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05.23.16 –    US spy plane flew ‘dangerously close’ to passenger jets near Russian border

  • A US defense attache has been summoned by Russia’s Defense Ministry after an incident over the Sea of Japan near Russia’s eastern borders, where an American spy plane was detected flying too close to civilian aircraft.
  • Russia’s air defense detected an RC-135 spy plane belonging to US Air Force on Sunday, the ministry said in its statement. The plane was on an air reconnaissance mission with all of its transponders having been shut off, it added.
  • The US crew had not provided any information regarding its flight to air traffic controllers in the region, despite it flying at the same altitude as scheduled civil aviation flights.
    “As the result of the unprofessional actions of the American plane crew, the hazard of a collision with civil aviation planes was created,” Russia’s Defense Ministry said, adding that it asked the US official to take measures to prevent such incidents from happening near Russia’s borders in the future.
  • At least two passenger jets belonging to major European airlines were endangered by the then-unknown aircraft over the neutral waters of the Sea of Japan on Sunday, Interfax reported.
  • The “unknown aircraft” was flying at the altitude of some 11,000 meters (36,000 feet) and did not respond to air traffic control, the agency said citing its source. Russian air controllers had to immediately change the flight path of a KLM Boeing-777, which was in the same region en route from Japan to Holland.
  • Pilots from another airplane, operated by Swiss airlines, heading to Switzerland from Japan, even reported “visual contact with a large four-engine aircraft, which was in direct proximity to their plane” and sent no recognition signals, the source said. The flying altitude for the Swiss jet also had to be changed by the air traffic control.
  • There have been a number of incidents during which US intelligence aircraft have been detected close to Russian airspace this year. In January, a US Air Force reconnaissance aircraft was intercepted by a Russian fighter jet when flying over the Black Sea. US officials then blamed Moscow for an “unproffessional” maneuver of its fighter jet. In April, another US reconnaissance plane “rapidly approaching the Russian border” was intercepted in the Baltic Sea.
  • Following the episodes over the Baltic Sea, Russia’s Defense Ministry released an official statement, saying US surveillance planes should either not approach the Russian borders or at least keep aerial transponders switched on. “Turn on transponders for automatic identification by our radars,” the ministry said at the time.

Source: rt.com

Economic Collapse, Dollar Collapse,Gold,Silver,Prepping,Preppers

05.23.16 –    We’re in the Eye of a Global Financial Hurricane

  • The only “growth” we’re experiencing are the financial cancers of systemic risk and financialization’s soaring wealth/income inequality.
  • The Keynesian gods have failed, and as a result we’re in the eye of a global financial hurricane.
  • The Keynesian god of growth has failed.
    The Keynesian god of borrowing from the future to fund today’s consumption has failed.
  • The Keynesian god of monetary stimulus / financialization has failed.
  • Every major central bank and state worships these Keynesian idols:
  • 1. Growth. (Never mind the cost or what kind of growth–all growth is good, even the financial equivalent of aggressive cancer).
  • 2. Borrowing from the future to fund today’s keg party, worthless college diploma, particle board bookcase, stock buy-back, etc. (oops, I mean “investment”)–a.k.a.deficit spending which is a polite way of saying this unsavory truth: stealing from our children and grandchildren to fund our lifestyles today.
  • 3. Monetary stimulus / financialization. If private investment sags (because there are few attractive investments at today’s nosebleed valuations and few attractive investments in a global economy burdened with massive over-production and over-capacity), drop interest rates to zero (or below zero) to “stimulate” new borrowing… for whatever: global carry trades, bat guano derivatives, etc.
    Here is my definition of Financialization:
  • Financialization is the mass commodification of debt and debt-based financial instruments collaterized by previously low-risk assets, a pyramiding of risk and speculative gains that is only possible in a massive expansion of low-cost credit and leverage.
  • That is a mouthful, so let’s break it into bite-sized chunks.
    Home mortgages are a good example of how financialization increases financial profits by jacking up risk and distributing it to suckers who don’t recognize the potential for staggering losses.
    In the good old days, home mortgages were safe and dull: banks and savings and loans institutions issued the mortgages and kept the loans on their books, earning a stable return for the 30 years of the mortgage’s term.
  • Then the financialization machine revolutionized the home mortgage business to increase profits. The first step was to generate entire new types of mortgages with higher profit margins than conventional mortgages. These included no-down payment mortgages (liar loans), no-interest-for-the-first-few-years mortgages, adjustable-rate mortgages, home equity lines of credit, and so on.
    This broadening of options (and risks) greatly expanded the pool of people who qualified for a mortgage. In the old days, only those with sterling credit qualified for a home mortgage. In the financialized realm, almost anyone with a pulse could qualify for an exotic mortgage.
  • The interest rate, risk and profit margins were all much higher for the originators. What’s not to like? Well, the risk of default is a problem. Defaults trigger losses.
  • Financialization’s solution: package the risk in safe-looking securities and offload the risk onto suckers and marks. Securitizing mortgages enabled loan originators to skim the origination fees and profits up front and then offload the risk of default and loss onto buyers of the mortgage securities.
  • Securitization was tailor-made for hiding risk deep inside apparently low-risk pools of mortgages and rigging the tranches to maximize profits for the packagers at the expense of the unwary buyers, who bought high-risk securities under the false premise that they were “safe home mortgages.”
    Financialization– which can only expand to dominate an economy if it is supported by a central bank bent on expanding credit–has two inevitable and highly toxic consequences:
  • — Risk seeps into every nook and cranny of the financial system, greatly increasing the odds of a systemic domino reaction in financial meltdowns. This is precisely what we saw in the 2008-09 Global Financial Meltdown (GFM): supposedly “contained” subprime mortgages toppled dominoes left and right, bringing the entire risk-saturated system to its knees.
  • — Extraordinary wealth and income inequality, as those closest to the central bank money/credit spigots can scoop up income-producing assets first at much lower costs than Mom and Pop Main Street investors.
  • The rising anger of the masses left behind by the central bank / financialization wealth harvesting machine is the direct result of Keynesian monetary stimulus that rewards debt-based speculative gambles by those closest to the cheap-credit spigots.
  • As I explain in my book Why Our Status Quo Failed and Is Beyond Reform, the only possible output of central bank monetary stimulus is financialization, and the only possible output of financialization is unprecedented wealth and income inequality.
  • The global financial system is in the eye of an unprecedented hurricane. While central bankers are congratulating themselves on their god-like mastery of Nature, and secretly praying to the idols of the Keynesian Cargo Cult every night, the inevitable consequence of borrowing from the future, the obsession with “growth” at any cost and financialization /monetary stimulus, a.k.a. the rich get richer thanks to central banks is systemic collapse.
  • Don’t fall for the mainstream media and politicos’ shuck-and-jive that all is well and “growth” will return any day now. The only “growth” we’re experiencing are the financial cancers of systemic risk and financialization’s soaring wealth/income inequality.

