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DYING CAPITALISM & THE NEW FEUDALISM
December 14, 2020
https://goldswitzerland.com/dying-capita...-feudalism
Matthew Piepenburg
American exceptionalism, as current COVID and capitalism disasters confirm, has morphed into a distortion that resembles more of a comorbidity than a guiding light. Despite a prior reputation for leading the world in innovation, problem solving and health care, the U.S. is witnessing record hospitalizations in a nation comprising 5% of the global population yet 25% of its COVID infections.
Regardless of one’s politics, the COVID crisis is now an open symptom of failure, not exceptionalism. The same is true of the current crisis facing American capitalism. In its purest form, capitalism is an exceptional system, yet sadly one that is morphing into something that is anything but exceptional.
A CRITICAL TURNING POINT
Regardless of legitimately debatable views on how individuals and policy makers (from central bankers to health organizations) have handled the pandemic, we can all agree that COVID represents a turning point. The question now is whether it will be a turning point for the worse or the better. One way to forecast this direction is by tracking the current health of U.S. capitalism.
CAPITALISM RE-ASSESSED
Today, with central banks engaged in open Wall Street socialism wherein artificially repressed rates and unlimited QE have directly benefited the two largest asset classes in America, namely real estate and stocks, we can’t deny the cause-and-effect powers (as well as beneficiaries) of such “accommodation.”
It’s an objective fact that 80 % of those assets are owned by the top 10%. Does that feel like capitalism working at a national level, or something far more targeted and far less “free-market” driven? The very concept of central-bank supported (and Congress-lobbied) capitalism is itself an oxymoron, and requires on honest re-assessment (and some hard questions) regarding the true meaning of capitalism.
Can any system, market or sector, for example, that is directly and exclusively supported by trillions in fiat money creation and decades of artificially repressed (and unnaturally low) interest rates by definition be labeled “free market,” “natural” or even “capitalistic”?
Be honest.
And has the $6+ trillion in Fed money creation since 2008 truly “trickled down” to the real economy or has it primarily benefited risk asset markets like stocks on the S&P 500…
or real estate owners and commission-based brokers: Again: Be honest.
Whether you be in the top 10% or the bottom 10%, the answer to such primary questions is empirically obvious. Such asset price inflation (i.e. bubbles) in everything from tech stocks to beach front real estate is not symbolic of the lauded and natural “Darwinism” of competitive, free-market capitalism.
Instead, such bubbles for the top 10% and the consequent wealth disparity that followed for the rest of the country are dangerous indicators of a kind of post-modern feudalism wherein a questionable cabal of policy makers subsidizes a distinct minority of beneficiaries and then calls the result “economic stimulus” as the rest of the country gets poorer by the day.
But again, is that capitalism?
Capitalism, whether defined by Adam Smith or abused by Gordon Gecko, is a dynamic, full-body contact sport of almost blood-thirsty competition played on a level playing field of new ideas, equal capital costs and individual effort. In addition, true capitalism, the kind our fathers knew, was equally designed to create a broad rather than narrow class of winners and prosperity over time.
Do the above charts suggest a broad class of winners?
Capitalism, of course, should reward executives. But by how much?
Since 1978, CEO compensation has grown by 940%, whereas worker compensation for the same period has grown by 12%. In 1965, the average ratio of CEO to median employee salaries was 21:1, today it’s over 320:1. For Jeff Bezos at Amazon, the ratio is 1.2 million to 1. Is such data a sign of an evolving capitalism or an indicator of something far more disturbing?
FAIR COMPETITION VS. A RIGGED GAME
Unfortunately, there are other and increasingly clear signs of rigged policies (from the Fed, Congress, SEC or White House) which have less to do with fair competition and compensation—the keystones of healthy capitalism—and far more do with an extended yet media-ignored paradigm of favoritism—i.e. cheating.
Today, a kind of pseudo capitalism has emerged which is neither empathetic toward (or beneficial to) its host nation. Instead, we have a distorted model of capitalism whose benefits and empathies are uniquely targeted to a singular (parasitic?) group of companies, individuals and markets. For every member of Congress, for example, there are at least four financial lobbyists (from banks and big-tech) scurrying to influence (i.e. purchase) favorable policy decisions. This suggests healthy capitalism is under the influence of bribery not policy, and backroom deals rather than fair competition.
Of course, any system that is inherently rigged, like the 1919 World Series, is inherently flawed.
Capitalism, when rigged, is no less disgraceful. We see this rigged game playing out in real time as the weak majority get weaker and the strong minority get stronger in a backdrop that is not a capitalistic “survival of the fittest,” but rather a feudalistic survival of the best-connected. Record breaking wealth disparity as well as the open and shameful disconnect between a tanking economy and a rising (Fed-supported) securities market is not an homage to capitalism, but rather open proof of its failure.
TESLA, APPLE AND AMAZON—THE NEW CAPITALISM?
Take Tesla. It’s a visionary company, but its stock has been skyrocketing on growth projections and historically low borrowing costs, easily managed by exaggerated share price inflation. In March, it was the 4th most valuable auto company in the world, today it is now the most valuable, worth more than Daimler, Toyota and Volkswagen combined. Or Apple. It took 12 years to get a $1 trillion market cap, but only 5 months to recently reach $2 trillion. Are such growth stories a consequence of fair, legitimate and natural free-market capitalism, or have they enjoyed an unfair advantage from the policy jocks?
Consider Amazon. With online sales skyrocketing as citizens are locked at home, Amazon has hired hundreds of thousands of minimum-wage warehouse workers to keep boxes coming to your doorsteps. We can applaud Amazon for its job creation and raising of the minimum wage. But let us not forget the larger picture in which AMAZON has gamified municipalities through its absurd HQ2 plan which transfers wealth from city police, fire and school districts to its shareholders. Nor should we forget that despite years of a profitless balance sheet and legal tax avoidance, Amazon’s share price bubble has allowed it to literally kill, gut and bury small businesses across the nation. At the same time, by owning the rails and engaging in anti-competitive behavior while dumping products and prices due to their access to cheap capital (against which no other companies can compete), Amazon has slaughtered rather than leveled the fair “playing field” upon which true capitalism was designed to be played.
Instead, names like Amazon, Tesla and Apple have prompted openly pro-capitalist thought leaders like Scott Galloway to question whether the pandemic was created, or at least co-opted, for taking the top 10% into the top 1% while sending the remaining 90% downward.
TWO AMERICAS, ZERO CAPITALISM
A recent study by the Robin Hood Foundation, for example, revealed that 32% of the people in New York, the homefield of Wall Street, have been forced to go to a food bank since the onset of the pandemic. That’s more people in the Empire State seeking free food than those who possess a college degree. Meanwhile, 1/3 of greater America is worried about paying their rent.
By pure math, we now live in a Dickensonian backdrop by which it is the “best of times” for a tiny minority (from Face-shot real estate brokers to Facebook tech investors) and the “worst of times” for the broader population. Is it truly fair to castigate the real America as “losers” in a so-called Capitalistic competition whose rigged rules and policies ensured who the winners would be before the game could even start?
The rigged game playing right under our noses in the U.S. is not free market capitalism, just as an S&P sitting atop a big, fat, $7+ trillion Fed air-bag, sure as hell aint a free market. Natural price discovery, as all honest Wall Street veterans know, died years ago. Nod to Greenspan, Bernanke, Yellen and Powell.
As a member of the Wall Street elite who benefited from such anti-capitalistic capitalism, I can’t ignore facts to alleviate a fake conscience. The simple truth is that current U.S. markets, competition and politics have nothing to do with fair competition and hence nothing to do with capitalism.
THE NEW FEUDALISM
As Galloway recently observed, “we are barreling toward a nation where 3 million lords are being served by 350 million serfs,” simply because US policy decided to favor corporations over populations as capitalism “collapses upon itself.”
Nor can this modern version of so-called capitalism rely on the “better angel” generosities of billionaires like Bezos or Musk to save the system. The moral character of overpaid CEO’s will not bring the dying middle class back to its glory days. Frankly, it’s up to the citizens themselves to get informed rather than angry. Knowledge begets better results than pitch forks.
America is falling not just because capitalism lost its way or policy-supported CEO’s lack the character and accountabilities of the past. It’s because citizens and their lobbied (bribed) leaders—red, blue and purple–have lost their sanity and are screaming at each other rather than opening a single economics, math, ethics, history or anti-trust book.
Today, the crowd gets its education from tweets and twits, not informed thoughts, sound leadership and patient knowledge or actual book reading.
BREAD & CIRCUS, FEAR & DIVISION
This, of course, makes the mal-informed majority (i.e. the bottom 90%) easier to trick and manipulate. Decision-makers on top, from ancient Rome to Herr Goebbels, have always understood, and hence exploited, such wide-spread ignorance.
In short, policy anti-heroes serve a mal-informed population a mixed cocktail of either: 1) bread & circus (from Netflix to celebrity virtue-signaling) or 2) fear (from “social-distancing” to COVID death rates) to keep the crowd ignorant, divided and afraid.
Today, most U.S. citizens are blind to the rudimentary basics of Fed policy, currency debasement, lobbying tricks, anti-trust principles, or even viral facts. Thus, as the middle-class flounders and a new financial feudalism replaces genuine capitalism, the mad crowd has no idea where to place its madness other than at each other in an historically divisive era of identity politics replacing anything resembling informed and unifying politics or policies.
Meanwhile, Amazon’s stock climbs as true capitalism crawls, and ancient assets like gold rise, as broken currencies like the dollar, fall. Such are the symptoms of modern feudalism. Get ready for more.
AMERICA's 'SUEZ MOMENT ' :
ANOTHER STRATEGIC MISTAKE WOULD BE ITS LAST
David Hearst
In 2021, President Joe Biden truly reaped a bitter harvest from the strategic foreign policy errors of four of his predecessors. But Washington would do well to think before it makes its next move.
"The chance of a global conflict involving real armies and real arms has never been higher. Biden should bear this in mind"
"America has just had its Suez Crisis," commented a member of the Iranian delegation at the nuclear talks in Vienna about the fall of Afghanistan to the Taliban, "but it has yet to see it."
It's not just the fall of Kabul.
In 2021, President Joe Biden truly reaped a bitter harvest from the strategic foreign policy errors of four of his predecessors. As he was the vice president for one of them, Barack Obama, he has trouble seeing this as well. The seeds of each of the major global conflict zones post - Afghanistan, Ukraine, Taiwan, and Iran were planted long ago.
It's not just the fall of Kabul. What unravelled this year was no less than three decades of bungled US global governanceWhat unravelled this year was no less than three decades of bungled US global governance.
Each US president in the post-Soviet period shared the belief that he had the file to himself. It was not something to be shared at the UN Security Council. He was the commander-in-chief of the largest, best-equipped and most mobile armed force in the world, one that could stage over the horizon attacks with devastating accuracy. The US president controls 750 military bases in 80 different countries. He also had the biggest pocket, the world's reserve currency, so, ergo, he could now set the rules.
What could possibly go wrong?
With that belief came two assumptions that proved to be fatally flawed: that the US monopoly on the use of force would last forever - it ended with Russia's intervention in Syria - and that the US could continue to enforce a "rules-based" world order - so long as it continued to make the rules. Biden has quietly buried both assumptions by admitting that great powers will be forced to "manage" their competition to avoid conflict that no one can win. But hang on a moment. There is something not quite right here.
The cause and effect theory
Major conflicts, which have the potential to produce tank battles not seen since World War II, like Ukraine, do not just happen. There is cause and effect. The cause was the unilateral but at the time uncontroversial decision to expand Nato eastwards in the 1990s, abandoning the model of a largely demilitarised and missile-free Eastern Europe that had been discussed with president Mikhail Gorbachev a decade earlier. Why global conflict is no longer unthinkable.
This was done to give new meaning to Nato, a military pact whose purpose died when its enemy did. Complete rubbish was talked about Nato "cementing" democracy in Eastern Europe by guaranteeing its independence from Moscow. But remember the mood at the time. It was triumphalist. Not only was capitalism the only economic system left, but its neo-liberal brand was the only brand worth promoting.
For a brief moment, Moscow became an eastern gold rush, a Klondike for venture capitalists, Ikea, Carrefour, Irish pubs, and bible bashers. The Russians, meanwhile, were obsessed with designer labels, not politics.
The Americans in Moscow - at the time - did not bother
much about what their hosts thought or did. Russia became irrelevant on the international stage. US advisers boasted about writing the decrees the Russian president Boris Yeltsin issued. And Yeltsin returned the favour by handing over the designs of the latest Russian tank and the wiring diagram of bugs placed by the KGB in the concrete foundation of an extension being built in the US embassy.
Then-US president George Bush and his Soviet counterpart Mikhail Gorbachev after a two-day US-Soviet summit dedicated to disarmament, on 31 July 1991 (AFP)For Russian nationalists, this was nothing less than an act of treason. But doors were open so wide to the West that literally everything that was not nailed down flew through them - nuclear scientists, missile engineers, the cream of the KGB, and suitcases full of cash. Where do you think the Russians who settled in Highgate in North London, or the Hamptons on Long Island, or Cyprus,
or Israel got their money from? For a time, even the word "West" dropped out of Russian political vocabulary because the new Russians thought they had just joined it.
Ukraine, the West's victim
The first US ambassador to the newly created Russian Federation, Robert Strauss, spent more time defending what happened in the Kremlin than the White House. Western embassies became spokesmen for a Russia they thought they now owned.
It is now in the US' strategic interest to staunch any more bloodletting in the battlefields it created this century. Strauss downplayed the first reports of the rise of the Russian mafia state, as a mere bagatelle. "This is what Chicago was like in the 20s," he told me. This was followed by inanities about the green shoots of democracy and the time it took to mow an English lawn. As if he knew.
