman Cain, the former CEO of Godfather’s Pizza, a previous chairman of the Kansas City branch of the Federal Reserve, and a past Republican presidential hopeful himself.

Trump Critics on the Left, on the Right, and at the Economist

Trump has been attacked from both the left and the right for seeming to want to pack the Federal Reserve Board of Governors with “political” types reflecting Trump’s desire for looser monetary policy and lower interest rates. Some on the political left oppose his nominees simply because, well, they are Trump’s choices, along with the additional criticisms that neither are Ph.D. economists nor known and respected experts on monetary policy.

Others more to the political right don’t want them on the Board because they would prefer a more “hawkish” Fed policy. Desmond Lachman, a resident scholar at the conservative American Enterprise Institute, thinks the Federal Reserve should raise interest rates so the central bank will have the room for future successful monetary-stimulus policies when the next economy-wide downturn comes along. In other words, he just wants monetary central planning in a different direction than President Trump.

The Economist magazine had as its cover topic for the April 13, 2019, issue the threat to central bank “independence” from Trump and others like him in charge of governments around the world. What is needed and has to be preserved, the Economist argues, are professional monetary-planning “technocrats” who rise above and are free from interference by politicians, so those at the central banking helm can focus on long-run price-level stability and non-ideological banking and interest rate policies.

The magazine admits that central bankers have not always gotten it right — even the most well-intentioned central planner is only human, let’s not forget — but in their wise hands the world has been saved from destabilizing price inflations and short-run policy manipulations that might have been harmful to full employment and steady growth.

The “Austrian” Critique of Central Planning vs. Markets

Rarely heard or suggested in all these commentaries on the Federal Reserve is whether the United States needs or should have a central bank. I would like to suggest that the answer is no, and for many of the same reasons that can be made against socialist central planning in general.

It will be 100 years in 2020 since the Austrian economist Ludwig von Mises first published his famous critique of socialist central planning in his article “Economic Calculation in the Socialist Commonwealth” (1920) and then extended the challenge to all facets of collectivism in his 1922 book, Socialism: An Economic and Sociological Analysis. The gist of his argument was that a centrally planned economy did away with the essential institutions necessary for rational economic calculation: private property in the means of production, market competition, and a functioning price system.

In a complex and ever-changing social system of division of labor all the multitudes of participants are interdependent for all the things needed for everyday life. It is necessary to have some means of knowing what it is that people want to buy in their role as consumers and the value they place on those things; and it is also essential to know what resources are available out of which desired consumer goods might be produced, and what their values might be in the alternative uses for which they could be applied.

In other words, do consumers desire hats, or shoes, or bananas, or breakfast cereal, or classical music, or serious books on economics, or anything else, and what are the relative values they may place on possibly purchasing them? At the same time, what are the available types and quantities of labor, land, resources and raw materials, and capital goods (machinery, tools, equipment) that may be used in various combinations to produce those consumer items, and what might be their appraised values in being employed in different and competing lines of production?

Market Prices and Economic Calculation

The market solves that problem, Mises explained, through the emergence of a competitive price system for both finished goods and the factors of production. With exchangeable private property there are opportunities to buy and sell; with the ability to buy and sell, people have motives and incentives to make bids and offers to each other; out of those bids and offers may arise agreed-upon terms of trade; and those agreed-upon terms of trade create the complex structure of relative prices for both those finished goods and the factors of production.

In a complex market system there also historically emerged a medium of exchange to overcome the hurdles of direct barter transactions to better facilitate the buying and selling of virtually everything. As the most widely used and generally accepted medium of exchange, the commodity that becomes the money-good comes to be on one side of every exchange.

People trade their goods for money, and then trade away that money for other goods they desire to buy. Almost every good and service on the market, therefore, comes to have a money price that then enables an ease of economic calculation through which all the physically heterogeneous goods offered on the market may be expressed in a single valuational common denominator — the money prices for everything.

Thus, all traders on the market can readily do their “comparison shopping.” What would this bundle of consumer items cost me to buy and what are the relative costs if I substitute one good for another to buy instead? If I buy one hat for $10, then I have to forgo the equivalent of two pairs of gloves that cost $5 a piece.

The same applies on the supply side of market production decisions. The entrepreneur can try to make an informed judgment concerning what a consumer good sells for in the present and might possibly sell for in the future if he were to bring some quantity of it to market. Likewise, he can determine what it would cost to rent, hire, or purchase alternative combinations of inputs (labor, land, capital) to manufacture some such consumer item, on the basis of which he can decide whether he thinks that doing so would be a profit-making or a loss-making endeavor; and if seeming to be profitable, which combination of those inputs would minimize his costs of production to potentially maximize the anticipated and hoped-for profits?

Central Planning Leads to Planned Chaos

A system of socialist central planning does away with all of this. With government nationalization of the means of production there is nothing to (legally) buy and sell on the production side of the economy. With nothing to buy and sell, there are, obviously, no bids or offers for the factors of production. With no bids and offers for labor, land, resources, and capital, there are no market-based prices for appraising profitable from unprofitable lines of production, and deciding which alternative ways of making finished goods would minimize the costs of production.

It is not surprising that a bit more than a quarter of a century after Mises first offered his criticisms of socialist central planning he titled a short monograph on the same theme Planned Chaos (1947). Without market-based and competitively generated prices to assist the ongoing process of rational economic calculation in a changing world, the central planners would be “flying blind” in trying to decide what to produce and how to produce it to get the most out of the scarce factors of production in value terms in supplying the goods and services consumers actually might want to buy and what they would have been willing to pay for them. (See my article “Why Socialism Is ‘Impossible.’”)

Most economists around today would find the gist of this argument fairly obvious if asked to agree with it or not, even if many mainstream economists would no doubt insist that there were problems of monopoly and undersupplied public goods, and assert the need for various redistributive welfare programs outside of the arena of market exchange due to income inequalities. But the notion that market-based, competitive prices enable effective and cost-efficient economic calculation for much that goes on in a complex society would be accepted, in this general formulation, without too much disagreement.

Central Banking Denies Freedom of Choice in Money

On this basis, I would argue that monetary central planning in the form of central banking creates many of the same problems for economic calculation and effective and efficient use of resources as traditional socialist economic planning. First of all, what commodity (or commodities) should be used as a medium (or media) of exchange? Under our current monetary system, anyone who attempts to offer and market alternative monies for use in domestic transactions is subject to legal penalty including arrest and imprisonment.

For instance, back in the late 1990s, Bernard von NotHaus decided to mint and market an alternative “private voluntary currency” for business and related transactions. In 2009, Mr. NotHous was arrested for circulating millions of his gold coins called Liberty Dollars in over 80 cities on counterfeiting charges and for undertaking a “conspiracy” against the U.S. government’s monetary monopoly. He was found guilty in 2011, and in 2014 he was given six months’ house arrest and three years’ probation. In 2018, Mr. NotHous was back, this time saying that he was starting up a cryptocurrency that was to be 100 percent backed by silver. How the government responds this time to his attempt to undermine America’s socialist monetary system remains to be seen.

But the fact is, how can any government and even the wisest and most Ph.D.’ed of their Federal Reserve experts know what people in the marketplace would find attractive, advantageous, and profitable to use as a medium of exchange in market transactions, or whether there might not be a demand for different types of money for different forms of market activities?

The answer is that there is no way of fully knowing this other than allowing private enterprisers and entrepreneurs in the financial and other everyday markets to competitively discover and offer what we the buying and selling public might want for this purpose. It is now more than 40 years since Austrian economist F.A. Hayek published his “Choice in Currency,” (1976) in which he called for the simple monetary reform of ending legal tender laws and allowing people to choose and use in domestic and foreign transactions any medium of exchange they desire. He considered this a necessary freedom to break the history of abuse under government-monopoly money and to allow people to use whatever money they want.

Only Markets Can Discover the Optimal Amount of Money

Second, how can the monetary central planners know how much money should be in circulation and in the banking system? This is no more possible than the old Soviet central planners knowing how much toilet paper to produce or the quantities and varieties of any other everyday household necessity. What the Soviet planners produced invariably turned out to be in the wrong amounts and of the wrong types. A visit to a “people’s” lingerie store (and I use this term very loosely) in Moscow before the collapse of the Soviet Union found one-size-fits-all in women’s underpants. Any needed adjustment of the waistband, well, comrade, that is what safety pins are for. No unnecessary quantities or wasteful duplication under bright and beautiful socialist planning. The central planners were, no doubt, Soviet socialism’s best and brightest — and with Ph.D.’s!

Under a commodity money such as gold in a fully free-enterprise system, the amount of money in the market is a reflection of supply and demand. People have uses for gold for either commercial or monetary purposes. Gold has its price in the marketplace. Based on this those on the supply side could estimate the profitability of prospecting, mining, minting, and marketing greater quantities of produced gold for sale for monetary and other commercial uses.

An increased demand for gold as money sees a shift of the commodity from commercial uses to monetary ones, and with the resulting rise in the value of gold in general, a greater profitability from gold prospecting, mining, and minting. As the supply increases, the rise in the market value of gold is tempered, with the increasing supply tending to satisfy the greater demand. Yes, there have been noticeable gold-based fluctuations due to newly discovered gold sources in various parts of the world. But in general these incidents have been few and far between, with gold annually being extracted from known pockets based on current and trend demand.

The crucial element in this is that the “optimal” quantity of money is the interactive outcome of the market participants themselves. The gold market provides the price system that reflects the demand for gold in its various uses, of which money is one. And the related markets for the needed means of production to mine, mint, and supply gold provide the cost prices that facilitate the rational economic calculations for an ever-adapting and ever-adjusting “optimal” market-guided quantity of money. (See my article “Government, Gold, and Separating Money from the State.”)

The Central Bankers Determine How Much Money

Today we are dependent on the decisions of a handful of central-planning executives on the Board of Governors of the Federal Reserve. What is their guide? The personal judgments of what they think the economy needs, based upon the prevailing macroeconomic theories used in the central bank about how the economy works and therefore how much money should be pumped into the banking system.

Our monetary fate is dependent upon whether the central bank experts, this year, are old-style Keynesians, new Keynesians, monetarists, new classical economists, Taylor-rule followers, supply-siders, new modern monetary theorists, or any number of other possibilities. In the old Soviet Union, it all depended upon whether Stalinists or Trotskyites were to be in charge; for the central planning of scientific research, genetics was or was not considered compatible with Marxism-Leninism as interpreted by the leadership of “the Party.”

Just as it is said that central banking needs to be independent so the “objective” and scientific monetary “experts” can guide the economy based on the latest and “correct” macroeconomic models, it was insisted under Soviet and all other socialisms-in-practice that it was all objective and scientific, being based on Marxian dialectical materialism, given what that meant in any particular situation. It’s all a politics and ideology of planning. A few say they know what is right for the many, and will use government to give it to them.

The False Target of 2 Percent Price Inflation

Also important to keep in mind is that there is no optimal rate of price inflation. To begin with, any benchmark meant to determine whether prices in general are rising or falling is based upon some statistical averaging of selected and weighted individual prices tracked through time to determine whether or not a constructed and imaginary basket of goods has become more expensive or less expensive, and if so by what percentage amount from an earlier point in time.

Changes in the cost of living affect each of us differently based on the reality of what we as individuals and separate households choose to buy and in what relative amounts. Also, our individual baskets are not invariant points of comparison even for ourselves, since changes in our tastes and preferences, in the relative prices among the goods we buy, and in the market’s offering of new and better quality goods on a frequent basis all bring about changes in what goods are in our respective baskets and their relative quantities.

Such statistical creations as the Consumer Price Index are at most very rough-and-ready general pieces of information for the consumer or citizen concerning what the central bank may be doing to the overall value of the money we use. The fact is, its importance is not for you or me, but as one of the signals used by the central bankers to decide the rate of monetary expansion and for influencing interest rates. (See my articles “The Consumer Price Index, a False Indicator of Our Individual Costs-of-Living” and “The False Promises of Controlled 2 Percent Inflation.”)

It’s all based on a macroeconomic conception that in general a falling price level is “bad,” and that growth and employment are “stimulated” by modestly rising prices. It has fallen mostly (though not exclusively) to the Austrian school over the last 100 years to demonstrate that falling prices due to greater outputs and supply-side cost efficiencies are not only not harmful to the wealth and health of modern society, but are an indication of increasing prosperity and rising real standards of living. (See my article “Don’t Fear Deflation, Unless Caused by Government.”)

Likewise, whether it is the attempt to maintain a relatively stable general level of prices (as partly guided Federal Reserve policy in the 1920s) or the contemporary central bank target of 2 percent price inflation, the primary institutional tool at the Federal Reserve’s disposal is to buy U.S. government securities (and now a variety of other market assets including mortgaged-backed securities during the financial crisis of 2008-9 and after) and to increase loanable reserves in the banking system. (See my article “Austrian Monetary Theory vs. Federal Reserve Inflation Targeting.”)

This becomes the means for influencing interest rates for investment and all other types of borrowing to try to “stimulate” spending and employment in the economy as a whole. Even the Fed’s latest policy trick since the financial crisis to pay banks not to lend the very trillions of dollars of excess reserves the central bank pumped into the banking system is a way for the Federal Reserve to try to influence interest rates and aggregate spending in the economy.

The fact is, interest rates should be left free and competitive to do their job as the network of intertemporal prices connecting and coordinating the savings decisions of lenders with the investment choices of borrowers. In other words, interest rates are the prices that are supposed to bring markets and the use of the factors of production into balance with each other across time.

Instead, by viewing and using interest rates as a policy tool to be manipulated, the Federal Reserve’s monetary central planners only succeed in distorting and preventing interest rates from telling the truth: how much savings is in the economy to sustain and maintain a structure of gross and net investments with varying time horizons. (See my article “Interest Rates Need to Tell the Truth.”)

Just as Soviet central planners may have believed that they could coordinate it all for better and more successful outcomes than market economies, our central bankers never fail in their enthusiasm and arrogant confidence that this time they will get it right, that they “now” have the right macroeconomic model of how it all works; they, finally, have bigger and better statistical data and computer capacity to successfully read and measure the entrails of the economic goose. (See my articles ”Macro Aggregates Hide the Real Market Processes at Work” and “The Myth of Aggregate Demand and Supply.”

What they, in fact, bring about are the inflations and recessions, the booms and busts that they insist they are in the central banking business to moderate, if not to prevent. By their fruits you will know them: the post-World War I inflation and depression; the 1920s false promise of prosperity and stability, followed by the Great Depression; the booms and busts of inflations and recessions in the 1950s; the monetary inflation of the 1960s and especially the high price inflation of the late 1970s and early 1980s; then a relative calm in the 1990s, but followed by the monetary expansion between 2003 and 2008 that set the stage for the great financial and housing crisis of 2008-10; and now the great experiment with “quantitative easing” and the ballooning Federal Reserve asset portfolio filled with private sector mortgages. (See my article “Ten Years On: Recession, Recovery, and the Regulatory State.”)

The long history of central banking, and especially over the last 100 years of paper monies and out-of-control government deficit spending partly funded by “monetization” of the debt, has more than clearly demonstrated that the epoch of modern central banking needs to come to an end. And in its place, we need the opening and freeing of financial markets to private competitive free banking, with markets — meaning all of us — deciding what we want to use as money. (See my eBook Monetary Central Planning and the State.)

Published:4/28/2019 6:11:39 PM
[Markets] Innovators, Imitators, Or Idiots - X Marks The Spot In Investing

Authored by Jamie Catherwood via,

Sunken Treasures

X Marks The Spot

First come the innovators, who see opportunities that others don’t. Then come the imitators, who copy what the innovators have done. And then come the idiots, whose avarice undoes the very innovations they are trying to use to get rich.”— Warren Buffet

A great deal of investing comes down to a process of identifying innovators, scrutinizing imitators, and screening out idiots.

This principle is applicable to everything from stock-picking to assessing management teams. Nowhere, however, is the concept more prevalent than in venture capital.

Every day, VC firms in Silicon Valley and beyond are inundated with pitches from startups touting innovative products and groundbreaking technology. Therefore, the clear determinant of a VC firm’s success lies in their ability to locate genius in a sea of mediocrity.

The obvious difficulty of this endeavor is reflected in the breakdown of a VC firm’s expected returns. As industry veteran Fred Wilson summarized it:

“I’ve said many times on this blog that our target batting average is ‘1/3, 1/3, 1/3’, which means that we expect to lose our entire investment on 1/3 of our investments, we expect to get our money back (or maybe make a small return) on 1/3 of our investments, and we expect to generate the bulk of our returns on 1/3 of our investments.”?—?Fred Wilson

To put it much more crudely:

An already difficult process then becomes even harder after the wild success of a truly innovative company. For example, Uber’s dominance prompted an outbreak of “Uber for X” startups.

From a behavioral standpoint, it’s not easy for an investor to resist companies claiming to be the ‘Uber for X’ after witnessing Uber’s success.

To be clear, there have been successful imitators. Wag!, the “Uber for Dogs”, being a prime example.

However, for every imitator like Wag! and Lyft, there is a longer list of failed imitators. Cherry, for instance, was the “Uber for carwashes” that eventually closed up shop.

That said, even the successful imitators aren’t perfect… poor Fluffy.

During the late 17th century, London’s nascent stock market experienced a wave of innovation. In 1687, only 15 public companies were listed on the London Stock Exchange. By 1695, however, that figure had increased tenfold.

The impetus for this investment boom is partially due to the Nine Years War, which restricted overseas trade with foreign powers. British investors were forced to deploy their capital into domestic investments as a result.

“A great many stocks have arisen since this war with France; for trade being obstructed at sea, few that have money were willing it should lie idle, and a great many that wanted employment studied how to dispose of their money…which they found they could more easily do in joint-stocks, than in laying out the same in lands, houses or commodities…”?—?John Houghton (1694)

What truly kick-started this period of speculation and startup investments, however, was a successful treasure hunt.

The Innovator

“Thanks be to God! We are all made!”

— Sir William Phips (1687)

Sir William Phips was described by his contemporary, Daniel Defoe, as someone who “sought wealth and advancement through money-making schemes financed by others”.

A trader and seafarer by nature, Phips commanded boats making frequent trips to the West Indies. In the course of these journeys, Phips heard rumors of a sunken ship in the Caribbean , the Concepciónwhich held unimaginable treasures.

Though many would scoff at such gossip today, the rumors were not unfounded. The Spanish had transported scores of precious metals from Mexico for over a century, and many of these ships did not make it home.

Before long, Sir Phips decided to try his luck at locating the Concepción. Just as the modern founder ventures to Silicon Valley in search of funding on Sand Hill Road, Sir Phips returned to London in search of an investor.

Phips found his 17th century venture capitalist in the Duke of Albemarle, and his syndicate of investors. The group of financiers quickly formed a small joint-stock company for funding the expedition. This joint-stock company could be considered a VC firm equivalent.

This was truly ad-venture capital.

Eventually, the Duke of Albermarle proved to be one savvy venture capitalist. After endlessly searching for the sunken Concepción, Sir Phips finally located his treasure in 1687.

In the wake of his incredible discovery, Phips and his crew spent over two months hauling up 32 tons of treasure from the ocean floor.

32 tons

Upon the treasure hunter’s return, the Duke of Albemarle and others received an astronomical 10,000% return on investment.

As for the captain himself, Phips took an 11% cut of the profit, which amounted to £12,000. This was an absolute fortune, as the average income for a merchant in 1688 was £400.

Sir William Phips represents a true Innovator. The treasure hunter had a bold, and risky business proposal, but offered an extremely enticing return if it proved successful.

The Imitator

[Wreck-recovery companies] made much noise at this time, and shares for them were presented to persons of distinction to give reputation to the affair and to draw on others. So the patentees were sure to be gainers but the sharers under them lost all they paid in, some of whom, it seems, were men of good understanding but were allured by the hopes of getting vast sudden wealth without trouble.”- Anonymous (1692)

Reflecting the excitement surrounding new technologies and inventions, there were a record number of patents filed in London between 1691–1693,

The speculation in treasure hunting specifically is evidenced by the increase in patents related to diving and shipwrecks during the 1690s.

Over a 19-year period (1672–1689), there were 5 patents filed for ‘diving engines’. In just two years, however, there were 17 patents filed for diving engines from late 1691 to late 1693.

In this period, patents provided a level of status and credibility that investments from prestigious VC firms similarly offer startups today. One Londoner commented in 1695, “Oh, a patent gives a reputation to it, and cullies in [i.e. takes in] the company”.

While it’s unclear whether Phips had used a similar device himself, these new products captivated British investors. In response to investor’s thirst for a 10,000% return, new companies advertised diving engines for salvaging sunken treasure off the ocean floor.

The prospectus of one such company promised investor’s a 100% return.

Just as the success of modern companies like Uber led to an outburst of “Uber for X” companies, Sir Phips’ expedition sparked the formation of numerous diving and treasure hunting companies.

The below is only a partial list of such companies:

Despite the number of new companies formed to emulate Sir Phips’ success, “none of these expeditions were successful?—?indeed the only ‘finds’ consisted of a few cannons”.

The Idiot

“So I have seen shares in Joint-Stocks, Patents, Engines, and Undertakings, blown up by the air of great words, and the name of some man of credit…and many families been ruin’d by the purchase [of these shares].”?—?Daniel Defoe (1697)

In this bizarre treasure hunting bubble of the late 17th century there were plenty of idiots. On the funnier side, there were those that sought patents for ideas like “catching fish with lights”, and the “sea-crab” apparatus.

However, investors were just as idiotic. Typically sensible Londoners embraced their inner idiocy as the cravings for profits grew stronger. The bubble even drew in former critics:

Captain Poyntz came forward with a petition on April 20th, in which he stated that persons who had secured patents for wrecks, sold shares at ‘extravagant rates and had as yet done nothing’. He too obtained a patent on April 29th.”

There were also many that suffered a fate similar to Daniel Defoe, who had invested and lost £200 in John Williams’ diving engine company. Later, he complained that Williams had only “pretended to be a skillful engineer in retrieving wrecks”.

Defoe, unable to identify Williams as an Idiot, was forced to deal with the consequences. Despite his best efforts to sue Williams, he eventually lost every penny of his investment.

Every investor wants to put their money in the Phips Treasure Hunt. However, finding Sir Phips is a treasure hunt in itself.

If you can identify Sir Phips before he embarks on his expedition, then the risk is worth the return.

Should you miss out on such a successful investment, however, ensure that you carefully scrutinize future opportunities borne out of its success. While imitators can certainly provide an attractive investment, you may end up holding shares in the “sea-crab” company.

Venture capital firms today acknowledge the difficulty of identifying the Innovator in how they construct their portfolios. The average investor should similarly ensure that they have a check in place.

Fail to identify the idiot in advance, and pretty soon you become the idiot yourself.

After losing his full investment in a sham diving company, Defoe lamented:

“I could give a very diverting history of a patent-monger…whose cully [fool] was nobody but myself”?—?Daniel Defore (1697)

Published:4/28/2019 4:14:15 PM
[Markets] The Great Financial Crisis Ten Years On: China's Past Role & Current Risks

In this week’s episode of Hidden Forces, Demetri Kofinas speaks with China expert Anne Stevenson-Yang about the imminent dangers facing global financial markets in the event of a break in the renminbi-dollar peg.

In the years leading up to the Great Financial Crisis, it was generally understood that the Chinese were artificially depressing the value of the RMB vis-à-vis the USD, in order maintain an abnormally large current account surplus that would be recycled into western financial markets in the form of government securities, equities, real estate, etc. By recycling so much of the proceeds from trade back into foreign markets, the CCP managed to maintain a lower exchange rate than it otherwise would be, were it to convert those dollars back into renminbi.

In other words, China was suppressing the value of its currency. Bob Wittbrot calls this recycling process the “Boomerang Greenback.” This dynamic worked extraordinary well until the world went into recession around the time of the great financial crisis, which marked a peak in China’s current account. The CCP also met the crisis by expanding bank lending, easing credit, and fueling investment even further. In addition, by maintaining interest rates and the cost of capital well-below the rate of inflation during China’s multi-decade boom, the CCP has managed to keep households’ share of the economy at low enough levels to induce an overall high-savings rate for the country (by having less disposable income than would otherwise be expected for an economy this size, the average Chinese citizen spends less on consumption than he or she otherwise would, absent financial repression). This has been an additional shot in the arm for investment.

At some point post-2008 (judging from their foreign exchange reserves, this appears to have started somewhere around the start of 2014) China went from artificially suppressing the value of its currency to artificially supporting it. Unlike a country like Thailand, however, whose currency peg famously broke under the speculative attacks of foreign investors during the 1997-98’ Asian Financial Crisis, the Chinese have managed to avoid such a scenario on account of maintaining a closed capital account (exercising tight capital controls). Coupling that with a current account surplus, the CCP has been able to obtain the hard currency it has needed in the last 5 years or so in order to buy the various inputs required to run their economy and keep the cycle going.

The problem is that China generated a tremendous amount of money and credit since the GFC, in particular, and therefore risks a major devaluation in the value of the RMB should the country no longer be able to get the foreign exchange reserves it needs through a sustainable current account surplus. They are, at the moment, running a negative current account, a negative fiscal balance (of roughly 9% of GDP), their foreign exchange reserves are declining for the first time ever, while the country’s external debt has doubled in the last five years, increasing by an average of $70 billion per quarter since the beginning of 2017. More than half of this debt is short-term, which means it needs to be constantly rolled over. Up until the Fed paused it’s tightening cycle, the rising interest rates coupled with new tariffs on Chinese goods were creating a pincer-like effect on China’s economy and on its ability to maintain its peg, forcing it to fund more of its dollar needs through borrowing at ever higher interest rates.

China cannot maintain a credible peg between the RMB and the USD when its money supply is growing, by some calculations at more than 10x that of the United States over the last 10 years. This is a fundamental problem of accounting. If China were completely self-sufficient – if it had access to sufficient energy, food, base metals, etc. within its own borders – then its inability to obtain dollars would not be an issue. The problem is that it is desperately short these commodities as inputs for its manufacturing and domestic consumption. The recent drop in the price of oil helped them out a bit, but it has been rising again, just as China’s oil imports are surging. The country recently surpassed the United States as the world’s largest crude importer. For a nation with dwindling foreign exchange reserves, this is not a good trend. And, it isn’t even clear what the real FOREX numbers are in China. Official foreign exchange reserve put that number at $3.2 Trillion, but US treasury tick data shows that China owns a little bit less than $1.2 trillion in US Treasuries, which according to some people, suggests that their overall FOREX position is closer to $2 Trillion.

Meanwhile, the U.S. trade deficit fell to $49.4 billion in February, the lowest level since June 2018, and well below what economists had expected. A 20.2% drop in imports from China was the main driver behind the nearly 3.4% improvement in the trade deficit in February, data from the Commerce Department showed. The trade deficit has narrowed for two straight months now.

There seems to be a growing sense of awareness among many in China that all is not well with the country’s capital account. We have seen numbers suggesting that illicit capital has been flowing out of China (whether we are talking about precious stones, Bitcoins, or other means available to the wealthier citizens of China) in noticeably higher amounts since the mini-devaluation in August 2015. This is consistent with what we often see in countries ahead of a devaluation, default, or some other financial disturbance. Do China’s wealthy know something we don’t?

Join the conversation on FacebookInstagram, and Twitter at @hiddenforcespod

Published:4/27/2019 9:36:31 PM
[Culture] Bosch (John Hinderaker) Michael Connelly’s books featuring Los Angeles Detective Harry Bosch are among the world’s most popular police procedurals. Connelly published the first Bosch book in 1992, and there have been 22 altogether. The Bosch series has spun off two other characters, Mickey Haller (the Lincoln Lawyer) and Renee Ballard, a young detective who has been featured in two books so far, which I like a lot. One of my sisters-in-law turned Published:4/27/2019 7:35:58 PM
[Entertainment & Gossip] George Orwell Has Written A New Book, Even Though He's Dead Extraordinary news has reached our Literature correspondent that author George Orwell, who wrote several classic books including '1984', 'Animal Farm', 'Homage To Catalonia' and 'The Road To Wigan Pier', has written a new book, despite the fact that... Published:4/26/2019 10:58:01 AM
[The Blog] Pugh attorney: Baltimore mayor “not lucid” enough to decide on resignation

“The books might just be a shiny object. My guess is there’s something bigger."

The post Pugh attorney: Baltimore mayor “not lucid” enough to decide on resignation appeared first on Hot Air.

Published:4/26/2019 9:57:47 AM
[Markets] Charles Hugh Smith: "Today Looks Like Just Before The 2000-DotCom Crash"

Via Greg Hunter’s,

Journalist and book author Charles Hugh Smith says the next market crash and recession will unfold like the bursting of the 2000 Dotcom bubble.

Smith explains, “The bubble popped or deflated not for any crisis, but simply because there was too much debt, too much leverage, too much euphoria and unrealistic valuations..."

"I think we are seeing that now in stocks, housing and a lot of other assets around the world. The valuations just exceed what makes financial sense...

And remember, we are at the longest expansion in history. It’s over 10 years, and the average expansion lasts 5, 6 or 7 years. So, this expansion is pretty long in tooth...

You will get a slowdown, and that is a self-reinforcing feedback loop. Once people stop buying houses and once people stop buying cars... then you are going to get people being laid off, less people being able to afford to eat out, and then you get a self-reinforcing recession. It’s not a crisis, but like an erosion because everybody is kind of tapped out.”

Recently, President Trump and his economic advisors have been talking up rate cuts and money printing to help the economy. Are they seeing a slowdown coming? Smith, who has written 12 financial oriented books, says:

“I think they do, and I think that’s the only reasonable explanation for why they are talking about rate cuts when the employment is strong and the economy is looking good by many factors.

Why would they want cheaper money unless they see the slowdown in auto sales, and they see the slowdown in housing, and they see a slowdown with all the things where you have to borrow a lot of money to make it work.

Can team Trump keep the economy going until after the 2020 election? Smith says:

“I think you are pushing a little bit on a string to get a 10 year long expansion to stretch out to 12 years. It’s like you are pushing sand uphill at some point....Inflation is roaring in assets. Housing is unaffordable in many areas, and the stock market is at nosebleed levels. So, it’s kind of hard to say we are going to get another two years of growth, but I don’t think anybody can say it can’t happen.

What we can say is debt levels are rising at a much faster rate than earned income. That’s where you are going to get a reset at some point. As costs go up and debt levels go up, then lowering interest rates gives you a little leeway, but only for awhile.”

Join Greg Hunter as he goes One-on-One with Charles Hugh Smith, founder of the popular website

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Published:4/25/2019 5:56:43 PM
[Markets] Gen Z May Be The American Mall's Unexpected Savior

Make no mistake, Generation Z is the future of commerce.

They're already reshaping the alcohol industry, positioning as first movers in the marijuana industry and advocating for companies to take political stands. But the wildest trend set by Gen Z is the fact that they love the shopping mall, according to Bloomberg

Nearly all, or some 95%, of Gen Zers visited a physical shopping center during a 3 month period in 2018. This compares to just 75% for millennials and 58% for Gen X. What's more, they say they genuinely like it: going to a brick and mortar store was found to be a better experience than shopping online for 75% of Gen Z shoppers.

Neil Saunders, an analyst at GlobalData Retail said: “There’s always been this assumption that as you go through the age spectrum, the younger consumer that has grown up with online and digital and is very savvy would shun physical experiences. But actually that’s not turned out to be the case.”

Gen Z interacts differently with stores than Gen X parents before them, and some companies that didn't understand this have found themselves going under: names like Charlotte Russe, Wet Seal and Claire’s, have all been victims.

With regional mall vacancy rates at 9.3% in the U.S., the pressure to adapt is on. Many names are doing this by embracing smartphones. Since Gen Z spends an inordinate amount of time on their phones, savvy retailers have created promotions around it. 

For instance, Forever 21 encourages phone-in-hand shopping by offering 21% off to anyone who takes a picture of themselves in a Forever 21 outfit and posts it with designated hashtags, then shows the cashier at the register. The results have been stunning: on Instagram, the #F21PROMO has been used about 20,000 times. One person on Twitter, who hid her face, even said: “my mom is making me do this for 21% off.”

Digital coupon company RetailMeNot is also responding. They can send push notifications to shoppers when they’re in a mall to alert them to discounts. A recent survey showed that 91% of Gen Z shoppers are searching for deals on their phones while shopping, so this promo fits that ethos perfectly. 

Stores are even changing their designs to make them more "Instagram worthy". Macy's, for instance, rolled out “Story” in 36 of its locations - a colorful themed shop-in-shop to attract more people to take photos. It's a brightly painted 7,500 square foot space in the company's flagship Herald Square location.

The area includes a pillar completely made of Crayola crayons, a pingpong table, a rainbow tunnel, hot dog-shaped pet toys, purses that charge phones and self-help books on how to cure hangovers.  Macy’s Chief Executive Officer Jeff Gennette calls the items in the area things that "nobody needs but are going to want". 

“You just don’t have the same predictability that you have in some of the department store square footage. You can always show up and find something different,’’ he said.

Stores are also letting Gen Zers customize their shopping experience, as these shoppers want products tailor-made to their tastes and interests. Marcie Merriman, an EY consultant who specializes in the Gen Z consumer said: “In the past, it has been a little more cookie-cutter. Now, for today’s teens, their mind just goes to a very different place because of their expectation that anything is possible.’’

In American Eagle stores, shoppers can take their jeans to a counter where they can customize them by embossing them, adding paint or adding patches. Activewear company Champion has trained associates to press and embroider its logo anywhere customers want on hoodies or sweatshirts. Levi Strauss & Co. also put tailor shops in most of its stores to entice consumers to add monogram stitching to products. Finally, Tiffany & Co. invested in a program to allow shoppers to customize jewelry beyond just engravings. CEO Alessandro Bogliolo said: “You can have your bracelet, ring or piece of jewelry personalized.’’

Gen Z is also looking for a good deal - and that means sometimes shopping secondhand. Stores are recognizing this trend, too. Neiman Marcus just bought a minority stake in Fashionphile, a company focused on pre-owned luxury handbags and accessories.

CEO Geoffroy Van Raemdonck said: “The customer who participates in buying secondhand products are younger. That’s usually their first time of entering the luxury market, and we aim to introduce them to Neiman Marcus—and ultimately to transition them to buying products of the season at Neiman Marcus. It’s clearly a recruitment effort.’’

Neil Saunders, an analyst at GlobalData Retail concluded: "The more traditional retailers haven’t really thought about this particular generation as an attractive target. They haven’t really thought about what this group wants out of a shopping experience. I think that’s starting to change now."

The new mall rats.


Published:4/25/2019 4:56:42 PM
[] FBI Raids Baltimore Mayor's Home and City Hall Office, Presumably Searching for Evidence of "Brazen, Cartoonish Corruption" You probably know about this story. The mayor of Baltimore has been running a grift: She self-published her own stupid children's books about health, about the unimaginitively named "Healthy Holly." She made these books available. To, for example, health care... Published:4/25/2019 1:22:56 PM
[Markets] Feds Raid Baltimore Mayor's Homes As 'Children's Book' Corruption Scandal Snowballs

As one of the most absurd corruption scandals in recent American memory continues to snowball, agents from the FBI and IRS on Thursday raided two homes owned by Baltimore Mayor Catherine Pugh, as well as city hall, presumably in connection with the "children's book" corruption scandal that has inflamed tensions in the city and prompted calls for Pugh to resign immediately.

According to AP, Dave Fitz, an FBI spokesman from the agency's Baltimore office, said the agents were "executing court-authorized search warrants" but couldn't release any more details because the warrants were sealed. On April 1, Maryland Gov. Larry Hogan asked state prosecutors to begin a criminal investigation into what appears to be a brazen kickback scheme involving sales of Pugh's "Healthy Holly" book series. Agents also raided a non-profit with which Pugh has been associated.

Yes, you read that right. The mayor of Baltimore has been accused of using her position to secure contracts worth hundreds of thousands of dollars from the University of Maryland Medical System and managed-care consortium KaiserPermanente. The contracts were agreements to buy thousands of copies of Pugh's "Healthy Holly" books, a series written by Pugh.

Pugh was sitting on the organization's board when she received the contract from the University of Maryland system. And shortly after she received a payment from KaiserPermanente, the company received a $48 million contract from the city. Though we're sure that's just a coincidence. Furthermore, some of the "Healthy Holly" copies that Pugh sold to the University of Maryland Medical System remain unaccounted for, and some suspect they may never have been printed.


In response to the scandal, which was uncovered by reporters from the Baltimore Sun earlier this month, the city council demanded that Pugh resign in a terse letter signed by the entire membership. The city's congressional delegation has also called on Pugh to resign, as have other state officials.

Adding to the farce, Pugh and five of her closest aids took a paid leave a few weeks ago, around the time Hogan called for a criminal investigation, with Pugh claiming that she has been recuperating after a brutal bout of pneumonia. She has barely been heard from or seen in that time.

Maryland's chief accountant called Pugh's "self-dealing" arrangements to sell her books as "brazen, cartoonish corruption."

Unfortunately for its long-suffering residents, who have been fleeing the city in droves as crime spirals out of control, City Hall is no stranger to absurd corruption cases. Pugh won the mayor's seat after triumphing over ex-Mayor Sheila Dixon, who spent much of her prior tenure as mayor battling corruption allegations stemming from her 'misappropriation' of $500 in gift cards intended for needy families. Dixon was accused of taking the gift cards and using them as gifts for family members. Dixon left office in 2010 as part of a plea deal with prosecutors.

Pugh's predecessor, Stephanie Rawlings-Blake, who took over from Dixon after her resignation, opted not to seek another term after she was roundly criticized for her handling of the Freddie Gray protests/riots.

Unfortunately for the city, only a conviction can force a Baltimore mayor's removal from office. The city's charter leaves no options for ousting the mayor, which amounts to a major bargaining chip for Pugh.

However, now that she appears to have become the target of a federal investigation, it will likely become increasingly difficult for her to hang on. Perhaps she'll need to invent another illness to avoid dealing with the public fallout from these raids.

Published:4/25/2019 11:22:06 AM
[Comedy] ‘Avengers: Endgame’ is a thank-you to those who believed in the storytelling power of Marvel Studios So many moments were taken straight from the pages of the comic books, a nod to whom the late Stan Lee always referred to as the “true believers.” Published:4/25/2019 11:22:06 AM
[Markets] Rothschilds Liquidating Royal Heirlooms In Historic Auction

The Rothschild banking family is auctioning off furniture and artifacts which once belonged to European monarchies, according to Bloomberg, which calls the July 4th liquidation a "royal summer yard sale." 

Members of the storied clan, whose extravagant style influenced generations of the mega-rich, consigned about 57 lots to Christie’s July 4 auction in London. The trove is estimated at about 10 million pounds ($12.9 million). -Bloomberg

"There’s something mythical about the Rothschilds that’s attached to whatever they owned," said New York interior designer Robert Couturier. "They created their own world of taste and elegance. There’s an abandon of luxury that few other families had." 

The 'crown jewels' of the collection are a pair of Flemish-made giltwood cabinets commissioned by King Philip V of Spain around the year 1713. They're estimated to bring in 1.5 to 2.5 million pounds ($1.9 - $3.2 million US). 

Philip V cabinets (photo: Christie's)

Also up for sale is a mahogany writing desk crafted for Marie Antoinette around 1780 by Jean Henri Riesener, whose work exemplified the "Louis XVI" style. Reisener was paid by the French Crown "with a lavishness unknown since the days of Louis XIV," receiving some 900,000 livres between 1775 - 1784 (roughly $23 million USD) while he was also working for private clients. 

The desk may fetch as much as 1 million pounds ($1.3 million USD), according to the report. 

Jean Henri Riesener?????

The lavish style is known as le gout Rothschild and became the hallmark of the American Gilded Age, influencing the Rockefellers, Astors and Vanderbilts. The family was known to buy only the best of what was on the market. After the French Revolution in 1789, many pieces from the Palace of Versailles entered their collection.  -Bloomberg

A rectangular parcel-gilt, gilt-bronze and rock-crystal casket, Venetian, circa 1600. Estimate: £100,000-150,000. Offered in Masterpieces from a Rothschild Collection on 4 July at Christie’s London

That said, the ornate aesthetic of many of the pieces has fallen somewhat out of fashion, according to the report, which notes that people pay more for a picture of the 'Kimpsons,' such as this one which sold for $2.6 million to a young Chinese buyer. 