Source: charleshughsmith.blogspot.com

Economic Collapse, Dollar Collapse,Gold,Silver,Prepping,Preppers

05.23.16 –    Despite Depression, Greece Forced To Hike VAT, Add New Taxes, More Austerity On the People

  • Greece remains in an economic depression interrupted by a few quarters of anemic growth.
  • Hiking taxes in a depression is one of the stupidest things one can do, but Greece is set for another vote to do just that.
  • Prime minister Alexis Tsipras is once again prepared to kiss German Chancellor Angela Merkel’s behind, and his party will likely go along for the ride.
  • The wildcard IMF has yet to chime in on the economic stupidity of this hike.
  • Please consider Greece Set for Austerity Vote to Secure Bailout Cash.

Greece’s parliament is expected to vote late Sunday on a raft of fresh taxes and austerity reforms that the country must legislate to unlock further rescue loans, ahead of a crucial eurozone finance ministers meeting on Tuesday.

The bill includes the last portion of an austerity package worth €5.4 billion ($6.06 billion), or 3% of the country’s gross domestic product, which Greece has agreed on with its international creditors to implement by 2018 in exchange for fresh bailout funds under the terms of its third bailout deal.

The IMF has said it would only sign up to the Greek bailout if Germany agrees to debt relief. But German officials are seeking to delay any debt restructuring until the end of the current Greek bailout program in 2018, so that Germany’s parliament, the Bundestag, would pass such measures only after Germany’s 2017 elections.

To meet its targets, Athens was asked to set up a “contingency mechanism” of additional austerity measures worth some 2% of GDP.

The measures being voted on Sunday include new taxes on fuel, tobacco, alcohol, Internet, pay TV, hotel stays, cars, changes in property tax, as well as a rise in the basic value-added tax rate, applied to most goods and services, from 23% to 24%.

The Greek parliament is also expected to vote on the fiscal brake mechanism that would automatically cut state spending if Greece misses its budget targets.

How much the next bailout tranche would be is still to be determined, but European Union officials indicate it could be €10 billion.

  • Another Humiliating Greece Cave-In
  • On May 14, I reported Greece “Demands” Debt Relief, Owes Troika €11+ Billion by July.
  • My comment: “Greece has caved in every time, and in the most humiliating ways. Greece even caved in on pension cuts last week. Why should anyone believe Greek demands now?
  • €10 billion would be a lot of money, if the money went to Greece. But virtually none of it will go to Greece.
  • Greece Short-Term Debt Timeline

Greece Debt Obligations1

  • Somehow I expect the next tranche to be a “greater than expected” €11 billion. Perhaps €10 billion will suffice if Greece has €1 billion of its own to pony up.
  • Greece Long-Term Debt Timeline

Greece Debt Obligations2

  • Payments to the Troika stretch all the way to 2059, while assuming Greece can maintain a primary account surplus of 3.5% the entire way.
  • The IMF says this is impossible, while proposing a surplus of 1.5%, also impossible.
  • Politics of Debt Relief
  • The IMF wants debt relief now, but Germany wants the IMF to hold off until Merkel wins reelection.
  • Meanwhile, the Greek depression resumes.

Greek Tax Hikes

  • These tax hikes are insane. The key question remains: Is the IMF bluffing about debt relief or not?

Source: mishtalk.com

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05.22.16 –   These Americans Are Preparing For War With Their Own Government

  • During the Oregon standoff, where a group of US citizens calling themselves the Citizens for Constitutional Freedom, seized control of a federal wildlife refuge in protest of harsh sentences being given to members of a ranching family for allegedly allowing fires set on their property to spread on to federal land, Ron Paul posed a question: Is the event isolated, or a sign of things to come?
  • It is becoming increasingly apparent that the Oregon standoff was the latter.
  • As the Washington Post writes, there is a significant movement among US citizens that are demanding that the federal government adhere to the Constitution, and stop what they see as systematic abuse of land rights, gun rights, freedom of speech and other liberties.

  • One example of this movement is a group in Oregon that calls itself the Central Oregon Constitutional Guard. The group refers to themselves as patriots, and is made up of people from all walks of life. The organization describes itself as a “defensive unit against all enemies foreign and domestic”, mainly because they believe the government is capable of unprovoked aggression against its own people.
 Deep in the heart of a vast U.S. military training ground, surrounded by spent shotgun shells and juniper trees blasted to shreds, the Central Oregon Constitutional Guard was conducting its weekly firearms training.

“The intent is to be able to work together and defend ourselves if we need to,” said Soper, 40, a building contractor who is an emerging leader in a growing national movement rooted in distrust of the federal government, one that increasingly finds itself in armed conflicts with authorities.

Those in the movement call themselves patriots, demanding that the federal government adhere to the Constitution and stop what they see as systematic abuse of land rights, gun rights, freedom of speech and other liberties.

Law enforcement officials call them dangerous, delusional and sometimes violent, and say that their numbers are growing amid a wave of anger at the government that has been gaining strength since 2008, a surge that coincided with the election of the first black U.S. president and a crippling economic recession.

Soper started his group, which consists of about 30 men, women and children from a handful of families, two years ago as a “defensive unit” against “all enemies foreign and domestic.” Mainly, he’s talking about the federal government, which he thinks is capable of unprovoked aggression against its own people.

The group’s members are drywallers and flooring contractors, nurses and painters and high school students, who stockpile supplies, practice survival skills and “basic infantry” tactics, learn how to treat combat injuries, study the Constitution and train with their concealed handguns and combat-style rifles.

“It doesn’t say in our Constitution that you can’t stand up and defend yourself,” Soper said. “We’ve let the government step over the line and rule us, and that was never the intent of this country.”

  • Law enforcement officials and watchdog groups are branding such organizations as anti-government extremists of course, and even trying to marginalize the groups by giving them nicknames such as “Y’all Qaeda” and “Vanilla Isis”, and the groups have even earned the designation of “domestic terrorists.” Despite the attempts to downplay the groups, the number of like minded organizations has grown from 150 in 2008 to about 1,000 now, and estimates peg the number of supporters in the hundreds of thousands. The movement had been emboldened by the 2014 standoff at Cliven Bundy’s ranch in Nevada, where federal agents faced off with hundreds of armed supporters of Bundy in a dispute over the rancher’s refusal to pay fees to graze his cattle on federal land – the agents eventually stood down.
 Law enforcement officials and the watchdog groups that track the self-styled “patriot” groups call them anti-government extremists, militias, armed militants or even domestic terrorists. Some opponents of the largely white and rural groups have made fun by calling them “Y’all Qaeda” or “Vanilla ISIS.”