Bill Clinton and Tony Blair were similarly blasé about what they did in Russia.The Russian army was "a joke". When the Russians sent their armoured columns into Grozny in December 1994, the West thought it could be stopped by small bands of determined Chechens; their pilots had only three hours flying time each month: their frigates sailed in pairs - one to patrol, the second to tow back the first one when it broke down; their submarines sunk.And so Nato pushed eastwards.
No one at the time bought the argument that all Nato would do was to push the line of confrontation eastwards. Russia's pleas to negotiate a security architecture for Eastern Europe fell on deaf ears. They are not falling on deaf ears now, with 90,000 Russian troops massed on Ukraine's borders.
The victim of this gross act of western stupidity was Ukraine, which for at least the first decade after the fall of the Soviets had survived intact and largely in peace. Civil wars raged all around it, but Ukraine itself maintained its political and social unity despite being comprised of very different communities. With the exception of Western Ukraine, which never forgot that it had been captured by the Bolsheviks from the crumbling Austro-Hungarian empire, Russian and Ukrainian speakers lived in peace.
Now it is divided forever, scared by a civil war from which it will never recover. Ukraine will never regain its lost unity, and for that, Brussels is as much to thank as the bully boys from Moscow.
Ukrainian servicemen take part in the joint Rapid Trident military exercises with the US and other Nato countries not far from Lviv, on 24 September 2021 (AFP)
The new cold war
Then there is China. Pivoting eastwards surely did not mean ending one Cold War and starting a new one with China, but that too is inexorably happening. Biden cannot decide whether to calm President Xi down or confront him, but doing each in sequence will not work.
To get a measure of what mainland China feels when British warships sail through the Taiwan Strait, how would Britain react if Chinese warships appeared in the Irish Sea and sailed between Scotland and Northern Ireland? How to avert a global conflict between China, Russia and the West
The game of "managing" competition has human consequences as devastating as the superpower triumphalism of the 1990s, and those can be observed in Afghanistan today. The Afghanistan of the ousted Afghani president Ashraf Ghani truly was a Potemkin village, a facade of independent statehood.
An astonishing 300,000 troops and soldiers on its government's books did not exist. "Ghost soldiers" were added to official lists so that generals would pocket their wages, Afghanistan’s former finance minister Khalid Payenda told the BBC. The black hole of the former corrupt regime's finances was an open secret long before Biden set a date for withdrawal. A report for the US special inspector general for Afghanistan (SIGAR) warned in 2016: "Neither the United States nor its Afghan allies know how many Afghan soldiers and police actually exist, how many are in fact available for duty, or, by extension, the true nature of their operational capabilities."
Now that the tap of US income has been turned off, Afghanistan is on the verge of a nationwide famine. But, incredibly, the US is blaming this situation on the Taliban. It withholds money on the grounds of human rights, the night-time revenge killings on former state employees, or the suppression of education for women.Much of the Afghan central bank's $10bn in assets is parked overseas, including $1.3bn in gold reserves in New York. The US Treasury is using this money as a lever to pressure the Taliban on women's rights and the rule of law. It has granted a licence to the US government and its partners to facilitate humanitarian aid and it gave Western Union permission to resume processing personal remittances from migrants overseas.
But the US does not hold itself to account for having nurtured
a state that cannot function without the money that it is now withholding. The US has direct responsibility for the famine that is now taking place in Afghanistan. To withhold money from the Taliban because they took power militarily, rather than negotiate their re-entry with other Afghan warlords, also wears somewhat thin.
Same story
The Taliban walked into Kabul with barely a shot fired because everything crumbled before them. The speed of the collapse of Afghan forces blindsided everybody - even Pakistan’s Inter-Services Intelligence (ISI), who are accused by India and western governments of running the Haqqani network of the Taliban. The only country that really knew what was happening was Iran, because officers of the Islamic Revolutionary Guard Corps (IRGC) were with the Taliban as they walked in, according to Iranian sources close to the IRGC.
A child cries on a sidewalk in Kabul, on 27 December 2021 (AFP) Even the ISI were blindsided by the speed of this collapse. An informed source told me in Islamabad: "We had expected the NDS [National Directorate of Security] to put up a fight in Mazar-i-Sharif, Herat, Kandahar and Kunduz. That would have produced a stalemate and the possibility for negotiation a more inclusive government."But we are where we are. "There were some improvements in the last 20 years. There was a middle class in Kabul, women's education. But if you want to lose everything, this is the way to do it. The Taliban will go hardline if the place runs out of money. If you want to protect the liberal elements, you have to make Afghanistan stable."
Pivoting eastwards surely did not mean ending one Cold War and starting a new one with China, but that too is inexorably happening.
The Pakistani source listed 10 jihadi groups, as opposed to the one jihadi group, al-Qaeda, that was around in 2001. And the ISI do not know what happened to the arms the Americans left behind.
"We simply don't know in whose hands they have ended up,"
he said. When they pressed the Taliban on forming an inclusive government, the Taliban shot back at them: "Do you have an inclusive government? Do you have a government that includes the PML-N? What do you think it would be like in Pakistan if you had to reconcile groups of fighters who had killed each other’s sons and cousins?"
Starved of funds, there is only one way for the breakaway groups to go - into the hands of the jihadists. He ended his analysis with the following thought: is it really in the US interest to stabilise Afghanistan? If they let the money through, it would mean supporting the very axis of China, Russia and Pakistan that they were now determined to push back. The faltering talks in Vienna, the crisis on Ukraine's border, renewed tension and military posturing in Taiwan, are all part of the same story.
Strategic mistakes
Washington would do well to look at the map of the world and think before it makes its next move. A long period of reflection is needed. Thus far it has obtained the dubious distinction of getting every conflict it has engaged with in this century wrong. The US has entered a new era where it can no longer change regimes by force of arms or sanctions. The chance of a global conflict involving real armies and real arms has never been higher and the tripwire to using weapons of mass destruction has never been strung tighter. Nor have all the world's military powers been better armed, able and willing to start their own inventions. Biden should bear this in mind.
It is now in the US' strategic interest to staunch any more bloodletting in the battlefields it created this century. That means the US should come to a deal with Iran by lifting the sanctions it imposed on Tehran since the 2015 JCPOA. If it wants to balance the growing Chinese and Russian influence in the Middle East, that is the surest way to do it. Iran is not going to give up its missiles any more than Israel is going to ground its air force. But a deal in Vienna could be a precursor to regional Gulf security negotiations. The Emiratis, Qataris, Omanis and Kuwaitis are all ready for it. If Washington wants to apply rules, let it do so first with its allies, who have extraordinary impunity for their brutal actions.
If Washington is the champion of human rights it claims to be, start with Saudi Arabia or Egypt. If it is the enforcer of international law, let's see Washington make Israel pay a price for its continued settlement policy, which makes a mockery of UN Security Council resolutions, and the US' own policy for a resolution to the Palestinian conflict. The Abraham Accords were devised to establish Israel as America's declared and open regional surrogate. Had Donald Trump secured a second term, such a policy would have been a disaster for US strategic interests in the Middle East. Already Israel thinks it has a veto on US decision making in the region. With this policy fully in place, it would have been in charge of it, which would have meant permanent conflict created by a military power that always strikes first.
Israel acts with ruthless logic. It will use any opportunity to expand its borders until a Palestinian state becomes an impossibility. It probably has already succeeded in that aim. However, this is not US policy. But this expansion continues, almost week in, week out, because no one in Washington will lift a finger to stop it. Doing nothing about armed lynch mobs of settlers attacking unarmed Palestinian villagers in the West Bank is the same as agreeing to them.
If you want to be a champion of rules, apply those rules to yourself first. This is the only way
to regain lost global authority. The US has entered a new era where it can no longer change regimes by force of arms or sanctions. It has discovered the uselessness of force. It should drop the stick and start handing out bucket loads of carrots. It should get on with the urgent task of deconfliction.
After the damage done this century by conflicts ordered, created and backed by US presidents - Afghanistan, Iraq, Syria, Yemen, Libya - that is not only a responsibility but a duty. Another US strategic mistake would be its, and Western Europe's, last.
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CIVIL WAR IS IMMINENT, BE PREPARED FOR DISASTER IN 2021
Robert Kiyosaki
THE CURRENCY RESET HAS BEGUN
Lynette Zang
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2022: THE YEAR THE US ACHIEVES COLLAPSE
Dmitry Orlov
December 30, 2021: Information Clearing House
I have been studying the forthcoming collapse of the USA for 25 years and publishing books and articles on this subject for the last 15, with good results: CCCP 2.0 is developing quite nicely. The 30-year reprieve which the US was granted thanks to the collapse of the USSR has now expired, every effort at imperial expansion since then (Afghanistan, Iraq, Syria, Libya and the “suicide belt” of Eastern Europe) has been a total failure. Meanwhile a reborn Russia, backed by much of the rest of Eurasia, is now turning the tables and ordering the US around in perfectly undiplomatic terms. And now this: Barbara Water of US San Diego recently appeared on CNN to explain that the US is now in a zone of high risk for political violence and civil war.
And what this means is that the US has finally achieved Total Collapse Preparedness. Let us look into the details of this.
Washington’s Crime and Punishment
Just yesterday Russia Foreign Ministry published a couple of documents which people have been struggling to interpret ever since, to little useful effect. I would like to offer my own explanation of what these documents mean, which will probably differ a great deal from most other explanations you are likely to hear. Time will tell how close they are to the truth; for now, I am happy to simply add to the spectrum of ideas that are available to it.
The two documents describe in detail what Washington must do to avoid the consequences of breaking its verbal agreement entered into with Mikhail Gorbachev to not expand NATO eastward toward Russia’s borders—essentially, to freeze NATO forces where they were in 1997, before NATO expanded farther east. The documents also address other aspects of deescalation, such as removing all US nuclear weapons from foreign territory and confining US forces to waters and airspace from which they cannot threaten the territory of Russia.
One line of explanation, most recently expressed in Washington and elsewhere, is that these documents are a negotiating gambit (not an ultimatum), to be discussed privately (to avoid complete loss of face by the US) and in consultation with NATO members and partners, plus, maybe, the European Union, the Council of Europe, the OSCE, Amnesty International and Greenpeace (to avoid making their combined irrelevance apparent to all). I agree that there is little to be gained from public discussions; after all Moscow has already achieved the required bombshell effect through the public release of these documents and in forcing Washington to acknowledge their receipt and to consent to “negotiations”.
I disagree that there is anything to be negotiated: these documents are not intended to be used as a starting point for negotiations; they are an invitation for Washington to acknowledge and remedy its transgressions. Washington broke the deal it made with Moscow not to expand east. It could do so because in the years following the breakup of the USSR Moscow was too weak to resist and run by people who thought it possible for Russia to integrate into the West, perhaps even to join NATO. But that era has ended some time ago and the collective West now has to put its collective toes back behind the red line—whether voluntarily or not—and that is the only thing yet to be determined. That is the only choice to be made: stand down voluntarily and make amends or refuse and be punished.
I also disagree that this choice—between making amends and accepting punishment—has anything to do with the EU, or NATO, or various “members” or “partners”. Moscow has no relationship with NATO, seeing it as a mere piece of paper that grants Washington rather questionable legal authority to deploy its military forces in countries around the world. Moscow has some vestigial diplomatic representation with the EU, but doesn’t see it as important and concentrates on bilateral relations with EU members. As for its Eastern European neighbors, the Ukraine is, viewed from Moscow, a US colony and thus entirely a
US concern, Poland can go and partition itself again (or not), and, as far as those tiny yet politically annoying statelets of Estonia, Latvia and Lithuania, so sorry, but the Russian army
is equipped with binoculars, not microscopes.
The choice, really, is between facing an increasing risk of a nuclear exchange between two nuclear superpowers—one that is rapidly fading in strength and one that is growing stronger all the time—and reducing that risk as much as possible. Only the two nuclear superpowers need to come to an understanding;everyone else can simply do as they say so that nobody gets hurt. In the case of the Europeans, they should be quite interested in doing so (if they still know what’s good for them) because NATO’s eastward expansion has left them with huge nuclear target signs painted all over them which they would do well to try to remove. Not only that, but NATO’s encroachment on Russia’s borders has increased the risk of a nuclear confrontation breaking out accidentally: all those nuclear-armed bombers, ships and submarines could make a wrong turn somewhere and then—kaboom!—no more Europe.
You might thing that those bombers and ships and submarines must loiter around Russia’s borders in order to “contain” Russia, but this is false. Russia does an acceptably good job of containing itself, and the little territorial disputes that are likely to crop up here and there periodically are certainly not going to be solved by increasing the risk of nuclear war. The Russian Federation has land borders with over a dozen countries, most of which have Russian citizens living on both sides of them, and that makes land disputes inevitable, but none of them will ever be worth blowing up the planet over.
You might think that NATO forces need to show activity and act dangerous in order to justify their existence and their ridiculously bloated defense budgets. Also, if they didn’t get a chance to be threatening toward Russia, they might become despondent and just sit around drinking, doing drugs and having gay sex, and that would be bad for morale. (But then what’s wrong with a little gay sex between consenting off-duty gender-ambiguous servicepersons?) I’d think that these are all rather minor, if not trifling, concerns, considering that what’s on the other side of the scale is the risk of a planetary conflagration.