UNTITLED (KIMPSONS #3), 2003 -- Sold for $2.6 million on April 1, 2019

"Taste changes. Times change. Houses change," said Couturier. "It is an era that has definitely passed." 

That said, the Rothschild name should appeal to plenty of Christie's clients, particularly in Europe - according to the auction house's head of European furniture, Paul Gallois. Also interested are buyers from Russia, Asia and the Middle East. 

Another featured item is artist Jean-Honore Fragonard's Dans les bles, which is estimated at 700,000 to 1 million pounds ($900,000 - $1.3 million USD) - though it appears to have failed to sell at Sotheby's in 2015 for more than twice as much - as well as an 18th century sundial believed to have been commissioned by King Louis XV, estimated at 60,000 - 80,000 pounds ($77,000 - $103,000). 

Dans les bles

The Rothschilds don’t sell often, Gallois said. In 2015, Eric de Rothschild sold a pair of Rembrandt portraits to the governments of France and the Netherlands for $180 million. The collection of barons Nathaniel and Albert von Rothschild was sold by Christie’s in 1999, with a royal commode by Riesener fetching 7 million pounds. It’s now on view at Versailles, according to Christie’s. -Bloomberg

Christie's has not disclosed which Rothschild family members are selling in July. 

"Most of the houses were filled with such splendors," said Couturier. "They could come from any of the Rothschilds’ homes."

Separate of the auction, the Louvre has agreed to buy Rembrandt van Rijn's The Standard Bearer (1636) from the Rothschilds for an undisclosed sum, after France declared it to be a "national treasure." The museum has 30 months to find the necessary funds, accordsing to The Art Newspaper

When Jacob James de Rothschild bought The Standard Bearer for £840 in 1840 at a Christie’s sale in London, it was perhaps the earliest purchase of a Rembrandt by a member of the banking family. The work was inherited by his son Edmond de Rothschild, who donated a collection of 40,000 prints and 3,000 drawings to the Louvre, including a selection of Rembrandt’s etchings and drawings, in 1935. The painting, which was previously in the collection of the English monarch King George IV, now belongs to the children of Élie de Rothschild, who died in 2007. -The Art Newspaper

Rembrandt's The Standard Bearer (1636) Image via Wikicommons


Published:4/25/2019 3:27:03 AM
[Markets] Billions In African Gold Being Smuggled Through UAE By Crime Syndicates: Report

A bombshell investigative report by Reuters has blown open a hitherto under-reported massive black market trade which has seen billions of dollars worth of gold smuggled out of Africa and sold to Europe via "middle man" countries like the United Arab Emirates and others in the Middle East. 

The investigation found the Middle East to be the illicit gold "gateway to markets in Europe, the United States and beyond" based on new analysis of customs data, showing tons of off-the-books non-taxed gold pouring out of countries like Ghana, Ivory Coast, Tanzania, Nigeria, and war-torn Libya and Sudan, with no official oversight by the states in which the gold is mined. 

Image via The New Arab.

The numbers are staggering in terms of the newly revealed whopping unaccounted for increase in Middle East imports for the past decade and more

Customs data shows that the UAE imported $15.1 billion worth of gold from Africa in 2016, more than any other country and up from $1.3 billion in 2006. The total weight was 446 tonnes, in varying degrees of purity – up from 67 tonnes in 2006.

Much of the gold was not recorded in the exports of African states. Five trade economists interviewed by Reuters said this indicates large amounts of gold are leaving Africa with no taxes being paid to the states that produce them.

Though small scale and individual mining which has long fueled Africa's black market trade, often involving children and impoverished families, already known and understood, analysts interviewed by Reuters say the newly unearthed figures reveal illegal exporting on a much larger scale than was previously thought is taking place. 

Charts via Reuters

One probable explanation is large criminal syndicates are increasingly directly involved in mining and smuggling.

Recently, Ghana’s President Nana Akufo-Addo, who overseas Africa's second-largest gold producing state, condemned these growing “large-scale and dangerous” operations which he blamed on foreign mafia entities. 

UAE's Imports Beat Africa's Exports, via Reuters 

The Reuters investigation concluded the following in examining customs declarations

Reuters assessed the volume of the illicit trade by comparing total imports into the UAE with the exports declared by African states. Industrial mining firms in Africa told Reuters they did not send their gold to the UAE – indicating that its gold imports from Africa come from other, informal sources.

The leaders of Tanzania and Zambia have also recently made public statements highlighting heightened illegal mining and smuggling operations "on a vast scale, sometimes by criminal operations, and often at a high human and environmental cost."

The "artisanal" or small-scale mining approach, however, often leaks chemicals and other pollutants into soil and rivers, as detailed in the report. This includes cheap purification methods like using mercury, nitric acid, and even cyanide, which can turn local water supplies toxic. 

Dubai, UAE

With gold now trading at prices of over $40,000 per kilo, the illicit trade has seen a recent boom.

Mine in Sierra Leone, via PRX

In interviews with economists, analysts, and individuals involved in black market activity, Reuters cited the following:

Gold can be imported to Dubai with little documentation, African traders told Reuters.

Elsewhere an adviser for the African Union's mineral oversight arm, Frank Mugyenyi, said “There is a lot of gold leaving Africa without being captured in our records.” Speaking on the Middle East in particular as a key transit point, he added, “UAE is cashing in on the unregulated environment in Africa.”

Reuters investigation: "The UAE is the biggest destination for African gold. But Africa’s biggest exporting countries are not always the biggest gold producers, according to trade data."

The report revealed that the numbers simply don't add up:

From 2006 to 2016, the share of African gold in UAE’s reported gold imports increased from 18 percent to nearly 50 percent, Comtrade data showed.

The UAE’s main commodity marketplace, the Dubai Multi-Commodities Centre (DMCC), calls itself on its website “your gateway to global trade.” Trading in gold accounts for nearly one-fifth of UAE’s GDP.

Simply put, no official company or industrial miner could account for the massive data gap. The report continues:

However, no big industrial companies reached by Reuters – including AngloGold Ashanti, Sibanye-Stillwater and Gold Fields – say they send gold there. Reuters contacted 23 mining companies with African operations, the smallest of which produced around 2.5 tonnes in 2018: 21 of them said they did not send metal to Dubai for refining, the other two did not respond.

Astoundingly, it appears the criminal gold trade through the Middle East is actually outpacing official purchases in that direction out of Africa. 

Further, the UN has over the past years spotlighted the UAE as among countries that continue to allow the trade in "conflict gold" originating from war-torn African states, which international monitoring bodies have sought to stamp out. 

The findings of the investigation were presented to 14 African governments, but few leaders were willing to acknowledge the depth of the problem, or stonewalled. "Of them, five said it reflected an existing concern about gold being smuggled out of their countries that they are trying to address. One said they did not think gold smuggling was a problem for them. The rest declined to comment or did not respond," according to the report. 

Published:4/24/2019 9:49:18 PM
[Donald Trump] President Trump, NeverTrumpers, and keeping kosher

Regarding NeverTrumpers, are there are two different kinds: — the sleazy grifters and the genuinely principled people who cannot swallow the idea of Trump? The Torah (that is, the five books of Moses) imposes multiple life rules on Jews and how many of these rules a given Jew follows depends on that person’s degree of […]

The post President Trump, NeverTrumpers, and keeping kosher appeared first on Bookworm Room.

Published:4/24/2019 7:47:49 PM
[Markets] How CIA & Allies Helped Jihadists In Syria: French Covert Ops Expert Exposes New Details

Authored and submitted by

Maxime Chaix, an expert on clandestine operations, intelligence and US foreign policy, is a journalist and regular contributor to He has written La guerre de l’ombre en Syrie (The Shadow War in Syria, published in French by Éditions Erick Bonnier), a shocker of a book in which he reveals insightful information on the support which several Western intelligence services provided to jihadist militias in Syria, starting with the CIA. His investigation reveals a multi-faceted state scandal and points out the murky game played by the Western powers and their Middle Eastern allies in the Levant.

An exclusive interview by Emmanuel Razavi (founder and editor of

* * *

Emmanuel Razavi: First of all, please refresh our memories about what operation Timber Sycamore is.

Maxime Chaix: Timber Sycamore is the codename of a covert operation officially authorized by Obama in June 2013 to train and equip the anti-Assad rebellion, but which actually started in October 2011, when the CIA was operating via Britain’s MI6 to avoid having to notify Congressthat it was arming the rebels in Syria. Originally, the CIA and MI6 (the British foreign intelligence service) set up a rebel arms supply network in Syria from Libya — a plan that involved the Saudi, Qatari and Turkish intelligence services.

In 2012, probably in spring, Obama reluctantly signed a top-secret executive order, of which little is known other than that it authorized the CIA to provide “non-lethal support” to the rebels in Syria. In concrete terms, then, what the CIA did was to link up its Qatari and Saudi allies with a number of arms manufacturers in the Balkans (Bulgaria, Romania, Serbia, Croatia, etc.). With the backing of NATO, which controls arms exports from the Balkans via EUFOR, Qatari and Saudi secret services began buying up weapons and ammunition from these countries to illegally equip anti-Assad rebels.

A few months later, in October 2012, the New York Times revealed that this vast CIA-sponsored arms trafficking was mainly going to support jihadist groups in Syria, while arms exports by air were growing, with weapons being injected into Syrian territory from “operation rooms” in Turkey and Jordan, through the FSA (“Free Syria Army”) and local arms traffickers.

Finally, it turned out that these “operation rooms” were cobbled together by fifteen Western and Middle Eastern intelligence services, including the DGSE(French foreign intelligence service) and MI6, although the we do not yet know exactly what role these various agencies played in this secret war. What is clear — and what I demonstrate in my book with irrefutable evidence —is that tens of thousands of tons of weapons and millions of rounds of ammunition were brought into the Syrian theater of war by this operation. It is also proven that these armaments mostly went to equip jihadist groups, including the terrorist militia which proclaimed itself “Islamic State” in June 2014.

Ultimately, Donald Trump decided to phase out this operation in early summer 2017. This was a major setback for the CIA, as the US President was thereby conceding the defeat of the United States and its partners in the war against Syria and its Russian, Iranian and Lebanese allies.

* * *

ER: What concrete evidence do you have to show that US intelligence services have provided support to jihadist militias in Syria?

MC: The coordination role that the Agency signed off on in the fall of 2011 is now a proven fact, as we know that it was belatedly confirmed in June 2018 by Ben Rhodes, Obama’s chief adviser from 2009 to 2017. During the interview in question, Rhodes argued that the blacklisting of al-Nusra Front on the State Department’s list of terrorist organizations in December 2012 was a “schizophrenic” move, since it was obvious that the jihadist militia was a “big chunk” of the anti-Assad opposition, as he put it in his own words. During that interview, journalist Mehdi Hasan not only elicited from him that the CIA had played a coordinating role in this vast arms trade, but also that US involvement in this shadow war had been much greater than we thought.

According to the Washington Post, it was one of the CIA’s “largest covert operations” in its history. In January 2016, the New York Times confirmed this, noting that the CIA’s maneuvers to overthrow Assad were part of a multinational campaign involving billions of petrodollars from the Gulf states, mainly spent by Saudi Arabia.

It must be understood that this secret war ushered in, between 2011 and 2017, close cooperation between Western secret services and their Turkish and Middle Eastern counterparts. Thus, many experts and journalists were making a mistake by analyzing the operations of the various Middle Eastern powers in isolation from those of the Western governments. On the contrary, as the former Qatari Prime Minister admitted in 2017, it was a joint and coordinated operation involving all of those intelligence services.

Due to the record number of public and private funders backing this campaign, and the tens of thousands of anti-Assad mujaheddin who were directly or indirectly aided by the CIA and its allies, I believe this could be the most massive clandestine operation in the history of the Agency. However, I have not been able to determine that with certainty due to the secrecy of this shadow war, which prevents access to archives and severely limits the quantity of leaks to the press.

The fact remains, however, that I was able to assemble in my book hundreds of undisputed sources which combine to corroborate my writing. In this book, internationally renowned researchers such as Joshua Landis and Christopher Davidsonsupport my arguments, which I developed after a long investigation that I launched in 2014. Once again, I invite your readers to consult the evidence cited in my book, as it is overwhelming. I would take this opportunity to point out that Bashar al-Assad and his allies have committed major abuses against Syrian civilians, and that my book is not intended to excuse what they are responsible for.

Nevertheless, and to date, the Western media have focused mainly on the crimes of Assad and his supporters, while suppressing or downplaying the vast shadow war launched by the CIA and its partners in the fall of 2011.

* * *

ER: What role did France play in these jihadist militias in Syria? Did it unambiguously support members of the Muslim Brotherhood and al-Qaeda?

MC: Operation Timber Sycamore is a clandestine operation, and such campaigns are not owned up to by those sponsoring them — at least, not typically. In this case, however, the operation has become one of such magnitude over time that Western powers have had to communicate something about it, albeit misleadingly. That is to say, succor to jihadist groups has long been described by Western government spokesmen as “non-lethal support” for so-called “moderate” rebels, yet the reality on the ground is that the “moderate rebel force” that is the Free Syria Army (FSA) has served as a pool of fightersweapons and ammunition for the anti-Assad jihadist nebula, whose tacticians and militiamen were much more effective than the FSA itself.

As I explain in my book, the FSA has been dependent on jihadist groups, first and foremost al-Nusra Front, and vice versa. Other factions of the FSA were completely put out of action by the jihadists, their arsenals being looted by the Islamist militias, including the Islamic Front in December 2013. At the very least, it is clear that the FSA as a disunited and complex bundle of anti-Assad armed groups was supported by Western powers as it fought shoulder to shoulder with jihadist groups, including with what later became Daesh, until the winter of 2013-2014.

In January 2014, the first major fighting erupted between Daesh and other rebel groups, including al-Nusra Front. It must be emphasized that, until their split in April 2013, al-Nusra Front and the soon-to-be-called “Islamic State” formed a single entity. More specifically, the founder of al-Nusra was sent to Syria in August 2011 by the leader of the future Daesh, Abu Bakr al-Baghdadi, to fight Assad’s troops.

However, between 2012 and 2014, it is beyond question that al-Nusra was the driving force of the rebellion in Syria, its tacticians developing major operations that allowed the conquest of various territories by the “Islamic State”, such as Camp Yarmouk south of Damascus, Raqqa, or Deir ez-Zor. In summary, the combined operations of the FSA and al-Nusra enabled the nascent Daesh to then establish itself in many Syrian cities following the split between al-Nusra and the “Islamic State”.

It should be noted that, through the FSA, al-Nusra had been enjoying CIA and MI6 support since early 2012, but it is unclear precisely when the French DGSE started becoming involved in this operation. According to François Hollande, the “moderate rebels” of the FSA were in receipt of French lethal support from the end of 2012, in violation of the EU arms embargo on Syria, which was only lifted in May 2013. That same year, Colonel Oqaidi, the commander of the FSA, said to camera that his relationship with Daesh was “good, and even brotherly”… And, as revealed during my investigation, Obama’s then ambassador to Syria, Robert S. Ford, telephoned Colonel Oqaidi to condemn the FSA’s persistent collaboration with al-Nusra.

At the time, and since at least the fall of 2012, the French intelligence services were alerting their government to the fact that the Muslim Brotherhood and jihadist groups such as al-Nusra were the driving forces of the anti-Assad rebellion. Despite these alarming surges in theater, Paris, London and Washington resolved to persist in their support for the anti-Assad rebellion, secure in the assurances being given them by their allies in the Gulf that Assad would be toppled quickly and that these groups would not be a problem after the fall of the Syrian government. Both these predictions turned out to be wrong, and the most brutal jihadist group in the Levant struck France directly on November 13th, 2015.

* * *

ER: To be clear: In your opinion, France abetted a clandestine operation by supporting entities that then organized attacks in France?

MC: As I explain in my book, the French state and its key Western allies did not directly support Daesh, but they oversaw a system that massively fueled what I call the anti-Assad jihadist nebula, of which the haplessly-named “Islamic State” on Syrian territory was an outgrowth and a driving force. I do not think that the French state or its allies, in carrying out this operation, ever imagined that Daesh would end up attacking Paris on November 13th, 2015.

On the other hand, it is clear that our government and its BritishAmerican and Israeli allies were consciously arming jihadist groups. In France, some parliamentarians of the PSLR and LS parties confirmed to me that the DGSE was involved in supporting groups that were not as “moderate” as they were being presented to us in the media. I would go even further, and this is one of the main arguments that I develop in my book: by arming and supporting the FSA in various ways, the Western powers encouraged the rise of what then became the “Islamic State”, which fought “hand in glove” with the FSA from the beginning of 2012 to the winter of 2013–2014. From the time of the break  between the FSA and Islamic State in January 2014 onward, the FSA and al-Nusra maintained a fusional relationship, both against the Assad forces and against Daesh.

Yet in August 2014, François Hollande acknowledged that French support for the FSA was continuing. Was he unaware of the close ties between the FSA and al-Nusra? If so, such a level of misinformation at the top of the government would be alarming. Nevertheless, in view of the available evidence, it is more likely that French leaders under the Hollande presidency were fully aware of the fact that al-Nusra was inextricably linked to the FSA.

Moreover, in a book that was never contested in litigation by the then French Foreign Minister Laurent Fabius, journalists Georges Malbrunot and Christian Chesnot claimed that the head of our diplomacy knew full well that Saudi Arabia and Qatar were infiltrating into al-Nusra’s private funding networks paid agents, professional trainers, known to DGSE officers. Despite this, according to Chesnot and Malbrunot, Fabius was complaining that the Syrian state and its armed forces were not being “hit hard enough [and] not strongly enough”.

ER: Speaking of Laurent Fabius, why does his name feature in the Lafarge affair? Is there any evidence that he endorsed a financial agreement between that French company and Daesh?

MC: Given his active stance on the Syria dossier, it is inevitable that his name pops up in the Lafarge affair. What’s more, there are even acronyms in it familiar to the French: DGSI (the Directorate General for Internal Security), DRM (French Military Intelligence Directorate), DGSE, and so on.

Let’s be clear: the Jalabiya cement factory, constructed by Lafarge in 2010, was transformed during the war into a “bridgehead” for the French intelligence services: that is to say, for the Élysée [President’s office], the Quai d’Orsay [French Foreign Ministry] and all the other ministries concerned. Indeed, as journalist Guillaume Dasquié has proved, “the documents in the case, the testimonies of the few insiders and the documents to which the JDD [the Journal du Dimanche Sunday paper] had access reconstruct a different story [than that put forward by the French authorities.] […] This directly implicates the command in charge of counter-terrorism, the DGSI, the Quai d’Orsay, and the external intelligence services of the DGSE. It spells out for us an improbable war-zone game of chess between industrialists, spies and diplomats, with everyone taking advantage of the presence of the others to advance his pawns, at a time when the Islamic State had not yet committed an attack on French soil.”

Laurent Fabius said in front of the investigative magistrates that he had not been aware of Lafarge’s actions in paying out cash to various local jihadist groups, including the ineptly-named “Islamic State” — an explanation that failed to convince some experts on the issue, including Georges Malbrunot. This is all the more eyebrow-raising since it has now become apparent that the French Military Intelligence Directorate was monitoring transactions between Lafarge and the various armed groups in the field.

So I return to my previous explanation: a clandestine operation is mounted in such a way that its sponsors have deniability of all knowledge of, as well as their role in, any maneuver of this type. It is now clear that the DGSE has been involved since at least 2012 in supporting the nebula of armed groups opposing Bashar al-Assad.

As we also know, Laurent Fabius was the most active of Hollande’s ministers on the Syria dossier, acting in the interests of a fickle “Sunni diplomacy” that put our trade relations with Saudi Arabia first — the main state funder of Timber Sycamore. Consequently, it is impossible that the Quai d’Orsay could have been unaware of Lafarge’s actions in Syria, which were part of several intelligence or destabilization operations carried out by the French secret services in that country. Renowned researcher Fabrice Balanche is of the same opinion on this as Guillaume Dasquié or Georges Malbrunot.

* * *

ER: On account of what interests might Laurent Fabius have allowed the DGSE to support islamists? Was he acting on behalf of the Saudis, as this same Georges Malbrunot and his co-author Christian Chesnot suggest in their book, Nos très chers émirs [Our Dearest Emirs]?

MC: First of all, it should be pointed out that the French President is supposed to be the one who sponsors, as a last resort, a clandestine operation. However, he enjoys legal impunity in the exercise of his mandate, which is not the case for any of his ministers.

During the Hollande presidency, we witnessed a blatant tendency for the French state to support and protect its Gulf allies. This policy materialized not only in Fabius’ hard line against Iran in the nuclear deal negotiations, but also, and much more seriously, in the shifty operations that aimed to shore up the disastrous interventions of the Saudis and their partners in Yemen and in Syria. This approach favorable to the Saudi monarchy was maintained under the Macron presidency, yet with a pro-Qatar instinct which became evident in the aftermath of the Gulf crisis that has set that emirate against Riyadh and Abu Dhabi since 2017.

But until then, Saudi Arabia was expressly supported by the French state, owing to the economic and strategic interdependencies that are at stake between Paris and Riyadh. Consequently, and in the interests of this notorious “Sunni diplomacy”, the French state has not only turned a blind eye to the suspicious deeds of Saudi Arabia in Syria and Yemen; it has directly supported Saudi campaigns, in the most discreet way possible.

These maneuvers have led to a literally schizophrenic political stance, whereby in fact the French state trumpets its operations against terrorism whenever it can, but further down at the level of the directorate and the intelligence services, strategies that have the specific effect of bolstering jihadist groups are being illegally imposed on some countries, such as SyriaYemen or Libya.

In the case of that latter Libyan operation, an anonymous DGSE officer revealed to our colleagues at Canal+ TV station that he had been ordered, in February 2011, to destabilize Benghazi in coordination with the Qatari intelligence servicesnotorious supporters of the Muslim Brotherhood, who at that time were dominating the Libyan jihadist nebula.

According to the reporter François de Labarre, this policy was then challenged by the French Ministry of Defense under Jean-Yves Le Drian, who used the DGSE to support General Haftar against Islamist armed groups. However, it is difficult to explain why the Quai d’Orsay [French Foreign Ministry] continued to support Abdelhakim Belhadj, one of the founders of al-Qaeda in Libya, who was appointed military commander of Tripoli in August 2011.

It should be noted that Belhadj is Qatar’s man in Libya, and that he is one of the most influential figures of the Muslim Brotherhood in that country. According to François de Labarre, President Hollande was unable to decide between the Defense Ministry’s pro-Haftar line and the pro-Belhadj policy — that is, pro-Qatar and pro-Muslim Brotherhood — which the Quai d’Orsay was adhering to. One is left wondering, therefore, whether François Hollande was able to arbitrate France’s foreign policy. In any case, one can be worried about the schizophrenia that this implies. Indeed, this can lead to operations against jihadist groups initially backed by our intelligence services and their allies – operations that are deadly in effect upon civilians.

In October 2018, Paris Match magazine co-editor Régis Le Sommier interviewed Russian Foreign Minister Sergei Lavrov. On that occasion, Lavrov revealed a shocking conversation between Laurent Fabius and himself: “Some time after the bombings of Libya, Laurent Fabius, [then] Minister of Foreign Affairs, had called me. According to [the Malian capital] Bamako, mujaheddin from northern Mali were nearing the French contingent’s positions. France intended to stop them by gaining the approval of the Security Council, and I was in favor. I told Laurent Fabius: ‘You surely understand that you are now going to face the same guys you armed in Libya.’ He chuckled and said to me, ‘C’est la vie’.” Lavrov’s comments were not denied by Laurent Fabius, so this type of flippancy in the face of the consequences of French foreign policy towards terrorist groups — and thus of the populations they threaten — is alarming.

The same is true of the Syrian dossier, which led our leaders to support for nearly five years a Free Syrian Army of which they could not ignore its close ties with al-Nusra since 2012, including when that Syrian branch of al-Qaeda and the ineptly-named “Islamic State” were a single entity.

ER: Should an investigation into this be opened by the counter-terrorist section of the Paris prosecutor’s office?

MC: Initially, I became interested in France’s clandestine actions in Syria in the spring of 2014. At the time, parliamentarian and former counter-terrorist judge Alain Marsaud was claiming in the media that our government had previously supported and infiltrated the al-Nusra Front.

The following year, he revealed to me that the president-supporting majority under François Hollande had refused any parliamentary inquiry on this issue so as not to “uncover such collaboration with a terrorist group, to quote his remarks. It should be noted again that several parliamentarians, including Claude Goasguen (LR party), Jacques Myard (LR) and Gérard Bapt (PS party), have leveled similar accusations at the French government. On LCP [French parliamentary TV], Mr. Goasguen declared in June 2015 that the French state was helping “al-Qaeda in Syria”, then the following year Gérard Bapt confirmed me the “clandestine support by the French state of the various islamist movements in Syria, in view of the porosity and proximity of these allied groups in the field”. He added that “French support for rebels in Syria, and more generally Western support for them, continued even after the attacks on Charlie Hebdo and [the French Jewish supermarket]Hyper Cacher, though these were claimed by al-Qaeda.

I must say that this explanation by Gérard Bapt seems to me the most accurate: according to him, the French state has supported militias evolving within a nebula of armed groups which was in constant flux, but which indisputably had al-Nusra Front among its driving forces — as Obama’s close adviser Ben Rhodes himself acknowledged.

Let’s not forget, either, that Claude Goasguen had frequently warned the French state on LCP against this policy of support for anti-Assad factions. Put simply, it is a safe bet that our government will oppose by all means the opening of parliamentary and judicial investigations around the clandestine actions of the French state in Syria.

But we are looking here at a case obviously much graver than the botched DGSE operation against the Rainbow Warrior, during François Mitterrand’s first term. Let us be clear: if several of our parliamentarians have publicly risen to declaim French state support of al-Qaeda’s branch in Syria, it is inconceivable that they did so without having specific information to back their accusations — which were never officially denied by the government.

As taxpayers and as citizens, we should be refusing to accept that our authorities can carry out such dangerous and misguided policies on our behalf and with our tax money, but without our consent — and without our even being aware of it at the outset.

Therefore, and as I explain in my book, several legal and factual arguments could justify at least the setting-up of a parliamentary committee of inquiry, though it seems unlikely to me that investigative magistrates will ever want to launch investigations into such a sensitive subject. Indeed, this clandestine operation is part of the state privilege and conduct of France’s foreign policy — an area in which the Executive has powers so exorbitant that it is able to support Islamist groups abroad that are officially considered enemies within our own borders.

Authors’s note: if you think this interview was interesting, you can support by clicking here.

Published:4/22/2019 11:04:22 PM
[Markets] Seattle's Revolt Of The Elites

Authored by Christopher Rufo via,

With residents fed up by the homelessness crisis, city leaders and their allies coordinate a PR campaign to convince them that everything is fine...

In Seattle, people are losing patience with city leadership over the homelessness crisis, but the frustration is running in both directions: the city’s political, cultural, and academic elites are conducting their own revolt—against the people.

Since the release of Eric Johnson’s documentary Seattle Is Dying, which depicts an epidemic of street homelessness, addiction, crime, and disorder, city elites have launched a coordinated information campaign targeted at voters frustrated with the city’s response to homelessness. Earlier this month, leaked documentsrevealed that a group of prominent nonprofits—the Bill & Melinda Gates Foundation, the Campion Advocacy Fund, the Raikes Foundation, and the Ballmer Group—hired a PR firm, Pyramid Communications, to conduct polling, create messaging, and disseminate the resulting content through a network of silent partners in academia, the press, government, and the nonprofit sector. The campaign, #SeattleForAll, is a case study in what writer James Lindsay calls “idea laundering”—creating misinformation and legitimizing it as objective truth through repetition in sympathetic media.

The key messages of the campaign include a number of misleading claims, including:

“Seattle is making progress to end homelessness,”

“1 in 4 people experiencing homelessness in our community struggle with drug or alcohol abuse,” and

“[62 percent of Seattle voters believe] we are not spending enough to address homelessness.”

All three contentions fail to meet basic scrutiny:

  • street homelessness has increased 131 percent over the past five years;

  • King County’s lawsuit against Purdue Pharma admits that “the majority of the homeless population is addicted to or uses opioids” (not one in four);

  • and 62 percent of Seattle voters agree to the statement “we are not spending enough” only when it is directly prefaced in the polling questionnaire by the phrase “other cities of the same size are spending 2 to 3 times the amount that Seattle is and are seeing significant reductions in homelessness”—itself an unsubstantiated claim. (When the same question is presented neutrally, without the framing, support for “we are not spending enough” drops to 7 percent).

Nonetheless, the media have widely circulated or echoed Pyramid’s talking points. “New poll shows the majority in Seattle say we have a moral obligation to help homeless people, and we need to spend more,” declared Seattle Timesdata journalist Gene Balk. Catherine Hinrichsen, director of Seattle University’s Project on Family Homelessness, published “6 reasons why KOMO’s [Seattle’s ABC affiliate, which broadcast Seattle Is Dying] take on homelessness is the wrong one” in the local magazine Crosscut, arguing that the documentary “conflates homelessness with drug use, mental illness, and crime.” And Seattle mayor Jenny Durkan told reporters that “we have made a lot of progress” and dismissed the documentary as “an opinion piece.” Her office pushed the #SeattleForAll messaging on government social media channels.

Many of the authors and news outlets that published the #SeattleForAll messaging failed to disclose that their work is funded by the same group of foundations that hired Pyramid Communications, and that their content is distributed in direct coordination with Pyramid and the City of Seattle. For example, in her story, Hinrichsen neglects to mention that the Bill & Melinda Gates Foundation is the sole funder of her work at the Project on Family Homelessness; the publisher, Crosscut, does not reveal that the Gates and Raikes foundations are major funders of their operations and their homelessness coverage.

In its own widely circulated story on the polling data, the Seattle Times does disclose that the Bill & Melinda Gates Foundation, the Campion Advocacy Fund, and the Raikes Foundation support their homelessness coverage—but not that Pyramid commissioned the polling and coordinated the campaign with the city and the mayor’s office. (Pyramid’s Chris Nelson confirmed via email that the #SeattleForAll coalition works in tandem with “City and County advisors working in the homelessness space,” but he refused to answer whether the coalition deliberately withheld this information from the Seattle Times and other media.)

The inner workings of the #SeattleForAll campaign tell a clear story: a group of well-funded philanthropies hired a PR firm to produce misleading polling results, distributed them through the city’s main newspaper and other media outlets (many of which enjoy generous donations from those same philanthropies), and then concealed the fact that the messaging was part of a broader campaign coordinated with the city. The “counter-narrative” to the Seattle Is Dying documentary was not a spontaneous reaction of a diverse group of experts; it was a planned effort by Seattle’s philanthropic, academic, media, and governmental elites to steamroll critics. Seattle’s institutional powers, in other words, attempted to quash the emerging public consensus that the city’s approach to homelessness is failing.

A quarter-century ago, social critic Christopher Lasch observed the beginnings of this kind of phenomenon, arguing that America’s political and cultural elites were starting to revolt against the people. While during Lasch’s time this elite contempt was directed against “middle America”—an early iteration of today’s “deplorables”—coastal progressivism has now reached the point that the new elites have gone into revolt against themselves. In Seattle, the emerging activist class—billionaire philanthropists, multimillionaire politicians, and like-minded commentators in academia and prestige media—has begun an information offensive against the liberal, wealthy, educated residents of a city that gave Hillary Clinton 92 percent of its votes. Scolding the public to be more “compassionate,” this new hyper-elite has shown only contempt for middle-class residents in Seattle’s hardest-hit neighborhoods.

The biggest problem with such top-down management of public knowledge is that it prevents honest debate—which Seattle desperately needs. The gap between elite rhetoric and on-the-ground reality continues to widen. In the most recent polling, 68 percent of Seattle voters say that they don’t trust the mayor and city council to solve the homelessness crisis—yet the foundations, the communications firms, and the mayor’s office keep lashing out at dissenters. In The Revolt of the Elites, Lasch revealed the danger of ignoring public opinion and limiting debate to elite influencers: “Since political debate is restricted, most of the time, to the ‘talking classes,’ as they have been aptly characterized, it becomes increasingly ingrown and formulaic. Ideas circulate and recirculate in the form of buzzwords and conditioned reflex.”

The #SeattleForAll campaign is destined to fail. The more that majority opinion gets muzzled, the stronger the eventual backlash will be. Seattle Is Dying spoke to the anger of hundreds of thousands of residents whose voices haven’t been heard. City leaders would be wise to give the PR efforts a rest and do some listening. The residents of Seattle are demanding change.

Published:4/21/2019 9:27:30 PM
[Books] The Power Line Show, Ep. 120: Reckoning With Race: America’s Failure (Steven Hayward) Just in time for your Easter Sunday afternoon walk or Monday morning commute, the latest podcast. Gene Dattel is my extraordinary guest on this week’s show. Gene is the author of a book that deserves to be much better known—Reckoning With Race: America’s Failure (Encounter Books). This remarkably compact book is brimming with details about and revisions to the standard narratives of race relations in America from the colonial era Published:4/21/2019 1:59:21 PM
[Markets] It's 2016 All Over Again. Or Is It?

Authored by Chris Martenson via,

The fate of the global economy rides on the answer...

Conditions today mirror 2016, when growing weakness in the global economy and wobbling financial markets caused the world’s central banks to absolutely freak out.

They responded by dumping more thin-air money into the system than ever before in history. And it worked (for them at least). Economic growth stabilized; and the prices of stocks, real estate, and other assets enjoyed another three-year joyride.

Similarly, as things started getting shaky in late 2018, the same playbook was deployed. And again, we've seen stocks rocket upwards ever since. 

But will the strategy actually work this time?  It's unclear. And a lot is riding on the answer.

Back in 2016 the financial world was falling apart. The US dollar was spiking. Emerging market currencies were getting destroyed. The S&P 500 equities was exhibiting a classic head-and-shoulders formation, indicative of a coming plunge. The macro-economic outlook looked grim, too, with global trade slipping into contraction:


But then everything suddenly turned around, as if by magic. 

Well, we now know that ‘magic’ was actually a massive quantity of monetary and fiscal stimulus pumped into the system by the world's central banking cartel. 

Our concern is that the monetary and fiscal authorities are thinking that since they were “successful” back in 2016, they can repeat the same strategy here in 2019. 

But can they? Maybe. Or maybe not. 

If the answer is “yes,” our prediction is to expect what we got last time, just taken to more extremes:  a vastly wider wealth gap between the 1% and everyone else, accelerated destruction of savers and the middle classes, and anemic GDP growth coupled with explosive further growth of global debt levels. 

If the answer is “no,” a massive crash of epic proportions, unlike any most of us have ever experienced, is in store. Credit bubbles are ugly beasts. They're fun while they last but devastating when they burst. The longer they carry on, the worse the crash when it comes -- this bubble has been going on for longer than most people ever could have imagined.

2016: A Post-Mortem

It's eerie how closely recent developments resemble what took place at the start of 2016.  

In 2016, there were slumping emerging markets, a slew of macro indicators pointing to a global slowdown, and equity bear markets all over the place. And then – presto! – everything reversed during one night in February 2016. It was as if nothing had ever happened.

Somehow all those fundamental macro warnings just melted away in a burst of financial market exuberance.

S&P futures took off in the overnight session between Feb 7th and the morning of February 8th as if the entire world suddenly had a change of heart:

From that moment on, the S&P started climbing to new all-time highs, practically unabated, until September 2018.

So, what happened here?  What new information became available to the world’s investors in the wee late night/early morning hours of February 8th , 2016 that wasn’t available the day before?

Nothing fundamental, that’s for sure. Massive buy orders showed up in the middle of the night and it was only later that the economic data began to turn the corner. 

What came first was the tremendous application of monetary, fiscal and financial stimulus.  Just gobs and gobs of it.  Economic recovery, such as it was, showed up later.

What you need to understand is that between 2016 and the middle of 2018 the world’s central banks opened up the floodgates here and poured the most amount of money into the system since the Global Financial Crisis began back in 2008.

In the chart above, you can see where the central banks panicked back in mid-2015. It didn't take long for their combined printing hit the highest run-rate of the entire crisis at $2.5 trillion dollars by mid-2016.  They then kept the pedal to the metal clear through mid-2018.  This represents by far, the largest stimulus of the entire mis-begotten Quantitative Easing experiment that began after the GFC -- printing up money from thin-air to jam into the financial markets (and thus into the portfolios of the rich).

The. Most. Money printing. Ever. 

By a huge margin.

This wasn’t even remotely in line with their public statements, which were all geared towards soothing and placating the masses.

“The economy is robust”  they said.  “Growth is on track,” they cooed.

But behind the scenes they were hastily, and often haphazardly, dumping the largest-ever quantity of money and credit into the system the world had ever seen. Not unlike how a 5-year-old, fearing getting caught, pushes a pilfered bag of chips quickly under a nearby sofa cushion.

As mentioned frequently here at Peak Prosperity, even though a painful correction was likely avoided by these efforts, not everybody shared equally in the resulting years of continued gains:

In a system now as heavily financialized as ours is, the benefits of such extreme stimulus efforts accrue exponentially to those who own and control financial assets -- those at very tippy-top of the wealth/income distribution.

It's amazing to see how not only does the top 1% dramatically outpace the bottom 99%, but the top 0.1% leaves the top 1% in the dust. Same for the top 0.01% vs the 0.1%. And the top 0.001%? They're in a stratosphere all their own.

The developed world is quickly becoming an oligarchy. And more central bank printing only exacerbates that dynamic.

The more they prop up the system with more money printing, the more Trumps, Brexits, Yellow Vest protestors, and populist politicians we’ll see. Money printing is a political act of wealth redistribution from the bottom to the top. It’s unfair and socially destabilizing.

Even if they can't yet see the true culprit here, the masses are beginning to wake up to how badly screwed they're getting. 

Until And Unless

“Until and unless,” we wrote in early 2018.  We warned that "until and unless" the world’s central banks reversed course and began printing like crazy, the vast global cesspool of over-expensive bubbly financial assets would soon undergo a painful downwards re-pricing.

And start fall they did; through September 2018 up through Christmas Eve.  Then, as they have done so many times, a “miracle” bottom was formed -- one that didn’t resemble a true bottom, where buyers and sellers settle in and wrestle for a while with neither side gaining ground. What we experienced instead was a very steep “V.”

A “needle bottom” if you will; an upside-down Matterhorn:

What caused this violent reversal?  Some immediate return of global macro conditions to amazing awesomeness?  Some new data revealing massive new sources of corporate profits?

No, none of that.  It was just another $1 trillion of central bank money printing, coupled with every other conceivable option to shove additional money and credit into the system.

In a recent interview, James Grant (of Grant's Interest Rate Observer) provided his views on the Fed and other central banks and their role in backstopping every downwards wiggle in today's stock ““markets”” (emphasis mine)

Q: What would you do if you were at the helm of the world’s most powerful central bank?

A: I fear it might be too late, but to start with, I’m in favor of interest rates which are discovered in the marketplace. And, at the very short end, interest rates ought to be pitched at a level that provides some premium to the inflation rate.

So, my first order would be to give a speech saying that we are out of the business of manipulating expectations; we are out of the business of manipulating the stock market. The stock market is going where it wants to go, and if it goes down a lot, so be it. That’s not our line of work. We are in the business of securing a currency which holds its value and which provides a good medium of exchange.

Q: Sounds straightforward. But how would the financial markets react?

A: They would consider it as very radical and very unhelpful. But the way forward is to somehow reinstitute the interaction of supply and demand on Wall Street and to get the Fed out of the business of wholesale manipulation of values. Because today, the Fed is expected to intervene when things go badly and what this has given us is immense distortions.


The central banks are so terrified of the Franken-Markets they’ve created that they now intervene both directly and indirectly, overtly and covertly, to do anything and everything necessary to prevent them from ever going down again.

James Grant thinks the Fed should get out of the business of wholesale manipulation of asset prices, and we could not agree more.  Its constant interventions and manipulations are terribly destructive on so many levels – societally, structurally, ecologically, and politically – that it’s worth an entire book to point them all out. 

But here we are. And the Fed does not look like it's planning to change its behavior anytime soon.

This Better Work

Our macro-beef with all of this is that even if the Fed is “successful”, we all lose. 

The natural end to its current policies is a tiny fraction of the population owning everything.