Mark Potok of the Southern Poverty Law Center, which monitors extremism, said there were about 150 such groups in 2008 and about 1,000 now. Potok and other analysts, including law enforcement officials who track the groups, said their supporters number in the hundreds of thousands, counting people who signal their support in more passive ways, such as following the groups on social media. The Facebook page of the Oath Keepers, a group of former members of police forces and the military, for example, has more than 525,000 “likes.”

 

President Obama’s progressive policies and the tough economic times have inflamed anti-government anger, the same vein of rage into which Donald Trump has tapped during his Republican presidential campaign, said Potok and Mark Pitcavage, who works with the Anti-Defamation League and has monitored extremism for 20 years.

Much of the movement traces its roots to the deadly 1990s confrontations between civilians and federal agents at Ruby Ridge, Idaho, and in Waco, Tex., that resulted in the deaths of as many as 90. Timothy Mc­Veigh cited both events before he was executed for the 1995 Oklahoma City bombing that killed 168 people, and said he had deliberately chosen a building housing federal government agencies.

Now a “Second Wave” is spreading across the country, especially in the West, fueled by the Internet and social media. J.J. MacNab, an author and George Washington University researcher who specializes in extremism, said social media has allowed individuals or small groups such as Soper’s to become far more influential than in the 1990s, when the groups would spread their message through meetings at local diners and via faxes.

The movement received a huge boost from the 2014 standoff at Cliven Bundy’s ranch in Nevada, where federal agents and hundreds of armed supporters of Bundy faced off in a dispute over the rancher’s refusal to pay fees to graze his cattle on federal land.

When federal agents backed down rather than risk a bloody clash, Bundy’s supporters claimed victory and were emboldened to stage similar armed face-offs last year at gold mines in Oregon and Montana.

  • The latest confrontation that has taken place was in Burns, Oregon, where armed occupiers, led by Cliven Bundy’s sons, took over the headquarters building of the Malheur National Wildlife Refuge. Ultimately, the standoff ended with multiple arrests, and even the death of the group spokesman Robert “LaVoy” Finicum, who was shot by the FBI after an incident at a roadblock in the area. BJ Soper, founder of the Central Oregon Constitutional Guard says he tries to be the calming voice of the growing movement, knowing there are many hot heads that fall within its ranks; a voice clearly much needed. After the standoff at the wildlife refuge, two members splintered off and went on to kill two police officers in Las Vegas, leaving a note saying “This is the beginning of the revolution.”
 n January, dozens of armed occupiers, led by Bundy’s sons Ammon and Ryan, took over the headquarters buildings of the Malheur National Wildlife Refuge near rural Burns, Ore., an action that resulted in the death of Robert “LaVoy” Finicum, an occupier who was shot by state troopers.

Soper has been in the middle of all of it. He says he has tried to be a more moderate voice in a movement best known for its hotheads. He spent a month living in his RV at Burns, trying to talk the occupiers into standing down.

Two days after Soper’s last visit to the refuge, Finicum was killed in an operation in which the Bundys were arrested. An independent local investigation concluded that the shooting was justified, although the U.S. Justice Department is investigating several FBI agents for possible misconduct. Soper considers Finicum’s death “murder.”

That kind of talk is “a big deal,” said Stephanie Douglas, who retired in 2013 as the FBI’s top official overseeing foreign and domestic counterterrorism programs. “Free speech doesn’t make you a terrorist just because you disagree with the government. But if you start espousing violence and radicalizing your own people toward a violent act, the federal government is going to take notice.”

Shortly after the Bundy ranch confrontation, two of Bundy’s supporters who had been at the ranch, Jerad and Amanda Miller, killed two police officers and a civilian and also died in a Las Vegas shooting rampage. Police said the couple left a note on the body of one the officers they had shot point-blank.

It said: “This is the beginning of the revolution.

 

  • BJ Soper has described his reasons to to start the Central Oregon Constitutional Guard as being simply that he used to be oblivious to everything that was going on, but after the Bundy Ranch incident, he decided to get more involved and make a difference. Soper’s understandable skepticism about the government gets rather intense, taking views quite outside the norm, entertaining that the government had a hand in 9/11, that the government is mandating vaccines that cause autism, and that the United Nations wants to reduce global population through a program called Agenda 21. All of which spurred Soper’s desire to create the group, and prepare his family for any possible scenario through weapons training and emergency food storage.
 “I lived like 90 percent of Americans, oblivious to everything that was going on, from the time I was 18 until the Bundy Ranch happened,” he said. “I just said, ‘I can’t sit back and do nothing. I’ve got to get involved.’ I feel responsible for where we’re at, because I’ve done nothing my entire life.”

His response was to start his Central Oregon Constitutional Guard, which he said was partly to protect against the government, but partly a way to get back to a simpler America.

“As a kid, life was easy,” he says on the group’s website. “No worries. Very little threats. I would ride my bike around all over the neighborhood for hours on end. Play with friends and show back up for dinner without worry.”

Critics say such talk is naive nostalgia for a 1950s America that wasn’t ever really such a homespun paradise in the first place. And they say the groups that have sprung up in response are far more dangerous than Soper and others want to make them seem.

“The idea that he needs to face down the government with weapons I think is really, really wrong,” Potok said. “They don’t really say that, but I think that is what is right under the surface.”

Soper’s research also led him to some of the Internet’s favorite conspiracy theories, including a purported U.N. plot to impose “One World Government.” And Soper, like most in the patriot movement, became a believer.

He suspects that the United Nations, through a program called Agenda 21, wants to reduce the global population from 7 billion to fewer than 1 billion. He said the federal government may be promoting abortions overseas as part of that plot, and also may be deliberately mandating childhood vaccines designed to cause autism because autistic adults are less likely to have children.

Soper said he could not rule out the possibility that the U.S. government was behind the 9/11 attacks. He suspects that the government and the “medical community” have had a cancer cure for years but won’t release it because cancer treatment is too profitable for pharmaceutical companies.

“I’m not saying that’s the case,” he said, “but I like to look at all avenues.”

Soper knows those ideas sound crazy to many people, but, he said with a laugh, “It shows I just don’t trust my government.”