You might also think that Washington’s eastward expansion is not a crime because, you see, Gorbachev failed to get its promise not to expand east committed to in writing. Well, let me offer you a tiny insight into the inner workings of Russian civilization. If you enter into a verbal agreement with the Russians, break it, and then taunt them by saying “But you didn’t get it in writing!” you have just made the problem much worse for yourself. We all make mistakes and must sometimes break our promises, in which the proper course of action is to be contrite, apologize sincerely and offer to make amends. If, instead, you claim that the promise is null and void because a certain piece of paper cannot be located, then you have compounded you dishonorable conduct with willful disregard and have singled yourself out for exemplary punishment. This punishment may be slow to arrive, taking decades, perhaps even centuries, but you can be sure that you will be punished eventually.
Once upon a time Moscow was weak and Washington strong, but now the balance has shifted in Moscow’s favor and the time for Washington’s punishment has finally come. The only remaining question is, What form will this punishment take? The one proposed by Moscow is in the form of submission to public humiliation: Washington signs the security guarantees drafted in Moscow, drags itself back to its kennel and lies quietly like a good doggo licking its balls to console itself. And that’s the more pleasant alternative, a win-win sort of thing, offered in good faith.
The less pleasant alternative would be, I can’t help but imagine, much less pleasant, very confusing and quite dangerous. Think about Poseidons—undetectable nuclear-powered torpedos—endlessly cruising in thousands of feet of water of water off the continental shelf along the US coasts, ready to wash them off with entirely accidental tsunamis, their sporadic pings causing the Joint Chiefs of Staff to soil their diapers every time. Think about NATO planes, ships and submarines quietly going missing for no adequately explored reason, their crews later turning up on some faraway beach very drunk and wearing Speedos in the colors of the Russian flag. Think of hypersonic something-or-others periodically doing zigzags in low Earth orbit over the US mainland, causing every cable TV channel to broadcast Russia Today, in turn causing CNN’s talking heads to explode in impotent fury.
I would think that, in their own enlightened best interest, right-thinking Americans, regardless of party affiliation or lack thereof, would want to clamor for their elected representatives to quit making any more trouble and to just sign the damned security guarantees! But that’s just my own, private opinion.2.
WILL THE FEDERAL RESERVE CRASH GLOBAL FINANCIAL MARKETS AS A MEANS TO IMPLEMENTING THEIR “GREAT RESET”?
https://www.globalresearch.ca/will-the-f...et/5764816
It’s looking increasingly likely that the US Federal Reserve and the globalist powers that be will use the dramatic rising of inflation as their excuse to bring down the US financial markets and with it, crash the greatest financial bubble in history.
The enormous inflation rise since the malicious political lockdowns and the trillions of dollars in emergency spending by both Trump and Biden, coupled with the continuation of the Fed’s unprecedented near-zero interest rate policies and asset purchases of billions in bonds to keep the bubble inflated a bit longer– have set the stage for an imminent market collapse. Unlike what we are told, it is deliberate and managed.
Supply chain disruptions from Asia to normal truck transport across North America are feeding the worst inflation in four decades in the USA. The stage is set for the central banks to bring down the debt-bloated system and prepare their Great Reset of the world financial system. However this is not an issue of inflation as some mysterious or “temporary” process.
The context is key. The decision to crash the financial system is being prepared amid the far-reaching global pandemic measures that have devastated the world economy since early 2020. It is coming as the NATO powers, led by the Biden Administration, are tipping the world into a potential World War by miscalculation. They are pouring arms and advisers into Ukraine provoking a response by Russia.
They are escalating pressures on China over Taiwan, and waging proxy wars against China in Ethiopia and Horn of Africa and countless other locations.
The looming collapse of the dollar system, which will bring down most of the world with it owing to debt ties, will come as the major industrial nations go fully into economic self-destruction via their so-called Green New Deal in the EU, and USA and beyond.
The ludicrous Zero Carbon policies to phase out coal, oil, gas and even nuclear have already brought the EU electric grid to the brink of major power blackouts this winter as dependency on unreliable wind and solar make up a major part of the grid. On December 31, the “green” new German government oversees the forced closing of three nuclear power plants that generate the electricity equivalent of the entire country of Denmark. Wind and solar can in no way fill the gaps. In the USA Biden’s misnamed Build Back Better policies have driven fuel coats to record highs. To raise interest rates in this conjuncture will devastate the entire world, which seems to be precisely the plan.
The Fake US Inflation Data
Ever since the early 1970s when President Nixon asked his pal, Arthur Burns, then head of the Federal Reserve, to find a way to get rid of politically damaging consumer inflation monthly data that reflected soaring oil prices along with grain, the Fed has used what they called “core inflation” which means consumer price rises MINUS energy and food. At the time energy made up a significant 11% of inflation data. Food had a weight of 25%. Presto by 1975 a 400% OPEC rise in oil prices and a 300% global grain price rise owing to harvest failures in the Soviet region, “core inflation” fell significantly. This, despite the fact that American consumers had to pay far more for gasoline and bread. Very few real people can live without energy or food. Core inflation is a scam.
By 1975 the Burns Fed had eliminated major costs of housing and other factors leaving a Consumer Price Index that was a mere 35% of the original basket of commodities measured. By then real everyday inflation was out of control. In the real world, USA gasoline today is 58 percent more expensive than in 2020 and over the last 12 months, food prices have gone up by more than 6 percent on average. Today the US Consumer Price Index does not include the cost buying and financing houses, and also not of property taxes or home maintenance and improvement. These factors have been soaring across America in the past year. Now all that is lacking is a statement by the Fed that inflation is more alarming than they thought and required aggressive rate hikes to “squeeze inflation out of the system,” a common central bank myth made dogma under Paul Volcker in the 1970s.
The Bloated US Stock Market
Wall Street markets, today with stocks at historic bloated highs, aided by near zero Fed rates and $120 billion of monthly purchases by the Fed of bonds as well, are at a point where a policy reverse by the Fed, expected now in early 2022, could begin a panic exit from stocks to “get out while the getting is good.” That in turn will likely trigger panic selling and a snowballing market collapse that will make the recent China Evergrande real estate and stock collapse look like nothing at all.
Since the global financial crisis of September 2008, the Federal Reserve and other major central banks such as the ECB in the EU and Bank of Japan have pursued unprecedented zero interest rates and often “quantitative easing” purchases of bonds to bail out the major financial institutions and Wall Street and EU banks. It had little to do with the health of the real economy. It was about the largest bailout in history of brain dead banks and financial funds. The predictable result of the Fed and other central banks’ unprecedented policies has been the artificial inflation of the greatest speculative bubble in stocks in history.
As President, Donald Trump constantly pointed to new record rises in the S&P 500 stocks as proof of the booming economy, even though as a savvy businessman he knew it was a lie. It was rising because of the Fed zero interest rate policy. Companies were borrowing at low rates not to expand plant and equipment investment so much as to buy back their own stocks from the market. That had the effect of boosting stocks in companies from Microsoft to Dell to Amazon, Pfizer, Tesla and hundreds of others. It was a manipulation that corporate executives, owning millions of their own company shares as options, loved. They made billions in some cases, while creating no real value in the economy or the economy.
How big is today’s US stock market bubble? In October 2008 just after the Lehman crisis, US stocks were listed at a total of $13 trillion capitalization. Today it is over $50 trillion, an increase of almost 400% and more than double the total US GDP. Apple Corp. alone is $3 trillion.
Yet with massive labor shortages, lockdowns across America and huge disruptions to trade supply chains especially from China, the economy is sinking and Biden’s phony “infrastructure” bill will do little to rebuild the vital economic infrastructure of highways, rains, water treatment plants and electric grids. For millions of Americans after the 2008 housing collapse, buying stocks has been their best hope for retirement income. A stock crash in 2022 is being prepared by the Fed, only this time it will be used to usher in a real Great Depression worse than the 1930’s as tens of millions or ordinary Americans see their life savings wiped out.
Stock Buyback Game
Over the past four quarters, S&P 500 companies bought back $742 billion of their own shares. Q4 of 2021 will likely see a record increase in that number as companies rush to pump their shares ahead of a reported Biden tax on corporate stock buybacks. Since the beginning of 2012, the S&P 500 companies have bought back nearly $5.68 trillion of their own shares. This is no small beer. The dynamic is so insane that amid a Microsoft decision last month to buy back ever more shares, Microsoft CEO Satya Nadella dumped over 50% of his Microsoft stock in one day. But the stock barely budged because Microsoft itself was busy buying back shares. That indicates the level of unreality in today’s US market. The insiders know it’s about to crash. Tesla’s Elon Musk just sold $10 billion of his stock, allegedly to pay taxes.
Making the stock market even more vulnerable to a panic selloff once it is clear the Fed will raise interest rates, there is nearly $1 trillion in margin debt as of data from October, debt for those buying stocks on borrowed money from their brokers. Once a major market selloff begins, likely early in 2022, brokers will demand repayment of their margin debt, so-called margin calls. That in turn will accelerate the forced selling to raise the cash calls.
Taper?
There is much discussion about when the Fed will reduce its buying of US Treasury securities as well as government-linked home mortgage bonds. That buying has been huge. Since the start of the covid pandemic hysteria in February 2020, total Federal Reserve holdings of such securities have more than doubled from $3.8 trillion to $8 trillion as of end of October 2021. That has kept home mortgage rates artificially low and fueled panic home buying as citizens realize the low rates are about to end. That the Fed calls “taper”, reducing the monthly buying of bonds to zero at the same time it raises key interest rates, a double whammy. This is huge, and blood will flow from Wall Street beginning 2022 when the Fed taper picks up momentum early in 2022 combined with raising rates.
Already in November the Fed began reducing its monthly market supporting buying. “In light of the substantial further progress the economy has made toward the Committee’s goals of maximum employment and price stability,” the FOMC declared in its recent minutes. It announced that it is decreasing the amount of Treasury and Mortgage backed securities purchases in November and December.
Since the Vietnam War era under President Lyndon Johnson, the US Government has manipulated employment data as well as inflation numbers to give a far better picture than exists. Private economist John Williams of Shadow Government Statistics, estimates that actual USA unemployment far from the reported 4.2% for November, is actually over 24.8%. As Williams further notes, “The Inflation Surge Reflects Extreme Money Supply Creation, Extreme Federal Deficit Spending and Federal Debt Expansion, Pandemic Disruptions and Supply Shortages; It Does Not Reflect an Overheating Economy.” Federal Budget Deficits are running a record $3 trillion a year with no end in sight.
Raising rates at this precarious juncture will bring down the fragile US and global financial system, paving the way for a crisis where citizens might beg for emergency relief in the form of digital money and a Great Reset. It is worth noting that every major US stock market crash since October 1929 including 2007-8, has been a result of deliberate Fed actions, disguised under the claims of “containing inflation.”
This time the damage could be epochal. In September the Washington-based Institute of International Finance estimated that global debt levels, which include government, household and corporate and bank debt, rose $4.8 trillion to $296 trillion at the end of June, $36 trillion above pre-pandemic levels. Fully $92 trillion of that is owed by emerging markets such as Turkey, China, India and Pakistan.
Rising interest rates will trigger default crises across the globe as borrowers are unable to repay. This has been deliberately created by central banks, led by the Fed, since their 2008 crisis by pushing interest rates to zero or even negative.
F. William Engdahl is strategic risk consultant and lecturer, he holds a degree in politics from Princeton University and is a best-selling author on oil and geopolitics.
A SELF FULFILLING PROPHECY
SYSTEMIC COLLAPSE AND PANDEMIC SIMULATION
https://thephilosophicalsalon.com/a-self...simulation
Fabio Vighi
Ayear and a half after the arrival of Virus, some may have started wondering why the usually unscrupulous ruling elites decided to freeze the global profit-making machine in the face of a pathogen that targets almost exclusively the unproductive (over 80s). Why all the humanitarian zeal? [i]Cui bono[/i]? Only those who are unfamiliar with the wondrous adventures of GloboCap can delude themselves into thinking that the system chose to shut down out of [i]compassion[/i]. Let us be clear from the start: the big predators of oil, arms, and vaccines could not care less about humanity.
Follow the money
In pre-Covid times, the world economy was on the verge of another colossal meltdown. Here is a brief chronicle of how the pressure was building up:
June 2019: In its Annual Economic Report, the Swiss-based Bank of International Settlements (BIS), the ‘Central Bank of all central banks’, sets the international alarm bells ringing. The document highlights “overheating […] in the leveraged loan market”, where “credit standards have been deteriorating” and “collateralized loan obligations (CLOs) have surged – reminiscent of the steep rise in collateralized debt obligations [CDOs] that amplified the subprime crisis [in 2008].” Simply stated, the belly of the financial industry is once again full of junk.
9 August 2019: The BIS issues a working paper calling for “unconventional monetary policy measures” to “[i]insulate the real economy[/i] from further deterioration in financial conditions”. The paper indicates that, by offering “direct credit to the economy” during a crisis, central bank lending “can replace commercial banks in providing loans to firms.”
15 August 2019: Blackrock Inc., the world’s most powerful investment fund (managing around $7 trillion in stock and bond funds), issues a white paper titled [i]Dealing with the next downturn[/i]. Essentially, the paper instructs the US Federal Reserve to inject liquidity [i]directly[/i] into the financial system to prevent “a dramatic downturn.” Again, the message is unequivocal: “An unprecedented response is needed when monetary policy is exhausted and fiscal policy alone is not enough. That response will likely involve ‘going direct’”: “finding ways to get central bank money directly in the hands of public and private sector spenders” while avoiding “hyperinflation. Examples include the Weimar Republic in the 1920s as well as Argentina and Zimbabwe more recently.”