But even worse than that, our planet is being despoiled by this desperate quest for more fantasy wealth, represented by fantasy digits within the entirely human-contrived fantasy of our financial markets. 

The "immense distortions" that James Grant mentions above lead to all sort of malinvestment that should never happen in a rational world. But as long as there's a short-term profit motive funded by endless thin-air money, there's an incentive to harvest the last tree, fish the last tuna, drain the last aquifer. And then where will we be?

If we don’t tame our addiction to endless growth(always more, more!) then we’ll simply consume ourselves out of existence, or at least to a civilization-ending conclusion.

Real wealth consists of real things. It’s health. It's the safety and security of those we care about. It's access to food and clean air and water. It's being in meaningful  relationships, held lovingly in the here and now.

What we call money is a claim on wealth. But it's not real wealth in and of itself.  Hopefully we can all agree that if the sun blinked out for some reason, we’d soon realize that money was never the thing of vast importance we made it out to be. 

Similarly, if our ecosystems crash, we’ll learn that the pursuit of money is much less important than we currently realize. Certainly not as important as eating.

Or if we stupidly allow the gap between the wealthy and the poor to widen, we’ll soon wake up to the type of revolution that history books are full of. 

The steps being taken by today's central banks are diverting us from having the conversations we really need to be engaging in. Those in power perpetuate the repeatedly disproven idea that printing money is the same thing as prosperity.  Our future is bleaker for their actions, not brighter.

The younger generations are starting to figure this out in droves as they face the piling evidence that they are inheriting a world burdened by debt, pollution and serious inequality. This is something the Baby Boomers running the central banks really ought to be noticing.

Sooner or later the propping, the manipulating, the cajoling and the distorting will fail. When it does, the aftermath will be quite unpleasant.

Tragically, we could have avoided much of the coming reckoning if we’d learned the right lessons from 2000 and 2008 and allowed the bad debts and the poorly-run large banks to simply fail.  The world would have shuddered for a brief period, but it would have then carried on from a much more sustainable baseline. 

The wealth gap would be a fraction of what it currently is, and Trump almost certainly would not be president, Brexit not on the table, and populist movements blooming like California poppies after heavy spring rains.

But we didn't learn the right lessons. And so here we are.

In Part 2: Why This Better Work, we look closely at just how awful the fast-deteriorating macroeconomic situation is. It's very bad. GDP is falling in nearly every region of the globe, long-hot real estate markets have nosed-over, world trade volumes are shrinking, industry energy consumption is in decline -- the list goes on and on.

Left to itself, the economy would enter recession in a skinny minute to flush out the many trillions of bad debt and malinvestment that have accreted over the past decade. To prevent this from happening and to keep asset prices moving higher -- or to even simply keep them at their current ultra-expensive levels -- the central banks will need to deploy a truly mind-boggling amount of intervention.

Will they? And will the system respond the same way it did before?

And even if it does, will the 99.9% placidly subsist on even smaller crumbs as the remaining wealth is hoovered into the pockets of the top 0.1%?

If the answer to any of these questions is "no", none of us is fully prepared for what's coming.

Buckle up.

Click here to read Part 2 of this report (free executive summary, enrollment required for full access).

Published:4/20/2019 12:20:13 PM
[Markets] Less Than 25% Of College Graduates Can Answer These 4 Simple Money Questions

Authored by Mac Slavo via,

Americans have become numb to financial intelligence. This is no more evident than a recent Sallie Mae survey, which indicated that college graduates can’t even answer simple questions about financial concepts, such as interest.

The statistics are not looking good for the United States, a nation deeply indebted, addicted to consumerism, and woefully ignorant about it all.  Not long ago, SHTFPlanreported that a mere 1 in 10 Americans is actually capable of getting an A on a basic financial security test.

And even college graduates, who are likely tens of thousands (if not more) dollars in debt because of school, learned little to nothing about handling their personal finances. The big red flag comes from consumer banking firm Sallie Mae. The firm released its new “Majoring in Money” study which asked hundreds of current and recently graduated college students up to age 29 about basic financial concepts. The results are worrisome.

Sallie Mae asked these individuals four questions related to credit and interest, and fewer than one in four got all four of these correct.

1. Interest accumulation: 
Suppose you had $100 in a savings account and the interest rate was 2% per year. After 5 years, how much do you think you would have in the account if you left the money to grow?
a. More than $102
b. Exactly $102
c. Less than $102
d. Not sure

2. Effects of payment behavior on credit cost: 
Assuming the following individuals have the same credit card with the same interest rate and balance, which will pay the most in interest on their credit card purchases over time?
a. Joe, who makes the minimum payment on his credit card bill every month
b. Jane, who pays the balance on her credit card in full every month
c. Joyce, who sometimes pays the minimum, sometimes pays less than the minimum and missed one payment on her credit card bill
d. All of them will pay the same amount in interest over time
e. Not sure

3. Impact of repayment term on cost of credit: 
Imagine that there are two options when it comes to paying back a loan and both come with the same interest rate. Provided you have the needed funds, which option would you select to minimize your total costs over the life of the loan (i.e., all of your payments combined until the loan is completely paid off)?
a. Option 1 allows you to take 10 years to pay back the loan
b. Option 2 allows you to take 20 years to pay back the loan
c. Both options have the same out-of-pocket cost over the life of the loan
d. Not sure

4. Interest terminology: 
Which of the following best defines the term “interest capitalization”?
a. The type of interest charged on high-balance loans
b. The addition of unpaid interest to the principal balance of a loan
c. Interest that is charged when you postpone payments on your loan

The fact that we have an entire generation, largely college educated, who cannot answer these questions does not bode well for our future as a society.  Not knowing the answers to these could end up costing people a lot of money down the road. According to Market Watch, 83% of college grads carry a credit card as revealed by Sallie Mae, but only about six in 10 say they pay the balance(s) in full and on time each month. Coupled with the fact that nearly seven in 10 college students take out student loans, graduating with an average of nearly $30,000 in debt, the decline in financial intelligence is evident.

There are ways to learn the basics of personal finance. Dave Ramsey’s Total Money Makeover book was of the most help to many people, and Ramsey is perhaps the most well-known personal finance guru out there.  He takes a strick “no debt” approach that has worked not only for himself, buy countless others. He also offers an easy to follow guide which he’s dubbed “the baby steps” that will get people on the path to financial freedom.

Other resources are those such as Robert Kiyosaki’s Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!

Both books are excellent resources that teach the very basics about money and personal finance that no one is learning about in their public school educations.

*  *  *

The answers are 1: A, 2: C, 3: A, and 4: B

Published:4/20/2019 10:49:08 AM
[Entertainment] 5 books not to miss: Melinda Gates' 'The Moment of Lift,' 'Wunderland,' 'Defying Hitler' This week's most compelling new books include Melinda Gates' "The Moment of Lift" and "Wunderland," a work of historical fiction set during WWII.
Published:4/20/2019 8:25:37 AM
[Democrats] Norman Podhoretz on the left (Scott Johnson) The Spring issue of the Claremont Review of Books has not yet gone to press, but it will feature an interview with the incomparable Norman Podhoretz that has been posted online here for subscribers and circulated by the editors in samizdat. The interview is great. Rush Limbaugh flagged it in a segment posted here. Mr. Ace plucked some juicy morsels here at Ace of Spades. The CRB’s idea in posting Published:4/20/2019 7:55:32 AM
[Markets] "We're All Sick And Tired Of Five Star:" New Crisis Erupts In Italy's Government

Just when the acrimony between the two leaders of Italy's populist governing coalition appeared to be fading, a pair of explosive corruption scandals involving senior members of both the League and the Five Star Movement have triggered a new crisis as tensions between the two parties flare. 

As frustration with M5S grows, Deputy Prime Minister Matteo Salvini, considered by many to be the most influential figure in contemporary Italian politics, is once again clashing with his fellow Deputy PM Luigi Di Maio, prompting senior officials within his own party to push for elections in June to try and capitalize on the League's growing popularity and push M5S out of the government.


Even before the scandals, policy differences had strained the relationship between the two anti-establishment parties. Over the past few months, M5S has grown increasingly impatient with the League's hardline anti-immigration stance, which nearly prompted a kidnapping investigation into Salvini over his involvement in the Diciotti crisis, though M5S decided to help block the probe in the Italian Senate, BBG reports. Meanwhile, the League has become frustrated with M5S's generous social welfare plans, particularly after revised government estimates pushed Italy's projected budget deficit to roughly 2.5% of GDP, well above the level to which Brussels agreed.

The two parties had briefly appeared to put these issues behind them after M5S stood by the League to help block the kidnapping investigation, but in a Facebook post published Friday, Luigi Di Maio, another deputy PM and leader of M5S, accused Salvini of secretly conspiring with Silvio Berlusconi, the former Italian prime minister and leader of one of Italy's largest center-right parties, to bring about the fall of the government and form a new conservative coalition in defiance of the people's will.

What's worse, prosecutors in Rome suspect that Armando Siri, an economic advisor to Salvini and an undersecretary at the Infrastructure and Transport Ministry, accepted a €30,000 ($34,000) bribe for allegedly seeking to favor businessmen in the renewable energy industry. He has denied wrongdoing, but Di Maio has demanded that he be removed from his position until the investigation has been finished, saying he could return to his post if he is vindicated.

In response, a senior League official reportedly told reporters that he and others in the party are "sick and tired" of M5S, and urged Salvini to pursue another election.

Recent polls show the League with a plurality of popular support, polling at 33% compared with M5S's 22%.

But M5S isn't without a scandal of its own. Virginia Raggi, the mayor of Rome, was accused on Thursday in a press report of encouraging a Roman garbage-collection company to cook its books. Raggi responded in a Facebook post that she had merely pressured the executive because garbage has been piling up in the streets of Rome, something that has become a persistent problem in recent years.

In response, Salvini called for Raggi to resign. But while Raggi remains mayor of Rome, League officials are frustrated at M5S after Danilo Toninelli, a M5S minister, suspended Siri’s mandate had been suspended over the investigation, viewing it as an unjustified interference.

With the race for the European Parliament heating up, Salvini denied Di Maio's warnings that the coalition was teetering on the brink of collapse, and added that "the League wants to govern well and for a long time in the interests of Italians, the government crisis is only in Di Maio’s head," Salvini said in comments sent by his spokeswoman.

Edoardo Rixi, deputy minister in the Infrastructure Ministry, echoed frustrations with M5S, saying Salvini "isn't the only one who is sick and tired."

M5S is doing “all it can to make us vote in June," following the European elections in May.

However, Salvini is reportedly wary of calling a vote until the League can shore up its support in southern Italy, in addition to its stronghold in the North.

But as Italy turns to Beijing to help bail out its floundering economy, more political instability is probably the last thing the Italian economy - and its banking sector in particular - needs.

Published:4/20/2019 6:53:44 AM
[Markets] Are "Conspiracy Theories" Tearing Society Apart Or Saving Us From Destruction?

Authored by Brandon Smith via,

The phrase “conspiracy theory” is often used by establishment agencies, the mainstream media and useful idiots as a tool to dismiss legitimate evidence or viewpoints that disagree with their predetermined version of events. This method of propaganda was not always as widespread as it is today. The phrase was not “created” by the CIA, but it was in fact weaponized by them in the 1960's after the assassination of John F. Kennedy with the express purpose of shutting down rational debate.

CIA memo 1035-960, circulated within the CIA in 1967 and exposed through a freedom of information act request by the New York Times in 1976, outlines strategies the agency would use to shut down critics of the Warren Commission Report. Specifically, they suggested the accusation of “conspiracy” with negative connotations attached, predominantly in mainstream books and articles. This was indeed done through the CIA's many puppets in the media, and the concept of “conspiracy theory” as a pejorative was born.

Through the use of strawman arguments, red herring fallacies and sophistry, the incredible scale of evidence (exposed by investigators like New Orleans District Attorney Jim Garrison) suggesting the Warren Commission was either corrupt or ignorant in its findings was buried in a flurry of hatchet jobs and hit pieces. And this was the goal, of course; to attack the messenger and silence the truth without having to go through the ugly process of directly confronting the truth.

Until recently, this strategy was highly effective. Attacking a person as a “conspiracy theorist” was the only tool critics really needed to keep a piece of evidence or a concrete viewpoint from going viral. Conspiracy theory is equated to insanity, or stupidity, or buffoonery. Everyone knows a conspiracy theorist is not to be taken seriously, so why waste time listening to what they have to say in the first place?

It should come as no surprise that conspiracy REALITY is not something these people want entertained by the public. Conspiracies are a fact of history. Governments lie, all the time, and they have been caught doing it. The media lies, constantly, and has been caught doing it. Yet, we are supposed to ignore this and assume that anyone daring to stand contrary to government and media claims is some kind of lunatic?

In the past 5-10 years, however, things have been changing.

Suddenly, anti-establishment views and investigations of corruption are bulldozing the mainstream scripted narrative, and the elites and the media are bewildered. They can see they are losing control of popular thought and they are disturbed, to say the least. A steady stream of articles and essays have been flooding the MSM recently lamenting the rise of “conspiracy culture” and warning of the “death of democracy” if this is allowed to continue.

They seem specifically angered by the idea that their “journalistic” and “professional” status no longer matters to most people. Not long ago, anyone wearing a suit, a uniform, a lab coat, a journalist's badge or collecting a government paycheck was supposed to be immediately taken seriously as a designated “expert”. As Noam Chomsky describes them in his book 'Manufacturing Consent', they were the professional class, the top 10% or less of individuals with “all the answers”. These were the people the establishment sought to indoctrinate most of all, because these were the community leaders that many in the public listened to without question.

Now there is a growing movement of people who could not care less about what kind of degree someone's parents purchased for them from an ivy league university. They don't care about establishment designations and fake accolades and titles and credentials. What they care about are facts and evidence. What they care about are the arguments a person puts forth, rather than how important they purport to be. This is causing some consternation among the elites.

A key figure and gatekeeper in the propaganda war against the alternative media and conspiracy reality is Cass Sunstein, former “Information Czar” in the Obama Administration. Sunstein has written numerous books and articles lamenting the growing influence of the alternative media, including his book 'Conspiracy Theories And Dangerous Ideas'.

The main thrust of Sunstein's position is that conspiracy theories isolate the populace into small groups of like-minded people perpetuating each others “misguided” views. He also suggests that these groups represent a concrete threat to the stability of government and of society by spreading wrong (or perhaps inconvenient) information and civil unrest. In other words, a few decades ago all information was centralized and filtered by the corporate media and government, and now the internet is decentralizing information flow thereby allowing people to think differently and break from the majority narrative, which is unacceptable by Sunstein's standards.

Sunstein sees the creation of a public hive mind as the best outcome for social order. He suggests in his book 'Nudge' the concept of “Libertarian Paternalism” (which is neither libertarian or paternal). He advocates for the control of society through subversive means of influence (nudging) while allowing people to continue believing that their choices are actually their own.

But how would Sunstein go about executing this influence? His solution to the threat of the alternative media was first made clear in his paper titled 'Conspiracy Theories', published in 2008. In it, he argues in favor of government interference or control of alternative media or “conspiracy theory” sources. His primary tactic was the infiltration of alternative media forums and sites by government agents or private actors paid by the government to disrupt discussion, derail activism and sow seeds of doubt or chaos. Effectively, Sunstein wanted the covert destruction of the liberty media by paid agitators.

So, the same man who accuses the alternative media of conspiracy mongering and the destruction of the western world is actively seeking to foment a conspiracy to undermine that movement. Is this irony, or hypocrisy or both?  Doesn't this mean that Sunstein is a part of one of the very conspiracies he criticizes people like me for being concerned about?

Sunstein and his elitist ilk want the power to erase or sabotage the alternative media. In fact, there are probably a few of their agent provocateurs attacking this article in the comments below right now. They would prefer that the government eventually take full control of the internet and dictate the terms of media participation directly. This gives rise to one of the most important questions that the establishment does not want to answer – Who gets to decide what is and what is not “dangerous conspiracy theory”?

If pressed, the elites will ultimately suggest that they are the best qualified. Sunstein describes the general public in his books as essentially lazy, unintelligent, impulsive and not to be trusted to make good decisions. He does not seem to include himself and his globalist comrades as being prone to the same weaknesses. They are apparently wise and benevolent enough to make the best decisions for all of us. Imagine that...

This elitism bias and Sunstein's overall methodology for biting at the ankles of the liberty media is being carried over into a new wave of propaganda in the past couple of years, primarily coming from (though not limited to) the political left.

Sunstein's gatekeeping has spawned a cancerous growth of copycats in progressive academics. This is going on everywhere, but one particular example I found recently was on Vox, a leftist rag which shamelessly flaunts its political bias and actively slanders conservatives.  Vox's article 'Conspiracy Theories Are Getting More Absurd And Harder To Refute' promotes a new book which regurgitates Sunstein's propaganda model. The article takes special time to reassert the old disinformation narrative by stating that:

Democracy requires a minimum amount of mutual trust among citizens, and conspiracism destroys it.”

Are you getting the sense yet that there is a repetitive message coming from these people that they want you to embrace? Is there ANYTHING true about the statement above?  The fundamental root of their argument is that conspiracy theories (viewpoints outside the mainstream) must be treated as existential threats to society. In other words, some ideas are so dangerous that they must be controlled or outlawed. The basis of this argument, though, is entirely fraudulent.

First, leftists incessantly refer to our society as a "democracy", I think because they believe if they tell the lie enough it will become reality by default.   The US was never intended to be a “democracy”, but a Republic, and with good reason. Democracy requires blind and often misplaced faith in the system. A Republic requires constant vigilance and healthy skepticism. In a Republic, we are not supposed to simply “trust” that our leaders are going to do the right thing. We are supposed to put them under a microscope, uncover criminality and corruption, and generally make them uncomfortable at all times. It is our civic duty to become “conspiracy theorists”.

The establishment prefers a democracy because in a democracy 51% of the population can dictate the individual liberties of the other 49%, and they are rightly convinced that they can influence the thinking and decisions of the larger half. Also, in a democracy, society revolves around moral relativism and the ever arbitrary “greater good for the greater number”, instead of governing according to individual liberty, inherent moral compass and human conscience.

The Vox article goes on to make the claim that while there are some correct conspiracy theories, they have all come from the left side of the political spectrum (which they call “progressive” conspiracy theories”). They then assert that there are no verifiable conspiracy theories coming from the political right. This is madness.

When Cass Sunstein describes the tribalist isolation and conspiracy delusions of certain groups, he was clearly trying to mislabel conservative activists and the alternative media, but the REAL conspiracy nutbags have actually been on the left this whole time.

A lot of young leftist millennials, professional (I say this with the utmost sarcasm) mainstream media personalities and celebrities foolishly bought into the Russiagate conspiracy theory; a theory based on ZERO concrete evidence and a garbage heap of empty conjecture. For example, how many sessions of Real Time With Bill Maher or Late Night With Stephen Colbert was the Russiagate fantasy propped up as verified fact by a screeching flock of leftist parrots, blanketed in the protective peanut-brained imbecility of the audiences in their Los Angeles and New York echo chambers?

Even today, after the long anticipated Mueller Report led to no indictments, leftists continue to cling desperately like hemorrhoids to the anus that is Russiagate.

Leftists have to this point justified much of their schizophrenic and sometimes violent and criminal behavior on the lie that Donald Trump is a usurper put into office by Russian manipulation of US elections. Now isn't this the epitome of a conspiracy theory that is destructive to society?

Not all conspiracy theories are started by the alternative media. Many are started by the establishment itself, and these are indeed designed to cause the destabilization of the nation.

At the same time, the fabricated Russiagate conspiracy has been very effective at leading the left away from the very real conspiracy of Trump's saturation of his cabinet with banking elites and globalist think tank ghouls like John Bolton, Steven Mnuchin or Wilber Ross. Weren't these the same elites that Trump was going to “drain from the swamp”? Why hasn't the left talking about that for the past two years?

The article also makes no mention of the DNC rigging of the Democratic primaries in favor of Hillary Clinton and against Bernie Sanders. This was a conspiracy conservatives had to help expose, while the left sat idle and ignored it, hyperfocusing on their hatred of Trump while propping up Hillary Clinton, a repeat criminal offender. But, hey, conservative conspiracies are always wrong and leftist conspiracies are often correct according to Vox and friends...

And what about the verified fact of mass digital surveillance by government on the public?  This was a conspiracy that conservative groups had been warning about for years.  We were called kooks, because why would the government care about what the average person did in their day-to-day life?  Our fears were verified by the exposure of classified data by people like Edward Snowden and Julian Assange (who is now facing extradition and prosecution for nothing more than publishing truths on the internet).  Both the political left and political right are aggressively hostile to both these men, and are seeking to bury them.

My question is, what is really more dangerous?  Conspiracy theories, or the actual conspiracies governments and elitists execute against the people?

The message here is not ambiguous at all. To summarize, the establishment wants control of internet media, by hook or by crook, in the name of protecting people from themselves and from ideas they consider unsettling to the world order. The political left is all on board with this as long as their conspiracy theories are treated with legitimacy; and they will be, because their conspiracy theories are the establishment's conspiracy theories.

The only theories that are being threatened with subjugation are those of conservatives and the alternative media that are contrary to centralization and government power. Not because our theories are dangerous to the fabric of society, but because our theories are dangerous to the people who want to dictate the fabric of society. Our activism and journalism represents decentralized thought which could choke the engine of the globalist agenda. We aren't tearing down the western world, we're the only thing keeping it alive.

*  *  *

If you would like to support the work that Alt-Market does while also receiving content on advanced tactics for defeating the globalist agenda, subscribe to our exclusive newsletter The Wild Bunch Dispatch.  Learn more about it HERE.

Published:4/19/2019 6:48:20 PM
[Hillary Clinton] How’s the Cover-up Going? (John Hinderaker) Back in the early 1970s, when the Doonesbury cartoon strip was campaigning to get President Nixon impeached, this was considered a classic. Click to enlarge: Of course, it was a joke. President Nixon didn’t actually say “How’s the cover-up going?” on tape. Not so with the cover-up of Hillary Clinton’s off-the-books email scandal. Last week, Judicial Watch released 422 pages of previously-hidden FBI documents on that agency’s investigation of the Published:4/18/2019 2:38:20 PM
[Markets] Are Central Banks Softening Us Up For Higher Inflation?

Authored by John Rubino via,

There was a time when “price stability” – that is, money that buys the same amount of stuff every year – was considered a good thing. But as debts began to pile up around the world, it became clear to policymakers that managing that debt required money that got a little less valuable over time, say 2%, to allow debtors to pay interest in cheaper currency and employers to placate workers with “cost of living” raises.

This delayed the reckoning on the old debt but at the cost of soaring new debt, as pretty much everyone figured out that it’s smart to borrow depreciating currency.

In the decade since the trough of the Great Recession, nearly every sector of every major economy took on historically unprecedented amounts of new debt. And now the old “optimal” inflation rate of 2% isn’t enough to make interest payable for a growing number of borrowers.

The solution? Higher inflation of course. The old 2% target was arbitrary to in any event. And as with so many other things in life, if a little was good, a little more must be better, right?

So the question becomes how to phrase the transition to faster currency depreciation in a way that shapes the behavior of buyers, sellers, borrowers and lenders in the best possible way.

China got the ball rolling back in December, with fuzzy words designed to reassure while avoiding specifics:

China’s top policy makers confirmed that more monetary and fiscal support will be rolled out in 2019, as the world’s second-largest economy grapples with a slowdown that’s yet to show signs of ending.

“Significant” cuts to taxes and fees will be enacted in 2019 and while monetary policy will remain “prudent,” officials will strike an “appropriate” balance between tightening and loosening, according to a statement published after the annual Economic Work Conference that concluded in Beijing Friday.

Very comforting: “Significant” is actually “prudent and appropriate.”

Thus reassured, Chinese banks and their customers went on a lending/borrowing spree for the record books. From Doug Noland’s Credit Bubble Bulletin:

China’s Aggregate Financing (approximately system Credit growth less government borrowings) jumped 2.860 trillion yuan, or $427 billion – during the 31 days of March ($13.8bn/day or $5.0 TN annualized). This was 55% above estimates and a full 80% ahead of March 2018. A big March placed Q1 growth of Aggregate Financing at $1.224 TN – surely the strongest three-month Credit expansion in history. First quarter growth in Aggregate Financing was 40% above that from Q1 2018.

While China was setting records, QE pioneer Bank of Japan conflated “powerful” and “patient”:

Bank of Japan Governor Haruhiko Kuroda on Tuesday vowed to “patiently continue” the central bank’s “powerful” monetary easing as it was taking longer than previously thought to accelerate inflation to its 2 percent target.

Japan offers a glimpse of the future as its population ages and its debts soar. The further it travels down this path, the more difficult the math becomes. Which means hitting the BoJ’s 2% target will just set the stage for even more “patient but powerful” easing.

Now it’s the Fed’s turn. US core inflation handily exceeded 2% last year, but has since trended down a bit.


Still, the recent average is close to 2.5%, which you’d think would be fine if 2% is still sufficient to manage our debts. But it’s not, and the Fed is now sending its talking heads out to break this news:

The U.S. Federal Reserve should embrace inflation above its target half the time and consider cutting rates if prices do not rise as fast as expected, a top policymaker at the central bank said on Monday.

“While policy has been successful in achieving our maximum employment mandate, it has been less successful with regard to our inflation objective,” Federal Reserve Bank of Chicago President Charles Evans said in New York.

“To fix this problem, I think the Fed must be willing to embrace inflation modestly above 2 percent 50 percent of the time. Indeed, I would communicate comfort with core inflation rates of 2-1/2 percent, as long as there is no obvious upward momentum and the path back toward 2 percent can be well managed.”

Again, lots of focus-grouped soft, comforting words: “modestly … no obvious upward movement … well managed.”

But the truth is less comforting: Rising inflation, by in effect putting money on sale, encourages borrowers to borrow more, which sends aggregate debt higher at a rate that (see China) exceeds the rate of inflation, thus making the problem worse at an accelerating rate.

The only solution to too much debt is a borrower die-off. And those are by definition the opposite of “well managed.”

Published:4/18/2019 1:36:53 PM
[Markets] How Has Former MI6 Spymaster Richard Dearlove Dodged Scrutiny Despite Links To Russiagate?

One of the figures involved in the Obama administration's "Russiagate" scandal who has largely avoided scrutiny is former MI6 spymaster Sir Richard Dearlove, who is intimately linked to several key players in what many now believe was a high-level Set-up against the Trump campaign during the 2016 US election. 

Dearlove, who served as chief of MI6 from 1999 to 2004, had contact during the 2016 campaign with dossier author Christopher Steele. He is also a close colleague of Stefan Halper, the alleged FBI and CIA informant who established contact with several Trump campaign advisers. Dearlove and Halper attended a Cambridge political event in July 2016 where Halper had his first contact with Trump campaign adviser Carter Page. -Daily Caller

Of note, Dearlove is best known for peddling a report alleging that Saddam Hussein had WMDs, which then-UK Prime Minister Tony Blair used to justify launching a war against Iraq. 

In 2014, the retired British spymaster hosted an event at Cambridge University along with Halper. In attendance was then-director of the Defense Intelligence Agency Michael Flynn, as well as a Russian-born college student Svetlana Lokhova. Both Dearlove and Halper reportedly expressed concerns about Flynn's contacts with Lokhova - which the 38-year-old Russian-born academic says is complete bullshit

Stefan Halper and the Pentagon, which paid him over $1 million during the Obama administration for "research." 

"General Flynn was the guest of honor and he sat on one side of the table in the middle. I sat on the opposite side of the table to Flynn next to Richard Dearlove because I was the only woman at dinner, and it's a British custom that the only woman gets to sit next to the host," Lokhova told Fox News, who added that she has never been alone with Flynn. On the contrary, the unplanned encounter was professional and mildly productive. 

Sir Richard Dearlove (L), Prof. Christopher Andrew (center), and then-Defense Intelligence Agency Director Michael Flynn (R), at Cambridge University, Feb. 28, 2014. (Photo courtesy Svetlana Lokhova via the Daily Caller)

Dearlove - who has feigned not knowing "Trump-Russia" dossier author Christopher Steele, discussed ongoing matters with the former MI6 spy during a meeting in London's posh Garrick Club according to the Washington Post.

And as the Daily Caller's Chuck Ross points out, "Despite his presence at those key junctures, Dearlove has mostly dodged media attention, as well as that of American lawmakers investigating the origins of the Russia probe," adding "That’s perhaps a testament to Dearlove’s 38 years in MI6."

As journalist Daniel Lazare wrote last year in Consortium News

A few things stand out about this august group.  One is its in-bred quality.  After helping to run an annual confab known as the Cambridge Intelligence Seminar, Dearlove and Halper are now partners in a private venture calling itself “The Cambridge Security Initiative.”  Both are connected to another London-based intelligence firm known as Hakluyt & Co. Halper is also connected via two books he wrote with Hakluyt representative Jonathan Clarke and Dearlove has a close personal friendship with Hakluyt founder Mike Reynolds, yet another MI6 vet.  Alexander Downer served a half-dozen years on Hakluyt’s international advisory board, while Andrew Wood is linked to Steele via Orbis Business Intelligence, the private research firm that Steele helped found, and which produced the anti-Trump dossier, and where Wood now serves as an unpaid advisor.

Everyone, in short, seems to know everyone else.  But another thing that stands out about this group is its incompetence.  Dearlove and Halper appear to be old-school paranoids for whom every Russian is a Boris Badenov or a Natasha Fatale.  In February 2014, Halper notified US intelligence that Mike Flynn, Trump’s future national security adviser, had grown overly chummy with an Anglo-Russian scholar named Svetlana Lokhova whom Halper suspected of being a spy – suspicions that Lokhova convincingly argues are absurd.

Dearlove, meanwhile, has showered praise upon Halper - a longtime suspected CIA and FBI informant, and has been involved in US politics at the highest levels for decades, becoming George H.W. Bush's National Director for Policy Development during his presidential campaign. After Bush lost to Reagan, Halper worked as Reagan's Deputy Assistant Secretary of State - where he served under three different Secretaries.

He then became a senior advisor to the Department of Defense and DOJ between 1984 and 2001. Halper's former father-in-law was Ray Cline, former Deputy Director of the CIA. He also allegedly spied on the Carter administration - collecting information on foreign policy (an account disputed by Ray Cline).

Halper received a DoD contract from the Obama administration for $411,575 - made in two payments, and had a start date of September 26, 2016 - three days after a September 23 Yahoo! News article by Michael Isikoff about Trump aide Carter Page, which used information fed to Isikoff by "pissgate" dossier creator Christopher Steele. The FBI would use the Yahoo! article along with the unverified "pissgate" dossier as supporting evidence in an FISA warrant application for Page. 

Most famously, however, Halper is known for infiltrating the Trump campaign on behalf of the Obama DOJ - spying on advisers Carter Page and George Papadopoulos, who he lured into his orbit under the guise of seeking legitimate professional relationships. 

Meanwhile, his buddy Richard Dearlove has remained largely out of the spotlight despite his glaring connections to Russiagate. 

Published:4/18/2019 3:34:16 AM
[] The Father of Neoconservatism, Norman Podhoretz, On Trump and NeverTrump Over at Claremont Review of Books, Norman Podhoretz gives a rare interview and expresses his opinion on Trump, NeverTrump, and, indirectly but unavoidably, his fat, soft-handed, lap-of-luxury decrepit soyspawn Jon Podhoretz. I think a very key distinction between them is... Published:4/17/2019 4:31:47 PM
[Markets] From Jesus Christ To Julian Assange: When Dissidents Become Enemies Of The State

Authored by John Whitehead via The Rutherford Institute,

“In a time of universal deceit, telling the truth is a revolutionary act.” — George Orwell

When exposing a crime is treated as committing a crime, you are being ruled by criminals.


In the current governmental climate, where laws that run counter to the dictates of the Constitution are made in secret, passed without debate, and upheld by secret courts that operate behind closed doors, obeying one’s conscience and speaking truth to the power of the police state can render you an “enemy of the state.”

That list of so-called “enemies of the state” is growing.

Wikileaks founder Julian Assange is merely the latest victim of the police state’s assault on dissidents and whistleblowers.

On April 11, 2019, police arrested Assange for daring to access and disclose military documents that portray the U.S. government and its endless wars abroad as reckless, irresponsible, immoral and responsible for thousands of civilian deaths.

Included among the leaked materials was gunsight video footage from two U.S. AH-64 Apache helicopters engaged in a series of air-to-ground attacks while American air crew laughed at some of the casualties. Among the casualties were two Reuters correspondents who were gunned down after their cameras were mistaken for weapons and a driver who stopped to help one of the journalists. The driver’s two children, who happened to be in the van at the time it was fired upon by U.S. forces, suffered serious injuries.

There is nothing defensible about crimes such as these perpetrated by the government.

When any government becomes almost indistinguishable from the evil it claims to be fighting—whether that evil takes the form of war, terrorism, torture, drug trafficking, sex trafficking, murder, violence, theft, pornography, scientific experimentations or some other diabolical means of inflicting pain, suffering and servitude on humanity—that government has lost its claim to legitimacy.

These are hard words, but hard times require straight-talking.

It is easy to remain silent in the face of evil.

What is harder—what we lack today and so desperately need—are those with moral courage who will risk their freedoms and lives in order to speak out against evil in its many forms.

Throughout history, individuals or groups of individuals have risen up to challenge the injustices of their age. Nazi Germany had its Dietrich Bonhoeffer. The gulags of the Soviet Union were challenged by Aleksandr Solzhenitsyn. America had its color-coded system of racial segregation and warmongering called out for what it was, blatant discrimination and profiteering, by Martin Luther King Jr.

And then there was Jesus Christ, an itinerant preacher and revolutionary activist, who not only died challenging the police state of his day—namely, the Roman Empire—but provided a blueprint for civil disobedience that would be followed by those, religious and otherwise, who came after him.

Indeed, it is fitting that we remember that Jesus Christ—the religious figure worshipped by Christians for his death on the cross and subsequent resurrection—paid the ultimate price for speaking out against the police state of his day.

A radical nonconformist who challenged authority at every turn, Jesus was a far cry from the watered-down, corporatized, simplified, gentrified, sissified vision of a meek creature holding a lamb that most modern churches peddle. In fact, he spent his adult life speaking truth to power, challenging the status quo of his day, and pushing back against the abuses of the Roman Empire.

Much like the American Empire today, the Roman Empire of Jesus’ day had all of the characteristics of a police state: secrecy, surveillance, a widespread police presence, a citizenry treated like suspects with little recourse against the police state, perpetual wars, a military empire, martial law, and political retribution against those who dared to challenge the power of the state.

For all the accolades poured out upon Jesus, little is said about the harsh realities of the police state in which he lived and its similarities to modern-day America, and yet they are striking.

Secrecy, surveillance and rule by the elite. As the chasm between the wealthy and poor grew wider in the Roman Empire, the ruling class and the wealthy class became synonymous, while the lower classes, increasingly deprived of their political freedoms, grew disinterested in the government and easily distracted by “bread and circuses.” Much like America today, with its lack of government transparency, overt domestic surveillance, and rule by the rich, the inner workings of the Roman Empire were shrouded in secrecy, while its leaders were constantly on the watch for any potential threats to its power. The resulting state-wide surveillance was primarily carried out by the military, which acted as investigators, enforcers, torturers, policemen, executioners and jailers. Today that role is fulfilled by the NSA, the FBI, the Department of Homeland Security and the increasingly militarized police forces across the country.

Widespread police presence. The Roman Empire used its military forces to maintain the “peace,” thereby establishing a police state that reached into all aspects of a citizen’s life. In this way, these military officers, used to address a broad range of routine problems and conflicts, enforced the will of the state. Today SWAT teams, comprised of local police and federal agents, are employed to carry out routine search warrants for minor crimes such as marijuana possession and credit card fraud.

Citizenry with little recourse against the police state. As the Roman Empire expanded, personal freedom and independence nearly vanished, as did any real sense of local governance and national consciousness. Similarly, in America today, citizens largely feel powerless, voiceless and unrepresented in the face of a power-hungry federal government. As states and localities are brought under direct control by federal agencies and regulations, a sense of learned helplessness grips the nation.

Perpetual wars and a military empire. Much like America today with its practice of policing the world, war and an over-arching militarist ethos provided the framework for the Roman Empire, which extended from the Italian peninsula to all over Southern, Western, and Eastern Europe, extending into North Africa and Western Asia as well. In addition to significant foreign threats, wars were waged against inchoate, unstructured and socially inferior foes.

Martial law. Eventually, Rome established a permanent military dictatorship that left the citizens at the mercy of an unreachable and oppressive totalitarian regime. In the absence of resources to establish civic police forces, the Romans relied increasingly on the military to intervene in all matters of conflict or upheaval in provinces, from small-scale scuffles to large-scale revolts. Not unlike police forces today, with their martial law training drills on American soil, militarized weapons and “shoot first, ask questions later” mindset, the Roman soldier had “the exercise of lethal force at his fingertips” with the potential of wreaking havoc on normal citizens’ lives.

A nation of suspects. Just as the American Empire looks upon its citizens as suspects to be tracked, surveilled and controlled, the Roman Empire looked upon all potential insubordinates, from the common thief to a full-fledged insurrectionist, as threats to its power. The insurrectionist was seen as directly challenging the Emperor.  A “bandit,” or revolutionist, was seen as capable of overturning the empire, was always considered guilty and deserving of the most savage penalties, including capital punishment. Bandits were usually punished publicly and cruelly as a means of deterring others from challenging the power of the state.  Jesus’ execution was one such public punishment.

Acts of civil disobedience by insurrectionists. Much like the Roman Empire, the American Empire has exhibited zero tolerance for dissidents such as Julian Assange, Edward Snowden and Chelsea Manningwho exposed the police state’s seedy underbelly. Jesus branded himself a political revolutionary starting with his act of civil disobedience at the Jewish temple, the site of the administrative headquarters of the Sanhedrin, the supreme Jewish council. When Jesus “with the help of his disciples, blocks the entrance to the courtyard” and forbids “anyone carrying goods for sale or trade from entering the Temple,” he committed a blatantly criminal and seditious act, an act “that undoubtedly precipitated his arrest and execution.” Because the commercial events were sponsored by the religious hierarchy, which in turn was operated by consent of the Roman government, Jesus’ attack on the money chargers and traders can be seen as an attack on Rome itself, an unmistakable declaration of political and social independence from the Roman oppression.

Military-style arrests in the dead of night. Jesus’ arrest account testifies to the fact that the Romans perceived Him as a revolutionary. Eerily similar to today’s SWAT team raids, Jesus was arrested in the middle of the night, in secret, by a large, heavily armed fleet of soldiers.  Rather than merely asking for Jesus when they came to arrest him, his pursuers collaborated beforehand with Judas. Acting as a government informant, Judas concocted a kiss as a secret identification marker, hinting that a level of deception and trickery must be used to obtain this seemingly “dangerous revolutionist’s” cooperation. 

Torture and capital punishment. In Jesus’ day, religious preachers, self-proclaimed prophets and nonviolent protesters were not summarily arrested and executed. Indeed, the high priests and Roman governors normally allowed a protest, particularly a small-scale one, to run its course. However, government authorities were quick to dispose of leaders and movements that appeared to threaten the Roman Empire. The charges leveled against Jesus—that he was a threat to the stability of the nation, opposed paying Roman taxes and claimed to be the rightful King—were purely political, not religious. To the Romans, any one of these charges was enough to merit death by crucifixion, which was usually reserved for slaves, non-Romans, radicals, revolutionaries and the worst criminals.
Jesus was presented to Pontius Pilate “as a disturber of the political peace,” a leader of a rebellion, a political threat, and most gravely—a claimant to kingship, a “king of the revolutionary type.” After Jesus is formally condemned by Pilate, he is sentenced to death by crucifixion, “the Roman means of executing criminals convicted of high treason.”  The purpose of crucifixion was not so much to kill the criminal, as it was an immensely public statement intended to visually warn all those who would challenge the power of the Roman Empire. Hence, it was reserved solely for the most extreme political crimes: treason, rebellion, sedition, and banditry. After being ruthlessly whipped and mocked, Jesus was nailed to a cross.