  • Alex McNeely, a 25 year old drywaller found the patriot group online, and joined the group to feel that he was helping defend the country. And in a textbook example of how words can cause many to take action, echoed the sentiment of many conservative pundits who claim Obama is a socialist who is trying to fundamentally change America. The group is conservative, and generally supports Trump, although anyone other than Hillary would suffice. One of the men indicted by the Bundy ranch case is Gerald DeLemus, who was New Hampshire co-chair of Veterans for Trump and was named by the Trump campaign as a New Hampshire alternate delegate to the Republican National Convention In Cleveland.
 “There’s this D.C. mentality that if you stand up for your rights, you’re dangerous and anti-government,” said McNeely, who has an AK-47 assault rifle tattooed on his forearm. “But if I’m denied my rights, what else can I do? Am I just going to stand there and take it, or am I going to do something?”

 

In the Constitutional Guard, McNeely said, “I feel what we do is stand up for people who don’t have the means to stand up for themselves. I have an overwhelming desire to help people.”

McNeely considered joining the military when he graduated from high school, but he turned 18 the month Obama was elected in 2008, and, because of Obama’s “socialist” policies, “I wasn’t going to accept him as my commander in chief.”

“I don’t like that he wants to fundamentally change America,”McNeely said.

The group members are conservatives, do not like former secretary of state Hillary Clinton and generally support Donald Trump. Soper said he would prefer just about anyone over Clinton but would not cast a vote for president this year. He said he thinks casting his vote is “a waste of time” because Oregon’s politics are dominated by Democrats.

  • Everyone in the group keeps 30 days worth of food and emergency supplies on hand, and group members learn gardening and raising livestock. They camp, and learn survival tactics, including how to fashion a shelter, find food and water, and make a fire. The group is preparing for anything, and that includes economic collapse.
 “I don’t know that it’s all that far-fetched that we have an economic collapse,” he said. “The dollar is a pretty scary investment anymore. China’s buying up all the gold. When people get hungry and thirsty and can’t feed themselves, they get desperate.”

  • Soper reiterates every chance that he gets that he does not want violence, however in his reality, he believes that if common sense doesn’t get restored in the government, people will get hurt.
 “The last thing I want is violence” Soper said. “But I hope they see that if we continue down this path, we’re going to have more bloodshed in this country.”
  • As he writes his sheriff upon learning of the news that more people had been arrested in connection with the 2014 standoff at the Bundy Ranch, Soper airs his concerns, and ends the letter in a very dramatic fashion:
 “People are being detained without due process” he said. “These are not our American values.”

“I pray we find some sense of it again, otherwise a very dark future awaits us, and it is not very far down the road.” Sheriff, he said, “People are going to die.

 

  • As America becomes even more fragmented, more fractured, and more polarized, and, as both the GOP and Democratic primaries have shown, with ever more people calling for true change to take place, the establishment may be under pressure to finally act for change, even if the change is at first, very painful – something 8 years of relentless central bank intervention has desperately tried to prevent. If the government chooses not to act, a violent future may await America as the people themselves rise up once more to recreate what was once the freest and most admired nation on earth.

Source: zerohedge.com

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05.22.16 –    WWIII? A “Hybrid Geo-Financial War” Between NATO and Russia Is Dangerously Escalating

  • Russia is preparing for war against the West.
  • Putin is being urged to do so because the U.S. and NATO have been preparing for war themselves.
  • Syria and Ukraine have just been warm ups. The real thing could be around the corner, and other proxy flashpoints are ready to line up.
  • The rising tensions for military conflict are sharply complicated by the stealthier financial war that is nonetheless taking a serious toll across the globe, in particular as collapsing oil prices put incredible pressure on those regimes who have cast a big social benefits net financed primarily by $100/barrel oil.
  • As SHTF previously reported, that made Venezuela the most vulnerable, and it is plain today that the oil rich nation is collapsing. However, the manipulation of these prices was also meant to put pressure on Russia (as well as other countries)… while the attempt to undercut Russian natural gas by taking over Ukraine and have NATO supply gas to Europe instead of Russia has so far failed.
  • It is a sophisticated geopolitical gamble that perhaps no one is winning, apart from who manages not to topple over.
  • A detailed, but nonetheless alarming article by Alastair Crooke reports that there is significant pressure on Putin from other Russian leaders to take a hard line in the days ahead.
  • via the Huffington Post:

Putin carries, at one end of his balancing pole, the various elites more oriented toward the West and the “Washington Consensus“ and, at the pole’s other end, those concerned that Russia faces both a real military threat from the North Atlantic Treaty Organization and a hybrid geo-financial war as well. He is being pressed to come down on the side of the latter, and to pry the grip of the former from the levers of economic power that they still tightly hold.

In short, the issue coming to a head in the Kremlin is whether Russia is sufficiently prepared for further Western efforts to ensure it does not impede or rival American hegemony. Can Russia sustain a geo-financial assault, if one were to be launched? And is such a threat real or mere Western posturing for other ends?

What is so important is that if these events are misread in the West, which is already primed to see any Russian defensive act as offensive and aggressive, the ground will already have been laid for escalation. We already had the first war to push back against NATO in Georgia. The second pushback war is ongoing in Ukraine. What might be the consequences to a third?

In mid-April, General Alexander Bastrykin, the head of Russia’s Investigative Committee (a sort of super attorney general, as Cohen describes it), wrote that Russia — its role in Syria notwithstanding — is militarily ill prepared to face a new war either at home or abroad, and that the economy is in a bad way, too. Russia, furthermore, is equally ill prepared to withstand a geo-financial war. He goes on to say that the West is preparing for war against Russia and that Russia’s leadership does not appear to be aware of or alert to the danger the country faces.

[…] A retired Russian general entered the fray to confirm that the West is indeed preparing for war — he pointed to NATO deployments in the Baltics, the Black Sea and Poland, among other places — and underlines again the unpreparedness of the Russian military to face this threat. “This is a heavy indictment of Putin,” Cohen says of the revelations from this analysis. “It is now out in the open.”

[…]

The government’s economic policy is being criticized. The opposing faction wants to see an immediate mobilization of the military and the economy for war, conventional or hybrid. This is not about wanting Putin ousted; it is about pushing him to wield the knife — and to cut deeply.