22-24 August 2019: G7 central bankers meet in Jackson Hole, Wyoming, to discuss BlackRock’s paper along with urgent measures to prevent the looming meltdown. In the prescient words of James Bullard, President of the St Louis Federal Reserve: “We just have to stop thinking that next year things are going to be normal.”
15-16 September 2019: The downturn is officially inaugurated by a sudden spike in the repo rates (from 2% to 10.5%). ‘Repo’ is shorthand for ‘repurchase agreement’, a contract where investment funds lend money against collateral assets (normally Treasury securities). At the time of the exchange, financial operators (banks) undertake to buy back the assets at a higher price, typically overnight. In brief, repos are short-term collateralized loans. They are the main source of funding for traders in most markets, especially the derivatives galaxy. A lack of liquidity in the repo market can have a devastating domino effect on all major financial sectors.
17 September 2019: The Fed begins the emergency monetary programme, pumping hundreds of billions of dollars per week into Wall Street, effectively executing BlackRock’s “going direct” plan. (Unsurprisingly, in March 2020 the Fed will hire BlackRock to manage the bailout package in response to the ‘COVID-19 crisis’).
19 September 2019: Donald Trump signs Executive Order 13887, establishing a [i]National Influenza Vaccine Task Force[/i] whose aim is to develop a “5-year national plan (Plan) to promote the use of more agile and scalable vaccine manufacturing technologies and to accelerate development of vaccines that protect against many or all influenza viruses.” This is to counteract “an influenza pandemic”, which, “unlike seasonal influenza […] has the potential to spread rapidly around the globe, infect higher numbers of people, and cause high rates of illness and death in populations that lack prior immunity”. As someone guessed, the pandemic was imminent, while in Europe too preparations were underway (see here and here).
18 October 2019: In New York, a global zoonotic pandemic is simulated during [i]Event 201[/i], a strategic exercise coordinated by the Johns Hopkins Biosecurity Center and the Bill and Melinda Gates Foundation.
21-24 January 2020: The World Economic Forum’s annual meeting takes place in Davos, Switzerland, where both the economy and vaccinations are discussed.
23 January 2020: China puts Wuhan and other cities of the Hubei province in lockdown.
11 March 2020: The WHO’s director general calls Covid-19 a pandemic. The rest is history.
Joining the dots is a simple enough exercise. If we do so, we might see a well-defined narrative outline emerge, whose succinct summary reads as follows: lockdowns and the global suspension of economic transactions were intended to 1) Allow the Fed to flood the ailing financial markets with freshly printed money while deferring hyperinflation; and 2) Introduce mass vaccination programmes and health passports as pillars of a neo-feudal regime of capitalist accumulation. As we shall see, the two aims merge into one.
In 2019, world economy was plagued by the same sickness that had caused the 2008 credit crunch. It was suffocating under an unsustainable mountain of debt. Many public companies could not generate enough profit to cover interest payments on their own debts and were staying afloat only by taking on new loans. ‘Zombie companies’ (with year-on-year low profitability, falling turnover, squeezed margins, limited cashflow, and highly leveraged balance sheet) were rising everywhere. The repo market meltdown of September 2019 must be placed within this fragile economic context.
When the air is saturated with flammable materials, any spark can cause the explosion. And in the magical world of finance, [i]tout se tient[/i]: one flap of a butterfly’s wings in a certain sector can send the whole house of cards tumbling down. In financial markets powered by cheap loans, any increase in interest rates is potentially cataclysmic for banks, hedge funds, pension funds and the entire government bond market, because the cost of borrowing increases and liquidity dries up. This is what happened with the ‘repocalypse’ of September 2019: interest rates spiked to 10.5% in a matter of hours, panic broke out affecting futures, options, currencies, and other markets where traders bet by borrowing from repos. The only way to defuse the contagion was by throwing as much liquidity as necessary into the system – like helicopters dropping thousands of gallons of water on a wildfire. Between September 2019 and March 2020, the Fed injected more than $9 trillion into the banking system, equivalent to more than 40% of US GDP.
The mainstream narrative should therefore be reversed: the stock market did not collapse (in March 2020) because lockdowns had to be imposed; rather, lockdowns had to be imposed because financial markets were collapsing. With lockdowns came the suspension of business transactions, which drained the demand for credit and stopped the contagion. In other words, restructuring the financial architecture through extraordinary monetary policy [i]was contingent on the economy’s engine being turned off[/i]. Had the enormous mass of liquidity pumped into the financial sector reached transactions on the ground, a monetary tsunami with catastrophic consequences would have been unleashed.
As claimed by economist Ellen Brown, it was “another bailout”, but this time “under cover of a virus.” Similarly, John Titus and Catherine Austin Fitts noted that the Covid-19 “magic wand” allowed the Fed to execute BlackRock’s “going direct” plan, literally: it carried out an unprecedented purchase of government bonds, while, on an infinitesimally smaller scale, also issuing government backed ‘COVID loans’ to businesses. In brief, only an [i]induced economic coma[/i] would provide the Fed with the room to defuse the time-bomb ticking away in the financial sector. Screened by mass-hysteria, the US central bank plugged the holes in the interbank lending market, dodging hyperinflation as well as the ‘Financial Stability Oversight Council’ (the federal agency for monitoring financial risk created after the 2008 collapse), as discussed here. However, the “going direct” blueprint should also be framed as a [i]desperate[/i] measure, for it can only prolong the agony of a global economy increasingly hostage to money printing and the artificial inflation of financial assets.
At the heart of our predicament lies an insurmountable structural impasse. Debt-leveraged financialization is contemporary capitalism’s [i]only[/i] line of flight, the inevitable forward-escape route for a reproductive model that has reached its historical limit. Capitals head for financial markets because the labour-based economy is increasingly unprofitable. How did we get to this?
The answer can be summarised as follows: 1. The economy’s mission to generate surplus-value is both the drive to [i]exploit[/i] the workforce and to [i]expel[/i] it from production. This is what Marx called capitalism’s “moving contradiction”.[1] While it constitutes the essence of our mode of production, this contradiction today backfires, turning political economy into a mode of permanent devastation. 2. The reason for this change of fortune is the[i] objective[/i] failure of the labour-capital dialectic: the unprecedented acceleration in technological automation since the 1980s causes more labour-power to be ejected from production than (re)absorbed. The contraction of the volume of wages means that the purchasing power of a growing part of the world population is falling, with debt and immiseration as inevitable consequences. 3. As less surplus-value is produced, capital seeks immediate returns in the debt-leveraged financial sector rather than in the real economy or by investing in socially constructive sectors like education, research, and public services.
The bottom line is that the paradigm shift underway is the necessary condition for the (dystopian) survival of capitalism, which is no longer able to reproduce itself through mass wage-labour and the attendant consumerist utopia. The pandemic agenda was dictated, ultimately, by systemic implosion: the profitability downturn of a mode of production which rampant automation is making obsolete. For this [i]immanent[/i] reason, capitalism is increasingly dependent on public debt, low wages, centralisation of wealth and power, a permanent state of emergency, and financial acrobatics.
If we ‘follow the money’, we will see that the economic blockade deviously attributed to Virus has achieved far from negligible results, not only in terms of social engineering, but also of financial predation. I will quickly highlight four of them.
1) As anticipated, it has allowed the Fed to reorganise the financial sector by printing a continuous stream of billions of dollars out of thin air; 2) It has accelerated the extinction of small and medium-sized companies, allowing major groups to monopolise trade flows; 3) It has further depressed labour wages and facilitated significant capital savings through ‘smart working’ (which is particularly smart for those who implement it); 4) It has enabled the growth of e-commerce, the explosion of Big Tech, and the proliferation of the pharma-dollar – which also includes the much disparaged plastic industry, now producing millions of new facemasks and gloves every week, many of which end up in the oceans (to the delight of the ‘green new dealers’). In 2020 alone, the wealth of the planet’s 2,200 or so billionaires grew by $1.9 trillion, an increase without historical precedent. All this thanks to a pathogen so lethal that, according to official data, only 99.8% of the infected survive (see here and here), most of them without experiencing any symptoms.
[b][b]Doing capitalism differently[/b][/b]
The economic motif of the Covid whodunit must be placed within a broader context of social transformation. If we scratch the surface of the official narrative, a neo-feudal scenario begins to take form. Masses of increasingly unproductive consumers are being regimented and cast aside, simply because Mr Global no longer knows what to do with them. Together with the underemployed and the excluded, the impoverished middle-classes are now a problem to be handled with the stick of lockdowns, curfews, mass vaccination, propaganda, and the militarisation of society, rather than with the carrot of work, consumption, participatory democracy, social rights (replaced in collective imagination by the civil rights of minorities), and ‘well-earned holidays.’
It is therefore delusional to believe that the purpose of lockdowns is therapeutic and humanitarian. When has capital ever cared for the people? Indifference and misanthropy are the typical traits of capitalism, whose only real passion is profit, and the power that comes with it. Today, capitalist power can be summed up with the names of the three biggest investment funds in the world: BlackRock, Vanguard and State Street Global Advisor. These giants, sitting at the centre of a huge galaxy of financial entities, manage a mass of value close to half the global GDP, and are major shareholders in around 90% of listed companies. Around them gravitate transnational institutions like the International Monetary Fund, the World Bank, the World Economic Forum, the Trilateral Commission, and the Bank for International Settlements, whose function is to coordinate consensus within the financial constellation. We can safely assume that all key strategic decisions – economic, political and military – are at least heavily influenced by these elites. Or do we want to believe that Virus has taken them by surprise? Rather, SARS-CoV-2 – which, by admission of the CDC and the European Commission has never been isolated nor purified – is the name of a special weapon of psychological warfare that was deployed in the moment of greatest need.
Why should we trust a mega pharmaceutical cartel (the WHO) that is [i]not[/i] in charge of ‘public health’, but rather of marketing private products worldwide at the most profitable rates possible? Public health problems stem from abysmal working conditions, poor nutrition, air, water, and food pollution, and above all from [i]rampant poverty[/i]; yet none of these ‘pathogens’ are on the WHO’s list of humanitarian concerns. The immense conflicts of interest between the predators of the pharmaceutical industry, national and supranational medical agencies, and the cynical political enforcers, is now an open secret. No wonder that on the day COVID-19 was classified as a pandemic, the WEF, together with the WHO, launched the Covid Action Platform, a “protection of life” coalition run by over 1,000 of the world’s most powerful private companies.
The only thing that matters for the clique directing the health emergency orchestra is to feed the profit-making machine, and every move is planned to this end, with the support of a political and media front motivated by opportunism. If the military industry needs wars, the pharmaceutical industry needs diseases. It is no coincidence that ‘public health’ is by far the most profitable sector of the world economy, to the extent that Big Pharma spends about three times as much as Big Oil and twice as much as Big Tech on lobbying. The potentially endless demand for vaccines and experimental gene concoctions offers pharmaceutical cartels the prospect of almost unlimited profit streams, especially when guaranteed by mass vaccination programmes subsidised by public money (i.e., by more debt that will fall on our heads).
Why have all Covid treatments been criminally banned or sabotaged? As the FDA candidly admits, the use of emergency vaccines is only possible if “there are no suitable, approved and available alternatives”. A case of truth hidden in plain sight. Moreover, the current vaccine religion is closely linked to the rise of the pharma-dollar, which, by feeding on pandemics, is set to emulate the glories of the ‘petro-dollar’, allowing the United States to continue to exercise global monetary supremacy. Why should the whole of humanity (including children!) inject experimental ‘vaccines’ with increasingly worrying yet systematically downplayed adverse effects, when more than 99% of those infected, the vast majority asymptomatic, recover? The answer is obvious: because vaccines are the golden calf of the third millennium, while humanity is ‘last generation’ exploitation material in guinea pig modality.
Given this context, the staging of the emergency pantomime succeeds through an unheard-of manipulation of public opinion. Every ‘public debate’ on the pandemic is shamelessly [i]privatised[/i], or rather monopolised by the religious belief in technical-scientific committees bankrolled by the financial elites. Every ‘free discussion’ is legitimised by adherence to pseudo-scientific protocols carefully purged from the socio-economic context: one ‘follows the science’ while pretending not to know that ‘science follows the money’. Karl Popper’s famous statement that “real science” is only possible under the aegis of liberal capitalism in what he called “the open society”,[1] is now coming true in the globalist ideology that animates, among others, George Soros’s Open Society Foundation. The combination of “real science” and “open and inclusive society” makes the Covid doctrine almost impossible to challenge.
For COVID-19, then, we could imagine the following agenda. A fictitious narrative is prepared based on an epidemic risk presented in such a way as to promote fear and submissive behaviour. Most likely a case of diagnostic reclassification. All that is needed is an epidemiologically ambiguous influenza virus, on which to build an aggressive tale of contagion relatable to geographical areas where the impact of respiratory or vascular diseases in the elderly and immunocompromised population is high – perhaps with the aggravating factor of heavy pollution. There is no need to make much up, given that intensive care units in ‘advanced’ countries had already collapsed in the years preceding the arrival of Covid, with mortality peaks for which no one had dreamed of exhuming quarantine. In other words, public health systems had already been demolished, and thus prepared for the pandemic scenario.
But this time there is method in madness: a state of emergency is declared, which triggers panic, in turn causing the clogging up of hospitals and care homes (at high risk of sepsis), the application of nefarious protocols, and the suspension of medical care. [i]Et voilà[/i], the killer Virus becomes a self-fulfilling prophecy! The propaganda raging across the main centres of financial power (especially North America and Europe) is essential to maintaining the ‘state of exception’ (Carl Schmitt), which is immediately accepted as the only possible form of political and existential rationality. Entire populations exposed to heavy media bombardment surrender through self-discipline, adhering with grotesque enthusiasm to forms of ‘civic responsibility’ in which coercion morphs into altruism.