As Professor Mark Lewis Taylor observed:

The cross within Roman politics and culture was a marker of shame, of being a criminal. If you were put to the cross, you were marked as shameful, as criminal, but especially as subversive. And there were thousands of people put to the cross. The cross was actually positioned at many crossroads, and, as New Testament scholar Paula Fredricksen has reminded us, it served as kind of a public service announcement that said, “Act like this person did, and this is how you will end up.”

Jesus—the revolutionary, the political dissident, and the nonviolent activist—lived and died in a police state. Any reflection on Jesus’ life and death within a police state must take into account several factors: Jesus spoke out strongly against such things as empires, controlling people, state violence and power politics. Jesus challenged the political and religious belief systems of his day. And worldly powers feared Jesus, not because he challenged them for control of thrones or government but because he undercut their claims of supremacy, and he dared to speak truth to power in a time when doing so could—and often did—cost a person his life.

Unfortunately, the radical Jesus, the political dissident who took aim at injustice and oppression, has been largely forgotten today, replaced by a congenial, smiling Jesus trotted out for religious holidays but otherwise rendered mute when it comes to matters of war, power and politics.

Yet for those who truly study the life and teachings of Jesus, the resounding theme is one of outright resistance to war, materialism and empire.

What a marked contrast to the advice being given to Americans by church leaders to “submit to your leaders and those in authority,” which in the American police state translates to complying, conforming, submitting, obeying orders, deferring to authority and generally doing whatever a government official tells you to do.

Telling Americans to march in lockstep and blindly obey the government—or put their faith in politics and vote for a political savior—flies in the face of everything for which Jesus lived and died.

Ultimately, this is the contradiction that must be resolved if the radical Jesus—the one who stood up to the Roman Empire and was crucified as a warning to others not to challenge the powers-that-be—is to be an example for our modern age.

As I make clear in my book Battlefield America: The War on the American People, we must decide whether we will follow the path of least resistance—willing to turn a blind eye to what Martin Luther King Jr. referred to as the “evils of segregation and the crippling effects of discrimination, to the moral degeneracy of religious bigotry and the corroding effects of narrow sectarianism, to economic conditions that deprive men of work and food, and to the insanities of militarism and the self-defeating effects of physical violence”—or whether we will be transformed nonconformists “dedicated to justice, peace, and brotherhood.”

As King explained in a powerful sermon delivered in 1954, “This command not to conform comes … [from] Jesus Christ, the world’s most dedicated nonconformist, whose ethical nonconformity still challenges the conscience of mankind.”

We need to recapture the gospel glow of the early Christians, who were nonconformists in the truest sense of the word and refused to shape their witness according to the mundane patterns of the world.  Willingly they sacrificed fame, fortune, and life itself in behalf of a cause they knew to be right.  Quantitatively small, they were qualitatively giants.  Their powerful gospel put an end to such barbaric evils as infanticide and bloody gladiatorial contests.  Finally, they captured the Roman Empire for Jesus Christ… The hope of a secure and livable world lies with disciplined nonconformists, who are dedicated to justice, peace, and brotherhood.  The trailblazers in human, academic, scientific, and religious freedom have always been nonconformists.  In any cause that concerns the progress of mankind, put your faith in the nonconformist!

…Honesty impels me to admit that transformed nonconformity, which is always costly and never altogether comfortable, may mean walking through the valley of the shadow of suffering, losing a job, or having a six-year-old daughter ask, “Daddy, why do you have to go to jail so much?”  But we are gravely mistaken to think that Christianity protects us from the pain and agony of mortal existence.  Christianity has always insisted that the cross we bear precedes the crown we wear.  To be a Christian, one must take up his cross, with all of its difficulties and agonizing and tragedy-packed content, and carry it until that very cross leaves its marks upon us and redeems us to that more excellent way that comes only through suffering.

In these days of worldwide confusion, there is a dire need for men and women who will courageously do battle for truth.  We must make a choice. Will we continue to march to the drumbeat of conformity and respectability, or will we, listening to the beat of a more distant drum, move to its echoing sounds?  Will we march only to the music of time, or will we, risking criticism and abuse, march to the soul saving music of eternity?

Published:4/16/2019 10:59:49 PM
[Markets] Mike 'Dirty Jobs' Rowe Routs America's School System: "We're Obsessed With Credentialing, Not Education"

Almost exactly a year ago, Dirty Jobs’ Mike Rowe noted that many Americans are dissatisfied with their lives because they no longer appreciate the intrinsic value of work.

Additionally,  Rowe previously concluded, millions of reasonable people – Republicans and Democrats alike – are worried that our universities are doing a poor job of preparing students for the real world. They’re worried about activist professors, safe spaces, the rising cost of tuition, a growing contempt for history, a simmering disregard of the first amendment, and most recently the so-called 'Varsity Blues' scandal of systemic elite cheating into prestigious schools.

And on the heels of that, Mike Rowe slammed the system on Tucker Carlson's Fox News show last night, blasting Americans, and the American establishment for being "obsessed with credentialing, not education."

“I think because stuck in this binary box, this or that. Right, blue-collar or white color, good job or a bad job. Higher education or higher alternative education.

When you only have two choices or you think you only have two choices, then you do one thing at the expense of the other.

So for instance, you know we have talked about this before, but it just seems so clear now. When four year degree universities needed a P.R. Campaign 40 years ago, they got one.

But the P.R. Came at the expense of all of the other forms of education. So it wasn’t hey, Tucker get your liberal arts degree because it will give you a broad base of appreciation for humanity. It was come if you don’t go get that degree, you will wind up over here turning a ranch or running a welding torch or doing some kind of consolation prize.

So we promoted the one thing at the expense of all of the others.

And that one thing just happened to be the most expensive thing. And so, look come I don’t think the skills set is the mystery. A reflection of what we value.

7 million — 7 million jobs available and they require training. Yet we are obsessed not really with education, you know. What we are obsessed with this credentialing.

People are buying diplomas. They are buying their degrees. It is a diploma dilemma, honestly. And it is expensive. It is getting worse. It’s not just the kids holding the note. It is us.”

All of which confirms his recent Facebook post, directing his frustration at the exorbitant cost of attending college, especially the elite schools that were involved with the scandal:

You don’t have to be rich or famous to believe your kid is doomed to fail without a four-year degree. Millions of otherwise sensible parents in every tax-bracket share this misguided belief, and many will do whatever it takes to get their kids enrolled in a “good school.” Obviously, those who resort to bribery are in a class by themselves, but what about parents who allow their kids to borrow vast sums of money to attend universities they can’t possibly afford? What about the guidance counselors and teachers who pressure kids to apply for college regardless of the cost? What about the politicians and lobbyists who so transparently favor one form of education at the expense of all the others? What about the employers who won’t even interview a candidate who doesn’t have a degree? Where’s the outrage?

The cost of college today has almost nothing to do with the cost of an education, and everything to do with the cost of buying a credential. That’s all a diploma is. Some are more expensive than others, but none of them reflect the character of the recipient, none are necessary to live a happy and prosperous life, and none of them come with any guarantees. And yet, the pressure we put on kids to borrow whatever it takes is constant, and precisely why tuition is so costly. It’s also why we have $1.6 trillion of student loans on the books along with a widening skills gap. That’s a bigger scandal, in my opinion.

Rowe has long been an advocate for trade and blue-collar skilled jobs. In many cases, these careers can earn similar salaries to those earned by college graduates.

Published:4/16/2019 10:32:24 PM
[World] BOOK REVIEW: 'Spearhead' by Adam Makos


By Adam Makos

Ballantine Books, $28, 393 pages

Claustrophobes, beware. "Spearhead" spends many of its pages inside tanks — doughty Shermans, dreaded Panthers, one mighty Pershing in particular — and inside the heads of ... Published:4/16/2019 6:56:04 PM

[Markets] The Pentagon's Bookkeeping Is Atrocious: The Books Are Wrong On Everything

Authored by Mac Slavo via,

The Department of Defense is the world’s worst bookkeeper. The books are so atrocious that they are wrong about everything and it’s impossible to detect just how bad the fraud and corruption that runs rampant through the Pentagon has become.

Journalist Matt Taibbi told RT’s Lee Camp that he discovered it’s not possible to make any sense of the books.

Taibbi recently dove headfirst into the insanity that is the Pentagon’s finances to find out how a much-lauded audit of the organization, (which receives half a trillion dollars a year) failed to give the DoD either a pass or fail. What Taibbi found was that the Pentagon operates under a system that is inherently unable to provide financial accountability, he said during an interview on Redacted Tonight.

“It’s organized so badly that when the Pentagon at the end of every year goes to ask for more money for the next year...they invent the numbers because they have no audit trail. They submit all those numbers to the Congress, saying we spent this on that, but they don’t actually have the documents,” he said.

“The sheer quantity of the numbers makes it impossible to detect anything like fraud or theft because the books are all wrong at every single level of the system.

The massive amount of waste and corruption is unbelievable, yet it’s impossible to even get a handle on just how bad it has become. Taibbi also says that there is no way the Pentagon will ever change the way they do their books unless there is reform to how they receive their money. Unless the Pentagon cuts off weapons contractors, there will never be any type of reform – so don’t hold your breath.

“The people who sit on the Armed Services Committee and the Appropriations Committee are going to be primarily funded by military contractors. Which means that none of those people are ever going to approve any measure that threatens to stop funding of the Pentagon until they get their books in order,” Taibbi said. 

“And the only way you can make the Pentagon make their books in order is to yank the money.”

The Pentagon is not known for their ability to reason or be responsible unless it’s providing “reasons” that they should be responsible for the deaths of millions across the globe.

*Side Note: Taibbi added that he sees the “Russiagate” hoax to be the biggest blow to mainstream media’s reputation since the “weapons of mass destruction” fiasco under the Bush administration.

Published:4/16/2019 11:29:18 AM
[Books] Paul Hollander, RIP (Steven Hayward) Sad news a few days ago of the passing of Paul Hollander, the long time professor of sociology at the University of Massachusetts at Amherst, and author of several important books about the culture of “fellow-traveling,” that is, the pathology of left-leaning intellectuals and cultural figures who were always taken in by the latest Communist totalitarian regime merely because they mouthed the slogans of revolutionary utopia. The most famous of Published:4/15/2019 10:47:57 AM
[Markets] FanDuel Loses $2 Million On Tiger Woods Historic Masters Comeback

Even those who have never played as stroke of golf probably understand that Tiger Woods' historic Masters' win on Sunday was a big moment - not just for a professional athlete who triumphed over a decade of scandal and adversity, but for America, a country that was built on the kind of grit and dedication displayed by Woods while capturing his fifth Masters' title, his first in more than a decade. At 43, he became the second-oldest person to win the tournament after Jack Nicklaus, who won the tournament in 1986 at age 46.

Unfortunately, some couldn't share in the excitement.


While Tiger's victory was a huge moment for fans, for sportsbooks in New Jersey and Nevada, the losses generated by Woods' come-from-behind win amounted to seven figures. Sports super-book FanDuel Group said it lost $2 million on the victory.

Another book, the Westgate Las Vegas SuperBook, lost nearly $100,000, its worst-ever showing for the Masters. A trader at William Hill US said the company's book lost "seven figures," according to Bloomberg.

"It’s great to see Tiger back," said Nick Bogdanovich, director of trading at William Hill U.S. "It’s a painful day for William Hill - our biggest golf loss ever - but a great day for golf."

However, Sunday's losses won't even begin to counterbalance the profits amassed during Woods's decade in the doghouse, where he remained a favorite of the betting public despite repeatedly disappointing on the course. It wasn't uncommon for Woods to be the betting favorite, despite the long odds.

"We are still doing well overall with wagers involving Tiger," Jeff Sherman, vice president of risk at Westgate SuperBook, said in an email.

That dynamic played out again on Sunday, when 21% of bets on FanDuel's platform were for Woods to win it all, a total that led to a net loss of $1 million.  On top of that, the company ran a promotion where it promised to refund all bets if Woods won the tournament. That cost it another $1 million.

At William Hill, a Nevada resident placed a $85,000 bet on Woods to win it all paid out $1.2 million on 14-to-1 odds, the largest single-ticket payout in the casino's history, according to CBS News.

The bet was so large that William Hill's staff had to reach out to the bettor to verify the ticket, and that the bettor wasn't off by a digit or two.

The wager was so large that it single-handedly pushed Woods to 10-to-1 odds at William Hill.

Not all sports books reported losses on Tiger's win, with at least one telling BBG that it broke even.

Not all sports books took a loss. MGM Resorts Internationalbroke even on the event, according to Jay Rood, its vice president of race and sports. MGM had its biggest handle ever for a golf tournament.

"We were a small loser to Tiger before the start but were able to fade it over the course of the tournament," Rood said.

Tiger's win forced sports betting organizations to reevaluate odds related to his career. FanDuel is now giving him 5-to-1 odds of tying Jack Nicklaus's record of 18 major tournament wins.

Published:4/15/2019 5:47:59 AM
[Markets] The 7 Years Of Lies About Assange Won't Stop Now

Authored by Jonathan Cook,

For seven years, from the moment Julian Assange first sought refuge in the Ecuadorean embassy in London, they have been telling us we were wrong, that we were paranoid conspiracy theorists. We were told there was no real threat of Assange’s extradition to the United States, that it was all in our fevered imaginations.

For seven years, we have had to listen to a chorus of journalists, politicians and “experts” telling us that Assange was nothing more than a fugitive from justice, and that the British and Swedish legal systems could be relied on to handle his case in full accordance with the law. Barely a “mainstream” voice was raised in his defence in all that time.

From the moment he sought asylum, Assange was cast as an outlaw. His work as the founder of Wikileaks – a digital platform that for the first time in history gave ordinary people a glimpse into the darkest recesses of the most secure vaults in the deepest of Deep States – was erased from the record.

Assange was reduced from one of the few towering figures of our time – a man who will have a central place in history books, if we as a species live long enough to write those books – to nothing more than a sex pest, and a scruffy bail-skipper.

The political and media class crafted a narrative of half-truths about the sex charges Assange was under investigation for in Sweden. They overlooked the fact that Assange had been allowed to leave Sweden by the original investigator, who dropped the inquiry, only for it to be revived by another investigator with a well-documented political agenda.

They failed to mention that Assange was always willing to be questioned by Swedish prosecutors in London, as had occurred in dozens of other cases involving extradition proceedings to Sweden. It was almost as if Swedish officials did not want to test the evidence they claimed to have in their possession.

The media and political courtiers endlessly emphasised Assange’s bail violation in the UK, ignoring the fact that asylum seekers fleeing legal and political persecution don’t usually honour bail conditions imposed by the very state authorites from which they are seeking asylum.

The political and media establishment ignored the mounting evidence of a secret grand jury in Virginia formulating charges against Assange, and ridiculed Wikileaks’ concerns that the Swedish case might be cover for a more sinister attempt by the US to extradite Assange and lock him away in a high-security prison, as had happened to whistleblower Chelsea Manning.

They belittled the 2016 verdict of a panel of United Nations legal scholars that the UK was “arbitrarily detaining” Assange. The media were more interested in the welfare of his cat.

They ignored the fact that after Ecuador changed presidents – with the new one keen to win favour with Washington – Assange was placed under more and more severe forms of solitary confinement. He was denied access to visitors and basic means of communications, violating both his asylum status and his human rights, and threatening his mental and physical wellbeing.

Equally, they ignored the fact that Assange had been given diplomatic status by Ecuador, as well as Ecuadorean citizenship. Britain was obligated to allow him to leave the embassy, using his diplomatic immunity, to travel unhindered to Ecuador. No “mainstream” journalist or politician thought this significant either.

They turned a blind eye to the news that, after refusing to question Assange in the UK, Swedish prosecutors had decided to quietly drop the case against him in 2015. Sweden had kept the decision under wraps for more than two years.

It was a freedom of information request by an ally of Assange, not a media outlet, that unearthed documents showing that Swedish investigators had, in fact, wanted to drop the case against Assange back in 2013. The UK, however, insisted that they carry on with the charade so that Assange could remain locked up. A British official emailed the Swedes: “Don’t you dare get cold feet!!!”

Most of the other documents relating to these conversations were unavailable. They had been destroyed by the UK’s Crown Prosecution Service in violation of protocol. But no one in the political and media establishment cared, of course.

Similarly, they ignored the fact that Assange was forced to hole up for years in the embassy, under the most intense form of house arrest, even though he no longer had a case to answer in Sweden. They told us – apparently in all seriousness – that he had to be arrested for his bail infraction, something that would normally be dealt with by a fine.

And possibly most egregiously of all, most of the media refused to acknowledge that Assange was a journalist and publisher, even though by failing to do so they exposed themselves to the future use of the same draconian sanctions should they or their publications ever need to be silenced. They signed off on the right of the US authorities to seize any foreign journalist, anywhere in the world, and lock him or her out of sight. They opened the door to a new, special form of rendition for journalists.

This was never about Sweden or bail violations, or even about the discredited Russiagate narrative, as anyone who was paying the vaguest attention should have been able to work out. It was about the US Deep State doing everything in its power to crush Wikileaks and make an example of its founder.

It was about making sure there would never again be a leak like that of Collateral Murder, the military video released by Wikileaks in 2007 that showed US soldiers celebrating as they murdered Iraqi civilians. It was about making sure there would never again be a dump of US diplomatic cables, like those released in 2010 that revealed the secret machinations of the US empire to dominate the planet whatever the cost in human rights violations.

Now the pretence is over. The British police invaded the diplomatic territory of Ecuador – invited in by Ecuador after it tore up Assange’s asylum status – to smuggle him off to jail. Two vassal states cooperating to do the bidding of the US empire. The arrest was not to help two women in Sweden or to enforce a minor bail infraction.

No, the British authorities were acting on an extradition warrant from the US. And the charges the US authorities have concocted relate to Wikileaks’ earliest work exposing the US military’s war crimes in Iraq – the stuff that we all once agreed was in the public interest, that British and US media clamoured to publish themselves.

Still the media and political class is turning a blind eye. Where is the outrage at the lies we have been served up for these past seven years? Where is the contrition at having been gulled for so long? Where is the fury at the most basic press freedom – the right to publish – being trashed to silence Assange? Where is the willingness finally to speak up in Assange’s defence?

It’s not there. There will be no indignation at the BBC, or the Guardian, or CNN. Just curious, impassive – even gently mocking – reporting of Assange’s fate.

And that is because these journalists, politicians and experts never really believed anything they said. They knew all along that the US wanted to silence Assange and to crush Wikileaks. They knew that all along and they didn’t care. In fact, they happily conspired in paving the way for today’s kidnapping of Assange.

They did so because they are not there to represent the truth, or to stand up for ordinary people, or to protect a free press, or even to enforce the rule of law. They don’t care about any of that. They are there to protect their careers, and the system that rewards them with money and influence. They don’t want an upstart like Assange kicking over their applecart.

Now they will spin us a whole new set of deceptions and distractions about Assange to keep us anaesthetised, to keep us from being incensed as our rights are whittled away, and to prevent us from realising that Assange’s rights and our own are indivisible. We stand or fall together.

*  *  *

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Published:4/14/2019 6:10:49 AM
[Markets] Coffee Robots Are Not Causing Homeless People To Starve

Authored by Art Carden via The American Institute for Economic Research,

A couple of months ago, this tweet made the social media rounds:

The group of “Starving Jobless Homeless” people huddled outdoors next to a “Fully Robotic Coffeeshop” is jarring. The coffee shop, CafeX, features “Coffee from the best local roasters crafted with precision using recipes designed by top baristas.” It’s an image of the coming techno-dystopia in which robots take our jobs and leave everyone who isn’t a capital-owning plutocrat to starve in the streets, no?

No. There are other things at play here. One reply to the tweet tagged John Stossel and diagnosed the problem immediately: the minimum wage in San Francisco is $15 per hour. That is a wage at which, apparently, the people in the picture cannot be profitably employed and which induces firms to look harder for ways to do with capital what was formerly profitable to do with labor.

Labor and Capital

“But firms will want to innovate and adopt new technology no matter what,” you say. Maybe: it depends on what the technological possibilities are. If labor is extremely abundant, then the low-cost, most efficient production method might be labor-intensive rather than capital-intensive.

Think about why so many people don’t buy the absolute-best top-of-the-line computers or smartphones. You probably don’t. Consider the Cray XT5m supercomputer system, which “starts around $500,000, takes advantage of the hardware and software advances of the Cray XT5 supercomputer, the basis of the petascale system currently in use at the U.S. Department of Energy’s Oak Ridge National Laboratory.”

That’s a heck of a machine, and if you’re doing particle physics, it’s probably nice to have. If all you need to do is check your email and manage a few spreadsheets, then it’s overkill. Just as you wouldn’t expect a firm to buy a Cray XT5m for everyone in the office and just as you probably don’t keep one in the sewing room from which to check email and play Minecraft, firms aren’t going to go for hyper-tech when that tech is hyper-expensive.

Again, firms will choose the lowest-cost way to produce a good in the interest of maximizing profits. When we use legislation like minimum wages and workplace safety rules and other things to increase the price of labor relative to what would obtain in the free market, we nudge firms toward replacing people with machines — as CafeX does, replacing human baristas with mechanical ones.

That gives us the phenomenon in the picture: a mass of people who are either unemployed or who have given up on the labor market, huddled outside a robotic coffee bar.

The same principles also explain why they are without housing. First, building new housing in San Francisco is notoriously difficult. Reason discusses an amusing-if-it-weren’t-so-tragic case in which the owner of a laundromat is being blocked from turning it into an eight-story apartment complex because the laundromat is “historic.”

Making it difficult for people to build new housing reduces the supply of housing, which drives up prices. It also changes the composition of housing: high regulatory costs that make it hard to build any kind of housing will induce substitution away from modest housing and toward luxury housing.

Changes in Relative Prices

Economists call this the Alchian-Allen effect after the economists Armen Alchian and William Allen. Adding a fixed cost to two similar goods will induce substitution toward the higher-quality good because it changes the relative price of that good.

The average quality of oranges in Florida, for example, is lower than the average quality of oranges in Vancouver for this reason. Suppose good oranges have a price of a dollar and bad oranges have a price of 50 cents. This means good oranges cost two bad oranges; a bad orange costs half a good orange. If it costs 50 cents to ship an orange — any orange — from Florida to Vancouver, it changes the relative price. Good oranges are relatively cheaper: with a total cost of $1.50 including shipping compared to $1 for bad oranges, good oranges only cost 1.5 bad oranges. The relative price of bad oranges rises, from half a good orange to 2/3 of a good orange. (The numbers in this example are from an example in Steven Landsburg’s textbook Price Theory and Applications.)

People substitute toward higher-quality oranges and away from lower-quality ones. Before you say, “Wouldn’t people always buy the highest-quality oranges?,” note that there is a price difference. Then look in your own fridge or on your own kitchen counter. You probably don’t have the absolutely highest-quality produce imaginable on hand.

Now, replace good and bad oranges with luxury and modest apartments and replace the fixed cost of shipping with a fixed cost of building. Costly regulations make all housing absolutely more expensive, but they make luxury housing relatively cheaper.

If you’re still not convinced, think about hiring a babysitter for $40 and going on a date. Would you go to Taco Bell? Or would you go somewhere nicer? Adding the price of the babysitter means going to Taco Bell and spending $10 each would cost you $60. Or you could go to a very nice restaurant and spend $40 each for a total of $120.

Without the cost of the babysitter, a trip to the very nice restaurant costs you four trips to Taco Bell. But the trip to the very nice restaurant is cheaper in terms of forgone trips to Taco Bell once you add the cost of the babysitter, which will cost $40 no matter what you do.

As the San Francisco Tenants Union explains, “In San Francisco, most tenants are covered by rent control.” Rent control is a standard example in introductory economics classes of a policy that hurts the people we ostensibly want to help. The Swedish economist Assar Lindbeck has said that “in many cases rent control appears to be the most efficient technique presently known to destroy a city — except for bombing.”

By holding prices below what the market will bear, rent-control ordinances ensure housing shortages, where, at the controlled price, people want more housing than firms and landlords are willing to provide.

Furthermore, they find themselves in a cat-and-mouse game with regulators because landlords and tenants move toward competition on non-price margins. Quality, to use just one example, falls because of rent control and necessitates, in the eyes of many activists, even more regulation.

The additional regulation raises the cost of providing housing, which reduces the supply of housing, which puts pressure on prices and thus leads to more and more calls for rent control. The outcome is grotesque: all the new construction is high-end luxury housing while the rent-controlled housing deteriorates more quickly.

Adam Smith famously wrote that “there is a great deal of ruin in a nation.” Does the picture of a huddled mass of homeless people outside a robotic coffee shop suggest the ruins of late-stage capitalism? I think not.

It represents instead the “great deal of ruin” policymakers create when they make policy as if the laws of supply and demand are optional.

Published:4/13/2019 9:07:52 PM
[Markets] Trump Signs Ambitious EMP Preparedness Executive Order

Authored by Daisy Luther via The Organic Prepper blog,

After years of the government blowing off concerns about an electromagnetic pulse, President Trump has signed an executive order that will put EMP preparedness in the hands of the White House.

What’s in the executive order?

The Executive Order on Coordinating National Resilience to Electromagnetic Pulses is a first step toward learning more about how an EMP would affect us and how to protect critical infrastructure.

An electromagnetic pulse (EMP) has the potential to disrupt, degrade, and damage technology and critical infrastructure systems.  Human-made or naturally occurring EMPs can affect large geographic areas, disrupting elements critical to the Nation’s security and economic prosperity, and could adversely affect global commerce and stability.  The Federal Government must foster sustainable, efficient, and cost-effective approaches to improving the Nation’s resilience to the effects of EMPs. (source)

The Order outlines the responsibilities of specific offices to help get the country ready for a threat to the grid and sets up a 4-year plan.

It is the policy of the United States to prepare for the effects of EMPs through targeted approaches that coordinate whole-of-government activities and encourage private-sector engagement.  The Federal Government must provide warning of an impending EMP; protect against, respond to, and recover from the effects of an EMP through public and private engagement, planning, and investment; and prevent adversarial events through deterrence, defense, and nuclear nonproliferation efforts.  To achieve these goals, the Federal Government shall engage in risk-informed planning, prioritize research and development (R&D) to address the needs of critical infrastructure stakeholders, and, for adversarial threats, consult Intelligence Community assessments.

(b)  To implement the actions directed in this order, the Federal Government shall promote collaboration and facilitate information sharing, including the sharing of threat and vulnerability assessments, among executive departments and agencies (agencies), the owners and operators of critical infrastructure, and other relevant stakeholders, as appropriate.  The Federal Government shall also provide incentives, as appropriate, to private-sector partners to encourage innovation that strengthens critical infrastructure against the effects of EMPs through the development and implementation of best practices, regulations, and appropriate guidance.

Sec. 4.  Coordination.  (a)  The Assistant to the President for National Security Affairs (APNSA), through National Security Council staff and in consultation with the Director of the Office of Science and Technology Policy (OSTP), shall coordinate the development and implementation of executive branch actions to assess, prioritize, and manage the risks of EMPs.  The APNSA shall, on an annual basis, submit a report to the President summarizing progress on the implementation of this order, identifying gaps in capability, and recommending how to address those gaps. (source)

In 2017, those in the know were aghast when the EMP Commission was defunded by Congress.

What is an EMP?

If you’re not familiar with the term “EMP” you’re in for a shocking awakening. An electromagnetic pulse is one of the biggest threats out there against our well-being.  Back in 2008, the EMP Commission warned of the extreme consequences and experts concluded that 9 out of 10 Americans could be dead within a year of such an event.

So what is it?

An electromagnetic pulse (EMP) is a high-frequency burst of electromagnetic energy caused by the rapid acceleration of changed particles. A catastrophic EMP would cause the collapse of critical civilian infrastructures such as the power grid, telecommunications, transportation, banking, finance, food and water systems across the entire continental United States—infrastructures that are vital to the sustenance of our modern society and the survival of its citizens.

An EMP event can occur naturally from a great geomagnetic storm, or it can be man-made through the use of a single, crude nuclear weapon delivered by a primitive missile, and the effects would be virtually identical. (source)

With the possibility of an EMP from either our enemies and our sun, it’s definitely an existential threat to which you should pay attention.

The havoc that such an event would cause is pretty difficult to imagine – and even worse, we don’t actually know how bad it would be. One Second After, a fictionalized tale of an EMP, has turned many a person into a prepper.

Some say that talk of an EMP is exaggerated. Others don’t.

After the Congressional report came out in 2017 about the risk of an EMP from North Korea, many mainstream outlets took to the airwaves to convince the public that it was overblown, if not a total hoax.

I asked my friend, Dr. Arthur T. Bradley about his thoughts on whether an EMP was a legitimate threat or a gigantic hoax. Dr. Bradley is an electrical engineer at NASA and has done a lot of scholarly research on the possibilities of EMP and space weather events. He’s a prolific author and his book Disaster Preparedness for EMP Attacks and Solar Storms is a classic that belongs on every prepper’s bookshelf. (Find all of his books here.) Needless to say, Dr. Bradley is a pro and knows that of which he speaks.

Here’s his very thorough answer:

To address whether or not an EMP is a scam, we should first ask what it is we’re wanting to deny. An EMP is simply a broadband electromagnetic pulse. Such a pulse can be created by the sudden release of energy, such as a spark gap or on a larger scale, a bolt of lightning. Likewise, a very large explosion can release an EMP due to gamma rays ionizing nearby air molecules. EMPs from these events are well understood, and there are countless technical papers addressing the phenomenon. Even without expert confirmation, most people have experienced the phenomenon when their radio, phone, or TV suddenly “pops” when a bolt of lightning strikes nearby. Simply put, to say that “EMP is a scam” is to deny science.

The real question at hand is are the effects of a nuclear-generated EMP really as significant as people claim. The short answer to that is no one knows for sure. The US government observed EMPs during nuclear testing in the 60’s, such as during the Starfish experiments, and it was identified as a possible weapon to disrupt an enemy’s infrastructures. The Russians also did extensive EMP testing during the same period, including the Soviet Test 184 in 1962 that caused extensive damage on the ground, including destroying the Karaganda power plant.

The US Air Force later built a very large $60 million wooden structure, known as ATLAS-I (aka Trestle), to study how best to harden systems against an EMP. More recently, the government commissioned a group of technical experts to assess the nation’s vulnerabilities to such an attack.

This council was known as the EMP Commission and issued a Critical National Infrastructures Report in April of 2008. In it, the commission discussed in detail how the nation’s critical infrastructures and citizens could be disrupted by a high-altitude nuclear-generated EMP, and the feasibility of hardening military and civilian systems. The EMP Commission was later reestablished in 2006 to make specific recommendations on reducing our susceptibilities.

Their conclusion was that an EMP “has the capability to produce significant damage to critical infrastructures that support the fabric of U.S. society and the ability of the United States and Western nations to project influence and military power,” and “damage to or loss of these components could leave significant parts of the electric power grid out of service for months to a year or more.” The loss of electricity would lead to the subsequent disruption of every other infrastructure, including food and water distribution, telecommunications, banking, transportation, emergency services, government, and energy production.

Whether or not the commission’s assessments would prove accurate is impossible to say, since no country has ever suffered a wide-scale EMP attack. What can be said is that a group of highly-trained experts commissioned by the government came to some very dire conclusions about the effects of an EMP attack. 

In fact, there have been several EMPs of which we know.

While some folks want to wave off concerns, there’s some history that tells is the warnings may not be exaggerated. In this in-depth article that discusses exactly what an EMP is, the author shared four examples.

The first is the Carrington Event of 1859, which was the first documented event of a solar flare impacting Earth. The event occurred at 11:18 a.m. EDT on Sept., 1 and is named after Richard Carrington, the solar astronomer who witnessed the event through his telescope.

The second event is the Star Fish Prime tests. In 1962, the US government launched a 1.4 megaton nuclear warhead about 250 miles into the atmosphere over the Pacific Ocean. The pulse results were much stronger than expected. It damaged street lights and microwave links in Hawaii, 900 miles away. The EMP was so intense that it was not accurately measured because “it drove much of the instrumentation off scale”.

The third event was a Soviet EMP test called “Test 184”. It happened around the same time as the Star Fish Prime tests. Not many details have been released from this. Although the warhead was not as powerful as the one from Star Fish Prime, it was exploded about 180 miles over the populated area of Kazakhstan.

What is known is that the EMP from Test 184 knocked out a 600-mile underground power line (shielded) that was buried 3 feet underground. It caused fires to the power station that the line was connected to. It also damaged diesel generators. (Most of the details have not been released and/or have remained classified.)…

…The final event I’ll mention here is a CME that hit Canada on March 13, 1989. A powerful solar flare set off a major power blackout that left six million people without electricity for about nine hours.

According to NASA, the CME disrupted electric power transmission from the Hydro Québec generating station and even melted some power transformers in New Jersey. NASA scientists have concluded that this event was only about a 1/3 the strength of the Carrington event. (source)

So, it’s definitely not impossible, although we do not know for sure the extent of the damage.

The Executive Order is a step in the right direction.

President Trump’s Executive Order is a step in the right direction when it comes to a threat like EMPs. But, as every prepper knows, you can’t wait for the government (or anyone else) to save you in the event of a disaster.

My personal plan for long-term grid interruption doesn’t include fancy generators and equipment. In fact, it’s pretty low-tech. If you’re on a budget, don’t spend a fortune on stuff that could potentially become very expensive paperweights.

Here’s an excerpt from my article on low-tech preparedness:

If money is an object in your preparedness endeavors, (and let’s face it, money is an object for most of us these days), then focus your dollars on preps that are sustainable without electrical power.  Instead of trying to live the exact same life you are living right now, only fueled by an individual generator, look for low-tech solutions instead.

This reminds me of people who stop eating gluten but still want to eat exactly like they have been eating their entire lives, only now with expensive gluten-free baked goods that cost 4 times the price of their wheat-filled counterparts.  When things change dramatically, accept the change and adapt to it, instead of trying to maintain the illusion that everything is the same.

Whether you can get power from an outlet in the wall or not, the necessities of day-to-day life will remain the same:

  • Water
  • Shelter and Warmth
  • Food
  • Sanitation and Hygiene
  • Light

The ultimate preparedness goal should be to provide those necessities without any help from the power grid, generators, or fossil fuel. (LEARN MORE about planning for a long-term disaster)

When my youngest daughter and I lived in the North Woods of Canada, we lost power frequently throughout the year. Lots of folks in the area had generators that they would fire up when the power went out, and that was a viable solution since gas stations were available and fuel was pretty much unlimited as long as you could afford to go get it.  We were on a tight budget, however, and we adapted our situation to live without power during those outages.

After the first couple of outages, we had worked out most of the bugs and we even began to look forward to our time without power – it was like a little vacation from the regular workday.  As plugged in as our society is, power is not actually a necessity – it’s a luxury, and we can live without it as long as we are adaptable, creative, willing, and prepared. (source)

Your skills and local resources will count more than anything in a situation like that. Read more about low-tech prepping and why I suggest it here, and check out this book about preparing specifically for EMPs and solar storms – I strongly recommend it.

Published:4/13/2019 11:40:45 AM
[Middle Column] Newsweek finds new DC scandal! Fmr. EPA Chief Pruitt ‘Was Gifted’ Copy of Morano’s ‘climate denial’ book – while Pruitt was EPA Administrator!

NEWSWEEK: The three texts that the list said were accepted and "returned to Administrator Pruitt" were Warming? Yes! Man Made? No!?, The Politically Incorrect Guide to Climate Change by Marc Morano? and The Climate Chronicles. The EPA did not immediately respond when contacted by Newsweek.


Climate Depot's Marc Morano's comment: I am proud to find out that former EPA chief Pruitt was interested in my best selling book, The Politically Incorrect Guide to Climate Change.  (Also see: Morano’s award-winning book honored as one of Top 10 ‘best new climate change books’ – ‘The Politically Incorrect Guide to Climate Change’) The book features a complete scientific and political A-Z rebuttal of the common claims made by the media, the UN, Al Gore, and environmental activists. It is nice to know that the EPA is well informed when it comes to man-made climate change claims. 

Published:4/11/2019 7:31:22 PM
[Markets] Golden Straws In The Wind & The Weaponized Dollar

Authored by Alasdair Macleod via,

Life in the world of gold bullion is full of mysteries. Each mystery is like a straw in the wind, which individually means little, but tempting us to speculate there’s a greater meaning behind it all. Yes, there is a far greater game in play, taking Kipling’s aphorism to a higher level.

One of those straws is Russia’s continuing accumulation of gold reserves. Financial pundits tell us that this is to avoid being beholden to the US dollar, and undoubtedly there is truth in it. But why gold? Here, the pundits are silent. There is an answer, and that is Russia understands in principal the virtues of sound money relative to possession of another country’s paper promises. Hence, they sell dollars and buy gold.

But Russia is now going a step further. Izvestia reported the Russian Finance Ministry is considering abolition of VAT on private purchases of gold bullion. We read that this could generate private Russian annual demand of between fifty and a hundred tonnes. More importantly, it paves the way for gold to circulate in Russia as money.

We should put ourselves in Russia’s shoes to find out why this may be important. Russia is the largest exporter of energy, including gas, pushing Saudi Arabia into second place. This means she is also the largest acquirer of fiat currency for energy. That’s fine if you like fiat currencies, but if you suspect them, then you either turn them into physical assets, such as infrastructure and military hardware, or gold. Russia does both.

Then there is China. China has started announcing monthly additions to her gold reserves. China is up to her neck in dollars, and the relatively minor monthly additions to her reserves really make little difference. However, the link between the gold exchanges in Moscow and Shanghai strongly suggest Russia and China are coordinating gold dealing activities.

In any event, China now dominates physical bullion markets. Deliveries (withdrawals) from the Shanghai Gold Exchange’s vaults into public hands are running at roughly two-thirds of the world’s annual mine supply. At 426 tonnes in 2017, China is the largest gold mining nation by far, and the state owns all China’s refining capacity, even taking in doré from abroad. No gold leaves this version of Hotel California.

The frequently-expressed reasoning for their gold policies is Russia and China are locked in a financial war with their largest debtor. This is not the underlying reason these nations have chosen gold as an expression of their dislike of America’s weaponization of her monetary policies. They know the difference between unbacked fiat currencies and sound money, which has been chosen by people ever since they began to use a separate commodity to intermediate in transactions.

However, it is true the Americans have weaponised the dollar, bringing an urgency to China’s and Russia’s deployment of gold. US dollars have been the world’s reserve currency for the last forty-eight years, and America, which pays for everything in costless, newly-issued dollars, now says it wants a better trade deal. It obviously assumes the dollar’s supremacy is unchallengeable and in their need for dollars China and other exporters to America will be forced to comply.

Let’s pick this apart. The US Government pays for everything in a currency which it issues at will. New dollars only gain value once they are in circulation, but the cost of production is zero, stealing their circulatory value from previously existing currency. However, the US Government is unable to balance its books without recycling some of these duff dollars into its own IOUs (Treasury stock). Because they are required to be repatriated to balance the US Treasury’s books, the US Treasury borrows them back from foreigners who might otherwise question the dollars true value. So, foreigners get a Treasury IOU eventually paid out in a currency IOU. It really is pig on pork.

So far, the foreigners have been successfully conned, though questions are beginning to be asked.

Logic suggests that the US Government getting something for nothing is as good as it gets. But President Trump thinks this is unfair, not on the Chinese and other foreigners swapping goods for ultimately worthless paper, but on America herself! He holds out for an even better deal. He demands the Chinese and others stop supplying real stuff to his people in return for his costless, dubious paper. In other words, speaking on behalf of the American People, he is now dissuading the Chinese from giving Americans something for what amounts to nothing.

Those on Planet Asia could be forgiven for looking at things rather differently. After Mao’s death and a brief period of accepting the dollar scam on the basis that demand for dollars would always ensure they could be exchanged for value, the Chinese have for a long time smelled a rat. This is why in 1983 they appointed the Peoples Bank to be in charge of liquidating dollars for gold and silver. They have gently played along with the dollar scam ever since, not wanting to be the party that exposes it for what it is.

Now it is Trump himself who has blown the whistle on the dollar. China and Russia have undoubtedly got the message from this new art of the deal. But at the heart of it is a deep, wider malaise in the fiat currency world. Understand that, and we get to the true reason why Russia and China are wary about accumulating the West’s fiat currencies. Until now, they have run with the hare and hunted with the hounds. China in particular uses fiat renminbi to drive expansion. But then if she didn’t, today’s world order would have probably collapsed in the wake of the Lehman crisis as the flaws and weaknesses of fiat currencies would have been exposed.