  • There is every reason to think that the clashing interests of NATO and Russia can and will spark more flashpoints across the map and around the arc that generally surrounds the former Soviet empire, which the United States hopes to contain in order to maintain its own crumbling empire.
  • While President Obama, now officially the president to oversee the longest period of war (albeit somewhat contracted), may be reluctant to pursue in form of open conflict with Russia, a president like Hillary Clinton may be all-too willing to do so. She has already called in recent days for an escalated ‘war against ISIS,’ which handily also gives an open ended pretext to challenge NATO-Russian conflict points wherever they might appear.
  • Donald Trump’s positions here are as yet unclear, but he is beginning to surround himself with the same type of advisers – including Henry Kissinger –  that have brought us to this point.
  • With economic decline and a definite fatigue for war, Americans face an end of the dollar as the world currency standard and an era where the BRICS nations, and in particular the militaries of Russia and China, pose an existential threat to the world that the U.S. and Britain carved out in the WWII era and which they essentially won away from the Soviets by the end of the Cold War.
  • These waxing and waning empires are dangerous as their vulnerabilities and short-comings become exposed, and their territories challenged.
  • That fact that Putin is being prodded from within Russia to be less diplomatic and more aggressive in posturing for war is downright unsettling. Many of our most dangerous American leaders are all-too willing to poke the bear and evoke a reaction.
  • Ukraine and Syria, as well as the Georgian conflict before it in 2008, prove that the U.S. will continue waging war and posturing for global domination in spite of the lack of a coherent narrative (but there’s ISIS), or any convincing pretext for sending troops and sponsoring proxy armies.
  • The American people are sick of war, but the misleaders in Washington are eager enough to reinvigorate their sense of power and entitlement to control the affairs here and abroad. After all, war – in a sick kind of way – is good for the economy, and a big one means a mandate of emergency powers and a period of unquestioning obedience from the domestic population.
  • The threat is all-too real, and a serious provocation, like the false flag attacks that have sparked most of the wars in the past, could be on the horizon.
  • That all basically points to WWIII… or at least a full second Cold War. It could be a long way off, but the sense is that the scent is in the air.
  • What do you think will happen next?