The whole pandemic script – from the ‘contagion curve’ to the ‘Covid deaths’ – rests on the PCR test, which was authorised for the detection of SARS-CoV-2 by a study produced in record time on commission from the WHO. As many will know by now, the diagnostic unreliability of the PCR test was denounced by its inventor himself, Nobel laureate Kary Mullis (unfortunately passed away on 7 August 2019), and recently reiterated by, among others, 22 internationally renowned experts who demanded its removal for clear scientific flaws. Obviously, the request fell on deaf ears.
The PCR test is the driving force behind the pandemic. It works through the infamous ‘cycle thresholds’: the more cycles you make, the more false positives (infections, Covid-deaths) you produce, as even guru Anthony Fauci recklessly admitted when he stated that swabs are worthless above 35 cycles. Now, why is it that during the pandemic, amplifications of 35 cycles or more were routinely carried out in laboratories all over the world? Even the [i]New York Times[/i] – certainly not a den of dangerous Covid-deniers – raised this key question last summer. Thanks to the sensitivity of the swab, the pandemic can be turned on and off like a tap, allowing the health regime to exert full control over the ‘numerological monster’ of Covid cases and deaths – the key instruments of everyday terror.
All this fearmongering continues today, despite the easing of some measures. To understand why, we should return to the economic motif. As noted, several trillions of newly printed cash have been created with a few clicks of a mouse by central banks and injected into financial systems, where they have in great part remained. The aim of the printing-spree was to plug calamitous liquidity gaps. Most of this ‘magic-tree money’ is still frozen inside the shadow banking system, the stock exchanges, and various virtual currency schemes that are [i]not[/i] meant to be used for spending and investment. Their function is solely to provide cheap loans for financial speculation. This is what Marx called ‘fictitious capital’, which continues to expand in an orbital loop that is now completely independent of economic cycles on the ground.
The bottom line is that all this cash cannot be allowed to flood the real economy, for the latter would overheat and trigger hyperinflation. And this is where Virus continues to come in handy. If it initially served to “insulate the real economy” (to quote again from the BIS paper), it now oversees its [i]tentative[/i] reopening, characterized by submission to the vaccination dogma and chromatic methods of mass regimentation, which may soon include climate lockdowns. Remember how we were told that only vaccines would give us back our ‘freedom’? All too predictably, we now discover that the road to freedom is littered with ‘variants’, that is to say, iterations of Virus. Their purpose is to increase the ‘case count’ and therefore prolong those states of emergency that justify central banks’ production of virtual money aimed at monetizing debt and financing deficits. Rather than returning to normal interest rates, the elites opt to normalize the health emergency by feeding the contagion ghost. The much-publicised ‘tapering’ (reduction of monetary stimulus) can therefore wait – just like Pandexit.
In the EU, for instance, the European Central Bank’s €1.85 trillion ‘pandemic emergency purchase program’, known as PEPP, is currently set to continue until March 2022. However, it has been intimated it might need to be extended beyond that date. In the meantime, the Delta variant is wreaking havoc on the travel and tourism industry, with new restrictions (including quarantine) disrupting the summer season. Again, we seem to be caught within a self-fulfilling prophecy (especially if, as Nobel laureate Luc Montagnier and many others have intimated, variants, however mild, are the consequence of aggressive mass vaccination campaigns). Whatever the case, the fundamental point is that Virus is still needed by senile capitalism, whose only chance of survival depends on generating a paradigm shift from liberalism to oligarchic authoritarianism.
While their crime is far from perfect, the orchestrators of this global [i]coup[/i] must nevertheless be credited with a certain sadistic brilliance. Their sleight of hand succeeded, perhaps even beyond expectations. However, any power aiming at totalisation is destined to fail, and this applies also to the high priests of the Covid religion and the institutional puppets they have mobilised to roll out the health emergency psyop. After all, power tends to delude itself about its omnipotence. Those sitting in the control room fail to realise the extent to
which their dominance is uncertain. What they do not see is that their authority depends on a ‘higher mission’, to which they remain partly blind, namely the anonymous self-reproduction of the capitalist matrix. Today’s power lies with the profit-making machine whose only purpose is to continue its reckless journey, potentially leading to the premature extinction of Homo sapiens. The elites who have conned the world into Covid-obedience are the anthropomorphic manifestation of the capitalist automaton, whose invisibility is as cunning as that of Virus itself. And the novelty of our era is that the ‘locked-down society’ is the model that best guarantees the reproducibility of the capitalist machine, irrespective of its dystopian destination.
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THE METAVERSE IS THE NEW SOLAR SYSTEM
In an interview that was recorded for the "What is Money?" show and podcast with Robert Breedlove, Raoul Pal ties together the golden thread for why our economic world and political world are where they are today, and then looks at how this ties into the Exponential Age. Raoul looks back at history: from the fall and decline of the British empire, to the Industrial Age, to World War I and World War II, up to the modern era. He then shifts to the new world and the Fourth Turning, “when society passes through a great and perilous gate in history”, and explains that the American Dream as we know it is dead, and a new world is emerging made up of robots, AI, and where there is no cost in producing energy. Yet in this new world, Raoul imagines a world of hope and optimism, where new identities and communities are formed: the metaverse. “The Metaverse is discovering the Americas again or even a new Solar System. If you think of the world constrained by its GDP, because of humans, productivity, and resources, the metaverse is none of that. There is a possibility that the metaverse allows us, people, incomes in a world free of the constraints, free of the debt shackle. This new world of crypto allows us to create our own world in the way that we want it,” says Raoul. In this special 2 ½ hour interview, you get it all on video! You can find Robert’s "What is Money?" show on YouTube or at www.whatismoneypodcast.com Check it out!
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FINANCIAL CRISIS IS ALREADY HERE
DON’T LET THE MARKET EXUBERANCE FOOL YOU
Warns Lynette Zang
PREPARE FOR FINANCIAL DISASTER IN 2022
Warns Gerald Celente Outlook 2022
MARKET CRASH IN PROGRESS
HAPPY NEW YEAR!
SILENT NIGHT, HOLY NIGHT, ALL IS NOT CALM,
ALL IS NOT BRIGHT
[/url][url=https://goldswitzerland.com/]
COMING MARKET MADNESS COULD TAKE 70 YEARS TO RECOVER
Egon von Greyerz
https://goldswitzerland.com/author/egon-von-greyerz
Cervantes famous classic novel Don Quixote can in simple terms be described as a fight for liberty and freedom against oppression and against the state. This book is from 1605 and considered to be one of the best books ever written.
In the midst of market madness, risk doesn’t exist because lunatics neither see, nor worry about risk. And still, 2022 will be more about risk and survival than anything else. So I will obviously talk more about “ The Triumph of Survival” which I discussed in a recent piece.
“When life itself seems lunatic, who knows where madness lies.” – Don Quixote
The year 2022 will most likely be the culmination of risk. An epic risk moment in history that very few investors will see until it is too late as they expect to be saved yet another time by the Fed and other central banks.And why should anyone believe that 2022 will be different from any year since 2009 when this bull market started? Few investors are superstitious and therefore won’t see that 13 spectacular years in stocks and other asset markets might signify an end to the epic super bubble.
The Great Financial Crisis (GFC) in 2006-9 was never repaired. Central bankers and governments patched Humpty up with glue and tape in the form of printed trillions of dollars, euro, yen etc. But poor Humpty Dumpty was fatally injured and the intensive care he received would only give him a temporary reprieve.When the GFC started in 2006, global debt was $120 trillion. Today we are at $300t, rising to potentially $3 quadrillion when the debt and derivative bubble finally first explodes and then implodes as I explained in my previous article.
It is amazing what fake money made of just air can achieve. Even better of course is that the central banks have manipulated interest rates to ZERO or below which means the debt is issued at zero or even negative cost.
INVESTORS HAVE FOUND SHANGRI-LA
Investors now believe they are in Shangri-La where markets can only go up and they can live in eternal bliss. Few understand that the increase in global debt since 2006 of $180t is what has fuelled investment markets.
Just look at these increases in the stock indices since 2008:
Nasdaq up 16X
S&P up 7x
Dow up 6X
And there are of course even more spectacular gains in stocks like:
Tesla up 352X or Apple up 62X.
These type of gains have very little to do with skilful investment, but mainly with a herd that has more money than sense fuelled by paper money printed at zero cost.To call the end of a secular bull market is a mug’s game. And there is nothing that stops this bubble from growing bigger. But we must remember that the bigger it grows, the greater the risk is of it totally wiping out gains not just since 2009 but also since the early 1980s when the current bull market started.
The problem is also that it will be impossible for the majority of investors to get out. Initially they will believe that it is just another correction like in 2020, 2007, 2000, 1987 etc. So greed will stop them from getting out. But then as the fall continues and fear sets in, investors will set a limit higher up where they intend to get out. And when the market never gets there, the scared investor will continue to set limits that are never reached until the market reaches the bottom at 80-95% from the top.And thus paper fortunes will be wiped out. We must also remember that it can take a painstakingly long time before the market recovers to the high in real terms. As Ray Dalio shows in the chart below, the 1929 high in the Dow was not even recovered in real terms by the mid 1960s. Finally it was surpassed in 2000.
This means that it took 70 years to recover in real terms! So investors might have to wait until 2090 to recover the current highs after the coming fall.
So looking at the chart, the market is now at a similar overvalued level it was in 1929, 1972 and 2000. Thus the risk
is as great as at some historical tops in the last 100 years.
THE EPIC BUBBLE MIGHT NOT RECOVER UNTIL 2090
The chart below shows that the 1929 top in the Dow was not reached in real terms until 2000.
How many investors are prepared to take the risk of a say 90% fall like in 1929-32 and not recover in real terms until by 2090!
Again, I repeat that this is not a forecast. But it is an epic warning that risk in investment markets are now at a level that investors should avoid.I fear that sadly very few investors will heed this risk warning.
DON QUIXOTE WOULD HAVE FOUGHT WOKENESS
As the world is being ever more oppressed and controlled by the state, Cervantes’ message in Don Quixote could not be more appropriate.I am quite convinced that Don Quixote would also have fought against the wokeness that today has become the guideline not onlyfor human behaviour but also for justice.
In the UK last week, a court acquitted four people accused of pulling down a statue of a historical figure who had been a major benefactor of the city of Bristol. Yes, he had made money on the slave trade in the late 1600s but where do we stop rewriting history?
With today’s woke interpretation of history, virtually every historical king, emperor, government leader, general or businessman, to mention a few, should be put on trial even if they are all dead.
For example, Great Britain, France, Spain were all part of invading North America killing a major part of the Indian population and taking their land. So if we rewrite history, shouldn’t all these Europeans as well as the Africans be pulled out of North America and the land handed bank to the Indians.
The same goes for South America of course. The Spanish and the Portuguese must all return and give the land back. And where do we stop? We should really go back to the Han Dynasty, the Roman, the Mongol, the Ottoman, Spanish, Russian or British Empires.
Why just deal with the slave trade in Africa when all these empires ransacked and conquered major land areas, took slaves and stole the riches of the countries they invaded. In a woke and fair world, all these actions must be reversed too. If the world decides to rewrite history, it must be done properly with major restitutions. There must of course be a UN Commission, and EU Commission and many more to deal with this properly.
As Don Quixote said: “Who knows where madness lies”.
EASY MONEY MADNESS
But it is most probably the total market Madness in the financial world which will have the biggest effect on the world economy in 2022 and onwards.
As I have pointed out many times, the US has not had a budget surplus since 1930 with the exception of a couple of years in the 1940s and 50s. The Clinton surpluses were fake as debt still increased.
But the money and market Madness started in the 1970s after Nixon couldn’t make ends meet and closed the gold window. The US federal debt in 1971 was $400 billion. Since then the US debt has grown by an average of 9% per year. This means that the US debt has doubled every 8 years since 1971. We can actually go back 90 years to 1931 and find that US debt since then has doubled every 8.3 years.
What a remarkable record of total mismanagement of the US economy for a century! The US has not had to build an empire in the conventional way by conquering other countries. Instead the combination of a reserve currency, money printing and a strong military power has given the US global power and a global financial empire.
Even worse, since the sinister smart coup by private bankers in 1913 to take control of the creation of money, the US Federal debt has gone from $1 billion to almost $30 trillion. As Mayer Amschel Rothschild poignantly stated in 1838: “Permit me to issue and control the money of a nation and I care not who makes its laws”.
And that is exactly what some powerful bankers and a senator decided on Jekyll Island in 1910 when they conspired to take over the US money system through the creation of the Fed which was founded in 1913.Ever since that time the bankers have helped themselves from the self-filling honeypot.
Controlling the Fed has given the bankers an unlimited supply of money and credit to finance their activities. They have used this to acquire assets around the world as well as power. As is the general rule today, debt is never repaid since new debt always makes the old debt insignificant as the currency is constantly debased with all the new money issued.
The debt issued was not only used for the direct financial gain of the bankers. No debt buys enormous power and by creating money to finance profligate governments, the bankers are also buying power and controlling the politicians.What a wonderful position as Rothschild made clear almost 200 years ago.
I COME IN A WORLD OF IRON TO MAKE A WORLD OF GOLD – Don Quixote
This was the ambitious goal of Don Quixote.But he didn’t succeed and today’s bankers have a totally different goal which is to make a world of fiat money. And they have been spectacularly successful at it.But the investors who wish to survive the coming global economic debacle must heed Don Quixote’s words and turn their paper assets into physical gold.