The next credit crisis could change everything

So far, China and Russia have resisted the temptation to act precipitously. Their economies are dependent on Western cooperation. Russia exports energy to the West, and China runs a trade surplus in goods and services. To dispense with Western trade, they need an Asia-wide self-contained market. They are building it, with China’s silk road projects and by consolidating the membership of the Shanghai Cooperation Organisation. But not all the groundwork has been done, certainly not enough to “go commando”.

The transfer from a dollar-centric world to gold-backed roubles and renminbi will continue to be at a pace determined by the monetary mistakes of America. That is why the next economic downturn is so important to geopolitical outcomes. And it won’t be just a rerun of Lehman, characterised by a sudden crisis, money-printing, and heaving a sigh of relief when the banking system doesn’t collapse.

The starting-gun for the next credit crisis has already been fired. A reversal of expanding cross-border trade is in full swing. The sales of dollars by foreigners has begun. There is little doubt there is a recession ahead, the only question is of its likely depth. The massive build-up of unsustainable global debt since the Lehman crisis tells us to expect the liquidation to be substantial. The coincidental combination of the peak of the credit cycle and trade protectionism warns us of something far worse than an ordinary recession: a possible rerun of 1929-32, only this time with unsound currency instead of currencies freely convertible into gold.

It is the sheer scale of the problem which is likely to prove the undoing of fiat currencies. A deep recession will do catastrophic damage to government finances, which can only be covered by massive monetary expansion. At the same time, monetary policy is designed to ensure the general price level does not fall. This occurs when a credit crisis wipes out demand, and prices in sound money fall significantly. We know this because in 1929-32 measured in gold-backed dollars prices did just that.

It may take a few months before the purchasing power of fiat currencies begins a renewed decline. The recent strength in energy and commodity prices is worrying in this context, but it is probably too early to call it the start of a definite trend of falling purchasing powers for the dollar and other currencies, measured against the commodity complex.

Trouble is likely to start with either the dollar or the euro. In a deepening recession, the euro will struggle with escalating problems in the PIGS, Brexit, US trade protectionism and systemic risks in the Eurozone’s banking system. The Eurozone could easily disintegrate. A falling dollar, over-owned in the context of declining international trade, is also a racing certainty. A race to the bottom for both currencies is becoming the increasingly obvious outcome of a slump in world trade.

Politicians are ill-equipped for a monetary crisis

Inevitably, the corruption emanating from the issuance at will of costless fiat currency leads to a deteriorating political morality. By debasing the currency, you can rob people of their wealth and earnings without their knowledge or approval. Get away with that, and the political class is on the highway to the ultimate in corruption.

In modern democracies, this is why the source of political power increasingly lies in the deception of the public, and why both control and debasement of a currency is its ultimate expression. The true purpose of the debasement of the currency is very rarely understood by a trusting public. The existence of a state-issued currency is blandly accepted as proof of its value, and no further questions are asked. The long-term decline in its value is given credibility by being declared to be official monetary policy, so everyone thinks it is a good thing. But the public are wholly unaware of the transfer of wealth from them to the state and its cronies, which is the inevitable consequence of monetary debasement.

It is anti-capitalistic in its destruction of both capital and values. The political class has been progressively leeching off the productive side of the economy to pay for its socialising schemes and for the sheer enjoyment of power. If the rate of currency debasement is slow and even, it can continue for a long time. As a destructive process, it is ultimately finite. But the pace has quickened. The Lehman crisis led to a rapid acceleration of the rate of currency debasement, which never really ceased. Debasement is about to accelerate yet again. Not only will the issuance of central bank money substantially increase to compensate for a slowing down in the rate of bank credit expansion, it is also becoming essential to finance government spending.

The likely scale of a renewed debasement of the currency threatens to alert the public to the instability of the situation, undermining confidence in unbacked currencies. Despite the stated intentions of monetary policy, its true purpose will become increasingly obvious when government revenue collapses and welfare costs rise. How convenient it will be for scaled-up quantitative easing, the printing of money to pay for government debt, to be slavishly supported by all advisors and commentators pretending to be economists. Wiser counsel, if it is listened to, will caution against the trap of relying on the destruction of currency values as the bedrock for future government finances.

What then for our politicians, who have come to rely on monetary debasement to finance their ambitions? Will they wake up to the predicament they have put us all in, and suddenly realise they must humbly genuflect at the altar of contrition, of sound money, and confess to their sins and submit themselves to public opprobrium?

Dream on, folks! They will struggle to extricate themselves with the only means at their disposal. More money. More socialism. More raping the productive economy by accelerating wealth transfer through monetary debasement. They know nothing else. They have not only deceived their voting public, but they have deceived themselves. If the world moves only half-way to a 1930s depression, the rate of monetary expansion to bridge the widening chasm between tax receipts and welfare obligations will be so great, it will likely lead to the end of the dollar, the end of the euro and the other currencies which copy them. Even the hitherto Teflon yen will be threatened with immolation.

The wise heads in China foresaw this in the last century, which is why they appointed the Peoples Bank to handle the state’s gold and silver purchases under government instruction. It is why they set up the Shanghai Gold Exchange in 2002 to allow and encourage the population to accumulate physical gold. They knew that one day, gold and silver would become the backbone of currencies again and they have ensured it is widely distributed. They knew the West’s Achilles’ heel was the modern equivalent of Genghis Khan’s mulberry-leaf paper, but without the great man’s despotic authority. In her long history, China has been there, seen it, done it, and has got the changshan.

Russia was late to this party, but the transformation in her understanding of the West’s monetary affairs was swift. America tried to use the dollar as a weapon to cripple Russia, but President Putin wasn’t to be panicked. He appointed a bright young woman, Elvira Nabiullina to head up the Central Bank of Russia. She reformed the banking system, strengthening commercial banks and replaced the Brussels-based SWIFT interbank messaging system with its own, which will link up with the Central Asian ‘stans, China, Iran and even Turkey. This will insulate Russia from Western banking crises, a point missed by Western commentators who only see isolationism. And it is Nabiullina who has overseen the selling of dollar reserves for gold bullion.

Russia and China have distanced themselves from the west’s financial system, so it can collapse without taking them down. Obviously, there will be collateral damage, but nothing unforeseen. They will be aware of the political consequences, so will not want to precipitate anything with their actions. Let the West destroy itself and for China and Russia not to be made the fall-guys.

America cannot escape the consequences of ending Bretton Woods

America set a trap for herself by ending the Bretton Woods Agreement in 1971. Since then, she has invested all her powers of persuasion in making the free world believe gold was no longer relevant as money. She started by selling gold in large tranches in the 1970s, but soon ceased when it was clear that the Arabs had an insatiable appetite for it. This was followed by a Faustian pact with Saudi Arabia and therefore OPEC to sell oil only for dollars, which has held ever since – until last week.

Reuters reported that Saudi Arabia was considering abandoning the pact as a response to an American threat that OPEC would face anti-trust lawsuits. This was subsequently denied, presumably under pressure from Washington. But clearly, this is seen to be a very sensitive issue, central to the dollar’s credibility.

The dollar’s role in pricing and settling all commodity and energy prices has given the US a strong grip on international affairs and capital flows. Consequently, by last January foreigners had accumulated dollar deposits and short-term securities worth $5.247 trillion, in addition to longer-term securities and industrial assets valued at $19.434 trillion (as at 30 June last year). The total of nearly $25 trillion is over 120% of US GDP.

Bond investors tell us that any country that relies on foreigners to finance government debt is heading for trouble. Usually, this is in the context of funding through the medium of foreign currencies, when repayment costs escalate if the country’s own currency devalues. This is undoubtedly true, but the same risk exists when foreign investors fund a government in its own currency. The mistake is to think only in terms of the repayment of existing debt, which can be devalued, when it is the future demands for credit that really matter.

Foreigners have already started selling dollars, evidenced in recent data from the US Treasury. In December and January, Treasury International Capital (TIC) data turned negative with net outflows of $257bn. The big reversal was of private sector flows, which had been strongly positive until that point. However, foreign governments have been net sellers since April 2017 to the tune of $224bn.

The free ride at foreigners’ expense appears to be over, and domestic US investors will have to start buying and pricing US debt realistically in the face of foreign divestment. Unless the Fed indulges in a renewed bout of quantitative easing, the reversal of foreign buying of dollars and US Treasuries is bound to raise funding costs to unsustainable levels (for the US Government) and put the dollar itself under pressure. It is shaping up to be a collapse of fiat-money arithmetic, the end of the fiat-money delusion, when the denial of gold in preference for an unbacked dollar finally ends.

A golden haystack is around the corner

We have noted some golden straws in the wind, which by virtue of a gathering fiat currency crisis should lead to the official restitution of gold as money in Asia, and consequently far higher gold prices. There can be little doubt that the end of the current credit cycle coinciding with American trade protectionism brings forward dangers for all fiat currencies, and particularly for the dollar. US Treasury TIC data shows capital flows suddenly reversing, which is consistent with collapsing cross-border trade. The effect on the US Government’s finances are likely to be catastrophic, further undermining global faith in the dollar.

The dollar’s plight is reminiscent of the events that led to the collapse of the London gold pool in the 1960s. Too many dollars were in foreign hands, driving foreign governments (notably the French but also the Germans) to swap dollar surpluses into gold under the Bretton Woods Agreement. Gold’s relative valuation in dollars is remarkably similar today, illustrated in the chart below.

In this chart, the price of gold is deflated from its 1934 fix at $35 by the increase in the quantity of fiat money, which includes money in circulation as defined by the Austrian Money Supply metric, plus money not in public circulation but held at the Fed, principally as bank reserves. Adjusted in these terms, the gold price is close to the level seen in August 1971 (shown by the pecked line), when America was forced to abandon the Bretton Woods Agreement. The tensions from a valuation perspective therefore confirm a far higher gold price is very likely.

All that’s needed is a trigger. China has cornered the bullion market. Russia is selling dollars for gold and appears to be paving the way for gold to circulate domestically. A deep recession, perhaps replicating the 1930s depression, is becoming more likely by the day. Massive monetary inflation will be required to prop up Western governments. Foreigners own too many dollars for these developing conditions. The world’s impending economic failure is entirely down to the continual debasement of fiat currencies, a practice that will be brought to a head by the ending of the current credit cycle.

Golden straws in the wind? They appear to be blowing off a haystack of them just around the corner.

Published:4/11/2019 4:01:25 PM
[Entertainment] How will George R.R.Martin's 'Game of Thrones' really end, for readers? The HBO series 'Game of Thrones' kicks off its final season Sunday but fans also wonder how and when will the series of books end
Published:4/11/2019 1:59:29 PM
[World] [Eugene Volokh] Teaching 5- and 6-Year-Olds Serious Basic Math

The second edition of "Breaking Numbers Into Parts": very highly recommended.

For several years, my son went to the UCLA Math Circle run by Dr. Olga Radko and Dr. Oleg Gleizer (both mathematics PhDs), whom I've gotten to know well. It's a superb program, which teaches children ages 5 to 17 serious mathematical concepts and mathematical problem-solving, not just drills or algorithms.

Gleizer and Radko now have a second, two-volume, edition of a book based on their work with the math circle, "Breaking Numbers into Parts," aimed at parents and teachers who want to teach 5- and 6-year-olds. The book isn't written to be read by children, who might not even be able to read well (or to read at all) at that age. But adults can use it very effectively to guide children through concepts such as commutativity, the number line, the properties of odd and even numbers, mathematical operations as a generalizable concept, reflections and symmetries, and more—and, more importantly, to teach children about proofs and about the use of math and logic to solve problems.

If you have young children whom you want to teach about math, definitely get these books.

Published:4/11/2019 11:26:40 AM
[World] [Ilya Somin] The Politics of Game of Thrones Revisited

The imminent start of the final season of Game of Thrones is a good time to consider the series' political message, and reprise some of my work on that subject. Plus, a discussion of the political economy portrayed in George R.R. Martin's recently published prequel to the series.

The final season of the of the hit TV series Game of Thrones begins this weekend, on April 14, ending a long wait that began when Season 7 ended in 2017. One of the many interesting aspects of the series and the books by George R.R. Martin on which it is based, is the attempt to address a variety of political issues. While some might consider it frivolous to assess the political message of a fantasy show, it's worth remembering that far more people consume science fiction and fantasy media than read serious nonfiction analyses of political issues. And social science research indicates that science fiction and fantasy, such as the Harry Potter series, can even have a significant influence on fans' political views. At the very least, discussing the politics of Game of Thrones is less painful than analyzing the much grimmer politics of the real world! Valar morghulis - "all men must die" - is all too true. But at least we can have some fun with fictional political economy first!

Over the last several years, I have written a good deal about the politics of Game of Thrones. My most extensive analysis is a 2017 article focusing on what it might take to fulfill Daenerys Targaryen's vow to "break the wheel" of Westeros' awful political system:

In a famous scene in Season 5 of Game of Thrones, Daenerys Targaryen compares the struggle for power in Westeros to a spinning wheel that elevates one great noble house and then another. She vows that she does not merely intend to turn the wheel in her own favor: "I'm not going to stop the wheel. I'm going to break the wheel."

In the world of the show, Daenerys's statement resonates because the rulers of Westeros have made a terrible mess of the continent...

Daenerys's desire to "break the wheel" suggests the possibility of a better approach. But, what exactly, does breaking the wheel entail?...

Even in the late stages of... Season 7, Daenerys seems to have little notion of what it means beyond defeating her enemies and installing herself as Queen on Westeros's Iron Throne....

Unlike most of the other rulers we see in the series, Daenerys has at least some genuine interest in improving the lot of ordinary people. Before coming to Westeros, she and her army freed tens of thousands of slaves on the continent of Essos. She delayed her departure from Essos long enough to try to establish a new government in the liberated areas that would — hopefully — prevent backsliding into slavery.

Nonetheless, it is not clear whether Daenerys has any plan to prevent future oppression and injustice other than to replace the current set of evil rulers with a better one: herself. The idea of "breaking the wheel" implies systemic institutional reform, not just replacing the person who has the dubious honor of planting his or her rear end on the Iron Throne in King's Landing. If Daenerys has any such reforms in mind, it is hard to say what they are....

Daenerys's failure to give serious consideration to institutional problems is shared by the other great leader beloved by fans of the show: Jon Snow, the newly enthroned King in the North. Perhaps even more than Daenerys, Jon has a genuine concern for ordinary people....

Perhaps to an even greater extent than Daenerys, however, Jon does not have any real notion of institutional reform....

But in Medieval Europe, on which Westeros is roughly based, parliaments, merchants' guilds, autonomous cities, and other institutions eventually emerged to challenge and curb the power of kings and nobles. These developments gradually helped lead to the Renaissance, the Enlightenment, and the economic growth that led to modern liberal democracy. Few if any such developments are in evidence in Westeros, which seems to have had thousands of years of economic, technological, and intellectual stagnation.

The characters in the books and the TV show are not the only ones who largely ignore the need for institutional change. We the fans are often guilty of the same sin.....

Most of us read fantasy literature and watch TV shows to be entertained, not to get a lesson in political theory. And it is much easier to develop an entertaining show focused on the need to replace a villainous evil ruler with a good, heroic, and virtuous one, than to produce an exciting story focused on institutional questions..... Game of Thrones/Song of Ice and Fire is comparatively unusual in even raising the possibility that institutional reform is the real solution to its fictional world's problems, and in making this idea one of the central themes of the story.

However understandable, the pop culture fixation on heroic leaders rather than institutions reinforces a dangerous tendency of real-world politics. The benighted people of Westeros are not the only ones who hope that their problems might go away if only we concentrate vast power in the hands of the right ruler. The same pathology has been exploited by dictators throughout history, both left and right.

It is also evident, in less extreme form, in many democratic societies.....

For all its serious flaws, our situation is not as bad as that of Westeros. But we too could benefit from more serious consideration of ways to break the wheel, as opposed to merely spin it in another direction. And our popular culture could benefit from having more stories that highlight the value of institutions, as well as heroic leaders. However much we love Daenerys and Jon, they and their real-world counterparts are unlikely to give us a better wheel on their own.

Back in 2016, I discussed Game of Thrones/Song of Ice and Fire in an article on the politics of several science fiction and fantasy series where I highlighted the series' skeptical view of political elites. In this 2013 post, I discussed the significance of the "Red Wedding," one of the most shocking and controversial episodes in the history of the series. Back in 2011, when the series first began, I commented on some of the political issues raised by the struggle for the Iron Throne, building on an Atlantic symposium about the series.

In August 2017, I participated in a panel on the politics of Game of Thrones, sponsored by the R Street Institute and the Cato Institute, along with Alyssa Rosenberg (Washington Post), Peter Suderman (Reason), and Matthew Yglesias (Vox). We are hoping to reprise our discussion during the final season.

During the long interregnum between the end of Season 7 and the start of Season 8, George R.R. Martin published the first volume of Fire and Blood, the history of House Targaryen's rule over the Seven Kingdoms of Westeros. The book predictably divided fans, many of whom would have preferred that Martin finish the long-awaited Winds of Winter instead. But I thought it was fascinating. At the very least, it did provide a lot of information about Westeros' political system. Here are a few examples (with spoilers largely avoided):

1. Even when the king is both competent and relatively well-intentioned, the political system doesn't function all that well. When he is either malevolent or incompetent, all kinds of disasters happen. And badly flawed kings seem to be more common than good ones. The high frequency of bad kings and the inability of good ones to make much progress is a strong sign that the monarchy's flaws are mostly systemic, rather than the fault of a few flawed individual rulers.

2. Like the Roman Empire, Westeros under the Targaryen kings never developed any generally accepted rules of succession. Thus, civil war breaks out over such issues as whether male offspring of the king take precedence over female ones who are older and/or more closely related. It is also not clear whether the king has the right to designate his own heir, or whether there are laws of succession that he cannot set aside (and if so, what they are).

3. Despite the above, Fire and Blood actually deepens the mystery of why Westeros has had so many centuries of economic stagnation. It shows that the kings invested in useful infrastructure (e.g. - ports and roads) and that there are many sources of investment capital other than the Iron Bank of Braavos. Plus, several of the great houses engage in extensive trade with other parts of the world. All of this should stimulate considerable innovation, growth, and technological progress. Yet very little seems to occur.

4. Fire and Blood makes clear that the stagnation probably is not caused by dragons, despite speculation to the contrary by commentators on the earlier books and TV show. There are never more than about 10-15 domesticated dragons in Westeros at any one time, and they don't seem to be used for anything but warfare and transportation for their riders (mostly members of the royal family). They clearly do not substitute for labor-saving devices or provide transportation for trade. And, while they are powerful battlefield weapons, they are clearly not invincible and their presence should stimulate military innovation, not stifle it.

5. Based on what we see, it is far from clear that Targaryen blood is actually necessary to become a dragonrider. If it is, only a tiny bit seems to be enough. This suggests that the number of domesticated dragons and dragonriders could be greatly expanded. If so, dragons could actually help jumpstart the economy! There is a lot they could do to increase Westerosi productivity, if they started to take on jobs other than killing people and transporting VIPs.

6. Women are clearly second-class citizens in Westeros. But they seem to have higher social status and more autonomy than their real-world medieval equivalents. We even see a number of cases of them entering male-dominated professions, including warfare. This further deepens the mystery of Westerosi stagnation, as relatively freer Westerosi women should be more productive than those of medieval Europe, yet this does not seem to result in much increased growth.

Perhaps we will get more insights on the politics of Westeros from Season 8, and George R.R. Martin's long-awaited Winds of Winter. Until then, don't forget that political chaos is a ladder!

Published:4/11/2019 10:58:09 AM
[Artificial Intelligence] AKQA says it used AI to invent a new sport called Speedgate At TechCrunch, we write about AI all the time, whether the technology is being used to write books, make films or create a better McDonald’s drive-thru. But we here’s one we haven’t heard before: Using an AI to invent a new sport. The sport in question is Speedgate, and it was developed by AKQA. Creative […] Published:4/11/2019 10:26:24 AM
[Markets] "Do It!" Bezos Challenges Retailers To Match Amazon's Minimum Wage

In his annual letter to shareholders, Amazon CEO Jeff Bezos diverted from his usual long-term strategic focus in favor of some short-term tactical virtue-signaling.

Having pledged in October to improve working conditions and raise the minimum wage of all his warehouse staff to $15 an hour: "We did it because it seemed like the right thing to do" (after public relations pressure from Bernie Sanders and Elizabeth Warren over 'living wage protections'), Bezos laid down a challenge to his competitors...

"Today I challenge our top retail competitors (you know who you are!) to match our employee benefits and our $15 minimum wage," Bezos said.

"Do it! Better yet, go to $16 and throw the gauntlet back at us. It’s a kind of competition that will benefit everyone."

Of course, Bezos would love everyone else to have even lower margins while he enjoys AWS' 30% profits - he's not the richest man in the world by complete accident.

However, what caught our eye most was the irony of his claim that "much of what we build at AWS is based on listening to customers" coming just a day after Bloomberg broke the "Alexa's always listening and humans are laughing at your conversations" story...

His parting words are particularly noteworthy: "Teams all across Amazon are listening to customers and wandering on their behalf!"

Big Brother Bezos for your own good, 'Murica!

*  *  *

Jeff Bezos Full Letter to Shareholders.

To our shareowners:

Something strange and remarkable has happened over the last 20 years. Take a look at these numbers:

1999                3%
2000                3%
2001                6%
2002              17%
2003              22%
2004              25%
2005              28%
2006              28%
2007              29%
2008              30%
2009              31%
2010              34%
2011              38%
2012              42%
2013              46%
2014              49%
2015              51%
2016              54%
2017              56%
2018              58%

The percentages represent the share of physical gross merchandise sales sold on Amazon by independent third-party sellers – mostly small- and medium-sized businesses – as opposed to Amazon retail’s own first party sales. Third-party sales have grown from 3% of the total to 58%. To put it bluntly:

Third-party sellers are kicking our first party butt. Badly.

And it’s a high bar too because our first-party business has grown dramatically over that period, from $1.6 billion in 1999 to $117 billion this past year. The compound annual growth rate for our first-party business in that time period is 25%. But in that same time, third-party sales have grown from $0.1 billion to $160 billion – a compound annual growth rate of 52%. To provide an external benchmark, eBay’s gross merchandise sales in that period have grown at a compound rate of 20%, from $2.8 billion to $95 billion.

Why did independent sellers do so much better selling on Amazon than they did on eBay? And why were independent sellers able to grow so much faster than Amazon’s own highly organized first-party sales organization? There isn’t one answer, but we do know one extremely important part of the answer:

We helped independent sellers compete against our first-party business by investing in and offering them the very best selling tools we could imagine and build.There are many such tools, including tools that help sellers manage inventory, process payments, track shipments, create reports, and sell across borders – and we’re inventing more every year. But of great importance are Fulfillment by Amazon and the Prime membership program. In combination, these two programs meaningfully improved the customer experience of buying from independent sellers. With the success of these two programs now so well established, it’s difficult for most people to fully appreciate today just how radical those two offerings were at the time we launched them. We invested in both of these programs at significant financial risk and after much internal debate. We had to continue investing significantly over time as we experimented with different ideas and iterations. We could not foresee with certainty what those programs would eventually look like, let alone whether they would succeed, but they were pushed forward with intuition and heart, and nourished with optimism.

Intuition, curiosity, and the power of wandering

From very early on in Amazon’s life, we knew we wanted to create a culture of builders – people who are curious, explorers. They like to invent. Even when they’re experts, they are “fresh” with a beginner’s mind. They see the way we do things as just the way we do things now. A builder’s mentality helps us approach big, hard-to-solve opportunities with a humble conviction that success can come through iteration: invent, launch, reinvent, relaunch, start over, rinse, repeat, again and again. They know the path to success is anything but straight.

Sometimes (often actually) in business, you do know where you’re going, and when you do, you can be efficient. Put in place a plan and execute. In contrast, wandering in business is not efficient … but it’s also not random. It’s guided – by hunch, gut, intuition, curiosity, and powered by a deep conviction that the prize for customers is big enough that it’s worth being a little messy and tangential to find our way there. Wandering is an essential counter-balance to efficiency. You need to employ both. The outsized discoveries – the “non-linear” ones – are highly likely to require wandering.

AWS’s millions of customers range from startups to large enterprises, government entities to nonprofits, each looking to build better solutions for their end users. We spend a lot of time thinking about what those organizations want and what the people inside them – developers, dev managers, ops managers, CIOs, chief digital officers, chief information security officers, etc. – want.

Much of what we build at AWS is based on listening to customers. It’s critical to ask customers what they want, listen carefully to their answers, and figure out a plan to provide it thoughtfully and quickly (speed matters in business!). No business could thrive without that kind of customer obsession. But it’s also not enough. The biggest needle movers will be things that customers don’t know to ask for. We must invent on their behalf. We have to tap into our own inner imagination about what’s possible.

AWS itself – as a whole – is an example. No one asked for AWS. No one. Turns out the world was in fact ready and hungry for an offering like AWS but didn’t know it. We had a hunch, followed our curiosity, took the necessary financial risks, and began building – reworking, experimenting, and iterating countless times as we proceeded.

Within AWS, that same pattern has recurred many times. For example, we invented DynamoDB, a highly scalable, low latency key-value database now used by thousands of AWS customers. And on the listening carefully-to-customers side, we heard loudly that companies felt constrained by their commercial database options and had been unhappy with their database providers for decades – these offerings are expensive, proprietary, have high-lock-in and punitive licensing terms. We spent several years building our own database engine, Amazon Aurora, a fully-managed MySQL and PostgreSQL-compatible service with the same or better durability and availability as the commercial engines, but at one-tenth of the cost. We were not surprised when this worked.

But we’re also optimistic about specialized databases for specialized workloads. Over the past 20 to 30 years, companies ran most of their workloads using relational databases. The broad familiarity with relational databases among developers made this technology the go-to even when it wasn’t ideal. Though sub-optimal, the data set sizes were often small enough and the acceptable query latencies long enough that you could make it work. But today, many applications are storing very large amounts of data – terabytes and petabytes. And the requirements for apps have changed. Modern applications are driving the need for low latencies, real-time processing, and the ability to process millions of requests per second. It’s not just key-value stores like DynamoDB, but also in-memory databases like Amazon ElastiCache, time series databases like Amazon Timestream, and ledger solutions like Amazon Quantum Ledger Database – the right tool for the right job saves money and gets your product to market faster.

We’re also plunging into helping companies harness Machine Learning. We’ve been working on this for a long time, and, as with other important advances, our initial attempts to externalize some of our early internal Machine Learning tools were failures. It took years of wandering – experimentation, iteration, and refinement, as well as valuable insights from our customers – to enable us to find SageMaker, which launched just 18 months ago. SageMaker removes the heavy lifting, complexity, and guesswork from each step of the machine learning process – democratizing AI. Today, thousands of customers are building machine learning models on top of AWS with SageMaker. We continue to enhance the service, including by adding new reinforcement learning capabilities. Reinforcement learning has a steep learning curve and many moving parts, which has largely put it out of reach of all but the most well-funded and technical organizations, until now. None of this would be possible without a culture of curiosity and a willingness to try totally new things on behalf of customers. And customers are responding to our customer-centric wandering and listening – AWS is now a $30 billion annual run rate business and growing fast.

Imagining the impossible

Amazon today remains a small player in global retail. We represent a low single-digit percentage of the retail market, and there are much larger retailers in every country where we operate. And that’s largely because nearly 90% of retail remains offline, in brick and mortar stores. For many years, we considered how we might serve customers in physical stores, but felt we needed first to invent something that would really delight customers in that environment. With Amazon Go, we had a clear vision. Get rid of the worst thing about physical retail: checkout lines. No one likes to wait in line. Instead, we imagined a store where you could walk in, pick up what you wanted, and leave.

Getting there was hard. Technically hard. It required the efforts of hundreds of smart, dedicated computer scientists and engineers around the world. We had to design and build our own proprietary cameras and shelves and invent new computer vision algorithms, including the ability to stitch together imagery from hundreds of cooperating cameras. And we had to do it in a way where the technology worked so well that it simply receded into the background, invisible. The reward has been the response from customers, who’ve described the experience of shopping at Amazon Go as “magical.” We now have 10 stores in Chicago, San Francisco, and Seattle, and are excited about the future.

Failure needs to scale too

As a company grows, everything needs to scale, including the size of your failed experiments. If the size of your failures isn’t growing, you’re not going to be inventing at a size that can actually move the needle. Amazon will be experimenting at the right scale for a company of our size if we occasionally have multibillion-dollar failures. Of course, we won’t undertake such experiments cavalierly. We will work hard to make them good bets, but not all good bets will ultimately pay out. This kind of large-scale risk taking is part of the service we as a large company can provide to our customers and to society. The good news for shareowners is that a single big winning bet can more than cover the cost of many losers.

Development of the Fire phone and Echo was started around the same time. While the Fire phone was a failure, we were able to take our learnings (as well as the developers) and accelerate our efforts building Echo and Alexa. The vision for Echo and Alexa was inspired by the Star Trek computer. The idea also had origins in two other arenas where we’d been building and wandering for years: machine learning and the cloud. From Amazon’s early days, machine learning was an essential part of our product recommendations, and AWS gave us a front row seat to the capabilities of the cloud. After many years of development, Echo debuted in 2014, powered by Alexa, who lives in the AWS cloud.

No customer was asking for Echo. This was definitely us wandering. Market research doesn’t help. If you had gone to a customer in 2013 and said “Would you like a black, always-on cylinder in your kitchen about the size of a Pringles can that you can talk to and ask questions, that also turns on your lights and plays music?” I guarantee you they’d have looked at you strangely and said “No, thank you.”

Since that first-generation Echo, customers have purchased more than 100 million Alexa-enabled devices. Last year, we improved Alexa’s ability to understand requests and answer questions by more than 20%, while adding billions of facts to make Alexa more knowledgeable than ever. Developers doubled the number of Alexa skills to over 80,000, and customers spoke to Alexa tens of billions more times in 2018 compared to 2017. The number of devices with Alexa built-in more than doubled in 2018. There are now more than 150 different products available with Alexa built-in, from headphones and PCs to cars and smart home devices. Much more to come!

One last thing before closing. As I said in the first shareholder letter more than 20 years ago, our focus is on hiring and retaining versatile and talented employees who can think like owners. Achieving that requires investing in our employees, and, as with so many other things at Amazon, we use not just analysis but also intuition and heart to find our way forward.

Last year, we raised our minimum wage to $15-an-hour for all full-time, part-time, temporary, and seasonal employees across the U.S. This wage hike benefitted more than 250,000 Amazon employees, as well as over 100,000 seasonal employees who worked at Amazon sites across the country last holiday. We strongly believe that this will benefit our business as we invest in our employees. But that is not what drove the decision. We had always offered competitive wages. But we decided it was time to lead – to offer wages that went beyond competitive. We did it because it seemed like the right thing to do.

Today I challenge our top retail competitors (you know who you are!) to match our employee benefits and our $15 minimum wage. Do it! Better yet, go to $16 and throw the gauntlet back at us. It’s a kind of competition that will benefit everyone.

Many of the other programs we have introduced for our employees came as much from the heart as the head. I’ve mentioned before the Career Choice program, which pays up to 95% of tuition and fees towards a certificate or diploma in qualified fields of study, leading to in-demand careers for our associates, even if those careers take them away from Amazon. More than 16,000 employees have now taken advantage of the program, which continues to grow. Similarly, our Career Skills program trains hourly associates in critical job skills like resume writing, how to communicate effectively, and computer basics. In October of last year, in continuation of these commitments, we signed the President’s Pledge to America’s Workers and announced we will be upskilling 50,000 U.S. employees through our range of innovative training programs.

Our investments are not limited to our current employees or even to the present. To train tomorrow’s workforce, we have pledged $50 million, including through our recently announced Amazon Future Engineer program, to support STEM and CS education around the country for elementary, high school, and university students, with a particular focus on attracting more girls and minorities to these professions. We also continue to take advantage of the incredible talents of our veterans. We are well on our way to meeting our pledge to hire 25,000 veterans and military spouses by 2021. And through the Amazon Technical Veterans Apprenticeship program, we are providing veterans on-the-job training in fields like cloud computing.

A huge thank you to our customers for allowing us to serve you while always challenging us to do even better, to our shareowners for your continuing support, and to all our employees worldwide for your hard work and pioneering spirit. Teams all across Amazon are listening to customers and wandering on their behalf!

As always, I attach a copy of our original 1997 letter. It remains Day 1.


Jeffrey P. Bezos
Founder and Chief Executive Officer, Inc.

*  *  *


(Reprinted from the 1997 Annual Report)

To our shareholders: passed many milestones in 1997: by year-end, we had served more than 1.5 million customers, yielding 838% revenue growth to $147.8 million, and extended our market leadership despite aggressive competitive entry.

But this is Day 1 for the Internet and, if we execute well, for Today, online commerce saves customers money and precious time. Tomorrow, through personalization, online commerce will accelerate the very process of discovery. uses the Internet to create real value for its customers and, by doing so, hopes to create an enduring franchise, even in established and large markets.

We have a window of opportunity as larger players marshal the resources to pursue the online opportunity and as customers, new to purchasing online, are receptive to forming new relationships. The competitive landscape has continued to evolve at a fast pace. Many large players have moved online with credible offerings and have devoted substantial energy and resources to building awareness, traffic, and sales. Our goal is to move quickly to solidify and extend our current position while we begin to pursue the online commerce opportunities in other areas. We see substantial opportunity in the large markets we are targeting. This strategy is not without risk: it requires serious investment and crisp execution against established franchise leaders.

It’s All About the Long Term

We believe that a fundamental measure of our success will be the shareholder value we create over the long term. This value will be a direct result of our ability to extend and solidify our current market leadership position. The stronger our market leadership, the more powerful our economic model. Market leadership can translate directly to higher revenue, higher profitability, greater capital velocity, and correspondingly stronger returns on invested capital.

Our decisions have consistently reflected this focus. We first measure ourselves in terms of the metrics most indicative of our market leadership: customer and revenue growth, the degree to which our customers continue to purchase from us on a repeat basis, and the strength of our brand. We have invested and will continue to invest aggressively to expand and leverage our customer base, brand, and infrastructure as we move to establish an enduring franchise.

Because of our emphasis on the long term, we may make decisions and weigh tradeoffs differently than some companies. Accordingly, we want to share with you our fundamental management and decision-making approach so that you, our shareholders, may confirm that it is consistent with your investment philosophy: 

  • We will continue to focus relentlessly on our customers.
  • We will continue to make investment decisions in light of long-term market leadership considerations rather than short-term profitability considerations or short-term Wall Street reactions.
  • We will continue to measure our programs and the effectiveness of our investments analytically, to jettison those that do not provide acceptable returns, and to step up our investment in those that work best. We will continue to learn from both our successes and our failures.
  • We will make bold rather than timid investment decisions where we see a sufficient probability of gaining market leadership advantages. Some of these investments will pay off, others will not, and we will have learned another valuable lesson in either case.
  • When forced to choose between optimizing the appearance of our GAAP accounting and maximizing the present value of future cash flows, we’ll take the cash flows.
  • We will share our strategic thought processes with you when we make bold choices (to the extent competitive pressures allow), so that you may evaluate for yourselves whether we are making rational long-term leadership investments.
  • We will work hard to spend wisely and maintain our lean culture. We understand the importance of continually reinforcing a cost-conscious culture, particularly in a business incurring net losses.
  • We will balance our focus on growth with emphasis on long-term profitability and capital management. At this stage, we choose to prioritize growth because we believe that scale is central to achieving the potential of our business model.
  • We will continue to focus on hiring and retaining versatile and talented employees, and continue to weight their compensation to stock options rather than cash. We know our success will be largely affected by our ability to attract and retain a motivated employee base, each of whom must think like, and therefore must actually be, an owner.

We aren’t so bold as to claim that the above is the “right” investment philosophy, but it’s ours, and we would be remiss if we weren’t clear in the approach we have taken and will continue to take.

With this foundation, we would like to turn to a review of our business focus, our progress in 1997, and our outlook for the future.

Obsess Over Customers

From the beginning, our focus has been on offering our customers compelling value. We realized that the Web was, and still is, the World Wide Wait. Therefore, we set out to offer customers something they simply could not get any other way, and began serving them with books. We brought them much more selection than was possible in a physical store (our store would now occupy 6 football fields), and presented it in a useful, easy- to-search, and easy-to-browse format in a store open 365 days a year, 24 hours a day. We maintained a dogged focus on improving the shopping experience, and in 1997 substantially enhanced our store. We now offer customers gift certificates, 1-Click shopping?, and vastly more reviews, content, browsing options, and recommendation features. We dramatically lowered prices, further increasing customer value. Word of mouth remains the most powerful customer acquisition tool we have, and we are grateful for the trust our customers have placed in us. Repeat purchases and word of mouth have combined to make the market leader in online bookselling.

By many measures, came a long way in 1997: 

  • Sales grew from $15.7 million in 1996 to $147.8 million – an 838% increase.
  • Cumulative customer accounts grew from 180,000 to 1,510,000 – a 738% increase.
  • The percentage of orders from repeat customers grew from over 46% in the fourth quarter of 1996 to over 58% in the same period in 1997.
  • In terms of audience reach, per Media Metrix, our Web site went from a rank of 90th to within the top 20.
  • We established long-term relationships with many important strategic partners, including America Online, Yahoo!, Excite, Netscape, GeoCities, AltaVista, @Home, and Prodigy.


During 1997, we worked hard to expand our business infrastructure to support these greatly increased traffic, sales, and service levels: 

  •’s employee base grew from 158 to 614, and we significantly strengthened our management team.
  • Distribution center capacity grew from 50,000 to 285,000 square feet, including a 70% expansion of our Seattle facilities and the launch of our second distribution center in Delaware in November.
  • Inventories rose to over 200,000 titles at year-end, enabling us to improve availability for our customers.
  • Our cash and investment balances at year-end were $125 million, thanks to our initial public offering in May 1997 and our $75 million loan, affording us substantial strategic flexibility.

Our Employees

The past year’s success is the product of a talented, smart, hard-working group, and I take great pride in being a part of this team. Setting the bar high in our approach to hiring has been, and will continue to be, the single most important element of’s success.

It’s not easy to work here (when I interview people I tell them, “You can work long, hard, or smart, but at you can’t choose two out of three”), but we are working to build something important, something that matters to our customers, something that we can all tell our grandchildren about. Such things aren’t meant to be easy. We are incredibly fortunate to have this group of dedicated employees whose sacrifices and passion build

Goals for 1998

We are still in the early stages of learning how to bring new value to our customers through Internet commerce and merchandising. Our goal remains to continue to solidify and extend our brand and customer base. This requires sustained investment in systems and infrastructure to support outstanding customer convenience, selection, and service while we grow. We are planning to add music to our product offering, and over time we believe that other products may be prudent investments. We also believe there are significant opportunities to better serve our customers overseas, such as reducing delivery times and better tailoring the customer experience. To be certain, a big part of the challenge for us will lie not in finding new ways to expand our business, but in prioritizing our investments.

We now know vastly more about online commerce than when was founded, but we still have so much to learn. Though we are optimistic, we must remain vigilant and maintain a sense of urgency. The challenges and hurdles we will face to make our long-term vision for a reality are several: aggressive, capable, well-funded competition; considerable growth challenges and execution risk; the risks of product and geographic expansion; and the need for large continuing investments to meet an expanding market opportunity. However, as we’ve long said, online bookselling, and online commerce in general, should prove to be a very large market, and it’s likely that a number of companies will see significant benefit. We feel good about what we’ve done, and even more excited about what we want to do.

1997 was indeed an incredible year. We at are grateful to our customers for their business and trust, to each other for our hard work, and to our shareholders for their support and encouragement.

Jeffrey P. Bezos

Published:4/11/2019 9:26:25 AM
[Entertainment] The top 25 spiritual and inspirational books from USA TODAY's Best-Selling Books list We took a look at the top spiritual nonfiction books over the 25-year history of our best-selling books list. Did your favorite make the list?
Published:4/10/2019 3:14:51 PM
[Markets] Baltimore City Council Demands Mayor To Resign After $500k Book Fraud    

The 14 members of the Baltimore City Council requested Monday for Mayor Catherine E. Pugh's resignation over her ongoing children's book scandal, The Washington Post reports.