Source:shtfplan.com

Economic Collapse, Dollar Collapse,Gold,Silver,Prepping,Preppers

05.21.16 –   UN Plots War On Free Speech To Stop “Extremism” Online

  • The United Nations Security Council wants a global “framework” for censoring the Internet, as well as for using government propaganda to “counter” what its apparatchiks call “online propaganda,” “hateful ideologies,” and “digital terrorism.” To that end, the UN Security Council this week ordered the UN “Counter-Terrorism Committee” — yes, that is a real bureaucracy — to draw up a plan by next year. From the Obama administration to the brutal Communist Chinese regime, everybody agreed that it was time for a UN-led crackdown on freedom of speech and thought online — all under the guise of fighting the transparently bogus terror war.
  • The UN, ridiculed by American critics as the “dictators club,” will reportedly be partnering with some of the world’s largest Internet and technology companies in the plot. Among the firms involved in the scheme is Microsoft, which, in a speech before the Security Council on May 11, called for “public-private partnerships” between Big Business and Big Government to battle online propaganda. As this magazine has documented, Google, Microsoft, Yahoo, and other top tech giants have all publicly embraced the UN and its agenda for humanity. Many of the more than 70 speakers also said it was past time to censor the Internet, with help from the “private sector.”
  • At the UN meeting this week, the 15 members of the UN Security Council, including some of the most extreme and violent dictatorships on the planet, claimed they wanted to stop extremism and violence from spreading on the Internet. In particular, the governments pretended as if the effort was aimed at Islamist terror groups such as ISIS and al-Qaeda, both of which have received crucial backing from leading members of the UN Security Council itself. Terrorism was not defined. Everybody agreed, though, that terror should not be associated with any particular religion, nationality, ethnicity, and so on, even though at least one delegation fingered the Israeli government.
  • In its “presidential statement” after the session, the UN Security Council claimed that “terrorism” could be defeated only with “international law” and through collaboration between the UN and emerging regional governments such as the various “unions” being imposed on Europe, Africa, Eurasia, South America, and beyond. “The Security Council stresses that terrorism can only be defeated by a sustained and comprehensive approach involving the active participation and collaboration of all States, international and regional organizations … consistent with the United Nations Global Counter-Terrorism Strategy,” it said. Of course, the UN still has no actual definition of terrorism, but it is in the process of usurping vast new powers under the guise of fighting this undefined nemesis.
  • However, the UN, in its ongoing war against free speech and actual human rights around the world, has offered some strong hints about its agenda. According to UN officials, the plan to regulate speech on the Internet will complement another, related UN plot known formally as the “Plan of Action to Prevent Violent Extremism.” As The New American reported last year, the plan calls for a global war on “ideologies.” That crusade will include, among other components, planetary efforts to stamp out all “anti-Muslim bigotry,” anti-immigrant sentiments, and much more, the UN and Obama explained. So-called “non-violent extremism” is also in the UN’s crosshairs, as is free speech generally.
  • It was not immediately clear how a UN-led war on “anti-Muslim bigotry” would stop ISIS. The savage terror group, which according to top U.S. officials was created and funded by Obama’s anti-ISIS coalition, served as the crucial justification for the UN plan. However, based on the outlines of the UN extremism scheme released so far, it is clear that there will be no serious efforts to address the growing extremism of the UN or the violent extremism of many of its mostly autocratic member regimes. Instead, the “extremism” plan will serve as a pretext to impose a broad range of truly extremist policies at the national, regional, and international level.
  • Seemingly oblivious to the totalitarian absurdity of the comments, top UN officials called for safeguards against “excessive punishment” wielded against those who express their views on the Internet. “The protection of free media can be a defense against terrorist narratives,” UN Deputy Secretary-General Jan Eliasson told the Security Council during the meeting this week in a stunning example of double-speak. “There must be no arbitrary or excessive punishment against people who are simply expressing their opinions.” It was not immediately clear what specific punishments for free speech would be considered non-excessive. But in the United States, despite UN claims about pseudo-“human rights” requiring censorship, any and all “punishment” for expressing one’s views is strictly prohibited.
  • Separately, the Communist Chinese dictatorship, which now dominates various UN bureaucracies, enthusiastically embraced the UN’s efforts. Speaking on behalf of the brutal regime, Liu Jieyi, Beijing’s permanent representative to the UN, said that institutions promoting “extremist ideologies” needed to be “closed down.” Apparently he was not referring to the “extremist ideology” of the Communist Party of China or its brutal regime, which has murdered more innocent human beings than any other in history. Beijing alone has killed more than 60 million people, not including those butchered in forced abortions. Other communist governments allied with Beijing have murdered tens of millions more, just in the last century.
  • While the UN has a major role to play, governments also need to help out in censoring the Internet and abolishing free speech, the communist regime said. “States must shut down some social media networks,” Liu continued, calling for the UN and its members to “cut off the channels for spreading terrorist ideologies.” He also touted terror decrees adopted recently by Beijing that target the Internet and purport to authorize the deployment of the communist dictatorship’s armed enforcers all over the world. As The New American has documented previously, the Chinese dictatorship will be playing a major role in the UN’s anti-freedom of speech crusade. In fact, the regime currently has its agents embedded all throughout the UN, and even at the top of the UN agency that globalists are working to empower as the global Internet regulator. He claims censorship is all in the eye of the beholder.
  • Even as Communist China and other overtly dictatorial UN members emphasized censorship and regulation to stop ideologies and “propaganda” they dislike, the Obama administration, the European Union, and some of its formerly sovereign member states instead touted government propaganda to counter extremist propaganda. However, speaking for the EU, Alain Le Roy also celebrated the unaccountable super-state’s own efforts to censor the Internet as something to be emulated. As this magazine reported last year, the EU’s self-styled police force, Europol, even launched a whole unit aimed at censoring “extremist” content on the Internet. The EU spokesman pointed to, among other schemes, ongoing EU efforts to remove “propaganda materials” from the Internet, as well as EU propaganda efforts to “spread alternative messages.”
  • The representative of Syria’s brutal dictatorship, Bashar Jaafari, showed up to crash the party. He pointed out that multiple UN member states had used terrorist fighters and mercenaries in their quest to destroy Syria. And he is right. Indeed, as far back as 2012, U.S. Defense Intelligence Agency documents show that the Obama administration knew the “moderate Syrian rebels” it was supporting were led by al-Qaeda and the Muslim Brotherhood. The administration and its allies were also working to create what they described as a “Salafist principality in Eastern Syria” — today the principality is known as the Islamic State, or ISIS — in order to destabilize the Assad regime. Even top U.S. officials have openly admitted that Obama’s “anti-ISIS” coalition was responsible for creating, arming, and funding ISIS. What role the Internet and “propaganda” may have played in that, if any, was not made clear at the UN meeting.
  • In Libya, a similar situation occurred. The Obama administration, under the guise of enforcing an illegitimate UN resolution, openly partnered with self-declared al-Qaeda leaders to overthrow former U.S. terror-war ally and brutal dictator Moammar Gadhafi. Congress was never consulted, making Obama’s war illegal and unconstitutional, in addition to the serious crime of providing aid to designated terror organizations. Today, thanks to that extremism, Libya is a failed state awash in heavy military weaponry and terror training camps. Much of the Obama administration-supplied aid for terror groups in Libya was transferred to supporting terror groups in Syria following the fall of Gadhafi’s regime.
  • Aside from governments, dictators, and international bureaucrats, Big Technology was also represented at the UN meeting. Microsoft Vice-President and Deputy General Counsel Steve Crown told the assembled representatives of governments and tyrants that there was no “silver bullet” to prevent terrorists and extremists from using the Internet. “If there were an elegant solution, industry would have adopted it,” he claimed, adding that Google, Facebook, and Twitter were coming together to prevent the Internet from being abused. Facebook was exposed just this week censoring conservative media outlets from its “trending” news section. And earlier this year, Google was exposed for having helping the U.S. government foment jihadist-led revolution in Syria.
  • Echoing the UN’s rhetoric, Crown claimed “international law” and fascist-style “public-private partnerships,” in which governments and Big Business join forces, were the appropriate response. He also said the “international community,” a deceptive term generally used to refer to the UN and its member governments, needed to “work together in a coordinated and transparent way.” The UN Security Council agreed, saying in its final declaration that there needed to be “more effective ways for governments to partner with … private sector industry partners.” It is hardly a new agenda.
  • As The New American reported previously, the technology giants — all of which are regularly represented at the globalist Bilderberg summits — have also emerged as enthusiastic supporters of the UN’s radical “Agenda 2030.” According to the agreement, the goal is “transforming our world,” redistributing wealth at the international level, empowering the institutions of global governance, and more. Among the mega-corporations proudly backing the scheme are the world’s top three search engines: Google, Microsoft’s Bing, and Yahoo. It was not immediately clear whether those corporations’ support for the deeply controversial UN agenda would affect the supposed impartiality of their search results. But critics of the UN plan expressed alarm nonetheless.
  • Of course, a handful of the more than 70 people who spoke at the Security Council confab paid lip service to freedom of speech and freedom of thought. The Iraqi government’s delegation, for example, emphasized differentiating between “freedom of thought and extremist ideologies.” Others said the war on extremism could not be used to justify persecuting critics of governments. Some of the speakers no doubt had good intentions, too.
  • However, putting the UN in charge of fighting extremism and dangerous ideologies would be like putting a mafia boss in charge of fighting crime — it is patently absurd, even grotesque. Most of the UN’s member regimes are undemocratic, to be generous, and many of them are led by genocidal psychopaths who murder with impunity. Among other UN member states, those enslaving North Korea, Zimbabwe, Cuba, Sudan, China, and many more are run by criminals and mass-murderers who epitomize terrorism and violent extremism. Plus, virtually every terror group on earth today has its roots in state-sponsorship, including ISIS and al-Qaeda.
  • The real solution to terror, then, is neither a stronger UN nor a global war on ideologies, extreme or otherwise. Empowering the UN to wage a global war on ideas, ideologies, propaganda, and speech is itself an extremist proposition riddled with extreme dangers. A far simpler answer to the scourge of terrorism would be to defund the UN, arrest those supporting terror groups, and stop propping up dictators and terrorists with taxpayer money. Anything else is a dangerous fraud.

Source: zerohedge.com

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05.20.16 –    Anti-govt protesters storm PM’s office, Green Zone in Baghdad, curfew imposed

  • At least three people are reported dead and scores injured after Iraqi state forces used live bullets and tear gas against anti-government protesters attempting to storm the Green Zone area of Baghdad.
  • Several hundred managed to break through the manned checkpoints into the heavily secured area, and made their way towards the cabinet building. Photos circulated online of protesters posing inside official meeting rooms and the prime minister’s press office.
  • The crowd only retreated once guards began to use live rounds, with video showing that many of the protesters were still milling outside the Green Zone gates minutes later.
  • A curfew has now been imposed, with state news reporting that “control has been restored, following an unfortunate series of events.”
  • “Riot police are dealing with anyone trying to damage state institutions in accordance with the law,” said a statement from the military.
  • Hours earlier, the mostly young male crowd gathered in central Baghdad, shouting, “This is the revenge of the people!” and “Don’t side with the corrupt!” in protest against the government’s failure to pass a key anti-corruption law.
  • Friday’s demonstration was called by secular protesters, who are calling for Prime Minister Haider al-Abadi to overcome bickering among the special interest groups and factions within his government.
    Al-Abadi has also shouldered blame for a worsening security situation, as Islamic State has been allowed to carry out a string of deadly bombings in Shia districts in the capital and other cities.
  • On Wednesday, a market in Sadr City, a stronghold of the influential Shia cleric Moqtada al-Sadr, was hit by a bomb. Relatives of the victims and Al-Sadr’s supporters were among the rioters.
  • Last month, al-Sadr’s followers managed to briefly break into the Green Zone, in a similar incident, which led to the sacking of its security chief.