Stocks, bonds and property in coming years will lose at least 90% in real terms against gold. Gold in US dollars started a bull market in 2001 as the chart below shows. Since then, gold is up every year (sideways 2018) until 2021 when we saw a small correction. Gold’s up cycles normally last at least 10 years. This means that the current leg of the bull market in gold should last at least until 2026 and potentially extend beyond that.
As I regularly point out, gold is extremely cheap in relation to the growth in US money supply.Gold is today as cheap as it was in 1970 at $35 and as cheap as in 2000 at $290.
Thus the upside potential for gold is multiples of the current price, especially since the currency debasement will accelerate due to accelerated money printing.
Gold is the king of wealth preservation and should be held in physical form outside the banking system. Silver is likely to go up 2-3 times as fast as gold and is therefore a fantastic speculative investment as long as it is held in physical form. The risk of holding paper silver is massive since there is virtually no physical silver available. But due to the volatility of silver, investors should hold a much smaller percentage of their financial assets in silver than in gold.
In summary, 2022 could be the year when investors’ wealth turns into ashes, or for the prudent investor, turns into solid gains in gold and silver.
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DEBT AND WAR- THE SIGNS OF A DYING EMPIRE
Matthew Piepenburg
SANCTIONS SPUR A MASSIVE DECLINE IN WESTERN HEGEMONY AS THE WORLD DE- DOLLARIZES
Matthew Piepenburg
April 1, 2022
THE U.S. FEDERAL RESERVE’s “INFLATION LIES”.
Ushering In A Global Economic Depression. Russia Sanctions and a New World Order
F. William Engdahl
Global Research, March 29, 2022
https://www.globalresearch.ca/fed-inflat...er/5775839
HOW THE WEST WAS LOST:
A FALTERING WORLD RESERVE CURRENCY
Matthew Piepenburg
March 30, 2022
https://goldswitzerland.com/how-the-west...e-currency
The Western financial system and world reserve currency is now in open decline.
WILL GATES, ROCKEFELLER, MUSK AND KLAUS SCHWAB PREVAIL IN THE CLASS WAR?
Michael Welch and Prof. Anthony J. Hall
https://www.globalresearch.ca/will-gates...ut/5781693
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JP MORGAN CEO SCREAMS ECONOMIC COLLAPSE
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MOVING CLOSER TO WORLD WAR 3?
A CONVERSATION WITH GERALD CELENTE AND LYNETTE ZANG
GLOBAL PLANNED FINANCIAL TSUNAMI HAS JUST BEGUN
https://www.globalresearch.ca/global-pla...un/5784217
A PERFECT STORM IS BREWING IN BANKING AND FINANCE
https://mises.org/wire/perfect-storm-bre...nd-finance
Forget Jerome Powell's fanciful "soft landing" or the notion that the Fed can pull another rabbit from its hat. The banking system is headed for a crash and monetary authorities likely will make things worse.
Now that interest rates are rising with much further to go, the global banking system faces a crisis on a scale like no other in history. Central banks loaded with financial securities acquired through QE face growing losses, and their balance sheet liabilities are now significantly greater than their assets—a condition which in the private sector is termed bankruptcy. They will need to be recapitalized urgently to retain credibility.
Furthermore, banking regulators have made a prodigious error in their oversight of the commercial banking system by focusing almost solely on bank balance sheet liquidity as the principal determinant of risk exposure. And on the few occasions in the past when they have demanded banks increase their own capital, it has always been through the creation of preference shares and pseudo-equities to avoid diluting the true shareholders. The consequence is that the level of leverage for common equity shareholders in the global systemically important banks has risen to stratospheric levels.
The regulators may be comfortable with their liquidity approach, but they have ignored the periodic certainty of a contraction in bank credit and the consequences for banks’ equity interests. Meanwhile, G-SIBs have asset to common equity ratios often more than fifty times, with some in the eurozone over seventy. It is hardly surprising that most G-SIBs are valued in the equity markets at substantial discounts to book value.
G-SIBs have accumulated excessive exposure to financial assets, both on-balance sheet and as loan collateral. With vicious bear markets now evident and further interest rate rises guaranteed by falling purchasing powers for currencies, the one thing regulators have not allowed for is now happening: like a deepening meteorological low, bank credit is contracting into a perfect storm.
Jamie Dimon’s recent warning that his bank (JPMorgan Chase) faces hurricane conditions confirms the timing. Central banks, bankrupt in all but name, will be tasked with rescuing entire commercial banking networks, bankrupted by a collapse in bank credit.
Why Are Markets Crashing?
It is becoming clear that financial assets are in a bear market, driven by persistent rises in producer inputs and consumer prices, which in turn are pushing interest rates and bond yields higher. So far, investors have been reluctant to lose trust in their central banks which have been instrumental in supporting financial markets. But this is now being tested, more so in the summer months as global food shortages develop.
We have increasing evidence that bank credit is either contracting or on the verge of doing so. This was the message loud and clear from Jamie Dimon’s recent description of economic conditions being raised from storm to hurricane force, and his follow up comments about what JPMorgan Chase was doing about it. Rarely do we get the dollar-world’s most senior banker giving us such a clear heads-up on a change in lending policies, which we know will be shared by all his competitors. And the fact that the bank’s senior economist was tasked with rowing back on Dimon’s statement indicates that the Fed, or perhaps Dimon’s colleagues, know that he should not have made public their greatest fears.
Contracting bank credit always ends in a crisis of some sort. With a long-term average of ten years, this cycle of bank credit has been exceptionally long in the tooth. Before we even consider the specific factors behind a withdrawal of credit, we can assume that the longer the period of credit expansion that precedes it, the greater the slump in economic activity that follows.
Not only is this the culmination of a cyclical bank credit expansion, but it is of a larger trend
set in motion in the mid-eighties. Following the inflationary seventies, which was book-ended with the abandonment of the Bretton Woods Agreement and Paul Volcker’s 20 percent prime rates, a means had to be devised to ensure that fiat currencies would be stabilized in a lower interest rate environment. By ensuring demand for dollars would always be sufficient to maintain its purchasing power, then all other currencies that were loosely pegged to it would
be similarly able to retain purchasing power without the prop of high interest rates.
Consciously or unconsciously, the planners deployed a variation on the Triffin dilemma. Robert Triffin was an economist who in the 1960s pointed out that a reserve currency would have to ensure that there is sufficient supply of it for it to fulfil the reserve currency role. He concluded that the supplier of the reserve currency would have to run irresponsible short-term monetary policies to ensure the supply is made available, for the likely detriment of long-term monetary and economic prospects.
In the mid-eighties the planners put in place the mechanism for creating Triffin’s demand for
the dollar. Deficits would be run by the US government, as Triffin had explained, and dollar bank credit would be expanded. The creation of bank credit outside the US banking system would be permitted in the form of the Eurodollar market. And the growth of shadow banking went unhampered.
Major banks were encouraged to buy into brokers, eventually absorbing them into their operations completely. London’s big-bang was what this was all about, followed by the Glass-Steagall Act being rescinded to allow the American money-center banks to enter brokerage and investment banking activities in their domestic markets as well as offshore. The purpose of financializing the dollar was to ensure there would always be speculative and portfolio demand for it.
The policy has fundamentally overturned the way free markets behave, making them increasingly driven by central bank interest rate policies instead of by non-financial factors. Time preference became progressively less important relative to Fed policy. Whenever the dollar slipped, by lowering interest rates instead of raising them the Fed could encourage foreign portfolio buying. Lower interest rates increased flows of currency and credit into financial assets instead of debasing the currency in the non-financial economy.
It has not been a perfect system, because prices of goods and services still increased reflecting the expansion of currency and credit, but at a slower pace than one might have expected, given the increased quantity of circulating media. Furthermore, calculation methods applied to consumer price indices all had the effect of reducing the apparent pace of price increases. And it was in everyone’s interest to buy into this perpetual system of wealth creation.
Thus, the creation of extra bank credit was directed increasingly into financial speculation in bond and equity markets. There were bubbles, such as the dotcoms in the late-1990s and in mortgage financing preceding the financial crisis of 2008/09. Despite these interruptions, the US authorities made sure that global investment flows primarily supported US financial interests. Thus, the wealth effect was created in America, and consequently through the internationalization of valuations in the jurisdictions of its major allies. And to the extent that credit expansion drove up financial asset prices, the effect was mostly ring-fenced within the financial economy, and was not recorded in official consumer price indices.
As markets caught on, interest rates declined to the point where they disappeared altogether. But as Triffin observed, policies to ensure that a currency is available as the world’s reserve are economically destructive in the long run, and the whole trend set in motion from London’s big bang onwards has now concluded with rising interest rates. It amounts to a super cycle of bank credit expansion certain to end more dramatically than a single cycle. Therefore, this bear market and its systemic issues can be expected to be of a greater magnitude than those which followed the dotcoms and the Lehman failure.
With interest rates so far beneath the rate at which prices are rising, which is mainly the consequence of earlier monetary debasement, losses are now accumulating for all those who bought into the financialization story and have failed to bail out of it. Top of a hubristic list are the central banks themselves which augmented monetary expansion with the acquisition of substantial bond portfolios through quantitative easing. Those assets are now collapsing in value, wiping out central bank equity many times over. The central banks themselves will need recapitalizing before they can tackle the problems of a widespread systemic collapse in the commercial banking network.
With a perfect storm forming in financial markets and the banks, we are witnessing the end of a global economic system which has denied the realities of free markets ever since President Hoover believed that the US Government could improve and then save the American economy in 1929. His errors were magnified by the neo-Keynesians’ hero, Franklin Roosevelt with his New Deal. A Second World War and post-war socialization of capital with a minimized gold standard followed. Every failure has been met with a new doubling down on capitalism.
And every failure has increased the power of the state over its people and diminished their freedom. The drift away from a world of progress, where people were free to exchange the fruits of their labor with the intermediation of sound money, enabling them to succeed or fail by their own efforts, has led to the ultimate failure: a looming collapse of the whole statist system.
Since the last fig-leaf of gold convertibility was finally abandoned fifty-one years ago, the final phase of our decline has been covered up by the increasing financialization of western economies, substituting paper wealth for real prosperity. The function of fiat currency has been to perpetuate this illusion, an illusion that is finally coming to an end.
In the financial and economic violence which we now face, it is difficult to anticipate the order of a series of events within the overall crisis. The outturn could be very different, but logic suggests the following. Interest rates will rise until bank failures materialize. Meanwhile, financial assets will have fallen in value, possibly very quickly. Then we can expect monetary policy to expand to rescue the commercial banks, suppress bond yields and to finance soaring government deficits.
WHAT WAS COVID REALLY ABOUT?
TRIGGERING A MULTI-TRILLION DOLLAR GLOBAL DEBT CRISIS “Ramping up an Imperialist Strategy”?
Covid, Capitalism, Friedrich Engels and Boris Johnson
Colin Todhunter
https://www.globalresearch.ca/covid-capitalism-friedrich-boris/5785964
ARE WE HEADING TOWARDS A CAPITALIST SUPERNOVA ?
https://www.commondreams.org/views/2022/...-supernova
THE WAR IN UKRAINE MARKS THE END OF THE AMERICAN CENTURY “WHAT’s LEFT IS A STEAMING PILE OF DOLLAR DENOMINATED DEBT”
Mike Whitney
Global Research, July 07, 2022
https://www.globalresearch.ca/war-ukraine-marks-end-american-century/5782901
UKRAINE IS THE LATEST NEOCON DISASTER
Jeffrey D. Sachs
https://www.commondreams.org/views/2022/...n-disaster
NATO’s NEW GLOBAL COLD WAR IS NOW OFFICIAL
https://www.strategic-culture.org/news/2022/07/01/nato-new-global-cold-war-now-official
FUELLING THE WARFARE STATE
America's $1.4 Trillion "National Security" Budget Makes Us Ever Less Safe
William D. Hartung
https://quincyinst.org/report/pathways-t...-obstacles
THE EMPIRE IS NOT DONE TORTURING AFGHANISTAN
Despite its resounding defeat, NATO is not quite done with inflicting misery on the land of the Afghans
Pepe Escobar
July 05 2022
https://thecradle.co/Article/Columns/12648
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GLOBAL PLANNED FINANCIAL TSUNAMI HAS JUST BEGUN
F. William Engdahl
July 25, 2022
Information Clearing House
Since the creation of the US Federal Reserve over a century ago, every major financial market collapse has been deliberately triggered for political motives by the central bank. The situation is no different today, as clearly the US Fed is acting with its interest rate weapon to crash what is the greatest speculative financial bubble in human history, a bubble it created. Global crash events always begin on the periphery, such as with the 1931 Austrian Creditanstalt or the Lehman Bros. failure in September 2008. The June 15 decision by the Fed to impose the largest single rate hike in almost 30 years as financial markets are already in a meltdown, now guarantees a global depression and worse.
The extent of the “cheap credit” bubble that the Fed, the ECB and Bank of Japan have engineered with buying up of bonds and maintaining unprecedented near-zero or even negative interest rates for now 14 years, is beyond imagination. Financial media cover it over with daily nonsense reporting , while the world economy is being readied, not for so-called “stagflation” or recession. What is coming now in the coming months, barring a dramatic policy reversal, is the worst economic depression in history to date. Thank you, globalization and Davos.
Globalization
The political pressures behind globalization and the creation of the World Trade Organization out of the Bretton Woods GATT trade rules with the 1994 Marrakesh Agreement, ensured that the advanced industrial manufacturing of the West, most especially the USA, could flee offshore, “outsource” to create production in extreme low wage countries. No country offered more benefit in the late 1990s than China. China joined WHO in 2001 and from then on the capital flows into China manufacture from the West have been staggering. So too has been the buildup of China dollar debt. Now that global world financial structure based on record debt is all beginning to come apart.