In a two-sentence letter, the council said the "entire membership of the Baltimore City Council believes that it is not in the best interest of the City of Baltimore for you to continue to serve as Mayor. We urge you to tender your resignation, effective immediately."

Pugh, who recently took an indefinite leave of absence for 'medical issues,' has been "recovering from pneumonia and regaining her health," said a statement issued by her office.  "She fully intends to resume the duties of her office and continuing her work on behalf of the people and the City of Baltimore."

City Council President Bernard C. "Jack" Young is assisting as acting mayor, said the Post.

Pugh has been heavily criticized after the Baltimore Sun reported that she reportedly received $500,000 from the University of Maryland Medical System for her self-authored "Healthy Holly" book series.

The university system paid Pugh for 100,000 copies of the book while she was on the board. The book teaches children how to live healthily; however, some 50,000 copies remain unaccounted for (as per the Baltimore Sun, the copies may have never been printed).

The Sun's report also said at the time Pugh received $100,000 tranche for her books, a company in the city called Kaiser Permanent received a $48 million contract. Coincidence?

Pugh issued an apology in March for her book ventures.

"I sincerely want to say that I apologize that I have done something to upset the people of Baltimore," she said on March 28. "I never intended to do anything that could not stand up to scrutiny."

Maryland Gov. Larry Hogan called for an immediate investigation into the possible fraud. He asked state prosecutor and Comptroller Peter Franchot to examine the case.

The Baltimore City House delegation said that it was "not in the best interests of Baltimore" for the mayor to stay in office.

"The position of mayor is not a revolving door," Del. Cheryl D. Glenn said. "We hope the mayor will do what is best for the city of Baltimore."

Councilman Zeke Cohen said while the move to out the mayor was "unprecedented," it is the best course for Baltimore.

Most likely Pugh is finished. Officials at every level have lost confidence in the mayor. It's likely that she'll announce her resignation in the coming weeks and or next month.

The breakdown in leadership shows how Baltimore continues to implode.

Published:4/10/2019 12:47:54 PM
[Markets] Reckoning With Failure In The War On Terror

Authored by Chris Hedges via,

Donald Trump’s ascendancy to the presidency, as Max Blumenthal points out in his insightful book “The Management of Savagery: How America’s National Security State Fueled the Rise of Al Qaeda, ISIS, and Donald Trump,” was made possible not only by massive social inequality and concentration of wealth and political power in the hands of the oligarchic elites but by the national security state’s disastrous and prolonged military interventions overseas.

From the CIA’s funneling of over a billion dollars to Islamic militants in the 1970s war in Afghanistan against the Soviet Union to the billion dollars spent on training and equipping the radical jihadists currently fighting in Syria, the United States has repeatedly empowered extremists who have filled the vacuums of failed states it created. The extremists have turned with a vengeance on their sponsors. Washington’s fueling of these conflicts was directly responsible for the rise of figures such as Ayman al-Zawahiri and Osama bin Laden and ultimately laid the groundwork for the 9/11 attacks. It also spawned the rabid Islamophobia in Europe and the United States that defines Trump’s racist worldview and has been successfully used to justify the eradication of basic civil liberties and democratic rights.

The misguided interventions by the national security apparatus have resulted in hundreds of thousands of deaths, over 5 million desperate refugees fleeing to Europe, the destruction of entire cities, the squandering of some $5 trillion of U.S. taxpayer money, rampant corruption and criminality. The mandarins of national security, rather than blunt the rise of radical jihadism, have ensured its spread across the globe. The architects of this imperial folly have a symbiotic relationship with those they profess to hate. The two radical extremes—the interventionists in the national security apparatus and the radical jihadists—play off of each other to countenance ever-greater acts of savagery. The more perfidious your enemy, the more your own extremism is justified. We are locked in a macabre dance with the killers we created and empowered, matching war crime for war crime, torture for torture and murder for murder. This unrestrained violence has a dark momentum that escapes management and control. It exacerbates the very insecurity it claims to be attempting to eliminate by constantly creating legions of new enemies.

“Drone strikes take out a few bad guys to be sure, but they also kill a large number of innocent civilians,” Nabeel Khoury, a former U.S. deputy chief of mission in Yemen, argues. “Given Yemen’s tribal structure, the U.S. generates roughly forty to sixty new enemies for every AQAP [al-Qaida in the Arabian Peninsula] operative killed by drones.”

The binary view of the world imagined by right-wing ideologues such as Richard Pipes during the Cold War, defined as a battle to the death against godless communism, has been reimagined by Israeli Prime Minister Benjamin Netanyahu and American neocons such as Mike Pompeo, John Bolton, Fred FleitzRobert Kagan, Steve Bannon, William Kristol, Paul Wolfowitz and Donald Rumsfeld and leaders of the Christian right including Gary Bauer and William Bennett to become a battle to the death between the “barbarity” of Islam and the “civilized” ethic of the Judeo-Christian West. It is a rebranding of the Cold War, so useful to the retrograde forces of capitalism in crushing popular dissent and so profitable to the arms industry. Its most prominent voices are a bizarre collection of neofascist ideologues and quack conspiracy theorists such as Bannon, Sean Hannity, Stephen Miller and Pam Geller, who claims that Barack Obama is the love child of Malcolm X.

This ideology, like the ideology of anti-communism, erases not only history but context. Those who oppose us are removed from the realm of the rational. They are seen as incomprehensible. Their hate has no justification. They are human embodiments of evil that must be eradicated. They despise us for our “values” or because they are driven by a perverted form of Islam. The failure, as Blumenthal writes, to place these conflicts in context, to examine our own complicity in fueling a justifiable anger, even rage, dooms us to perpetual misunderstanding and perpetual warfare. Our response is to employ greater and greater levels of violence that only expand the extremism at home and abroad. This demented project, as Blumenthal writes, collapses “the fragile space where multi-confessional societies survive.” It bifurcates political space into competing forms of extremism between the jihadists and the counter-jihadists. It creates a strange and even comforting “mutually reinforcing symbiosis” that depends “on a constantly escalating sense of antagonism.”

The methods used on a wary public by the national security state, especially the FBI and the intelligence agencies, to justify and advance these wars are increasingly unsavory. Muslims, many suffering from emotional and mental disabilities, are baited by law enforcement into “terrorist” plots that few of them could have conceived or organized on their own. The highly publicized arrests and quashing of these nascent “terrorist plots” exaggerate the presence of radical jihadists within the country. They keep fear at a fever pitch among the U.S. population. Trevor Aaronson, the author of “Terror Factory: Inside the FBI’s Manufactured War on Terror,” found that nearly half of all terror prosecutions between Sept. 11, 2001, and 2010 involved informants, including some with criminal backgrounds who were paid as much as $100,000 by the FBI. Aaronson noted that during the last year of the George W. Bush administration the government did not prosecute anyone arrested in a terrorist “sting.” But such stings exploded under Barack Obama, a tactic that Blumenthal writes was “designed to cast his administration as just as tough on terror as any Republican”—the Obama administration “announced an arrest resulting from a terrorism sting every sixty days.” This suggested, Aaronson writes, “that there are a lot of ineffective terrorists in the United States, or that the FBI has become effective at creating the very enemy it is hunting.”

The longer and more confusing the “war on terror” becomes, nearly two decades on, the more irrational our national discourse becomes. The paranoid and racist narratives of the far right have poisoned the mainstream dialogue. These racist tropes are repeated by the White House, members of Congress and the press.

“Islamophobia had become the language of a wounded empire, the guttural roar of its malevolent violence turned back from the sands of Iraq and the mountain passes of Afghanistan, and leveled against the mosque down the turnpike, the hijabi in the checkout line, the Sikh behind the cash register—the neighbors who looked like The Enemy,” Blumenthal writes.

Far-right parties are riding this rampant Islamophobia, fueled by the catastrophic failures in the Middle East, to power in Germany, Italy, France, Britain, Sweden, Poland and Hungary. This toxic hatred is also a central theme of the Trump administration, which demonizes Muslims, especially Muslim refugees, and seeks to bar them from entering the United States.

The arrival of millions of Muslim refugees in Europe from states such as Libya, Syria (which alone has produced a million refugees in Europe), Iraq and Afghanistan has dramatically bolstered the appeal of European neofascists. Nearly 73 percent of Britons who voted for their nation to leave the European Union cited the arrival of immigrants as their most important reason for supporting the referendum.

The radical jihadists have long expressed a desire to extinguish democratic space in the West. They are aware that the curtailment of civil liberties, evisceration of democratic institutions, especially the judicial system, and overt hatred of Muslims push Muslims in the West into their arms. Such conditions also increase the military blunders of the United States and its allies abroad, providing jihadists with a steady supply of new recruits and failed states from which they can operate. The jihadist strategy is working. In the year before the 2016 presidential election, violence against Muslims in the United States soared, including shootings and arson attacks on mosques. Public disapproval of Muslims, according to opinion polls, is at a record high.

The Democratic Party, signing on to the forever crusade by the national security state in the name of humanitarian intervention, is as complicit. The Obama administration not only accelerated the sting operations in the United States against supposed terrorists but, in its foreign operations, increased the use of militarized drones, sent more troops to Afghanistan and foolishly toppled the regime of Moammar Gadhafi in Libya, creating yet another failed state and safe haven for jihadists.

The radical jihadists, in an irony not lost on Blumenthal, are often deliberately armed and empowered by the U.S. national security apparatus, along with Israel, as a way to pressure or remove regimes deemed antagonistic to Israel and the United States. Obama’s secretary of state, John Kerry, in audio leaked from a closed meeting with Syrian opposition activists, admitted that the U.S. had used Islamic State as a tool for pressuring the Syrian government. He also acknowledged that Washington’s complicity in the growth of IS in Syria was the major cause for Russian intervention there.

In a 2016 op-ed titled “The Destruction of Islamic State Is a Strategic Mistake,” Efraim Inbar, the director of the Begin-Sadat Center for Strategic Studies, argued that “[t]he West should seek the further weakening of Islamic State, but not its destruction.” He said the West should exploit IS as a “useful tool” in the fight against Iran and its proxy, Hezbollah. “A weak IS is, counterintuitively, preferable to a destroyed IS,” Inbar concluded. He went on to argue for prolonging the conflict in Syria, saying that extended sectarian bloodshed would produce “positive change.”

Earlier in 2016, Israel’s former Defense Minister Moshe Ya’alon had said similarly, “In Syria, if the choice is between Iran and the Islamic State, I choose the Islamic State.”

Israel seeks to create buffer zones between itself and Hezbollah in southern Lebanon. It sees its neighbor Syria, because of its alliance with Iran, as a mortal enemy. The solution has been to cripple these traditional enemies by temporarily empowering radical Sunni jihadists and al-Qaida. There are numerous reports of Israel, along with the United States, using its aircraft and military in Syria to aid the very jihadists Washington and Jerusalem claim to want to wipe from the face of the earth.

This intractable morass, Blumenthal argues, led directly to the demonization of Russia. Trump’s anti-interventionist rhetoric, however disingenuous, triggered what Blumenthal calls “a wild hysteria” among the foreign policy elites. Trump calls the invasion of Iraq a mistake. He questions the arming of Syrian jihadists and deployment of U.S. forces in Syria. He is critical of NATO. At the same time, he has called for better relations with Russia.

“Joining with the dead-enders of Hillary Clinton’s campaign, who were desperate to deflect from their crushing loss, the mandarins of the national security state worked their media contacts to generate the narrative of Trump-Russia collusion,” Blumenthal writes.

“Out of the postelection despair of liberals and national security elites, the furor of Russiagate was born. This national outrage substituted Russia for ISIS as the country’s new folk devil and painted Trump as Russian president Vladimir Putin’s Manchurian candidate.”

“Almost overnight, hundreds of thousands of liberals were showing up at postelection rallies with placards depicting Trump in Russian garb and surrounded by Soviet hammer-and-sickle symbols,” Blumenthal writes.

The FBI and the intelligence community, organizations that have long spied upon and harassed the left and often liberals, became folk heroes. NATO, which was the instrument used to destabilize the Middle East and heighten tensions with Russia because of its expansion in Eastern Europe, became sacrosanct.

“In its obsession with Moscow’s supposed meddling, the Democratic Party elite eagerly rehabilitated the Bush-era neoconservatives, welcoming PNAC [Project for the New American Century] founder William Kristol and ‘axis of evil’ author David Frum into the ranks of the so-called ‘resistance,’ ” Blumenthal writes. “The Center for American Progress, the semiofficial think tank of the Democratic Party, consolidated the liberal-neocon alliance by forging a formal working partnership with the American Enterprise Institute, the nest of the Iraq war neocons, to ‘stand up to Russia.’ ”

Those in the alternative media who question the Russia narrative and chronical the imperial disasters are in this new version of the Cold War branded as agents of a foreign power and hit with algorithms from Google, Facebook, YouTube and Twitter to deflect viewers from reading or listening to their critiques. Politicians, such as Bernie Sanders and Labour Party leader Jeremy Corbyn, who push back against the war lust are smeared with the same nefarious charge. It is, as Blumenthal writes, a desperate bid by the war industry and the interventionists to mask the greatest strategic blunder in American history, one that signals the end of American hegemony.

“In the face of their own failure, America’s national security elites had successfully engineered a new Cold War, wagering that the reignited conflict would preserve their management of savagery abroad and postpone the terrible reckoning they deserved at home,” Blumenthal concludes.

The corporate state, its legitimacy in tatters, seeks to make us afraid in order to maintain its control over the economic, political and military institutions. It needs mortal enemies, manufactured or real, at home or abroad, to justify its existence and mask its mismanagement and corruption. This narrative of fear is what Antonio Gramsci called a “legitimation doctrine.” It is not about making us safe—indeed the policies the state pursues make us less secure—but about getting us to surrender to the will of the elites. The more inequality and injustice grow, the more the legitimation doctrine will be used to keep us cowed and compliant. The doctrine means that the enemies of the United States will never be destroyed, but will mutate and expand; they are too useful to be allowed to disappear. It means that the primary language of the state will be fear. The longer the national security state plays this game, the more a fascist America is assured.

Published:4/9/2019 8:09:21 PM
[Markets] Trump Cares About Two Things: Empire & The Stock Market

Authored by Mike Krieger via Liberty Blitzkrieg blog,

Though not surprising, it’s nevertheless extraordinary to watch Donald Trump publicly and shamelessly morph into a George W. Bush era neocon when it comes to foreign policy, and a CNBC stock market cheerleader when it comes to the economy. Just like Barack Obama before him, Trump talked a good populist game on two issues of monumental importance (foreign policy and the rigged economy), but once elected immediately turned around and prioritized the core interests of oligarchy.

Trump doesn’t even give lip service to big picture populist topics anymore unless they’re somehow related to the culture war, which works out perfectly for the entrenched oligarchy since the culture war primarily serves as a useful distraction to keep the rabble squabbling while apex societal predators loot whatever’s left of this hollowed out neo-feudal economy.

The pivot toward status quo consensus when it comes to two of the most existential issues facing the nation should be deeply concerning to everyone, but particularly to those who thought Donald Trump would be different. When it comes to militarism and empire, Trump’s hypocrisy and bait and switch is one for the record books. Just as it became clear Obama was a fraud once he hired Larry Summers and Timothy Geithner (we later found out his cabinet was apparently chosen by Citibank), Trump placing neocons Mike Pompeo and John Bolton into key positions was a clear sign you could take “Make America Great Again” and flush it down the toilet. This administration is now laser focused on maintaining and even expanding imperial reach.

Like Obama before him, Trump’s abandonment of every important thing he ran on was noticeable early on. Recall that while campaigning, Trump accurately called out the Saudis for their key role in the 9/11 attacks:

“Who blew up the World Trade Center? It wasn’t the Iraqis, it was Saudi — take a look at Saudi Arabia, open the documents,” Trump told the gang at Fox & Friends Wednesday morning…

“It wasn’t the Iraqis that knocked down the World Trade Center,” Trump told a crowd in Bluffton, South Carolina. “It wasn’t the Iraqis. You will find out who really knocked down the World Trade Center, ‘cuz they have papers in there that are very secret. You may find it’s the Saudis, okay? But you will find out.”

Shortly after he made those comments, the infamous “28 Pages” were released showing how Saudi elites helped finance the whole operation. Did that stop Trump from making Saudi Arabia his very first state visit after being elected? Don’t be ridiculous.

Donald Trump knows the score when it comes to Saudi Arabia. He knows about their role in 9/11 and he knows they’re the top global proliferators of terrorist ideology on the planet. Nevertheless, Trump is now enthusiastically tied to the hip with the Saudis, thus making him a defender and protector of the status quo. Defend him all you want, but this isn’t the sort of thing he ran on with regard to America’s foreign policy.

Like other presidents who came before him, he campaigned on one foreign policy platform and then supports another once elected. In fact, Trump’s now so far off the deep end he’s widely expected to veto a measure recently passed by both houses of Congress to stop aiding Saudi Arabia in its ongoing genocidal war in Yemen.

Trump knows better when it comes to foreign policy, but he’s doing this stuff anyway. A similar thing could be said for his economic policy. While on the campaign trail he accurately called what was going on in financial markets a “big, fat, ugly bubble,” but now that he’s in the Oval office, he can’t get enough of it — cheering on the stock market every chance he gets as if it means anything to the masses of people barely getting by.

Meanwhile, back in 2011 Trump tweeted the following.

Turns out QE led to massive asset price inflation and society-destabilizing wealth inequality which played a key role in Trump’s election, but he’s not concerned about that anymore. In fact, he’s now actively begging for more Federal Reserve money printing.

I’ll take the other side.

Many people naively believed Trump meant what he said on the campaign trail. They thought because he was already wealthy and not a career politician he’d get in there and really shake up the status quo on hugely important issues like foreign policy and the rigged, monopoly dominated, surveillance focused, financialized crony-economy. Well it turns out Trump’s just like everybody else. He doesn’t want to be the guy sitting in the White House when the scam economy and unsustainable empire collapses. I guess I can’t blame him, but it doesn’t make the situation any less dire for the rest of us.

While there’s a very high probability that both the U.S. empire and the world financial system fall apart under Trump, it’s important to note that he didn’t create either one of those things. All the dangerous, outdated, corrupt and unsustainable things being desperately stitched together on a daily basis to maintain the status quo have been building up for decades.

It’s become clear no president will ever intentionally dismantle this ticking time bomb, it just has to play out on its own timeline. The important thing is to be honest about what’s really going on so you’re not completely caught off guard when the world changes faster and more dramatically than you could ever imagine in the years ahead.

*  *  *

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Published:4/9/2019 3:40:06 PM
[Markets] Designating Iran's Revolutionary Guards As Terrorists Will Have Consequences For America

Authored by James Durso, op-ed via The Hill,

America’s designation of the Iranian Revolutionary Guard Corps (IRGC) as a terrorist group is an example of taking a good idea — sanctioning Iranian entities for malign behavior — one step too far.

A former State Department counterterrorism official said of the designation, “The future ramifications of this decision will be profound.” He’s right about that, but “profound” may cut both ways.

In 2007, the U.S. designated the Guard’s overseas operations arm, the Quds Force, for support of terrorist organizations, so the new sanctions will hit the parent organization which is already under sanctions for ballistic missile development and supporting the Bashar Assad regime in Syria.

An Iranian lawmaker responded to the news by saying Iran would regard the U.S. military as no different than the Islamic State, echoing the 2017 statement by the commander of the Guards, Major General Mohammad Ali Jafari, that the Guards would “consider the American army to be like Islamic State all around the world.”

The Department of Defense (DOD) and the CIA reportedly opposed the move, and no wonder: Officials at the National Security Council and the Treasury Department are safe in Washington, D.C., State Department officers in Baghdad labor under restrictive security rules which limit their movements, which leaves the U.S. military and CIA officers exposed.

DOD has opposed this idea for a long time. When it was considered in 2007, the representative of the Joint Chiefs of Staff told his civilian counterparts, “The United States has always carefully avoided declaring military officers engaged in activities sanctioned by their governments as terrorists to avoid the same being done to us.” It could be applied to American special forces officers, who frequently operate clandestinely and have provided military assistance and training to insurgents.

Encounters between the American and Iranian military and security services can go one of three ways:

  • Proxy war: Iraqi militias supported by Iran killed at least 608 American servicemen.

  • Let’s-get-this-over-with: Iran quickly released the U.S. Navy crews who were captured by the IRGC Navy when they wandered into Iranian waters in early 2016.

  • The Beirut option: In the 1980s, the CIA’s Beirut station chief William Buckley and U.S. Marine colonel William Higgins were kidnapped by Iran’s Lebanese Hezbollah allies and died under interrogation. Former FBI agent - and CIA contractor - Robert Levinson disappeared in Iran in 2007, and the FBI, then led by Robert Mueller, was reduced to asking Vladimir Putin’s most loyal oligarch, Oleg Deripaska, to fund his (unsuccessful) rescue.

And the designation won’t just discomfit Americans; Iraqi officials regularly encounter Guards officers whether they want to or not. Quds Force commander Qasem Soleimani regularly visits Iraq, and the last three Iranian ambassadors to Baghdad have been Quds Force officers, so Iraqi officials can expect to be put on notice by the Americans to avoid “terrorists.” Iran is active economically in Iraq, so the designation may be bad for Iraq’s economy. One near-term effect may be to scuttle an effort to import electricity from Iran, badly needed as the country still suffers from power shortages.

America’s timing is bad, as Iran’s “resistance economy” is dragging, and the government has been criticized for its lackluster response to the recent widespread, deadly flooding. These sanctions will just give the mullahs an excuse for their economic mismanagement.

Given the Guard’s penetration of Iran’s economy, new sanctions might enrich it even more. If the economy becomes radioactive to outside investors because the due diligence is too hard, the IRGC could buy the remaining assets at cut-rate prices. If, in the future, the Guard is neutered and sanctions are relaxed, unwinding the sanctioned businesses will take years and will require the approval of the U.S., which will move at the speed of government. This will hobble the post-mullah regime which will be under pressure to improve the lives of newly-free Iranians.

The current U.S. practice of targeting specific people and economic entities for sanctions allows the U.S. to fine-tune its actions and tells the Iranians the U.S. knows who is doing what. Given the Guards economic ubiquity, the terrorist designation is a blanket sanction with unknown consequences, though one might be increased power for the Guards.

The last time a military formation of a sovereign state was declared a criminal organization was when Nazi Germany’s Waffen-SS was condemned for its involvement in war crimes and crimes against humanity. Designating the IRGC a terrorist entity may sound great after that third beer, but is IRGC commander Major General Jafari as bad as Himmler? No.

Terrorism sanctions on Iran’s Revolutionary Guards promise something for everyone, all of it bad: More American hostages, and more money for the Guards. The Americans should ignore the bright, shiny object of terrorism sanctions and remember firm, consistent pressure is the way to win the contest with Iran.

Published:4/8/2019 11:34:15 PM
[World] [Ilya Somin] Bryan Caplan's New Book on Open Borders

It should be of great interest to anyone who follows debates over immigration.

My George Mason University colleague, prominent libertarian economist Bryan Caplan, has a forthcoming book making the case for open borders. It is entitled Open Borders: The Science and Ethics of Immigration. In this recent blog post, Bryan explains the purpose of the book, and its somewhat unusual "nonfiction graphic novel" format:

Open Borders is a non-fiction graphic novel. If you're unfamiliar with the genre, picture a comic-book documentary. While the form is light-hearted, the content is thoroughly researched and carefully documented. I strive to steelman the critics. I've got chapters on all the leading objections to open borders: economic, fiscal, cultural, and political....

While the book is packed with arguments, you can easily read it cover-to-cover (minus the References) in two fun-filled hours. Indeed, out of all my books, Open Borders delivers the most information per minute of reader time. How is this possible? Because combining words and pictures allows me to communicate far more economically than I can communicate with words alone.

Who's the target audience? Everyone from curious laymen to researchers specializing in immigration. And due to the format, "laymen" even includes precocious kids as young as seven. I'm not kidding: My youngest kids kept reading it over my shoulder as I was writing it....

Above all, I consider Open Borders the most persuasive book I've ever written. I know what I'm advocating is radical and scary. I know I bear the burden of proof – and I gladly accept it. I know that political discourse has gone from bad to worse over the last decade. My goal, however, is to be part of the solution. I don't want to demonize, humiliate, or "call out" people who disagree with me about immigration. I want to listen to them, answer their objections to their own satisfaction, and be friends. An impossible dream? Probably. But Open Borders is me doing my best to make that dream a reality.

Graphic novels are not really my thing, so it is hard for me to comment on that aspect of the book. Be that as it may, I am confident this will turn out to be a compelling contribution to the debate over one of the most significant issues of our time. I have long found Bryan to be one of the most impressive academic commentators on immigration policy and debates over related issues. His 2012 article "Why Restrict Immigration?" may be the best short introduction to the case for open borders, effectively combining intellectual rigor with accessibility.

I am also a big fan of Bryan's previous books, The Case Against Education (which I reviewed here), The Myth of the Rational Voter (an important influence on my own work on voter ignorance, though we differ on some key points), and Selfish Reasons to Have More Kids. All are major, innovative contributions to our understanding of important issues, and all have had a substantial impact on public debate. If Open Borders is indeed his most persuasive book, that's quite an accomplishment!

Published:4/8/2019 12:31:19 PM
[Markets] 'Bond Trading' Exodus Reveals The Global Economy's Landmine

Authored by Jeffrey Snider via Alhambra Investment Partners,

It isn’t just US or European banks which are shrinking. The nature of this post-August 9, 2007, world is just that – global. Sure, there are regulations which have made investment banking more expensive. But there isn’t a rule or law that Wall Street (really Lombard Street) wouldn’t “discover” a way to circumvent it if they all thought it was worth the trouble.

Bond trading, a euphemism for all this FICC money dealing stuff, didn’t need an LCR to look at the world differently. It only needed Bear Stearns.

There is only risk where there used to be only return. In an environment where everyone largely agrees (outside of a few outliers) with this returnless risk scenario there really is no other course. Being on the wrong end of such asymmetry leaves only the one long run option. You can fight it and disagree now and again, but that sort of reflationary thinking just cannot last.

Goldman Sachs earlier this year announced that it would be cutting back. This week, it was Nomura in Japan (thanks J. Fraser). Once that country’s biggest stalwart in “fixed income”, another way of saying bond trading, they don’t want to do it anymore, either.

The biggest question mark hovers over the cuts in fixed-income trading, often seen as a strength at the bank. Nomura is scaling back emerging markets and G-10 rates, foreign exchange and flow-credit trading businesses, as well as costs in the EMEA flow business by 50 percent. Flow trading occurs on behalf of clients, unlike proprietary trading.

The business just isn’t there for them to keep up with capacity. Why isn’t the business there? An unstable system destroys not just opportunity but also the incentives to try and stabilize the system. At this point, nothing other than outside influence will break the cycle (and that’s about as likely as a central banker recovery prediction paying off).

The Office of the Comptroller of the Currency (OCC) data on Q4 2018 was pretty damning as far as the domestic dealers are concerned. Goldman had an atrocious quarter, no surprise, almost certainly betting on Jay Powell. Money dealers are described in the Economics (and central bank) textbook running neutral books; they don’t, they never have.

You can see the ebbs and flows of particular dealers which follow along each reflation episode. Goldman, out of all of them, really bought into Reflation #3. Beginning with the first quarter of 2017, this bank’s derivative book skyrocketed an astounding 33% over the next five quarters! Apparently, they weren’t in much demand for compression trading during 2017’s globally synchronized growth scare, and boy did the world seem much better for it (CNY UP, too).

That trend, however, abruptly ended around Q1 2018. Not surprisingly, especially since it was the same trend for the other dealers, too, a lot of bad monetary things have been happening ever since.

These are the more visible pieces of that “rest of the money markets that do matter” I write about when they intrude upon federal funds, the trouble out there in the shadows which must be severe if it shows up in EFF and IOER (the joke). Since around Q1 2018, yep, intrude they have.

In Q4 when everything was going wrong, GS’s derivative book collapsed 22% during just those three months. Weeks later, the “bank” then announced how it didn’t want to do this stuff anymore. Having bet on Yellen, the bank’s withdrawal helped force her successor to his epic flip flop.

The other big banks reduced their exposures during Q4, too. Citigroup, which as late as 2014 right before Euro$ #3 was jockeying to overtake JPM as the money dealer king, ran for the hills in Q4 2018. Its book was whacked 13%. We know the global economy hit a landmine in this same October to December window.

Again, it’s not just US banks or those conflicted throughout Europe. This is a systemic problem all across the board, a point driven home by Japan’s Nomura. This derivative stuff, or bond trading and FICC, is the guts of the global money system – a credit-based currency regime. This eurodollar is the world’s reserve currency, its corrosive fingerprints once more all over the global economy.

And so, our problems at least are very well defined. You just can’t get anyone to believe it, the high intellectual hurdle which I described a few months ago:

This is one key factor as to why our economic problems are so hard to overcome; how in the world the global economy can lose an entire decade and be one-tenth of the way into another. You start by saying the central bank isn’t central and already people are at best skeptical if not completely turned off. And then you tell them, the few who are left, if you really want any chance at legitimate economic recovery Goldman Sachs [or Nomura] needs to make more money, a lot more, in its bond trading business. And if you don’t want Goldman [or Nomura] to thrive in FICC, then the whole global monetary system must be completely revamped from the ground up.

Oh, and by the way, we’ve been operating under a clandestine global monetary system predicated on the world’s biggest banks who aren’t really banks working in the shadows for half a century already.

It’s way, way too much to grasp, especially all at once.

Real economy participants don’t care one way or the other about formal definitions.

They’re stuck with what’s actually available, or not available. The consequences are real, too.

Published:4/8/2019 11:29:03 AM
[Markets] Aramco Launches Massive 6-Part Dollar Debt Deal Which Is Already 4x Oversubscribed

Just a day after the Saudis allegedly threatened the hegemon of the almighty petrodollar, Saudi Aramco began the sale of its first-ever dollar bonds with an order-book of around $40 billion.

“It will be definitely a jumbo deal with at least four tranches,” said Sergey Dergachev senior portfolio manager at Union Investment Privatfonds GmbH in Frankfurt. “Demand should be huge.”

Demand for the most highly anticipated sale of the year already totaled $30 billion, Aramco Chairman and Saudi Energy Minister Khalid Al-Falih told Bloomberg TV early on Monday, but it has already rep[ortedly surpassed that.

Dergachev speculated that demand could even surpass the record $53 billion in bids that Qatar received for its $12 billion bond sale last year.

Entering the bond market has forced Aramco to open its books after decades of speculation about its earnings and production. The company got the fifth-highest investment-grade ratings at both Moody’s Investors Service and Fitch Ratings, matching Saudi Arabia’s sovereign grade.

Bloomberg reports that the oil giant is offering six-tranche debt, according to the people familiar with the matter, who asked not to be identified. The world’s most profitable company is tapping the market ahead of a planned $69 billion acquisition.

Initial Price Thoughts:

  • USD 3Y Fixed -- T+75 area

  • USD 3Y Floating Rate Notes -- Libor + equivalent

  • USD 5Y Fixed -- T+95 area

  • USD 10Y Fixed -- T+125 area

  • USD 20Y Fixed -- T+160 area

  • USD 30Y Fixed -- T+175 area

Aramco may raise about $10 billion from the sale, the kingdom’s energy minister said in January, as Saudi Arabia combines the oil producer with chemical maker Saudi Basic Industries Corp.

The deal is expected to price tomorrow, so we would not be surprised to see leakage higher in Treasury yields on rate-locks and rotation.

Published:4/8/2019 7:58:32 AM
[Markets] Visualizing The Most Hyped Technology Of Every Year From 2000-2018

Nothing captures our collective imagination quite like emerging technology.

In a short amount of time, technological innovations such as wireless internet and social networking have become a ubiquitous part of our everyday lives, quietly transforming the way we live, work, and communicate. Other promising technologies have their moment in the sun, only to fade into obscurity.

As Visual Capitalist's Nick Routley notes, Gartner’s Hype Cycle charts the roller coaster ride of emerging tech, from the first stirrings of public awareness to the point of wider adoption and economic viability. Today’s graphic is a retrospective look at which trends scaled the summit of the Hype Cycle each year since 2000.

Reaching the Peak

As the media searches for the next big thing, certain technologies tend to dominate the headlines. Meanwhile, venture capital flows into the companies racing to bring the tech to market, valuations swell, marketing departments generate excitement, and the expectations of the general public begin to grow as well.

One example of this phenomenon at work is the adoption of microblogging. Today, we don’t think twice about posting a tweet or updating our status on Facebook, but a decade ago, the act of posting a short public message was major shift in the way people used technology to communicate with one another. The intense buzz that sent microblogging towards the top of the Hype Cycle is corroborated by Google Search data.

Living Up to the Hype

A few technologies transcend the hype to transform entire industries. Here are some examples that lived up to their time in the spotlight.

Cloud Computing
Right from the beginning, the analogy of data breaking the shackles of folders and clunky external drives – instead zipping efficiently into the invisible cloud – generated a lot of excitement. It felt like the future of computing, and enterprises and individuals eagerly adopted the technology.

Today, Microsoft and Amazon’s cloud computing divisions each make $6-7 billion in revenue per quarter, and that number is still growing at a brisk pace.

NFC Payments
Near Field Communication – the technology that enables contactless payments – is transforming the way people pay for purchases around the world.

The global contactless payments market is expected to reach $138.4 billion by 2023. Here’s a look at where NFC payments are making the greatest in-roads:

The Ones That Underwhelmed

During the Christmas season of 2009, Kindle became the most gifted item in Amazon’s history. This watershed moment looked like the end of physical books as the public embraced the e-reader as the new way of consuming text.

Fast-forward to today, and only 19% of adults in the U.S. own an e-reader.

Of course, not every technology that grabs the headlines is going to become the next iPhone. Here are some others that didn’t immediately meet expectations after topping the Hype Cycle.

Some concepts fail primarily because they’re ahead of their time. Such is the case with mobile commerce.

By 2001, more than half of Americans owned mobile phones, and this represented a huge opportunity. Unfortunately, early m-commerce was restricted by the limitations of mobile phones of that time period. It wasn’t until the introduction of smartphones that the concept really took off. Today, nearly half of all online transactions are made via mobile devices.

3D Printing
Few technologies reach the fever pitch that 3D printing did in 2012. From the $1.4 billion merger of the largest players in the sector to the reports of firearm blueprints circulating the web, you could forgive people for believing that the 3D printer was destined to become the next microwave. In the end, interest in 3D printing leveled off.

While it is getting used for prototyping in many different industries, it remains to be seen whether the technology will ever achieve the wide consumer-level adoption that was promised.

What’s Next?

When 2019’s Hype Cycle is released later this year, it remains to be seen which technology will rise to the top. Based on the trajectory from last year, search volume, and current news reports, 5G is a strong competitor.

Published:4/7/2019 10:56:16 PM
[Markets] The Management Of Savagery: Pro-War Lobbyists Push To Ban Book Exposing Regime Change Wars

Authored by Alexander Rubinstein via MintPress News

The Syrian American Council and a collection of pro-war lobbyists have led an intimidation campaign aimed at bullying a major Washington-based bookstore, Politics and Prose, into canceling award-winning journalist and author Max Blumenthal’s launch event for his new book The Management of Savagery.

And it appears to have worked. Politics and Prose announced that it would “postpone” the event, citing “concerns” over the event’s “format, substance, … [and] security” in a tweet. In a testament to the ferocity of the harassment campaign against the small chain, the company has pinned the statement to the top of its Twitter page so that anyone visiting it sees immediately that they caved.

Politics and Prose is the go-to space for D.C. book events. If you are on a book tour and coming to Washington, chances are that Politics and Prose will be hosting your event.

On Monday, I called the Politics and Prose location that was to host the event for Blumenthal. I was directed to the events department, as nobody in the store itself had authority on such matters. After being put on hold for a few minutes, I was told by an employee, “I spoke to all of my co… my manager and also our events person and we have no plans for canceling that event. It is going to go on as scheduled.”

What was left out was that the store had already begun making onerous demands of Blumenthal, including requiring him to have an “interlocutor” on stage, specifically, one who would appease the Syrian American Council. Blumenthal secured Andrew Cockburn, one of the premiere journalists covering U.S. and Middle East politics and a longtime correspondent for Harper’s Magazine. But Blumenthal told MintPress that Cockburn was denied; Politics and Prose management insisted that Cockburn was “too sympathetic” to his own views.

As the pressure campaign increased, so too did the company’s suspicions of Blumenthal. One would think that they would be familiar with Blumenthal already, as he has appeared for three previous book events there.

Critics say that Blumenthal paints a rescue organization as a terrorist group and has mocked victims of war crimes. What they leave out is that Blumenthal’s reporting exposed that rescue organization — the infamous White Helmets — as a Western government-funded public-relations project that has, in fact, been operating alongside extremist groups like Jabhat al-Nusra and Al Qaeda. And he has not mocked victims of war crimes, but instead made light of the lack of evidence of those crimes beyond manipulative social-media videos that ranged from the slickly produced to outright sloppy.

In a phone conversation with Blumenthal just hours before the April 3 event, Politics and Prose co-owner Bradley Graham informed him that his reporting from Venezuela, where he recently challenged corporate media deceptions from Caracas, had also become a problem. Graham said:

A number of people … have expressed concern on various aspects of the event; first and foremost that you’re being given a platform and in some cases raising not just objections about your positions on Syria, but on Venezuela, on other issues.

“I don’t know what is behind all this, and this is the point I’m trying to get to,” Graham told Blumenthal, according to the journalist. “We haven’t had the time to sort through what all these claims are and whether there’s any relevance to them or not.”

Politics and Prose co-owner Lisa Muscatine chimed in: “We just felt so up-against-the-wall. They’re all over our social media… We’ve been fucking inundated.”

The Syrian American Council celebrated the success of their pressure campaign, thanking Politics and Prose for “listening” to the “Syrian American community,” whose views, in their implicit opinion, are monolithic. They went on to accuse Blumenthal of denying the “lived experiences” of Syrian Americans, who in reality are not so homogenous.

Thus they were able to silence their most effective critique. Blumenthal’s latest book, The Management of Savagery, reveals the cynical aspirations of this lobby, from regime change to genocide, if its bedfellows are any indication of its aims.

Deceptions and double standards

Blumenthal told MintPress News that the criticism of his book willfully misrepresented its content:

None of these people who tried to have me canceled have read this book, but it’s understandable that they would want it banned, because it is actually about them. But if they had opened the book they would see that it’s actually a critique of right-wing politics and Islamophobia through the framework of American empire, showing how these proxy wars and regime change wars that the West has waged from Afghanistan to Iraq to Libya to Syria have been like steroids for the ultra-right, whipping up a xenophobic frenzy thanks to a series of refugee crises that our national security state fomented.

In my book, I go back to the era well before the so-called “war on terror” to show how this campaign of destabilization fueled the rise of Islamophobia, which Donald Trump effectively exploited to become president. So anyone trying to say this book is somehow Islamophobic – I’ve seen that allegation carelessly thrown around – clearly hasn’t read it. I think this book is one of the most damning surveys of the rise of the Islamophobia industry and the national security state’s role fueling it – and funding it in many cases. Clearly these regime change lobbyists want to burn my book because it exposes their own cynical tactics, but in doing so they’re seeking to deprive people of the ability to to learn about the horrible political crisis we’re in in the West from a new and unique angle.

Blumenthal has been covering what he calls the “anti-Islam industry” for years. In fact, it is part of what brought the author to prominence. His investigation into the rise of Islamophobia in which Blumenthal named and shamed leading anti-Muslim agitators and funders predated mainstream studies of the trend and was even blamed in an angry screed by the far-right FrontPageMag for providing “the idea behind” the Center for American Progress report on anti-Muslim politics, “Fear Inc.” Blumenthal told MintPress that he founded the Grayzone Project at AlterNet in 2015 in part to provide critical coverage of the dangerous anti-Muslim politics that Trump was exploiting at the time.

During his exchanges with the owners of Politics and Prose, Blumenthal said he emphasized the double standards they were applying to him.