Source: rt.com

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05.20.16 –    Unintended Consequences Of Monetary Policy 101: Easy Money = Over-Capacity = Deflation

  • Somewhere back in the depths of time the world got the idea that easy money — that is, low interest rates and high levels of government spending — would produce sustainable growth with modest but positive inflation. And for a while it seemed to work.
  • But that was an illusion. What actually happened was textbook, long-term, surreally-vast misallocation of capital in which individuals, companies and governments were fooled into thinking that adding new factories, stores and infrastructure at a rate several times that of population growth would somehow work out for the best.
  • China, as with so many other things, was the epicenter of this delusion. In response to the 2008-2009 financial crisis it borrowed more money than any other country ever, and spent most of the proceeds on infrastructure and basic industry. It’s steel-making capacity, already huge by 2008, kept growing right through the Great Recession, and now dwarfs that of any other country.

China steel produciton

  • The result was indeed higher prices for iron ore and finished steel up front (that is, the inflation the architects of the easy money era expected and desired).But this was soon followed by falling prices as the rest of the world’s steel makers tried to stay in the game.

Steel price

  • It’s the same story pretty much everywhere. Miners that produced the raw materials for the infrastructure/industrial build-out started projects based on inflated price projections and now have no choice but to keep producing to cover variable costs and avoid bankruptcy. Prices of virtually every commodity have as a result plunged.
  • In the US, retailers built new stores at a pace that vastly exceeded population growth, apparently on the assumption that consumers would keep borrowing in order to buy ever-greater amounts of semi-useless stuff. And now bricks and mortar retailing is suffering a mass-die-off.

Retail space per capita

 

  • Even cheese, of all things, is in a potentially disastrous glut:

(Wall Street Journal) Yes, fattened cows, excess milk production and a strong dollar have helped U.S. stockpiles of cheese grow to unprecedented levels. But the great American cheese glut is also getting a boost from overseas.

Even a U.S. sales have fallen abroad due to a relatively strong dollar, a glut of production along with the weakening of currencies in dairy producing regions, has increased imports of cheese to the United States from Europe, New Zealand and Canada.

On a tonnage basis, annual U.S. cheese and curd exports were down 14% as of the end of February at 309,704 metric tons, while imports of cheese were up 23% at 209,402 tons, according to U.S. Census Bureau Trade Data.

Milk production from the top seven exporting regions continues to increase, albeit at a much slower pace compared to when the expansion first began in 2014, Gregg Tanner, chief executive of dairy giant Dean Foods said in a February earnings call. The European Union is the largest contributor as milk production there has increased by more than 5% year-over-year since the elimination of milk quotas the end of March last year.

The increase is significant as Europe’s dairy production is already one-and-a-half times larger than the U.S. and seven-and-a-half times larger than New Zealand and comes at a time when Russia is banning imports.

This adds up to good news for the cheese adventurous.

A typically hard-to-find exotic cheese from farflung New Zealand that normally sells for $8 a pound recently showed up across the street from Tom Bailey’s house, haphazardly packaged and selling for $5 a pound. He snatched it up.

“They’re just trying to clear this stuff,” said Mr. Bailey, a senior dairy analyst at Rabobank International in New York. “You might see some cheeses you haven’t seen before.”

  • What does this mean? Several things:
 Cheap money sends a “borrow and spend me” signal to the markets, just as expensive money (i.e., high interest rates and government surpluses) says “save and invest me”. So when money is made artificially cheap by cluelessly expansionist governments, it leads people to overborrow and overbuild.

The resulting overcapacity leads to price cuts as marginal producers sell for whatever they can get just to keep the lights on. Falling prices for individual products in the aggregate create systemic deflation. In other words, we’re getting exactly what we should have expected from “inflationary” policies — which is deflation.

  • The next stage of this process will be either:
 The mass failure of marginal players in virtually every basic field. Steel mills, cement factories, shopping malls, high-cost miners, dairy farms, etc., etc., will default on their debt, fire their workers and liquidate their assets, leading to a global depression in which deflation exceeds the 25% seen in the 1930s.

Or…

Mass devaluation in which the world’s governments lower the value of their currencies to make their debts survivable.This will, of course, scream “borrow and spend me before I lose even more value” to the markets, thus increasing systemic leverage and producing an even bigger bust somewhere in the future.

  • We’re clearly opening door number two, so the volatility of the coming decade should put today’s uncertainties to shame.
  • One final, hopeful note:
  In both scenarios, real cash, i.e., gold, is king. In the Great Depression, things got cheaper, which made life easier and more fun for people with money. During times of currency devaluation, gold soars in local currency terms — and life gets easier and more fun for the metal’s owners. So either way, owning sound money (as opposed to euros, dollars, yen or yuan) is one part of a plan to survive what’s coming.

Source: dollarcollapse.com

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05.20.16 –    Turkish parliament approves lifting lawmakers’ legal immunity

  • The Turkish parliament has approved a bill allowing its lawmakers to be prosecuted. The third and final vote on the matter was a secret ballot on Friday, with 376 MPs out of 550 voting in favor of the lifting of immunity from prosecution.
    The bill garnered enough support to go directly to implementation, avoiding a referendum.
  • The government of President Recep Tayyip Erdogan, in the midst of a crackdown on free speech and the press, is apparently turning on its own lawmakers for their alleged “support of terrorism,” which implies members of the People’s Democratic Party (HDP) in particular, and their views on Kurdish groups.
  • One of the MPs who could soon find themselves in hot water is Eren Erdem of the Republican People’s Party (CHP). Currently under investigation for treason, his crime was to allege that the government allowed Islamic State (IS, formerly ISIS/ISIL) terrorists to deliver deadly sarin gas through its territory and on to Syria.
  • “Chemical weapon materials were brought to Turkey and put together in ISIS camps in Syria, which was known as the Iraqi Al-Qaeda at that time,” Erdem told RT in an exclusive in December.
  • All 316 lawmakers from Turkey’s ruling Justice and Development Party (AKP) reportedly signed the proposal.
  • Prime Minister Ahmet Davutoglu did not hold back, claiming the measure is aimed at “so-called lawmakers who lend support to terror and terrorists,” in an apparent reference to HDP members.