When Washington deliberately allowed the September 2008 Lehman Bros financial collapse, the Chinese leadership responded with panic and commissioned unprecedented credit to local governments to build infrastructure. Some of it was partly useful, such as a network of high-speed railways. Some of it was plainly wasteful, such as construction of empty “ghost cities.” For the rest of the world, the unprecedented China demand for construction steel, coal, oil, copper and such was welcome, as fears of a global depression receded. But the actions by the US Fed and ECB after 2008, and of their respective governments, did nothing to address the systemic financial abuse of the world’s major private banks on Wall Street and Europe , as well as Hong Kong.
The August 1971 Nixon decision to decouple the US dollar, the world reserve currency, from gold, opened the floodgates to global money flows. Ever more permissive laws favoring uncontrolled financial speculation in the US and abroad were imposed at every turn, from Clinton’s repeal of Glass-Steagall at the behest of Wall Street in November 1999. That allowed creation of mega-banks so large that the government declared them “too big to fail.” That was a hoax, but the population believed it and bailed them out with hundreds of billions in taxpayer money.
Since the crisis of 2008 the Fed and other major global central banks have created unprecedented credit, so-called “helicopter money,” to bailout the major financial institutions. The health of the real economy was not a goal. In the case of the Fed, Bank of Japan, ECB and Bank of England, a combined $25 trillion was injected into the banking system via “quantitative easing” purchase of bonds, as well as dodgy assets like mortgage-backed securities over the past 14 years.
Quantitative madness
Here is where it began to go really bad. The largest Wall Street banks such as JP MorganChase, Wells Fargo, Citigroup or in London HSBC or Barclays, lent billions to their major corporate clients. The borrowers in turn used the liquidity, not to invest in new manufacturing or mining technology, but rather to inflate the value of their company stocks, so-called stock buy-backs, termed “maximizing shareholder value.”
BlackRock, Fidelity, banks and other investors loved the free ride. From the onset of Fed easing in 2008 to July 2020, some $5 trillions had been invested in such stock buybacks, creating the greatest stock market rally in history. Everything became financialized in the process. Corporations paid out $3.8 trillion in dividends in the period from 2010 to 2019. Companies like Tesla which had never earned a profit, became more valuable than Ford and GM combined. Cryptocurrencies such as Bitcoin reached market cap valuation over $1 trillion by late 2021. With Fed money flowing freely, banks and investment funds invested in high-risk, high profit areas like junk bonds or emerging market debt in places like Turkey, Indonesia or, yes, China.
The post-2008 era of Quantitative Easing and zero Fed interest rates led to absurd US Government debt expansion. Since January 2020 the Fed, Bank of England, European Central Bank and Bank of Japan have injected a combined $9 trillion in near zero rate credit into the world banking system. Since a Fed policy change in September 2019, it enabled Washington to increase public debt by a staggering $10 trillion in less than 3 years. Then the Fed again covertly bailed out Wall Street by buying $120 billion per month of US Treasury bonds and Mortgage-Backed Securities creating a huge bond bubble.
A reckless Biden Administration began doling out trillions in so-called stimulus money to combat needless lockdowns of the economy. US Federal debt went from a manageable 35% of GDP in 1980 to more than 129% of GDP today. Only the Fed Quantitative Easing, buying of trillions of US government and mortgage debt and the near zero rates made that possible. Now the Fed has begun to unwind that and withdraw liquidity from the economy with QT or tightening, plus rate hikes. This is deliberate. It is not about a stumbling Fed mis-judging inflation.
Energy drives the collapse
Sadly, the Fed and other central bankers lie. Raising interest rates is not to cure inflation. It is to force a global reset in control over the world’s assets, it’s wealth, whether real estate, farmland, commodity production, industry, even water. The Fed knows very well that Inflation is only beginning to rip across the global economy. What is unique is that now Green Energy mandates across the industrial world are driving this inflation crisis for the first time, something deliberately ignored by Washington or Brussels or Berlin.
The global shortages of fertilizers, soaring prices of natural gas, and grain supply losses from global draught or exploding costs of fertilizers and fuel or the war in Ukraine, guarantee that, at latest this September-October harvest time, we will undergo a global additional food and energy price explosion. Those shortages all are a result of deliberate policies.
Moreover, far worse inflation is certain, due to the pathological insistence of the world’s leading industrial economies led by the Biden Administration’s anti-hydrocarbon agenda. That agenda is typified by the astonishing nonsense of the US Energy Secretary stating, “buy E-autos instead” as the answer to exploding gasoline prices.
Similarly, the European Union has decided to phase out Russian oil and gas with no viable substitute as its leading economy, Germany, moves to shut its last nuclear reactor and close more coal plants. Germany and other EU economies as a result will see power blackouts this winter and natural gas prices will continue to soar. In the second week of June in Germany gas prices rose another 60% alone. Both the Green-controlled German government and the Green Agenda “Fit for 55” by the EU Commission continue to push unreliable and costly wind and solar at the expense of far cheaper and reliable hydrocarbons, insuring an unprecedented energy-led inflation.
Fed has pulled the plug
With the 0.75% Fed rate hike, largest in almost 30 years, and promise of more to come, the US central bank has now guaranteed a collapse of not merely the US debt bubble, but also much of the post-2008 global debt of $303 trillion. Rising interest rates after almost 15 years mean collapsing bond values. Bonds, not stocks, are the heart of the global financial system.
US mortgage rates have now doubled in just 5 months to above 6%, and home sales were already plunging before the latest rate hike. US corporations took on record debt owing to the years of ultra-low rates. Some 70% of that debt is rated just above “junk” status. That corporate non-financial debt totaled $9 trillion in 2006. Today it exceeds $18 trillion. Now a large number of those marginal companies will not be able to rollover the old debt with new, and bankruptcies will follow in coming months. The cosmetics giant Revlon just declared bankruptcy.
The highly-speculative, unregulated Crypto market, led by Bitcoin, is collapsing as investors realize there is no bailout there. Last November the Crypto world had a $3 trillion valuation. Today it is less than half, and with more collapse underway. Even before the latest Fed rate hike the stock value of the US megabanks had lost some $300 billion. Now with stock market further panic selling guaranteed as a global economic collapse grows, those banks are pre-programmed for a new severe bank crisis over the coming months.
As US economist Doug Noland recently noted, “Today, there’s a massive “periphery” loaded with “subprime” junk bonds, leveraged loans, buy-now-pay-later, auto, credit card, housing, and solar securitizations, franchise loans, private Credit, crypto Credit, DeFi, and on and on. A massive infrastructure has evolved over this long cycle to spur consumption for tens of millions, while financing thousands of uneconomic enterprises. The “periphery” has become systemic like never before. And things have started to Break.”
The Federal Government will now find its interest cost of carrying a record $30 trillion in Federal debt far more costly. Unlike the 1930s Great Depression when Federal debt was near nothing, today the Government, especially since the Biden budget measures, is at the limits. The US is becoming a Third World economy. If the Fed no longer buys trillions of US debt, who will? China? Japan? Not likely.
Deleveraging the bubble
With the Fed now imposing a Quantitative Tightening, withdrawing tens of billions in bonds and other assets monthly, as well as raising key interest rates, financial markets have begun a deleveraging. It will likely be jerky, as key players like BlackRock and Fidelity seek to control the meltdown for their purposes. But the direction is clear.
By late last year investors had borrowed almost $1 trillion in margin debt to buy stocks. That was in a rising market. Now the opposite holds, and margin borrowers are forced to give more collateral or sell their stocks to avoid default. That feeds the coming meltdown. With collapse of both stocks and bonds in coming months, go the private retirement savings of tens of millions of Americans in programs like 401-k. Credit card auto loans and other consumer debt in the USA has ballooned in the past decade to a record $4.3 trillion at end of 2021. Now interest rates on that debt, especially credit card, will jump from an already high 16%. Defaults on those credit loans will skyrocket.
Outside the US what we will see now, as the Swiss National Bank, Bank of England and even ECB are forced to follow the Fed raising rates, is the global snowballing of defaults, bankruptcies, amid a soaring inflation which the central bank interest rates have no power to control. About 27% of global nonfinancial corporate debt is held by Chinese companies, estimated at $23 trillion. Another $32 trillion corporate debt is held by US and EU companies. Now China is in the midst of its worst economic crisis since 30 years and little sign of recovery. With the USA, China’s largest customer, going into an economic depression, China’s crisis can only worsen. That will not be good for the world economy.
Italy, with a national debt of $3.2 trillion, has a debt-to-GDP of 150%. Only ECB negative interest rates have kept that from exploding in a new banking crisis. Now that explosion is pre-programmed despite soothing words from Lagarde of the ECB. Japan, with a 260% debt level is the worst of all industrial nations, and is in a trap of zero rates with more than $7.5 trillion public debt. The yen is now falling seriously, and destabilizing all of Asia.
The heart of the world financial system, contrary to popular belief, is not stock markets. It is bond markets—government, corporate and agency bonds. This bond market has been losing value as inflation has soared and interest rates have risen since 2021 in the USA and EU. Globally this comprises some $250 trillion in asset value a sum that, with every fed interest rise , loses more value. The last time we had such a major reverse in bond values was forty years ago in the Paul Volcker era with 20% interest rates to “squeeze out inflation.”
As bond prices fall, the value of bank capital falls. The most exposed to such a loss of value are major French banks along with Deutsche Bank in the EU, along with the largest Japanese banks. US banks like JP MorganChase are believed to be only slightly less exposed to a major bond crash. Much of their risk is hidden in off-balance sheet derivatives and such. However, unlike in 2008, today central banks can’t rerun another decade of zero interest rates and QE. This time, as insiders like ex-Bank of England head Mark Carney noted three years ago, the crisis will be used to force the world to accept a new Central Bank Digital Currency, a world where all money will be centrally issued and controlled. This is also what Davos WEF people mean by their Great Reset. It will not be good. A Global Planned Financial Tsunami Has Just Begun.
THE UNITED STATES DOES NOT HAVE AN ECONOMY
Dr. Paul Craig Roberts
https://www.globalresearch.ca/united-sta...my/5787057
The US financial sector has long looted other countries. A number of participants have described the process. First a country is enticed with bribes to the leaders to take out loans that cannot be serviced or repaid. Then in comes the IMF. Austerity is imposed on the population. Public services and employment are cut to free resources for debt service, and public assets are sold to repay the loan. Living standards fall, and US corporations take over the country’s economy.
As foreign governments, having experienced or witnessed the economic carnage and fearing accountability, are less willing to be bribed into indebting their countries, American finance is now applying this technique to Americans. Contrary to the narrative in the financial press, the Federal Reserve is not raising interest rates in order to fight inflation. It is ludicrous to think that a three-quarters of one percent rise in a very low interest rate is going to have any impact on a 9.1% rate of consumer inflation or that speculation that the Federal Reserve has in mind another three-quarters of one percent possibly followed by one half of one percent comprise an anti-inflation policy. If all these increases occur, it still leaves the interest rate below the inflation rate.
Moreover, as I have previously explained, the inflation is not monetary. The higher prices are the result of supply disruptions caused by Washington’s Covid lockdowns and Russian sanctions. Production was stopped and supply chains are broken.
The Federal Reserve’s rise in interest rates is just a continuation of its policy of concentrating income and wealth in the hands of the One Percent. Quantitative Easing was the cloak for the Federal Reserve to print $8.2 trillion in new money which was directed or found its way into the prices of stocks and bonds, thus enriching the small number who own most of these financial instruments. Having maxed out this avenue of wealth concentration, the Federal Reserve is now raising interest rates in order to drive up mortgage costs to aspiring home owners. The Federal Reserve is driving individuals out of the housing market in order to free up properties for “private equity” firms to purchase homes for their rental values. That private equity firms see rental income from the existing stock of houses as the best investment opportunity tells us that the US economy has played out. When investment goes into existing assets, not into producing new assets, the economy ceases to grow.
The Obama regimes policy of bailing out the financial fraudsters responsible for the 2008 crash while foreclosing on their victims, reduced American homeownership from 70% to 63 percent. The Urban Institute predicts further declines. Today homeowners’ equity has declined from 85% after World War II to one-third, leaving two-thirds of homeowner equity in the hands of creditors. This makes it completely clear that a financialized economy indebts the people for the sake of rentier income to the One Percent. Indeed, the financialized economy created by the Federal Reserve has reimposed a class system akin to the landed British aristocracy that was overthrown. Indeed, we have an economically far worst class system. The landed British aristocrats produced food that fed the nation. The American class system produces interest and fees for the financial system.
As Michael Hudson has shown us, a no-growth economy is the end result of a financialized economy. A financialized economy is one in which consumer income is diverted by debt expansion away from the purchase of new goods and services into debt service and fees–interest on mortgages, car loans, credit card debt, student loan debt. With such a large share of household income spent on debt service, little is left for driving the economy forward.
If American economists were capable of escaping from their neoliberal junk economics, they would realize that “the world’s largest economy” they attribute to the United States is total fiction. The fact is that the United States does not have an economy. Corporations driven by Wall Street located American manufacturing in Asia so that the One Percent could benefit from higher profits from lower labor costs, while the deserted city and states had to sell their income streams, such as Chicago’s parking meter revenues for 75 years, to foreigners for one lump sum payment to solve one year’s budget crisis.