“I pointed out that last week they hosted Janet Napolitano, who was essentially the deportation tsar under Obama, destroying thousands of immigrant families through the deportation machine she oversaw. And I said that nobody asked her to have somebody on stage to challenge her when she, unlike me, was actually personally involved in human rights abuses. Politics and Prose has also hosted David Frum, the neocon who appears in the pages of my book crafting the bogus case for the war in Iraq in which a million people were killed. Nobody said that he had to have someone grilling him for his role in one of the worst catastrophes in modern history. The owners really didn’t have a response to my comments.”

* * *

Gulf-backed experts, foreign operatives and pro-war lobbyists put the pressure on

Blumenthal said that the owners of Politics and Prose insisted they’d spoken to “Middle East experts” about his book and that they expressed reservations about hosting him. But when pressed for the names of those experts, he received one: Amy Hawthorne, a former resident fellow at the Saudi-funded Rafik Hariri Center at the Atlantic Council – a think tank backed by the arms industry and various Gulf monarchies that has been at the center of the campaign for regime change in Syria.

Before her time at the Atlantic Council, Hawthorne worked in the US State Department, where she “helped to shape and coordinate US support for Egypt’s transition and advised on the US response to the Arab Spring,” according to her bio.

Another one of the self-styled Syria experts who pushed to have Blumenthal’s Politics and Prose event canceled was Charles Lister. Like so many of the lobbyists demanding the censorship of Blumenthal’s book, Lister is a fellow at a Gulf-funded think tank featured in the “Management of Savagery” for research that falsely claimed that 70,000 so-called “moderate rebels” were battling the Syrian government. When Blumenthal personally confronted Lister about his discredited claims during a 2017 Atlantic Council meeting, Lister flew into contortions and struggled to push back.

Mouaz Moustafa, the director of the Syrian Emergency Task Force, also joined the campaign to block Blumenthal’s book event. In fact, Blumenthal’s book documents how Moustafa served as the Washington point man for the Syrian regime change operation, escorting John McCain to the Syrian border in 2013, where the late senator posed for photos with extremist insurgents involved in the kidnapping of Shia pilgrims.

As Ben Norton reported at The Grayzone, Moustafa has continued to lobby the Trump administration on Syria. He even boasted that he was “hanging out” with CNN anchor Wolf Blitzer and MSNBC’s Chris Matthews at about the same time as he was clamoring online for the cancellation of Blumenthal’s book event.

“It is totally understandable that a character like Moustafa would want my book banned,” Blumenthal said. “I excavated his shocking record of pro-war lobbying and expose all the deceptions that were deployed in the process.”

The Syrian American Council, the pro-war lobbying outfit that led the charge against Blumenthal’s book, has also been involved with some unsavory figures during its push for regime change in Syria. As Norton reported, the Council hosted at its 2015 gala a Syrian opposition activist named Maher Sharafeddine who has openly called for the genocide of religious minorities in Syria.

“I am warning the Alawites to get out of the country or they will all be slaughtered. There can be no reconciliation with the Alawites,” Sharafeddine said during an infamous 2015 appearance on Al Jazeera Arabic. “The only way for us to take [power] from them is over their dead bodies.”

“It is the right of the [Sunnis] to demand the slaughter of the Alawites,” the host of that Al Jazeera show, Faisal al-Qassem said, “Of course, of course,” Sharafeddine replied.

Perhaps the most remarkable figure to weigh in against Blumenthal’s book and demand the cancellation of his event was James Le Mesurier. A former British military intelligence officer and UAE-backed mercenary, Le Mesurier oversaw the foundation of the White Helmets in Turkey and placed himself at the center of destabilization campaign against Syria’s government. Through the White Helmets, who were at the scene seemingly any time a major chemical attack was alleged, Le Mesurier played a central role in driving the US to bomb Syria over so-called “red line” violations.

“The whole history of Le Mesurier and the White Helmets in trying to push the US to decapitate the government of another previously stable Middle Eastern state is told in ‘The Management of Savagery,’” Blumenthal said. “Once again, you have a figure trying to cover up their dirty deeds by censoring a journalist who dared to expose them.”

From my point of view, and I told this to Politics and Prose,” Blumenthal continued, “they have surrendered to a bullying campaign run by a lobbying apparatus that’s tried to silence me and shut down my factual journalism, which has helped expose what I consider to be one of the biggest scandals in recent memory, which is the multi-billion dollar campaign to arm and equip extremist insurgents to rip Syria to shreds. But I think the public wants to know more about this titanic scandal, and it wants to know what’s on the pages of my book, and there’s nothing these war lobbyists can do about that. The mask is off.”

Blumenthal’s book is available through his publisher at Verso and many other locations. The launch event for ‘The Management of Savagery’ will be held at the Justice Center at 617 Florida Avenue NW, Washington, D.C. on Wednesday the 10th at 7:00 p.m. Eastern Time.

Published:4/7/2019 9:27:04 PM
[Markets] The Ultimate Pivot: Saudi Betrayal Of The Petrodollar

Authored by Tom Luongo,

Saudi Arabia has gone nuclear, threatening the petrodollar. Or has it?

The report from Zerohedge via Reuters that Saudi Arabia is angry with the U.S. for considering a bill exposing OPEC to U.S. antitrust law is a trial balloon.

The chances of the U.S. bill known as NOPEC coming into force are slim and Saudi Arabia would be unlikely to follow through, but the fact Riyadh is considering such a drastic step is a sign of the kingdom’s annoyance about potential U.S. legal challenges to OPEC.

If these things are so unlikely then why make the threat public? There are a number of reasons.

First, one must remember that the Saudis are hemorrhaging money. Their primary budget deficit in 2018 was around 7% of GDP. Since the 2014 crash in oil prices it has gone from almost zero sovereign debt to $180 billion in debt to finance its spending, or around 22% of GDP.

2019’s budget will be even bigger as it tries to deficit spend its way to growth. It’s needs for a higher oil price are built into their primary budget not their production costs, which are some of the lowest in the world.

Second, the Saudis finally opened up the books on Saudi-Aramco this week. And it revealed the giant is far more profitable than thought. It has is eye on acquiring stakes in some of the biggest oil and gas projects out there these past couple of years. It’s floating its first public bond to buy a stake in SABIC to get into the mid and downstream petroleum markets.

Third, the Saudis budget deficit is tied directly to its having pegged the Riyal to the U.S. dollar which leaves them at the mercy of the dollar price of oil. It doesn’t have the flexibility of Russia who free-floated the ruble back in late 2014 to pay local expenses in devalued local currency when oil prices drop.

This is why the Saudis are struggling financially and why Aramco is looking to use its financial might to finally begin making friends and influencing people around the world.

So, a threat to de-couple Saudi oil sales from the dollar is a threat a long time coming.I’ve been talking about this day since I started this blog and for years previous when I wrote for Newsmax.

The petrodollar still forms the backbone of how the U.S. dollar maintains its reserve currency status. That a vast majority of the oil trade is still settled in dollars creates a synthetic form of demand for U.S. debt, which, in turn, liquefies world trade.

The Saudis need budgetary flexibility to assist Crown Prince Mohammed bin Salman’s Vision 2030 plan to remake the Saudi economy a reality. Deficit spending and gutting the country’s balance sheet is not the path to sustainable prosperity.

But since l’affair Kashoggi last fall relations between the U.S. and Saudi Arabia have been deteriorating. The division between a now-hostile U.S. legislature and a deal-making Trump is intensifying.

Congress is forcing President Trump to veto their bill to end U.S. support for the Saudis war in Yemen, another bin Salman tragedy. At the same time, Saudi Arabia is a key part of Trump’s plans to secure peace for Israel (sold as his Deal of the Century to be unveiled on Israeli Independence Day no less).

So Trump needs the Saudis to stay on board with the plan. But the tensions are rising because the Saudis can see how the political and economic winds are shifting. Trump has been running roughshod over the Saudis, shaking them down for weapon sales while trying to take oil market share from them.

About the only area they agree on anymore is their hatred for Iran, which is driven by Trump’s arch-neocon/Israeli Firster cabinet. The Saudis are in an increasingly untenable position and can’t get any relief from either the U.S. or Russia.

So, the conventional wisdom, expressed by the Saudis, is that the U.S. needs the petrodollar to maintain its position of world power. Trump is trying to do just that not by enforcing compliance on the Saudis but by increasing our domestic exports while restricting supply from marginal producers like Libya, Venezuela, Iraq and Iran.

That would give Trump the leverage he needs to confront China, a massive energy importer. But China is also a major Saudi customer and that’s where this threat gets interesting.

China is the one pushing the Saudis to accept yuan for their oil. De-pegging the riyal is the only way they could do that and still manage their foreign exchange reserves.

At the same time, though, Trump wants a weaker dollar because he needs that to fund his gross fiscal debauchery to spend our grandchildren into debtor’s prison.

He even went so far as to instruct the Fed to stop QT, drop rates and even do more QE because the ‘economy is so strong.’ He’s become a cartoon of himself at this point. He needs the Fed to end QT so he can sell more than a trillion of new debt at low rates into the market to fund his insane budget.

And this lends credence to the theory that Trump is actually trying to end the dollar’s reserve currency status. But, like I just said, if he were interested in that he wouldn’t be running the biggest deficit in the country’s history, he would be cutting spending overall.

The situation is beyond complicated but it boils down to the simplest of things. That which is unsustainable will end. The petrodollar is one of those things. It will be torn apart by Saudi spending needs, China’s willingness to buy oil from everyone else, including the U.S., and the waning U.S. influence in the Middle East.

If not today or next week, than in the near future. The question is whether the U.S. is prepared for it or not. Right now the dollar is king. A decade of ZIRP has created a massive synthetic short position in the dollar in the form of emerging market corporate and real estate debt.

But after that? And after that synthetic short pushes the dollar much higher and the price of oil into the floor? That’s when things get truly interesting. For now, the Saudis are making noise. With oil trading in the $60s no one is losing too much money or market share too quickly.

And so the status quo will prevail, for now.

Published:4/7/2019 8:23:36 AM
[Markets] Operation Gladio: The Unholy Alliance Between The Vatican, The CIA, & The Mafia

Authored by via,

On the hot summer morning of Aug. 2, 1980 a massive explosion ripped apart the main waiting room of the Bologna railway station. Eighty-five people were killed and hundreds more injured. Though at first blamed on Italy’s legendary urban guerrillas, The Red Brigades, it soon emerged that the attack had, in fact, originated from within the ‘deep state’ of the Italian government itself.

The full nature of this secret parallel state would only come to light a decade later when the Italian premier, Giulio Andreotti, under questioning from a special commission of inquiry, revealed the existence of arms caches stashed all around the country and which were at the disposal of an organization which later came to be identified as ‘Gladio’.

The members of this group turned out to include not only hundreds of far-right figures in the intelligence, military, government, media, Church and corporate sectors, but a motley assortment of unreconstructed WW2 fascists, psychopaths and criminal underworld types to boot. And despite Andreotti’s attempts to airbrush the group as ‘patriots’ it appeared evident to much of the rest of the Italian polity that these seemed rather more like pretty bad folk indeed. Little did they know. Follow-up research by the likes of Daniele Ganser, Claudio Celani, Jurgen Roth and Henrik Kruger traced connections to similar groups spread throughout Europe of which all were found to be deep state terrorist organizations, and all of which were found, ultimately, to be subservient unto the highest levels of the CIA and NATO command structures.

The moniker ‘Gladio’ (after the two-edged sword used in classical Rome) was eventually broadened to include a bewildering host of related deep state terrorist structures including: ‘P2’ In Italy, ‘P26’ in Switzerland, ‘Sveaborg’ in Sweden, ‘Counter-Guerrilla’ in Turkey and ‘Sheepskin’ in Greece. This (hardly definitive) European list was then found to have connections not only to virtually every US sponsored secret state terrorist organization the world over (including the likes of Operation Condor in Latin America), but also to many of the global drug cartels that provided the secretive wealth needed to fund and otherwise lubricate the whole rotting, corrupt shebang.

If all this sounds sinister enough, it pales in light of the detailed structure of the dazzlingly diabolical Gladio edifice. And it is to those details we now repair vis a vis an overview of the remarkable, if otherwise unheralded, 2015 work by journalist Paul L. Williams entitled, ‘Operation Gladio: The Unholy Alliance Between the Vatican, the CIA and the Mafia’. Though there are other books on the subject worthy of honourable mention (including Daniele Ganser’s seminal tome, ‘NATO’s Secret Armies’, and Richard Cottrell’s recent and stylishly written, ‘Gladio: NATO’s Dagger at the Heart of Europe’), it is to Williams that I believe we owe a particular debt of gratitude in having provided a more or less fully integrated portrait of the global machinations of Operation Gladio.

Before embarking on our grim, if yet fascinating, journey it is worth first noting that whilst ‘Gladio’ was officially acknowledged and condemned by the European Parliament (in Nov., 1990; Washington and NATO having ever after refused ‘comment’ on the matter), and its multifarious organs and factions ordered dismantled, it is hardly likely that the latter was ever fully enacted. The historical context of ‘Gladio’, then, is really the quintessential backdrop to understanding the trademark false flag events of the modern era.


The general origins of this labyrinthine network of deep state actors lay in the so-called ‘stay-behind-armies’ set up at the end of WW2 by the Allied powers (principally the US) ostensibly to act as resistance forces should the Soviets ever decide to invade Europe. Quickly, however, the raison d’etre of the ‘armies’ transmogrified into a mission to counteract, not external invasion, but ‘internal subversion’. Such would eventually result in the undermining not just of post-war European socialism, but of Italian, Greek – and later global – democracy itself.

But we get ahead of ourselves.

The primal author of the ‘stay-behind-armies’, Williams informs us, was General Reinhard Gehlen, the head of German military intelligence during the Second World War. Having foreseen early on that the Reich was doomed to defeat, Gehlen had “concocted the idea of forming clandestine guerilla squads composed of Hitler youth and die-hard fascist fanatics” ostensibly to fend off the inevitable Soviet invasion. These guerilla units he referred to as ‘werewolves’.

Not ones to miss a fascist opportunity when they saw it, the US Office of Strategic Services (the OSS, and the forerunner of the CIA), under the leadership of William ‘Wild Bill’ Donovan, quickly enlisted both Gehlen and SS General Karl Wolff (in 1945) in forming the Gehlen Organization (later to transform into the present-day German BND) and which received its initial funding from US Army G-2 intelligence resources.

The American point-man on this was Allen Dulles, the first president (in 1927) of the Council on Foreign Relations, and later the first head of the CIA. Duly incorporated into the American fold, the ‘werewolves’ were, given that their initial meddling took place in Italy, rebranded as ‘gladiators’. Operation Gladio was born.

In 1947 the CIA (having, that year, superseded the OSS) was faced with its first daunting task, i.e. how to prevent the Italian Communist Party (PCI) from forming the next government. Elections were scheduled for 1948 and the PCI was a virtual shoe-in not just in Italy proper, but in Sicily as well. Fortunately, ‘Gladio’ was ready and waiting. The gladiators had been training in a special camp set up in Sardinia under the local command of the former WW2 Italian fascist leader, Prince Junio Valerio Borghese.

In addition, hundreds of American mafioso began to arrive on the shores of Italy to lend a hand with the communist ‘problem’. The arrival of the ‘made men’ was the result of Donovan’s efforts from 1943 onward in working with American mobsters Charles ‘Lucky’ Luciano and Vito Genovese to conger new (drug) funding for the OSS’s off-books’ operations, and to reinstall the Sicilian mafia on the island in the leadup to Operation Husky (the Allied invasion of Sicily). These forces were now unleashed on the Italian electorate, and through 1948 an average of five people a week were murdered by the CIA-backed terrorist units. The results were grimly predictable. Hallelujah, the PCI were defeated and the Christian Democrats returned to power.

Still, the threat remained. Fully half the Italian electorate were communist sympathizers and, moreover, leftist politics pervaded much of the rest of the diseased European body. More would have to be done. The problem, however, was money. There simply wasn’t enough of it. Thus, the initial $200 million in funding for Gladio (which had come from the Rockefeller and Mellon foundations) was quickly exhausted. And though the National Security Act of 1947 had provided the loophole that allowed for the CIA’s covert operations, it had not allowed for their overt Congressional funding. There lay the rub. Thankfully, Paul Helliwell knew how to salve the itch.

Paul Helliwell was an inner member of the original OSS (along with key scions of the Morgan, Mellon, Vanderbilt, Carnegie, DuPont and Ryan families) and, according to Williams, likely the greatest unsung hero of the nicknamed ‘Oh-So-Social’ club. It was he, who having cut his teeth in the drugs-for-arms trade by shepherding opium deals with the Kuomintang (KMT, the Chinese National Army fighting against Mao Zedung), conjured the brilliant inspiration to do the very same thing – in the United States itself.

Thus, it was at his suggestion that Donovan elected to forge the deep bond (and that exists to this day) between the nation’s intelligence services and organized crime. Enter stage left such notables as ‘Lucky’ Luciano, Vito Genovese, Meyer Lansky and the Trafficante and Gambino crime clans. Quickly the streets of, first, New York, and later many an American metropolis, were flooded with heroin. These early, halcyon days would soon lead to the infamous ‘French Connection’, thence to the ‘Golden Triangle’ (where the CIA’s very own ‘Air America’ transported drugs out of South East Asia during the Vietnam War) and, later, to the Balkan, Mexican, and Colombian drug cartels.

All very well and good. But, to begin with, there was yet a fly in the whole drugs-for-arms-for-terror ointment. To wit: how to pay off the mafioso without anyone noticing; indeed, how to stash, launder and hide all of this financial derring-do from the prying eyes of the authorities; you know, the real-enough authorities, the Treasury cops and so forth. How do you do that?


Article 2 of the Lateran Treaty of 1929 was clear and unequivocal. The Article, which served to regulate matters between the Holy See and the Italian state, expressly forbade any interference of the latter in the affairs of the former. It is hardly conceivable, of course, that the framers of the Treaty ever foresaw what such immunity could actually mean in practice. But then they probably hadn’t reckoned on the fiendish formation of the Institute for Works of Religion (IOR), or more colloquially, the Vatican Bank.

Established by Pope Pius XII and Bernardino Nogara in 1942, the Bank would quickly come to serve as the principal repository post-war both for the Sicilian Mafia and for the OSS/CIA wherein all of the monies and documents relating to drug trafficking and to Gladio would be stored and laundered. Already in 1945 the pope had held private audiences with Donovan to discuss the implementation of Gladio and where, as Williams reports, Donovan was knighted as an anti-Communist crusader with the Grand Cross of the Order of Sylvester. Prior to this time Pius XII had proven himself a loyal ally in working with Dulles and the OSS to establish the ratlines used to help prominent Nazis escape Europe. Now, new horizons beckoned. The first duty at hand, of course, was to destroy the communist menace in respect of the 1948 elections. To this end the pope authorized his own terror squads (under Monsignor Bicchierai) to assist the gladiators and the ‘made men’ in intimidating the Italian electorate. Task accomplished.

The second duty at hand, however, was longer term. Communism, socialism and, indeed, any Godless form of progressive government, anywhere, had to be stamped out at source. For this money would be needed. Lots of money. Untraceable money. Drug money. Now in the months before the 1948 election the CIA deposited some $65 million into the Vatican Bank. The source of these monies came from heroin produced by the Italian pharmaceutical giant, Schiaparelli, and which was then transported by the Sicilian mob into Cuba where it was cut and then distributed to New Orleans, Miami and New York by the Santo Trafficante family. Lucrative though this trade was, it was not nearly enough to suit the needs of the CIA and ‘Gladio’. More would be required. More drug networks and more banks. Gladio was about to global.

To start with a new alliance was forged with the Corsican mafia. Unlike the Sicilian mob, the Corsicans had extensive experience in processing heroin, a skill they had picked up through years of working with Laotian, Cambodian and Vietnamese technicians in French Indochina. A supply route then emerged running from Burma through Turkey to Beirut and thence to Marseille. Alas, there was a slight hitch when the leftist dockworkers in Marseille, being sympathetic to the rebel army under Ho Chi Minh, refused to load and unload the boats from Indochina. No worries. A deft bit of terror administered by the Corsican boys (and funded by the CIA), and problem solved. By 1951, then, Marseille had become the center of the Western heroin industry. Voila, the ‘French Connection’.

Meanwhile, Wild Bill Donovan had ‘resigned’ from the CIA to form the World Commerce Corporation (WCC) whose primary function was to facilitate the arms-for-drugs deals with the KMT. Paul Helliwell lent a needed hand at the helm by heading up Sea Supply, Inc., a CIA front company gainfully employed in shipping heroin from Bangkok. By 1958 the whole operation was so successful that a second supply route was established running through Saigon. Here, the help of Ngo Dinh Diem, the US installed despot of South Vietnam, proved invaluable.

Still, there was a potential cloud on the horizon, i.e. word of all these shenanigans was bound to leak out. What to do? The first reflex, naturally, was to pin the blame for the West’s growing heroin problem on the Communist Chinese under Mao Zedung. Check. The second, more considered response, was to organize an ongoing campaign to deflect attention away from, and burnish the image of, the CIA. And to this end, in 1953, did the CIA establish ‘Operation Mockingbird’. Under ‘Mockingbird’ the Agency recruited hundreds of American journalists to spread false stories and propaganda about the Company’s ‘benign’ activities. Eventually, this depraved fabric of anti-journalism enlisted entire news networks including ABC, NBC, Newsweek, Associated Press, and The Saturday Evening Post. Now the guys and gals at Langley could relax. Henceforth, American (and global) eyes were dutifully prismed through the rose-coloured lens of ‘Mockingbird’.

But back to the Vatican. The IOR, solid banking pillar of the Gladio community that it was, could hardly be expected to do all the heavy lifting itself. After all, the global heroin industry would, by 1980, be pulling in a cool $400 billion annually. En route an extensive and orchestrated financial network would be required to supplement God’s Bank. As with any fine orchestra it helps to have a maestro of exquisite genius to run the show. A nice round of applause, then, for one Michele Sindona. The biography of Sindona begins, humbly enough, with his degree in tax law from the University of Messina in 1942 after which, in quick succession, he rockets to stardom as a leading financial adviser to the Sicilian mafia, an agent for the CIA, and, thereafter, a financial intimate of the Holy See. By the late 1950s Sindona had become the lynchpin in a nexus between the mob, the CIA and the Vatican that would eventually, as Williams chillingly puts it, “result in the toppling of governments, wholesale slaughter and financial devastation.”

Though a full elaboration of this bewilderingly complex financial system is best left to the author, it is worth briefly savouring a few highlights. To begin with Sindona purchased Fasco AG, a Liechtenstein holding company and through which he purchased his first bank – the Banca Privata Finanziaria (BPF). The BPF then became, by way of a Chicago-based intermediary bank, Continental Illinois, a principal conduit for transferring drug money from the IOR for the purposes of Gladio. In fact, it was this banking pipeline in particular which provided the filthy lucre that fueled the 1967 coup d’etat in Greece. But more on this heady stuff in a bit.

It was through his Chicago contacts that Sindona first met Monsignor Paul Marcinkus, popularly known as ‘the Gorilla’. The Gorilla was six foot four, “a gifted street fighter…and a lover of bourbon, fine cigars and young women”. Under Sindona’s patronage Marcinkus would soon rise to become both Pope Paul VI’s personal body guard and the head of the IOR. A third musketeer in the person of Roberto Calvi (the assistant – and later full – director of the famous, Milan-based Banco Ambrosiano) came to complete the three Vatican amigos. Together they would cut a dramatic, collective figure in the global banking underworld all through the ‘anni di Piombo’ (the Gladio ‘years of lead’ in Italy from 1969 to 1987). Exactly how dramatic is illustrated, par excellence, by Calvi’s eventual dark demise. Who among us, old enough to remember, can forget the macabre spectacle (June, 1982) of Calvi’s body hanging from Blackfriars Bridge, his feet dangling in the Thames and pockets stuffed with five masonry bricks. Sindona would also later be murdered (1986) by means of a cyanide-laced cup of coffee whilst in jail and under ‘maximum protective custody’.

Calvi was a key figure in establishing a series of eight shell companies (six in Panama, two in Europe) through which drug lords like Pablo Escobar in South America were encouraged to deposit their ill-gotten loot. (The CIA put shoulder to wheel by helping ferry the Escobar cocaine in a fleet of planes operating out of Scranton airport in Pennsylvania). The monies were then transferred via Banco Ambrosiano to the IOR which took a 15 to 20 percent processing fee. From there funds were distributed to a host of European banks set up by Sindona for use by Gladio units spread throughout the continent. In addition to the flow of cash from the cartels, funds were bled from Banco Ambrosiano into the eight shell companies – again for use by the CIA in funding its covert operations.

This points up a general operating procedure of the entire Gladio ‘banking’ system, i.e. the system, far from being designed to turn a profit, was expressly designed to ‘lose’ money; that is, to have it siphoned off into covert ops. Such explains the regular and spectacular failure of a host of CIA-related banks including: Franklin National Bank (purchased by Sindona), Castle Bank & Trust, Mercantile Bank & Trust (both set up by the ubiquitous Paul Helliwell), Nugan Hand Bank (in Australia, and from which funds were diverted to undermine Prime Minister Gough Whitlam during the Vietnam War), and the infamous Bank of Credit and Commerce International (based in Karachi in aid, primarily, of the Southeast Asian heroin trade). Indeed, it was precisely the collapse of Banco Ambrosiano itself that brought both Calvi and Sindona to their untimely ends.

Finally, it is worth noting here that these august institutions were linked in a tight criminal embrace with many of the most prestigious financial firms in America including Citibank, the Bank of New York, and the Bank of Boston. The base of the iceberg, in short, extended far and wide. But then, what was all this money really doing?


Following the thwarting of Italian democracy in 1948 the Gladio ‘secret armies’ entered into a period of what one might characterize as pregnant incubation. Thus, it was during the 1950s that the various drug supply routes and financial networks were being created, as were some of the principal political organizations. Probably the most important of the latter was ‘Propaganda Due’ otherwise known as ‘P2’.

Created in 1877 as a Freemasonry lodge for the Piedmont nobility, it was banned by Mussolini in 1924 only to be resurrected post-war with the approval of Allen Dulles, himself a thirty-third degree Mason. The lodge, though at first dominated mainly by spooks, spies, military and mafia figures, would soon encompass a who’s who of Italian political, corporate, banking and media supremos to boot. Indeed, the organization would eventually spread shoots throughout Europe as well as North and South America, and its members would come to include such luminaries as Henry Kissinger and General Alexander Haig.

A ‘P2’ denizen of especial significance was Licio Gelli. The latter’s pedigree was impressive: a former volunteer in the 735th Black Shirts Battalion, a former member of the elite SS Division under Field Marshall Goering and, thereafter, a chummy employee of the US Counter Intelligence Corps of the Fifth Army. Working with William Colby, the OSS agent in France, and Allen Dulles, the OSS director, Gelli soon gained entry to the Vatican where he helped set up the Nazi escape routes to Argentina. His ties with Argentina would later prove critical in facilitating Operation Condor (the US-backed mass assassination program in 1970s and ‘80s South America). Moreover, in 1972, Gelli would emerge as P2’s supreme ‘Worshipful Master’ under whose leadership the lodge would reach its full, horrific flowering. Finally, it is worth mentioning at this juncture that it was as a result of a police raid on Gelli’s villa in 1981 that the full, tentacled structure of Gladio would come to light. But we digress.

One of the first substantive actions of Gladio was the Turkish coup of 1960. Here the incumbent Prime Minister, Adnan Menderes, made the fatal mistake of believing he was really in charge and thereafter initiating a visit to Moscow to secure economic aid. The ‘stay-behind-army’ in Turkey known as Counter-Guerilla, in alliance with the Turkish military, quickly disabused him of any such delusions by arresting and executing him. Throughout the 1970s both Counter-Guerilla and its youth wing, the Grey Wolves, would stage “ongoing terror attacks…that resulted in the deaths of over five thousand students, teachers, trade union leaders, booksellers and politicians”.

Counter-Guerilla would also figure in the Turkish coup of 1980 when its commander, General Kenan Evren, toppled the moderate government of Bulent Ecevit. According to Williams, US President Jimmy Carter phoned in his approval to the CIA station-chief in Ankara, Paul Henze, with a jubilant, ‘Your boys have done it!’ What they had done, of course, was set up a tyranny in which thousands more would be tortured while incarcerated. The Turkish Gladio boys would also be unleashed in the 1980s upon the PKK – the Kurdistan Workers Party. All of this was in keeping with Zbigniew Brzezinski’s (Carter’s national security advisor) core vision of the importance of controlling Central Asia to which Turkey was both a vital portal and, thus, a key NATO ally.

Alas, Gladio would prove something of a disappointment in France, where, after having backed a series of assassination attempts against the regrettably too independent President Charles de Gaulle, it found itself on the receiving end of de Gaulle’s boot. Actually, it was NATO itself – at the time, headquartered in Paris – that was unceremoniously kicked out of France (in 1966, whence it took up its present cozy and famously corrupt abode in Brussels). But, of course, de Gaulle was ahead of the curve and understood all too well who was really behind the mayhem and murder.

Greece, unfortunately, did not fare as well. In 1967 the ‘Hellenic Raiding Force’, a franchise of Gladio and playing to a NATO authored script entitled Operation Prometheus, overthrew the left-leaning government of George Papandreou. The ensuing military dictatorship would last until 1974 though this would hardly signal the end of Greece’s tribulations. From 1980 until near the turn of the millennium, the nation would suffer under a reign of terror and political assassinations nominally attributed to ‘November 17’, an alleged Marxist revolutionary group, but which in fact (and here I briefly tag-team with authors Cottrell and Ganser) was yet another faction of Greek-Gladio known as ‘Sheepskin’.

This illustrates a point originally brought home by Ganser’s research to the effect that virtually every alleged ‘leftist revolutionary’ group said to have been operating in Europe throughout the post-war years was, in truth, either a Gladio ‘secret army’ unit or else had been completely infiltrated by state intelligence services, and was subsequently being steered by them for Gladio-style state-terrorist ends.

Such is well documented for the ‘Red Brigades’ in Italy and the ‘Baader-Meinhof Gang’ in Germany (the ‘gang’ being conveniently and cold-bloodedly exterminated on the ‘night of the long knives’, Oct.18, 1977, whilst under custody in Stammheim prison). It also, just by the by, speaks to the universally attested prior association of many a modern-day ‘terrorist’ and their police and intelligence handlers.

In Spain, during the early ‘70s, Stefano delle Chiaie and fellow Gladio agents from Italy provided their consulting expertise to General Francisco Franco’s secret police who conducted over a thousand violent acts and some fifty murders. Following Franco’s death in 1975, delle Chiaie moved to Chile to lend a fatherly hand in helping the CIA-backed Augusto Pinochet set up his death squads. In later years the Spanish Gladio unit would find gainful employment hunting down and assassinating the leaders of the Basque separatist movement.

Of Italy we have already mentioned the ‘years of lead’, but just to capture a few highlights. The ‘strategy of tension’ unleashed in 1969 in Italy – the same year ‘Condor’ was unleashed in Latin America – was in response to the renewed popularity of Communism throughout the country and which, itself, was partly in response to the uptick in revolutionary sentiment globally as a result of antipathy towards the US war on Vietnam. The antidote, naturally, to this woeful state of progressive affairs was a healthy dose of terror. According to Williams, “Henry Kissinger, Nixon’s National Security Advisor, issued orders to Licio Gelli through his deputy, General Alexander Haig, for the implementation of terror attacks and coup attempts.” The terror attacks began on December 12, 1969 when a bomb exploded in the crowded lobby of a bank in Milan’s Piazza Fontana in which seventeen people were killed and eighty-eight injured. Over the ensuing years (from 1969 to 1987) there followed more than ‘14,000 acts of violence with a political motivation’. The most infamous of these was, of course, the Bologna bombing in August of 1980 and which led to the initial exposure of Gladio in Italy.

Of the many attempted coups and related high-level political machinations engineered by Gladio forces in Italy (1963, 1970, 1976) and Sicily (more or less continually on tap throughout the decade), the kidnapping on March 16, 1978 – and murder a month or so later – of Prime Minister Aldo Moro was likely the most sensational. Moro had dared to include communists in his new coalition government. At first blamed on the usual suspects, i.e. the Red Brigades, further investigation (to begin with by journalist Carmine ‘Mino’ Pecorelli who paid with his life) led to the real usual suspects including CIA operative Mario Moretti (eventually convicted of the killing) and thence up the line to Gelli, then to Italy’s interior minister Francesco Cossiga and onwards to Zbigniew Brzezinski.

The high-level intrigue did not stop at the murder of a prime minister however. At least two Popes felt the sharp end of the Gladio sword as well. In August of 1978, Pope Paul VI died. His successor, the preternaturally timid John Paul I, soon gave his handlers a very real shock when, after looking at the IOR accounts, he issued a ‘call for reform’. The very next day the otherwise fastidiously health-conscious pontiff – in office barely a month – was dead. Not just dead but expired with the telltale bulging eyes and horrific grimace of acute poisoning. His autopsy was definitively thwarted by an illegal and hastily contrived embalming, and his personal papers disappeared without a trace. Archbishop Marcinkus, having been temporarily removed prior, was returned to office whilst Calvi and Sindona, also under scrutiny at the time, breathed a (temporary) sigh of relief.

Having been (almost) burned once the overseers of Gladio made sure to engineer the follow-up Papal succession. Thus did Cardinal Karol Wojtyla shuffle onto the historical proscenium as Pope John Paul II. Now, at first, John Paul worked seamlessly with the CIA and Gladio. Together they oversaw the destruction of Liberation Theology in Latin America, the continued undermining of Italian democracy, and the dispensing of black funds for Solidarity in Poland. Ah, but how the best laid plans do oft go astray. By the spring of 1981 not only were events spinning out of control for Gladio itself, but so too were they for Banco Ambrosiano, and by extension, the IOR. The Pope, inexplicably, refused to act. Compounding this lapse was an unaccountable trifecta of moral turpitude that witnessed the Holy Father suddenly breaking into treasonous song singing the benefits of rapprochement with the Soviets; recognition of the Palestine Liberation Organization; and, egads, nuclear disarmament. The order from on high was given: ‘Kill the Pope’.

But best blame it on the Soviets. So issued the ‘Bulgarian Thesis’ wherein a lowly Bulgarian airline employee (Sergei Antonov) was set up as the patsy. In truth, the key actors in the Papal plot came straight from Gladio central casting. The starring role in the drama fell to General Giuseppe Santovito, the head of Italy’s military intelligence (SISMI) and the commander of the Italian Gladio units. His co-star, Theodore Shackley, was the infamous CIA mastermind who had already served as executive producer on such epics as Operation Phoenix (involving the murder of some 40,000 non-combatants in Vietnam), Operation Condor, the setting up of Nugan Hand Bank, and, along with delle Chiaie, the murder of Salvador Allende. West Germany’s BND (the national security services) garnered a significant credit by harbouring and financing the two actual assassins, Mehmet Agca and Abdullah Cath (both from Turkish Gladio). And, of course, the Mighty Wurlitzer, i.e. Operation Mockingbird, figured prominently in the aftermath grinding out endless tunes on the ‘Bulgarian Thesis’ – despite the fact of Agca’s eventual (lone) conviction in the shooting.

The production ended all somewhat anticlimactically when the Pope (on May 13, 1981) was only seriously wounded. In a fascinating denouement, however, on Christmas Day 1983, the Pope opted to publicly forgive Agca. Italian state television was allowed to record the moment when John Paul asked his assassin from whom he had received his orders. Leaning forward to hear Agca’s response the Pope appeared momentarily frozen, then clasped his hands to his face. Though the Pontiff kept it secret, there was little need to guess at the answer.

The adventures of both Agca and Cath are the stuff of legend. Indeed, Cath figures in events well beyond the time line of Gladio proper, enough to suggest that Gladio never really shut down at all. But that, as they say, is a whole other story – and one I leave to the author to take up.

*  *  *

Paul Williams has made a fine contribution here. Certainly, if the day ever comes when, seated across from some smug establishment interlocutor, you are taken to task for being a ‘conspiracy monger’ – well, you need only lean back, smile gently, and utter but two words….’Operation Gladio’.

Published:4/6/2019 10:19:38 PM
[Markets] Cyprus, Six Years Later

Submitted by Harris Kupperman from Adventures in Capitalism

I’m writing to you from the beach in Larnaca, Cyprus. It’s 6am and I’m jetlagged, hopped up on coffee and ready to get exploring.

Why Cyprus? Next week, I’m speaking at the annual VALUEx Caspian conference in Baku, Azerbaijan, hosted by my good friend Isaac Schwartz of Robotti & Company Advisors To break up the flights, I stared at a map and Cyprus seemed to be roughly on the path there. Unfortunately, after I booked the first leg, I realized that to get from Cyprus to Baku, you have to go 20 hours out of your way and transfer through Moscow. Who says global travel isn’t an adventure?

However; I have another reason for going to Cyprus. You see, a few years back, Cypriot banks did some pretty stupid things. They made some dodgy property development loans, over-expanded in consumer lending and when they ran out of bad investments in Cyprus, decided to diversify and buy almost $6 billion in Greek sovereign debt, which was almost immediately written off.

The ECB showed up, saw a smoldering crisis and decided that the prudent decision was to turn it into a raging bonfire. “Hold my beer, we’re gonna bail-in the banks.”

Depositors with more than EUR 100,000 lost 47.5% of their deposits. This was justified by pointing to the Russian connection in Cyprus—yes, Cypriot banks had Russian depositors. However, plenty of Cypriots also lost half their deposits. More importantly, the bail-in led to capital flight, lack of investment and a further round of detonation of the Cypriot economy. (I wrote about this back in 2013).

Even after the bail-in, the Cypriot banking system was still effectively insolvent. The ECB decided that the best way to solve for this, would be to force the banks to de-lever. This sounds fine in theory, but NPEs are hard to restructure or sell. Therefore, to de-lever, you reduce new lending and let performing loans run off your books. If you continue to reduce your performing loans each year, at some point, all you have left are non-performing loans. Hence, despite plenty of NPE exits and asset sales over the past few years, Cypriot banks still have dangerously high NPE ratios. Even worse, when you stop lending, businesses suffer and asset values decline, leading to an increase in new NPE formations. Logic would state that the only way to solve for this is to grow the loan book, dilute the NPE exposures with new performing loans and then use retained earnings to rebuild the capital base. Please, don’t ask the ECB to use logic.

We all take banks for granted. Imagine not being able to get basic working capital loans, not being able to get a mortgage, not being about to effect transactions for fear of keeping capital in the Cypriot banking system. In the ECB’s desire to hurt a few Russians, they hurt over 1 million Cypriot citizens.

As I prepared for my trip to Cyprus, I looked over my notes (Part 1, Part 2, Part 3 )from my trip to Greece a year and half ago. Same dilemma, same bureaucratic cure, same economic malaise. Glad I talked myself out of buying Greek banks. You’d think that these guys at the ECB would learn by now. The difference, is that whereas the demographics and macro situation in Greece is weak, those metrics are going in the other direction in Cyprus.

Cyprus has just over 1 million people, it is a low-tax jurisdiction in the EU and tax evasion is ALWAYS in a bull market. Non-performing loans are finally being restructured, property values are starting to recover and the Cypriot economy is back to growth. Most importantly, it appears that a whole lot of natural gas has been discovered off the coast of Cyprus. While it will take many years before this discovery becomes tax revenue, every step along the way will lead to foreign investment, more high paying jobs and new capital in the banking system. Basically, there’s now a catalyst for the recovery.

In any case, I’m in Cyprus. I’ll be taking a bunch of meetings, visiting some historic ruins and drinking too much Zivania (Cyprus’ answer to Raki). Basically, the same recipe I’ve used to learn about every other country I’ve visited. Now, it’s time to wake up my wife and get going.

To be continued…

Published:4/6/2019 7:15:56 AM
[Markets] How Brzezinski's Chessboard Degenerated Into Brennan's Russophobia

Authored by Mike Whitney via The Unz Review,

“Russia is an inalienable and organic part of Greater Europe and European civilization. Our citizens think of themselves as European. That’s why Russia proposes moving towards the creation of a common economic space from the Atlantic to the Pacific Ocean, a community referred to by Russian experts as ‘the Union of Europe’ which will strengthen Russia’s potential in its economic pivot toward the ‘New Asia.’”

- Vladimir Putin, President of the Russian Federation, February 2012

The allegations of ‘Russian meddling’ only make sense if they’re put into a broader geopolitical context.