The offshoring of American production, carried out under the cloak of “globalism,” destroyed the American economy and the tax bases of cities and states. While the real economy declines, the Democrat Party, seeking permanent power, has imposed a policy of open borders for immigrant-invaders. How are these millions of peoples to support themselves in an economy whose manufacturing has been moved abroad? How can a population, deserted by American corporations, that is experiencing debt deflation absorb the costs of support and social infrastructure for tens of millions of third world immigrant-invaders?
You will never hear it from the whores in the financial press, but the United States is on the precipice of economic and social collapse. And what are the fools in Washington doing? The idiots are ginning up wars with Russia, China, and Iran.
RUSSIA AND CHINA OFFICIALLY ANNOUNCE A
NEW GLOBAL RESERVE CURRENCY
And once again, as happens often with consequential news in the United States and the West, no one has noticed and no one seems to care.
QTR's Fringe Finance
July 25, 2022: Information Clearing House If you’ve blinked over the last month, you may have missed it…
China and Russia are taking their shot at the U.S. dollar. And as often happens with consequential news in the United States and the West, no one seems to notice or even care.
Since the beginning of the year, I have been writing about the possibility of Russia and China challenging the US dollar’s global reserve status. Now, it’s happening.
It shouldn’t be any surprise to those paying attention that Russia and China are strengthening their economic ties amidst continued Western sanctions on Russia as a result of the country’s war in Ukraine.
What may surprise some people, however, is that Russia and the BRICS countries, including Brazil, Russia, India, China, and South Africa, are officially working on their own “new global reserve currency,” RT reported in late June. Nobody even seemed to notice.
“The issue of creating an international reserve currency based on a basket of currencies of our countries is being worked out,” Vladimir Putin said at the BRICS business forum last month.
And of course, as Russia has been cut off from the SWIFT system, it is also pairing with China and the BRIC nations to develop “reliable alternative mechanisms for international payments” in order to “cut reliance on the Western financial system.”
In the meantime, Russia is also taking other steps to strengthen the alliance between BRIC nations, including re-routing trade to China and India, according to CNN:
President Vladimir Putin said Wednesday that Russia is rerouting trade to "reliable international partners" such as Brazil, India, China and South Africa as the West attempts to sever economic ties.
"We are actively engaged in reorienting our trade flows and foreign economic contacts towards reliable international partners, primarily the BRICS countries," Putin said in his opening video address to the participants of the virtual BRICS Summit. In fact, “trade between Russia and the BRICS countries increased by 38% and reached $45 billion in the first three months of the year” this year, the report says. Meanwhile, Russian crude sales to China have hit record numbers during Spring of this year, edging out Saudi Arabia as China’s primary oil supplier.
"Together with BRICS partners, we are developing reliable alternative mechanisms for international settlements," Putin said.
Putin continued, stating last month: "Contacts between Russian business circles and the business community of the BRICS countries have intensified. For example, negotiations are underway to open Indian chain stores in Russia [and to] increase the share of Chinese cars, equipment and hardware on our market."
In June, Putin also accused the West of ignoring"the basic principles of [the] market economy" such as free trade. "It undermines business interests on a global scale, negatively affecting the wellbeing of people, in effect, of all countries," he said.
President Xi echoed Putin’s sentiments, according to a June writeup by Bloomberg:
“Politicizing, instrumentalizing and weaponizing the world economy using a dominant position in the global financial system to wantonly impose sanctions would only hurt others as well as hurting oneself, leaving people around the world suffering. Those who obsess with a position of strength, expand their military alliance, and seek their own security at the expense of others will only fall into a security conundrum.”
The developments obviously further my long held belief that a gold backed global reserve currency is on its way - something I have been writing about for months. I’m also stunned that nobody seems to care that arguably the largest shift on the global macroeconomic playing field over the last half century may be taking place.
Sure, under the context of the conflict in Ukraine, the news may seem “par for the course” of sorts, which may result in the media and the financial world downplaying it. But put this piece of information out there on its own, without context - that there is a coordinated global challenge taking place to the U.S. dollar - and it would be the biggest news story in decades. Imagine if China and Russia just dropped this out of nowhere? Now, remember that both countries have been working on, and preparing for, this situation for [b]years. [/b]
I mean, holy hell, look at Russia’s Treasury holdings as far back as 2018:
As I’ve noted before, Russia was also increasing its holdings of gold over the same period:
And this headline came out in 2020, just months before Russia’s invasaion of Ukraine
Does anyone think it’s a coincidence?
Nikkei wrote at the time:
Dedollarization has been a priority for Russia and China since 2014, when they began expanding economic cooperation following Moscow's estrangement from the West over its annexation of Crimea. Replacing the dollar in trade settlements became a necessity to sidestep U.S. sanctions against Russia.
Ergo, it seems to me that the BRIC nations understand exactly how precarious of a financial situation the U.S. - and our dollar - is in. Despite the dollar’s recent strengthening, these nations have been in the midst of a multi-decade-long plan to de-dollarize. Even before the Ukraine conflict started, both China and Russia were stockpiling gold and working on denominating transactions outside of the U.S. dollar. It was another “secret” that was out there in the open.
Remember how “insane” this headline was just 6 months ago when I predicted it for the first time?
Meanwhile, since the BRIC conference, ties between Russia and China continue to tighten, with Japan even warning this week about the pair’s “strengthening of military ties” - at the same time China has closely scrutinized a planned trip by House Speaker Nancy Pelosi to Taiwan.
Japan said this past week:
“As a result of the current aggression, it is possible that Russia’s national power in the medium- to longterm may decline, and the military balance within the region and military cooperation with China may change.
In the vicinity of Japan, Russia has made moves to strengthen cooperation with China, such as through joint bomber flights and joint warship sails involving the Russian and Chinese militaries, as well as moves to portray such military cooperation as strategic coordination.”
Japan said this alignment between the two countries “must continue to be closely watched in the future.”
While the economic gears turn behind the scenes, China is also becoming incresingly cagey about Taiwan. The country “has sent warplanes into Taiwan's self-declared air defense zone identification zone many times in recent months,” according to CNN, and recently alluded to the idea of a no-fly zone over Taiwan ahead of a planned visit by Nancy Pelosi.
President Biden commented on Pelosi’s travel plans this week, stating: “The military thinks it’s not a good idea right now. But I don’t know what the status of it is.”
We’re sure Pelosi will wind up going anyway. Remember, this is the same woman who danced her way through Chinatown while Covid was spreading to the U.S., from China, to prove she wasn’t racist. I can hear her en route to Taiwan now:
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WITH WESTERN IMPERIAL DECLINE , CAPITALISM IS IN
CRISIS- A NEW PHASE IS EMERGING
The energy crisis in Europe, proxy war in Ukraine, rebellion in the Global South, and expansion of the BRICS reflect the decline of Western imperialism and growing cracks in the capitalist world system.
João Romeiro Hermeto
September 03, 2022: Information Clearing House
"Multipolarista" The feeble and tired capitalist elites in the West, drunk with their own power, numbed to human pain, incapable of human empathy, have been shown to be naked – emperors with no clothes. As the US and European empires are in decline, their collective ignorance has been exposed. And their attempt to erase past crises and crimes has become clear. The major imperialist wars of the 20th century appear for the ruling class to be simple phantoms of individual failures within a otherwise healthy system based on merit, pride, freedom, and democracy. The horrifying acts perpetrated by Britain, France, and the United States are never emphatically condemned – only, when required, faintly and vaguely objected to.
In the ongoing proxy war in Ukraine, the West is avoiding peace negotiations at all costs, while pouring money into the weapons industry, in an effort to make a killing out of killing. It is another example of so-called disaster capitalism, and reflects the capitalist’s logic: “never let a crisis go to waste”.
Yet the lack of support in the Global South for the proxy war waged by the United States and its vassals – the Frankenstein’s monster of NATO – has shown that most countries in the world do not adhere to Washington’s binary insistence that “you are either with us or against us”.
This disentanglement of the previous forced alignment with the West has also revealed the NATO bloc’s own fragility.
The BRICS nations (Brazil, Russia, India, China, and South Africa) together account for approximately 40% of the world population. And this bloc managed to keep itself unified during the conflict in Ukraine.The bloc has begun expanding into BRICS+, moving to add new countries to the organization, such as Argentina and Iran.There is even discussion of BRICS+ potentially including Turkey, Egypt, and Saudi Arabia.
Saudi Arabia, a longtime Western ally, is precisely the power that made it possible for the US empire to keep running huge deficits since the 1970s, on the basis of the petrodollar. But Riyadh may be breaking its traditional position as a vassal.Saudi Arabia has already maintained a firm position within OPEC+, which means keeping close ties with Russia.
Meanwhile, the United States has tried to convince Venezuela to provide oil to ease the West’s energy crisis, after decades of treating the Chavista government like a pariah. This a huge setback for the West’s brutal campaign of sanctions and blockade against Venezuela and its people.
Even more striking is the refusal by most countries of the world to adopt the unilateral sanctions that the West has imposed on Russia. The once widespread willingness to follow Western biddings is now in marked decline. Aligned with the United States are the usual suspects: the neoliberal European Union, Australia, Japan, a few more countries. Much of
the rest of the world has rejected the West’s 500 years of colonial rule.
Decades of imperialist war on communism repressed anti-capitalist ideologies, making it difficult for alternatives to arise. The crushing of the anti-capitalist left-wing movement (which now is slowly starting to re-emerge) gave capitalism a green light to impose itself on the peoples of the globe, leading to a colonization of their hearts and minds on a scale never seen before. This was the neoliberal phase.
At the same time, the lack of significant alternatives to capitalism also prevented capitalist elites from outsourcing the responsibility for the problems that they created and blaming competing systems or ideologies.Today, the mainstream media and the political class tries to scapegoat immigrants, the “other,” China, and Russia.
Yet, among the masses of people, there is a general sense that what is needed is:
- social change;
- a stable future, where pain at social and individual levels does not become a constant normality;
- a sustainable world which can remain habitable;
- healthy social relations;
- job security, the ability to provide for your family without living pay-check-to-pay-check.
Such a life full of anxiety and despair is not just a problem of the Third World; it has become widespread in the imperial core in the West. And it was not a foreign, alien ideology that created these problems; instead, it was Western governments’ own policies of egoism, destruction, domination, and profit-seeking, the very essence of capitalist ideology.
Capitalism acts like cancer. It grows unceasingly with complete disregard for humanity or nature.
While the historical rise of capitalism in the West had the production of commodities as one of its foundations, its nature of profit-seeking and expansion demanded the exportation of capital.
Thus, Western capitalism reallocated production elsewhere, on the outskirts of the world, so far away that its middle class could feel freed and purified from the toils and “filth” of manual labor.
Moreover, by controlling the flow of capital, the Occident could also control the dynamics of far-away industries. When local governments in the South tried to regulate industries and take back natural resources to the advantage of their populations, Western capitalist elites used their proxies – comprador politicians, court-workers, bureaucrats, ideologues, think tanks, militaries, and militias – to make sure that local national interests could and would not prevail.
This dynamic proved itself for many decades to be quite successful. The few Western failures, in countries like Cuba, North Korea, Venezuela, and Nicaragua, were ostracized and denied social relations with the rest of the world through mafia-like maneuvers of blackmail, deception, threats, intimidation, and segregation.
Western weakness had always been latent, but there were several factors sustaining its hegemony:
- a lack of strong powers able to challenge Western imperialism,
- the risk of facing a brutal counteraction and being blockaded and ostracized, and
- the difficulty of coordinating among countries and organizing a collective alternative to Western unipolar world dominance.
The situation today, however, appears to contain something new. The Global South’s overwhelming refusal to abide by Western sanctions on Russia amid NATO’s proxy war in Ukraine has shown that Western hegemony is seriously being challenged. This growing systemic challenge has multiple dimensions.
First, the legitimacy of capitalism was shattered by the 2008 financial crisis – which for much of the world is still ongoing.This crash made it clear that Western capitalist rule cannot provide anything beyond precarity for the 99%, while giving only the 1% a comfortable life.
Second, for more than a decade, Russia has been planning an alternative to the SWIFT financial messaging system, and since at least 2012 China began developing its own. This brought both countries closer together at the financial level. The West’s exclusion of Russia from SWIFT in response to the war in Ukraine will majorly backfire, because it ends the Western monopoly on the global flow of financial capital and jumpstarts this joint Chinese-Russian project to create an alternative, while catalyzing it further among Third World nations. The Western financial war on Russia has put cracks into the institutions that enabled the US empire to function since the 1970s on the basis of indiscriminately printing dollars and selling debt. Given that the European Union has shown itself to act as a US vassal, these financial cracks will keep growing, until they are too big to be fixed.
Finally, the energy crisis that Western sanctions on Russia have unleashed in Europe has made everyone see clearly that capitalism requires great amounts of energy to produce a constant flow of surplus. This emphasized to the Third World the supreme importance of their natural resources, and highlighted the unequal dialectics between the master and slave.
While the Third World has neither the military nor the financial capacity to explicitly challenge Western imperialism, the resources it possesses grants it an extreme amount of power.
The West simply cannot function without the constant flow of resources extracted overseas – usually from Third World countries – which is then transformed elsewhere, under its rule, through capitalist production, into products that are sold. This process is what enables the West to realize such huge profits.
This dimension of the flow of resources is often taken for granted. But an attempt at coordination by energy producers in the South could put the West on its knees within weeks,
or at least enable Third World countries to start conceiving of their own national and regional projects beyond the tutelage of capitalist imperialism.
The world is moving from Zbigniew Brzezinski’s “grand chessboard” to a new game with the complexity of Chinese Weiqi (known popularly in the West as Go). And not only is King Capitalism naked, but there is no one on the helm as he sails the society-ship straight into a dreadfully wild storm.
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