Once we realize that Washington is implementing an aggressive “containment” strategy to militarily encircle Russia and China in order to spread its tentacles across Central Asian, then we begin to understand that Russia is not the perpetrator of the hostilities and propaganda, but the victim. The Russia hacking allegations are part of a larger asymmetrical-information war that has been joined by the entire Washington political establishment. The objective is to methodically weaken an emerging rival while reinforcing US global hegemony.

Try to imagine for a minute, that the hacking claims were not part of a sinister plan by Vladimir Putin “to sow discord and division” in the United States, but were conjured up to create an external threat that would justify an aggressive response from Washington. That’s what Russiagate is really all about.

US policymakers and their allies in the military and Intelligence agencies, know that relations with Russia are bound to get increasingly confrontational, mainly because Washington is determined to pursue its ambitious “pivot” to Asia plan. This new regional strategy focuses on “strengthening bilateral security alliances, expanding trade and investment, and forging a broad-based military presence.” In short, the US is determined to maintain its global supremacy by establishing military outposts across Eurasia, continuing to tighten the noose around Russia and China, and reinforcing its position as the dominant player in the most populous and prosperous region in the world. The plan was first presented in its skeletal form by the architect of Washington’s plan to rule the world, Zbigniew Brzezinski. Here’s how Jimmy Carter’s former national security advisor summed it up in his 1997 magnum opus, The Grand Chessboard: American Primacy And Its Geostrategic Imperatives:

“For America, the chief geopolitical prize is Eurasia… (p.30)….. Eurasia is the globe’s largest continent and is geopolitically axial. A power that dominates Eurasia would control two of the world’s three most advanced and economically productive regions. …. About 75 per cent of the world’s people live in Eurasia, and most of the world’s physical wealth is there as well, both in its enterprises and underneath its soil. Eurasia accounts for 60 per cent of the world’s GNP and about three-fourths of the world’s known energy resources.” (“The Grand Chessboard:American Primacy And Its Geostrategic Imperatives”, Zbigniew Brzezinski, Basic Books, page 31, 1997)

14 years after those words were written, former Secretary of State Hillary Clinton took up the banner of imperial expansion and demanded a dramatic shift in US foreign policy that would focus primarily on increasing America’s military footprint in Asia. It was Clinton who first coined the term “pivot” in a speech she delivered in 2010 titled “America’s Pacific Century”. Here’s an excerpt from the speech:

“As the war in Iraq winds down and America begins to withdraw its forces from Afghanistan, the United States stands at a pivot point. Over the last 10 years, we have allocated immense resources to those two theaters. In the next 10 years, we need to be smart and systematic about where we invest time and energy, so that we put ourselves in the best position to sustain our leadership, secure our interests, and advance our values. One of the most important tasks of American statecraft over the next decade will therefore be to lock in a substantially increased investment — diplomatic, economic, strategic, and otherwise — in the Asia-Pacific region…

Open markets in Asia provide the United States with unprecedented opportunities for investment, trade, and access to cutting-edge technology…..American firms (need) to tap into the vast and growing consumer base of Asia…The region already generates more than half of global output and nearly half of global trade. As we strive to meet President Obama’s goal of doubling exports by 2015, we are looking for opportunities to do even more business in Asia…and our investment opportunities in Asia’s dynamic markets.”

(“America’s Pacific Century”, Secretary of State Hillary Clinton”, Foreign Policy Magazine, 2011)

The pivot strategy is not some trifling rehash of the 19th century “Great Game” promoted by think-tank fantasists and conspiracy theorists. It is Washington’s premier foreign policy doctrine, a ‘rebalancing’ theory that focuses on increasing US military and diplomatic presence across the Asian landmass. Naturally, NATO’s ominous troop movements on Russia’s western flank and Washington’s provocative naval operations in the South China Sea have sent up red flags in Moscow and Beijing. Former Chinese President Hu Jintao summed it up like this:

“The United States has strengthened its military deployments in the Asia-Pacific region, strengthened the US-Japan military alliance, strengthened strategic cooperation with India, improved relations with Vietnam, inveigled Pakistan, established a pro-American government in Afghanistan, increased arms sales to Taiwan, and so on. They have extended outposts and placed pressure points on us from the east, south, and west.”

Russian President Vladimir Putin has been equally critical of Washington’s erratic behavior. NATO’s eastward expansion has convinced Putin that the US will continue to be a disruptive force on the continent for the foreseeable future. Both leaders worry that Washington’s relentless provocations will lead to an unexpected clash that will end in war.

Even so, the political class has fully embraced the pivot strategy as a last-gasp attempt to roll back the clock to the post war era when the world’s industrial centers were in ruins and America was the only game in town. Now the center of gravity has shifted from west to east, leaving Washington with just two options: Allow the emerging giants in Asia to connect their high-speed rail and gas pipelines to Europe creating the world’s biggest free trade zone, or try to overturn the applecart by bullying allies and threatening rivals, by implementing sanctions that slow growth and send currencies plunging, and by arming jihadist proxies to fuel ethnic hatred and foment political unrest. Clearly, the choice has already been made. Uncle Sam has decided to fight til the bitter end.

Washington has many ways of dealing with its enemies, but none of these strategies have dampened the growth of its competitors in the east. China is poised to overtake the US as the world’s biggest economy sometime in the next 2 decades while Russia’s intervention in Syria has rolled back Washington’s plan to topple Bashar al Assad and consolidate its grip on the resource-rich Middle East. That plan has now collapsed forcing US policymakers to scrap the War on Terror altogether and switch to a “great power competition” which acknowledges that the US can no longer unilaterally impose its will wherever it goes. Challenges to America’s dominance are emerging everywhere particularly in the region where the US hopes to reign supreme, Asia.

This is why the entire national security state now stands foursquare behind the improbable pivot plan. It’s a desperate “Hail Mary” attempt to preserve the decaying unipolar world order.

What does that mean in practical terms?

It means that the White House (the National Security Strategy) the Pentagon (National Defense Strategy) and the Intelligence Community (The Worldwide Threat Assessment) have all drawn up their own respective analyses of the biggest threats the US currently faces.

Naturally, Russia is at the very top of those lists. Russia has derailed Washington’s proxy war in Syria, frustrated US attempts to establish itself across Central Asia, and strengthened ties with the EU hoping to “create a harmonious community of economies from Lisbon to Vladivostok.” (Putin)

Keep in mind, the US does not feel threatened by the possibility of a Russian attack, but by Russia’s ability to thwart Washington’s grandiose imperial ambitions in Asia.

As we noted, the National Security Strategy (NSS) is a statutorily mandated document produced by the White House that explains how the President intends to implement his national security vision. Not surprisingly, the document’s main focus is Russia and China. Here’s an excerpt:

“China and Russia challenge American power, influence, and interests, attempting to erode American security and prosperity. They are determined to make economies less free and less fair, to grow their militaries, and to control information and data to repress their societies and expand their influence.” (Neither Russia nor China are attempting to erode American security and prosperity.” They are merely growing their economies and expanding their markets. If US corporations reinvested their capital into factories, employee training and R and D instead of stock buybacks and executive compensation, then they would be better able to complete globally.)

Here’s more:

“Through modernized forms of subversive tactics, Russia interferes in the domestic political affairs of countries around the world.” (This is a case of the ‘pot calling the kettle black.’)

“Today, actors such as Russia are using information tools in an attempt to undermine the legitimacy of democracies. Adversaries target media, political processes, financial networks, and personal data.” (The western media behemoth is the biggest disinformation bullhorn the world has ever seen. RT and Sputnik don’t hold a candle to the ginormous MSM ‘Wurlitzer’ that controls the cable news stations, the newspapers and most of the print media. The Mueller Report proves beyond a doubt that the politically-motivated nonsense one reads in the media is neither reliably sourced nor trustworthy.)

The Worldwide Threat Assessment of the US Intelligence Community is even more explicit in its attacks on Russia. Check it out:

“Threats to US national security will expand and diversify in the coming year, driven in part by China and Russia as they respectively compete more intensely with the United States and its traditional allies and partners…. We assess that Moscow will continue pursuing a range of objectives to expand its reach, including undermining the US-led liberal international order, dividing Western political and security institutions, demonstrating Russia’s ability to shape global issues, and bolstering Putin’s domestic legitimacy.

We assess that Moscow has heightened confidence, based on its success in helping restore the Asad regime’s territorial control in Syria,...

Russia seeks to boost its military presence and political influence in the Mediterranean and Red Seas… mediate conflicts, including engaging in the Middle East Peace Process and Afghanistan reconciliation….

Russia will continue pressing Central Asia’s leaders to support Russian-led economic and security initiatives and reduce engagement with Washington. …Russia and China are likely to intensify efforts to build influence in Europe at the expense of US interests…” (“The Worldwide Threat Assessment of the US Intelligence Community”, USG)

Notice how the Intelligence Community summary does not suggest that Russia poses an imminent military threat to the US, only that Russia has restored order in Syria, strengthened ties with China, emerged as an “honest broker” among countries in the Middle East, and used the free market system to improve relations with its trading partners and grow its economy. The IC appears to find fault with Russia because it is using the system the US created to better advantage than the US. This is entirely understandable given Putin’s determination to draw Europe and Asia closer together through a region-wide economic integration plan. Here’s Putin:

“We must consider more extensive cooperation in the energy sphere, up to and including the formation of a common European energy complex. The Nord Stream gas pipeline under the Baltic Sea and the South Stream pipeline under the Black Sea are important steps in that direction. These projects have the support of many governments and involve major European energy companies. Once the pipelines start operating at full capacity, Europe will have a reliable and flexible gas-supply system that does not depend on the political whims of any nation. This will strengthen the continent’s energy security not only in form but in substance. This is particularly relevant in the light of the decision of some European states to reduce or renounce nuclear energy.”

The gas pipelines and high-speed rail are the arteries that will bind the continents together and strengthen the new EU-Asia superstate. This is Washington’s greatest nightmare, a massive, thriving free trade zone beyond its reach and not subject to its rules. In 2012, Hillary Clinton acknowledged this new threat and promised to do everything in her power to destroy it. Check out this excerpt:

“U.S. Secretary of State Hillary Clinton described efforts to promote greater economic integration in Eurasia as “a move to re-Sovietize the region.”….

“We know what the goal is and we are trying to figure out effective ways to slow down or prevent it,” she said at an international conference in Dublin on December 6, 2012, Radio Free Europe.”

“Slow down or prevent it”?

Why? Because EU-Asia growth and prosperity will put pressure on US debt markets, US corporate interests, US (ballooning) national debt, and the US Dollar? Is that why Hillary is so committed to sabotaging Putin’s economic integration plan?

Indeed, it is. Washington wants to block progress and prosperity in the east in order to extend the lifespan of a doddering and thoroughly-bankrupt state that is presently $22 trillion in the red but continues to write checks on an overdrawn account.

But Russia shouldn’t be blamed for Washington’s profligate behavior, that’s not Putin’s fault. Moscow is merely using the free market system more effectively that the US.

Now consider the Pentagon’s 2018 National Defense Strategy (NDS) which reiterates many of the same themes as the other two documents.

“Today, we are emerging from a period of strategic atrophy, aware that our competitive military advantage has been eroding. We are facing increased global disorder, characterized by decline in the long-standing rules-based international order—creating a security environment more complex and volatile than any we have experienced in recent memory. Inter-state strategic competition, not terrorism, is now the primary concern in U.S. national security.”

(Naturally, the “security environment” is going to be more challenging when ‘regime change’ is the cornerstone of one’s foreign policy. Of course, the NDS glosses over that sad fact. Here’s more:)

“Russia has violated the borders of nearby nations and pursues veto power over the economic, diplomatic, and security decisions of its neighbors…..(Baloney. Russia has been a force for stability in Syria and Ukraine. If Obama had his way, Syria would have wound up like Iraq, a hellish wastelands occupied by foreign mercenaries. Is that how the Pentagon measures success?) Here’s more:

“China and Russia want to shape a world consistent with their authoritarian model…

“China and Russia are now undermining the international order from within the system…….

“China and Russia are the principal priorities for the Department… because of the magnitude of the threats they pose to U.S. security.” (National Defense Strategy of the United States of America)

Get the picture? China and Russia, China and Russia, China and Russia. Bad, bad, bad.

Why? Because they are successfully implementing their own development model which is NOT programed to favor US financial institutions and corporations. That’s the whole thing in a nutshell. The only reason Russia and China are a threat to the “rules-based system”, is because Washington insists on being the only one who makes the rules. That’s why foreign leaders are no longer falling in line, because it’s not a fair system.

These assessments represent the prevailing opinion of senior-level policymakers across the spectrum. (The White House, the Pentagon and the Intelligence Community) The USG is unanimous in its judgement that a harsher more combative approach is needed to deal with Russia and China. Foreign policy elites want to put the nation on the path to more confrontation, more conflict and more war. At the same time, none of these three documents suggest that Russia has any intention of launching an attack on the United States. The greatest concern is the effect that emerging competitors will have on Washington’s provocative plan for military and economic expansion, the threat that Russia and China pose to America’s tenuous grip on global power. It is that fear that drives US foreign policy.

And this is broader context into which we must fit the Russia investigation. The reason the Russia hacking furor has been allowed to flourish and spread despite the obvious lack of any supporting evidence, is because the vilifying of Russia segues perfectly with the geopolitical interests of elites in the government. The USG now works collaboratively with the media to influence public attitudes on issues that are important to the powerful foreign policy establishment. The ostensible goal of these psychological operations (PSYOP) is to selectively use information on “audiences to influence their emotions, motives, objective reasoning, and ultimately the behavior of… organizations, groups, and individuals.”

The USG now sees the minds of ordinary Americans as a legitimate target for their influence campaigns. They regard attitudes and perceptions as “the cognitive domain of the battlespace” which they must exploit in order to build public support for their vastly unpopular wars and interventions. The relentless Russiagate narrative (which was first referred to the FBI by the chief architect of the Syrian War, former-CIA Director John Brennan) represents the disinformation component of the broader campaign against Russia. Foreign policy elites are determined to persuade the American people that Russia constitutes a material threat to their security that must be countered by tighter sanctions, more sabre-rattling, and eventually war.

Published:4/5/2019 11:02:53 PM
[Markets] Schlichter: The Admission Scam Is Another Reason To Destroy Academia As We Know It

Authored by Kurt Schlicher, op-ed via,

American college is terrible and, as a society, we should stop doing it – at least how it is being currently done. The greatest benefit of a system where most citizens are pushed to get college educations, whether they truly need and want one or not, would be a society of really smart, informed, and engaged citizens.

Do you see that happening?

No, you do not.

Instead, we have a bunch of people who are dragged down by crushing debt after wasting years of their youth chasing a piece of paper that often has no relationship to these graduates’ futures. Compounding the failure is how these grads march off campus infatuated with ridiculous commie notions abhorrent to a free people. The college system is a disaster – an expensive disaster that picks our pockets as well as those of the suckers who matriculate – and we should stop tolerating it. Time for conservatives to reform academia the hard way, and by “reform” I mean, “Destroy it, sow the campuses with salt, and rebuild academia into something that isn’t useless.”

About 99% of current college grads will feel that “sow with salt” line zoom over their empty heads. Most of them probably think “Carthage” is a rapper, or maybe a lesser Kardashian. 

The college admission scandal, where a herd of rich Democrat donors paid a ton of dough to get their half-wit progeny into Snooty U, was the perfect encapsulation of how big a rip-off college really is. Did you notice how the parents forked over cash to get Junior into school because Junior scored 112 on his SAT and then…Junior stayed in the elite school with no problem? You might think that if these schools were rigorous institutions of higher learning instead of ruling class credential rubber-stump machines, they might flunk out? But no. When the internet famous daughter of that (former) Full House / Hallmark-movie-about-a-widow-finding-love-with-a sexy-carpenter-at-Christmas starlet Lori Loughlin was busted, she was literally sailing around the Bahamas on a yacht owned by a USC trustee.

I guess she needed a break from her work carrying on Dr. Hawking’s particle physics research.

Of course, according to our betters – the same betters who pulled off this scam and all the myriad other scams that are wrecking our culture – the answer to this outrage is to eliminate standardize testing. That way there will be no objective criteria for college admission at all, and the elite can simply wield its influence, pull a few strings, and voilà – Kaden has his gender studies degree from Yale!

But your kid, like every other Normal kid, will have even less chance of being accepted at, say, Harvard, because they can’t test in anymore. Harvard is, of course, the best school in the world, according to Harvard and the people who went there, a fact about them that you will learn within 15 seconds of meeting one. And your kid will have even an even worse chance if he or she (though not xe – that’s a plus) is both Normal and Asian. Apparently the hard work and talent of Asian-American students give them an unfair advantage over people lucky at being bornor who get on TV spouting approved liberal clichés

It’s apparent that the current collegiate system serves several functions, all of them a symptom of a deeper problem with our society. We have seen how admission to one of the elite schools is a de facto degree, which in turn is a de facto ticket into the ruling class. Any actual education is purely coincidental. It is also clear that attendance at non-elite schools is today merely a signal to employers that the person might possesses the basic readin’, writin’ and ‘rithmatic skills we used to expect from a high school graduate. This is because high school’s purpose is not to create a baseline educated citizen anymore but, rather, to provide comfy sinecures for Democrat-voting unionized teachers and the swollen ranks of lazy, useless administrators. Again, education is an afterthought – public education’s real goal is to provide jobs for Democrat constituencies. 

Academia is similar. It exists to mass produce ignorant future elitists and to provide jobs for liberal indoctrinators fueled by our tax money. The state and private schools both take our dough directly as well as through guaranteed student loans. Student loans are a giant scam, of course. Students get grifted into chaining an anchor around their necks in exchange for credentials most don’t even need. Colleges can raise tuition as high as they like because the government will just back the loans these suckers take out. It’s a great system, if you’re an academic. Not so much if you are a student or a taxpayer. 

Of course, the schools love the “free college” movement. Nothing costs as much as “free.” The only thing better than having the millennial dummies willing to borrow 200 grand for a degree in the feminist literature of Mongolia pay for it is to make you and me pay for it.

How about no?

Now, the college scam has insinuated itself into our culture like a malignancy, and cutting it out will be traumatic, but we need to do it or it will destroy us.

First, we need to demand that high school do its job and turn out students who can do the basic things citizens must do without taking remedial courses in college so they can master See Spot Run. Outlawing teachers’ unions sounds like a great start, as well as refusing federal aid for any district that has more than a 1:1 teacher to administrator ratio.

Second, we need a cultural rethink of the concept of college itself. A four-year degree – as opposed to a four-year party – is not for everyone. It’s not even for most people. You know who do well today, who aren’t MFA grads yet making our coffee for us? People with skills. Plumbers. Electricians. Welders. Trades are the future.

And a four-year degree should not always be a prerequisite for a professional degree either. I did four years of undergrad, where I majored in beer and girls with a minor in 80s post-punk alternative music, then three years of law school (albeit interrupted by the Army). That seven years could have been condensed to five, maybe four. Same with med school; docs learn as on the job as residents. You should not have to spend nearly a decade taking classes to do the vast majority of jobs. I deal with other lawyers for a living. Most are quarter-wits aspiring to be half-wits.

Third, we need to realize that our elite schools are not elite. Their status comes not from the quality of their education but the selectivity (at least, the selectivity they claim to the public) of their admissions. Guess what the median grade at Harvard is. Go on, guess. Our most rigorous school, right? It should be really hard, right? Lots of “C” and “B” grades because of said rigor, right? 

It’s an “A-.” The median grade at Harvard is an “A-,” which is supposed to be “outstanding.” But a Harvard A- is not “outstanding.” It is the default. Think about it. Half the grades at Harvard are “A-” or above. Would you give our ruling class an “A-”?

And beside all this, the universities as bastions of leftism and censorship. That needs to end tooPresident Trump’s free speech executive order is just the first step in defeating academic fascism.

Academia is a scam, as well as a campus gulag archipelago of hellholes of leftist oppression, and we need to tear it down and start over.

*  *  *

Since I’m a unintersectionalist author of non-cisness, am regularly-abled and identify as a dude, my novels about an America split apart into red and blue (People's RepublicIndian Country and Wildfire) will never get on a college reading list. Check them out anyway, if only to irritate the SJWs.

Published:4/5/2019 10:10:33 AM
[Markets] Even The Machines Can't Comprehend Brexit: 'Blizzard' Of Headlines Renders Pound Untradeable For Algos

Since June 23, 2016, trading the British pound has been fraught with peril for both carbon-based and mechanical counterparts. Though it outperformed most other G10 currencies during Q1 (even as the risk of a disorganized 'no deal' Brexit appears to have risen), the currency has shed 13% from its pre-Brexit highs, and traders have had to contend with extreme bouts of intraday volatility, not to mention the occasional flash crash.

But as the Brexit drama has intensified over the past few weeks, with critical votes being held almost every day followed by an endless stream of commentary, speculation and conflicting reports, parsing all of this data has rendered the pound practically untradeable for algos designed to read and react to newswire headlines.

According to Reuters, "as a divided government battles a divided parliament over a way forward, the chorus of characters who can now influence events has grown, flummoxing news-reading algorithms...which are designed to parse phrases from recognized speakers before executing a trade."


This "blizzard" of Brexit-related headlines has been one of the biggest challenges for algorithmic traders in their short existance. Reuters has pumped out as many as 400 Brexit-related headlines a day in recent weeks, up from just 15 on average before Brexit, while Bloomberg has published as many as 1,000 on particularly busy days, like on March 12, when MPs rejected Theresa May's withdrawal agreement for the second time.

After Prime Minister Theresa May decided to pursue talks with the opposition, we saw a surge in conflicting Brexit headlines, presumably because the fractious interest groups within the government and the opposition have engaged in a chaotic battle royal to try and wrest control of the narrative. Just look at the news flow since the beginning of the week: news wires have reported that the PM will pursue talks with the opposition, that she might endorse a vote on Brexit-deal alternatives, that she might call for a general election, request a long Brexit delay, request a short Brexit delay, possibly consider another referendum etc. etc. And that's not even factoring in the reports from Brussels.

While machine learning has made serious strides over the past ten years, trading algos still don't have the capacity to understand the mechanics of obscure British parliamentary procedures like how Speaker John Bercow was able to declare that May couldn't bring her withdrawal agreement back for a third vote unless strict conditions had been met.


Courtesy of Reuters

Machines also don't possess the ability to process visual cues.

On November 6, Britain’s then Brexit Minister Dominic Raab, pushed the pound up simply by giving a “thumbs up” after a cabinet meeting - a visual cue that would outfox machines programmed to analyze words.

Raab’s market-moving gesture came after the pound had fallen on a tweet warning of a no-deal Brexit from Jeffrey Donaldson, one of 10 Democratic Unionist Party lawmakers whose support May needs.

The fact that traditional market drivers like economic data and central bank forecasts have been lost amid this storm of political speculation has compounded the frustration for some quant-driven macro hedge funds (though American equity bears can probably sympathize with this). Some have stopped trading sterling altogether.

Some hedge funds have opted out of trading sterling altogether because the usual models they rely on don’t work in the current climate, according to one FX trader at a major UK investment bank.

Their models are based around economic data and expectations for Bank of England rate changes, but those have become secondary drivers compared with political news, he said.

But the buy side aren't the only ones struggling thanks to Brexit. Since roughly 70% of trades on some of the most popular FX trading platforms are executed by algorithms, market makers are widening the spread they're demanding for facilitating trades to compensate for any losses due to volatile trading aggravated by poor liquidity conditions.

That is driving up costs for everybody who trades sterling, either for speculative for commercial purposes

But a wider spread makes it more expensive to deal in pounds. Rob Turner, a quantitative trader at RBC Capital Markets said the average cost of trading, by taking into account the spreads, for sterling in a usual 10 million ticket jumped last week to 2.9 pips from 1.9 pips in October.

"That shows that the price at the very best moment for executing a sterling trade last week was still a lot worse than the worst moment in a normal week," Turner said.

Meanwhile, most currency dealers that take risk on to their own books are now reluctant to leave the machines unsupervised.

Some banks are ensuring that trading the pound is not left completely to the machines while other banks are using tiny orders within narrow trading ranges to prevent large losses.

"If it was your job and given the complexity of the Brexit story, do you really want to precode something to automatically infer and put material risk on the back of that," said David Leigh, global head of FX spot and electronic trading at Deutsche Bank.
“Probably not.”

The result has made sterling an outlier. As volatility in G10 FX - and stocks, and bonds - has plunged, for sterling, volatility has surged to its highest level in two years.

And if May and Europe decide to kick the can once again, this pattern will probably persist for the foreseeable future. If this happens, a lot of people will be unhappy, but we could think of two organizations that just might benefit.

Published:4/5/2019 2:09:41 AM
[Markets] Was John Brennan The Russia Lie Ringleader?

Authored by Monica Crowley, op-ed via The Washington Times,

The best defense, the saying goes, is a good offense.

The key orchestrators of the Big Trump-Russia Collusion Lie seem to have hewed tightly to that tactical advice.

Over the past two years, one of their biggest “tells” has been their hyper-aggressive and gratuitous attacks on the president. Given that special counsel Robert Mueller’s investigation found no collusion or obstruction of justice, their constant broadsides now look, in retrospect, like calculated pre-emptive strikes to deflect attention and culpability away from themselves.

By accusing Mr. Trump of what they themselves were guilty of, they created a masterful distraction through projection.

We now know that former FBI Director James Comey and his deputy, Andrew McCabe, are hip-deep in the conspiracy. Both wrote supposed “tell-all” books and carpet-bombed the media with interviews in which they regularly flung criminal accusations against the president. Whenever asked about their own roles, they reverted to denouncing Mr. Trump.

With Mr. Mueller’s findings, Mr. Comey’s and Mr. McCabe’s media benders look increasingly suspicious.

As do those of their comrades in the Obama national security apparatus, including former Director of National Intelligence James Clapper and his partner in possible crime, former CIA Director John Brennan, who, apart from former President Barack Obama himself, may be the biggest player of them all.

Any investigation into the origins and execution of the Big Lie must focus on Mr. Brennan, whose job as the nation’s chief spook would have prohibited him, by law, from engaging in any domestic political spy games.

Of course, the law didn’t stop him from illegally spying on the Senate Intelligence Committee by hacking into its computers and lying repeatedly about it, prompting Democratic senators to call for his resignation.

Once out of Langley, Mr. Brennan tore into Mr. Trump, accusing him of “treason” (among other crimes) in countless television appearances and bitter tweets. It got so vicious that Mr. Trump pulled his security clearance.

Consider a few critical data points.

The Obama Department of Justice and FBI targeting of two low-level Trump aides, George Papadopoulos and Carter Page, was carried out in the spring of 2016 because they wanted to spy on the Trump campaign but needed a way in. They enlisted an American academic and shadowy FBI informant named Stefan Halper to repeatedly sidle up to both Mr. Papadopoulos and Mr. Page. But complementing his work for the FBI, Mr. Halper had a side gig as an intelligence operative with longstanding ties to the CIAand British intelligence MI6.

Another foreign professor, Joseph Mifsud, who played an important early part in targeting Papadopoulos, also had abiding ties to the CIA, MI6 and the British foreign secretary.

A third operative, Australian diplomat Alexander Downer, targeted Mr. Papadopoulos in a London bar. It was Mr. Downer’s “tip” to the FBI that provided the justification for the start of Russia counterintelligence investigation, complete with fraudulently-obtained FISA warrants to spy on the Trump campaign.

All of these interactions reek of entrapment. Mr. Papadopoulos now says, “I believe Australian and UK intelligence were involved in an active operation to target Trump and his associates.” Like Mr. Halper and Mr. Mifsud, Mr. Downer had ties to the CIA, MI6 and (surprise!) the Clintons.

Given the deep intelligence backgrounds of these folks, it’s difficult to believe that former DOJ/FBIofficials such as Peter Strzok or even James Comey and Andrew McCabe on their own devised the plan to deploy them.

So: who did? How did the relationships with Messrs. Halper, Mifsud and Downer come about? Who suggested them for these tasks? To whom did they report? How were they compensated?

Any investigation must follow the money — and the personnel. There were plenty of DOJ/FBI officials involved, but what about intelligence officials? Was Mr. Brennan a central player in the hoax, which would help explain the participation of Mr. Halper, Mr. Mifsud and Mr. Downer? Intel officials are likely to draw on other intelligence operatives.

There is also a glimpse of a paper trail.

Fox News’ Catherine Herridge reported last week that “in a Dec. 12, 2016 text, [FBI lawyer Lisa] Page wrote to McCabe: “Btw, Clapper told Pete that he was meeting with Brennan and Cohen for dinner tonight. Just FYSA [for your situational awareness].”

“Within a minute, McCabe replied, “OK.”

Ms. Herridge notes that those named are likely Peter Strzok and Mr. Brennan’s then-deputy, David Cohen. Ms. Herridge also notes that while we don’t yet know what was discussed during the dinner, government sources thought it “irregular” for Mr. Clapper to be in contact with the more junior-level Mr. Strzok. She also points out that the text came “during a critical time for the Russia probe.”

Indeed. It was right before the publication of the ICA, the official Intelligence Community Assessment of Russian 2016 election interference.

As Paul Sperry has reported, “A source close to the House investigation said Brennan himself selected the CIA and FBI analysts who worked on the ICA, and that they included former FBI counterespionage chief Peter Strzok.

“Strzok was the intermediary between Brennan and Comey, and he was one of the authors of the ICA,” according to the source.” Recall that the dossier-based ICA was briefed to Obama, Trump and Congress ahead of Trump’s inauguration.

Post-Mueller report, Mr. Brennan is spinning wildly that perhaps his early condemnations of Mr. Trumpwere based on “bad information.”

These are just some of the threads suggesting Mr. Brennan may be one of the Masters of the Big Lie, requiring full investigation.

If the devil is in the details, Mr. Brennan is all over the details.

No wonder he — and his fellow caballers — have been so loud. They doth protest too much.

Published:4/4/2019 8:36:19 PM
[Markets] Baltimore Auditor Quits After Officials Pressured Her To Cook The Books 

The Baltimore Brew has learned that Baltimore City auditor Audrey Askew resigned from her post after officials told her to cook the books.

The numbers in question are federal grants to city agencies as well as cash and investments, which Askew pressed officials for a "qualified" opinion to the Comprehensive Annual Financial Report (CAFR).

The Brew said that such an opinion would damage Baltimore’s credit rating and result in investigations by federal agencies over the distribution of grant monies.

Askew told The Brew that top officials told her to "go easy" on city finances.

Askew’s sudden departure five weeks ago was never publicized by the city or her boss, Comptroller Joan Pratt.

The Brew spoke with Askew who said, "I am a person of integrity," which essentially implies that she wasn't willing to commit fraud.

Sources say Askew’s "qualified" audit proposal was challenged by Finance Department officials and by SB & Co., the Baltimore County firm contracted by Mayor Catherine Pugh to review the CAFR report.

The Brew said SB founding partner Graylin Smith and Finance Director Henry Raymond pressured Askew to "write-off" federal grant money to balance the books.

After Askew asked Pratt to side against the fraud, she faced "interference" by Deputy Comptroller Harriette Taylor, who began attending CAFR meetings.

The Brew said friction between Askew and Taylor spiraled out of control several weeks before she resigned.

On Monday night, Councilman Ryan Dorsey provided more details about Askew’s resignation:

"As I understand it, the auditor wanted to release audits of the Finance Department, who didn’t want them released. The auditor believed it was wrong not to. The Comptroller threatened to fire the auditor if she did (for legal if petty reasons). The auditor resigned," Dorsey tweeted.

Pratt told The Brew, "I have never threatened the city auditor regarding the issuance of financial statement." She added, "The city auditor voluntarily resigned on February 27, 2019 and thanked me for the opportunity to work with the City of Baltimore."

"I was not aware that she resigned because of the CAFR," She admitted that "there are isolated incidences of grant reporting issues by grant-funded agencies due to long-term decentralization of the grant process."

Raymond didn't respond to any questions from The Brew.

In March, Raymond declined to discuss the CAFR audit. "You need to talk to the comptroller. She is responsible for the audit report," he said.

Askew refused to answer exactly why she resigned.

"Baltimore will never know why, but they know why," Askew said.

She added, "I am a person of integrity, and I am honest. Anything that alters that, I don’t do."

Hired two years ago as deputy auditor, she was named city auditor by Pratt last summer. Askew has been critical of expenditures by Mayor Pugh's staff for using a city-issued credit card to pay for dubious expenses.

Published:4/4/2019 7:36:57 PM
[Markets] Only The Strong Survive: JCPenney, Payless, LifeWay To Close Over 3,000 Stores

Authored by Mike Shedlock via MishTalk,

The weak keep getting weaker. Another 3,000 stores will bite the dust and mall vacancies are at an 8-year high.

“In the post-digital era, only the strong will survive. Darwin would love this,” said one retail analyst as JCPenney, Payless, LifeWay Announce 3,000+ Combined Store Closures.

Retail job cuts for January and February total 41,201, said research firm Challenger, Gray & Christmas in a new survey, including nationwide retailers such as Payless and Charlotte Russe.

“This is significant, and marks an acceleration of store closures and job cuts in the near term," said Mark Hamrick, a senior economic analyst at Bankrate.

“Retail is ground zero for seeing the shifts of change in our lives.”

Lifeway Christian Bookstores announced last week it would be closing the doors of all 170 brick and mortar stores, in a pivot to focusing on digital and e-commerce.

“The decision to close our local stores is a difficult one,” said Lifeway Chief Executive Officer Brad Waggoner.

“While we had hoped to keep some stores open, current market projections show this is no longer a viable option.”

“In the post-digital era, only the strong will survive,” Ron Johnson, CEO of Enjoy, a retail technology company, told NBC News.

“You need a great brand, a strong balance sheet, and a vision for experience that commences digitally. Darwin would love this.”

Mall Vacancies on the Rise

The Financial Times notes US Shopping Centre Vacancies Rise to Eight-Year High

"US retailers have set out plans to close 5,480 stores, according to Coresight Research — almost as many as the 5,730 announced in all of 2018."

Trump Sounds Like the French


Donald J. Trump?@realDonaldTrump

States and Cities throughout our Country are being cheated and treated so badly by online retailers. Very unfair to traditional tax paying stores!


3:59 PM - Apr 17, 2018

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Save the local bookstores was the cry in France. Here's reality.


Lexi Beach@lexiatwork

Ok, bookstore loving friends, here is the truth:
At a certain point, buying books from the store you love is not going to be enough to keep it open.


7:45 AM - Oct 9, 2018

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Lexi then goes off the deep end with anti-capitalist nonsense.


Lexi Beach@lexiatwork

 · Oct 9, 2018

Replying to @lexiatwork

I promise you, there is no volume of business that McJ could have feasibly been doing such that, when the initial sweet deal of a 15-yr lease expired, they'd magically be able to pay market rent in that neighborhood.

Lexi Beach@lexiatwork

The problem is not the sustainability of bookstores. It's the immoral capitalist (is that redundant?) system we've all accepted as normal wherein the composition of your neighborhood is dictated by people who do not actually live there.


8:09 AM - Oct 9, 2018

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Unfair Competition

Businesses that cannot compete always complain about fairness.

They want subsidies at taxpayer expense, higher prices for consumers, or both.

Pathetic Hooey

What a pathetic bunch of hooey from Trump.

Published:4/4/2019 6:07:44 PM
[Markets] The Delusional Futurism Of 'Liberal World Order' Academics

Authored by Brandon Smith via,

Perhaps this is an overly broad generalization, but I feel there is an almost universal feeling among the public that there is something intrinsically annoying about academia. The source of this annoyance is up for debate, but I believe it stems from the image academics project versus the reality of their personal character and intent. Your average university approved academic will say that some people find them distasteful because they are “so smart”, and this makes others envious. I would say it's the opposite – the average academic is actually quite ignorant, but brandishes a false image of being a genius. This is why I often refer to them as “academic idiots”.

Fake intelligence and faux wisdom are like sandpaper to people's exposed nerves, and the average person is not as dumb as academics think they are.

At the top of the fraudulent academic totem pole are what I would call the “academic philosophers”; the gatekeepers, the people who pontificate regularly on the meaning of life and society while living the most charmed life one can imagine. These are people who in most cases come from upper class backgrounds. They have been provided for every waking moment of their existence. They have had every door opened for them by someone else on the path to success, and have experienced little to no struggle or suffering in the whole of their time on this Earth. And yet, they somehow deem themselves expertly qualified to comment on the human condition.

It should come as no surprise that the ideas these academics develop tend to deny concrete reality. They seek to pursue agendas that are fanciful at best and would be ultimately destructive if ever applied in the real world.

I find this to be common with many philosophers, not just today but throughout history. The venerated Plato was such a person; the youngest son of wealthy aristocratic parents who was required to do very little in early life but ponder. The trials surrounding his friend Socrates aside, Plato never abandoned the notion of elitist rule over society. Plato's Republic is a shrine to the elitist model, imagining a world governed essentially by academics – People born with superior intellectual abilities and who were destined to rule over the rest of us as benevolent demigods.

It's a funny coincidence that supposedly objective elitist academics always come to the conclusion that THEY are the best equipped people to manage society.

The academic cabal is not entirely naive, however. They have realized over time that their sales pitch of an intellectual priest class and Utopian pyramid schemes are not very effective, and they have opted to switch narratives. The new narrative is one of inevitability; the inevitability of socialism, the inevitability of globalism and the inevitability of algorithmic automation.

In other words, globalism will be the apex social structure and artificial intelligence will govern the daily machinations of that structure, regardless of what the public wants. The elites won't rule the world directly, but their ilk will create the algorithms and the policies that will rule the world by virtue of social and technological evolution.  Like Jean-Luc Godard's French New Wave film, Alphaville, the idea is that the elites can simply sit back and let the dark "logic" of algorithmic governance do the dirty work.  For, after all, how can we possibly argue with a computer?

An example of one of the academic elitists of which I speak is Yuval Noah Harari. His editorials are getting a lot of play in the mainstream media lately and they focus on the necessity of globalism as well as the need for humans to quickly adapt to technocracy lest they find themselves obsolete. Harari is a prototypical academic philosopher, regurgitating old concepts of aristocracy and feudalism thinly veiled in futurist imagery. His arguments are the type that other lesser academics absorb and endlessly parrot as if they are profound.

For those not familiar with the ideas behind futurism, I suggest reading my article 'The Meaning Of Good And Evil In Perilous Times'. To summarize, futurists consistently endorse the notion that old methodologies must be erased to make way for new methodologies. Traditions and ideals of the past are considered a prison which holds humanity back from progress and a better tomorrow. They believe that the solution to the imbalances and tragedies of today is to aggressively dismantle the existing system and rebuild it in a new and original way. This includes morals and guiding principles, which they see as stifling and relative.

Futurism was founded in the early 20th century in Europe with sister groups in Russia and is considered a precursor to early socialist movements including fascism and communism. To clarify, there are no new ideas under the sun, only old ideas with a slightly different spin. Socialism precedes globalism, which is one of the oldest ideas; the idea of total empire.

Like most modern academic philosophers, Yuval Harari displays futurism and globalism in spades. He is associated with the globalist Carnegie Council For Ethics In International Affairs.  Once known as the Church Peace Union, the group helped push Woodrow Wilson into involving the US in WWI and also helped promote the establishment of the UN.

He is an adequate model for my debunking of what these people often refer to as the “liberal world order”, which is just another brand of futurism. As a reference point I am using two of Harari's articles, one published for the Guardian on the future of automation and the robots displacing humanity, and the other published for the Rothschild owned magazine The Economiston the need for globalism and the end of nationalism. I will be summarizing his arguments and views, but I welcome readers to examine his articles linked above.

Let's get to it...

AI Will Replace Most Humans...And This Is A Good Thing

This is becoming a mainstay narrative from the globalist establishment and their academia for a number of reasons. The argument that AI dominance is an inevitability is much like the argument that globalism is an inevitability; both are based on self fulfilling prophecy.

Harari imagines what he calls a “world without work”, a development only 20-30 years in the future in which algorithmic machines replace human beings as the primary source of labor. There are two sides to this piece of propaganda; first it is meant to frighten the public into demanding centralization and global governance. Harari asserts that without global governance and a “universal basic income”, AI will make most people without technological savvy into instant paupers, which he labels “the useless class”. And here we see the trick.

As I outlined in my article