Source: rt.com

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05.20.16 –    Egyptian Military Finds Debris, Personal Belongings From Crashed Airliner

  • The Egyptian military said it has found EgyptAir Flight MS804 debris 290 km north of the Mediterranean coastal city of Alexandria. Egyptian army spokesman Brg. Gen. Mohammed Samir said on his verified Facebook page Friday that his military’s search planes and vessels had discovered parts of the Airbus A320 along with some passengers’ belongings.The military is certain the debris comes from Flight MS804 Samir told NBC News by phone, adding that the wreckage will be brought back to Egypt for investigation.
  • The Egyptian military released the following video of the search and rescue operations:

  • EgyptAir has expressed “deepest sorrow to the families and friends.
  • Egypt’s Civil Aviation Minister Sherif Fathy said terrorism was more likely to blame than a technical fault. French President Francois Hollande said at a press conference Thursday “As soon as we know the truth, we’ll have to draw all conclusions, be it an accident or any other hypothesis.”

  • Egypt is leading the investigation, with assistance from Greece and others. Salvage teams from Greece and Egypt have been joined by French investigators to find debris as authorities seek to piece together what happened to the Airbus A320 plane.
  • As reported yesterday, authorities aren’t ruling out any possible cause for the disappearance, including a deliberate act or malfunction, though Egyptian Minister of Aviation Sherif Fathy said the possibility of a terrorist attack is higher than a technical failure. The Airbus jet made sudden movements before swooping into a deep descent before air-traffic control lost contact, according to Greek radar reports. Pilots sent no emergency signal, and their final contact with controllers revealed no signs of distress.
  • Salvage crews will focus on retrieving the flight and data recorders, so-called black boxes that store key flight metrics and voices and sounds from the cockpit that can help investigators pinpoint the cause of a crash. Finding a plane after an incident, particularly over water, can often take days.
  • According to Bloomberg, several factors come into play when searching for wreckage in an ocean. Sea currents, weather and the speed at which the jet hits the water are some issues to be taken into consideration, said Ken Mathews, a former accident investigator who’s worked with the U.S. National Transportation Safety Board as well as its U.K. and New Zealand peers. “If they narrow down the likely area, then it’s only a matter of time,” Mathews said. “The Mediterranean is not a vast area, or so deep as an ocean.”

 Source: zerohedge.com

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05.20.16 –    Can Russia Survive Washington’s Attack?

  • It is not only American generals who are irresponsible and declare on the basis of no evidence whatsoever that “Russia is an existential threat to the United States” and also to the Baltic states, Poland, Georgia, Ukraine, and all of Europe. British generals also participate in the warmongering. UK retired general and former NATO commander Sir Richard Shirreff, Deputy Supreme Allied Commander in Europe until 2014, has just declared that nuclear war with Russia is “entirely possible” within the year.
  • My loyal readers know that I, myself, have been warning for some time about the likelihood of nuclear war. However, there is a vast difference between me and the Western generals. I see the war as the consequence of the neoconservative drive for US world hegemony. The neoconservative drive for world hegemony is acknowledged by the neoconservatives themselves in their public position papers, and it has a 15 year record of being implemented in America’s many and ongoing wars in the Middle East and Africa. Although the Presstitute media does its best to keep our focus away from the known facts, the facts remain known.
  • The position of the Western generals is that “Russian aggression” is driving an innocent America/NATO to nuclear war.
  • Here is General Shirreff’s list of “Russian aggressions”: “He [Putin] has invaded Georgia, he has invaded the Crimea, he has invaded Ukraine. He has used force and got away with it. In a period of tension, an attack on the Baltic states… is entirely plausible.” Shirreff is talking about make-believe happenings that even if real would be taking place inside what were until recently Russia’s long-standing national boundaries.
  • General Shirreff strikes me as either uninformed or a dissembler. It is the United States and Israel who use force and get away with it. The Russian invasion of the former Russian province, Georgia, was a response to the American puppet government’s invasion of South Ossetia in which the American and israeli trained and equipped Georgian troops killed Russian peace-keeping troops and a large number of South Ossetian civilians while the Russian government was at the Beijing olympics.
  • It only took a small fraction of the Russian Army a few hours to roll up the American and Israeli trained Georgian Army. Putin had the former Russian province in his hand. He could have hung the American puppet president and reincorporated Georgia back into Russia, where if probably belongs, having spent all of modern history in that location.
  • But Putin did not see Georgia as a prize, and having made his point, let the Americans have their puppet state back. The president at the time, a scummy scoundrel, was thrown out of the country by Georgians and now serves the American puppet state of Ukraine, like so many others who are not Ukrainian. Apparently, Washington can’t find enough Ukrainians who will sell out their country for Washington and has to bring in foreigners to help Washington rule Ukraine.
  • There has been, alas, no Russian invasion of Ukraine. Putin would not even accept the pleas of the Russian majority populations in the breakaway provinces of Donetsk and Luhansk to be reincorporated back into Russia where they belong. If Putin actually wanted Ukraine, he doesn’t need to send in an army. He can take back the eastern and southern parts just by accepting the pleas of the people to again be a part of Russia.
  • The only plea that Putin accepted was that of the Crimeans, who with an extremely high turnout never experienced in “western democracies” voted 97.6 percent to rejoin Russia, where Crimea resided for longer than the US has existed, until Khrushchev, a Ukrainian, transferred Crimea from the Russian Soviet Republic to the Ukrainian Soviet Republic when both were provinces of the Soviet Union.
  • Little doubt that Putin accepted Crimea’s plea because Russia’s only warm water port and entrance into the Mediterranean Sea is Russia’s naval base in Crimea, and little doubt that Putin refused Donetsk and Luhansk in order to deflect Washington’s propagandistic charges, such as those of former general Shirreff. Putin reasoned, mistakenly in my view, that his refusal to accept Donetsk and Luhansk would reassure Washington’s NATO puppet states and lessen Washington’s influence over Europe. For the corrupt Europeans, facts are of no consequence. Washington’s money prevails.
  • Putin doesn’t understand the power of Washington’s money. In the entire West only money counts. There is no such thing as Washington’s word, government integrity, truth, or even empirical facts. There are only well-propagated lies. The entire West is a lie. The West exists for one reason only–corporate profits.
  • The retired general Shirreff claims, without any evidence, which is typical, that Putin “used force and got away with it.”
  • What force is the general talking about? Can he identify the force? The independent international observers of the Crimean voting report that it was completely fair, that there was no intimidation, no troops or any Russian intimidation present.
  • The former NATO general Shirreff believes that a Russian attack “on the Baltic states is entirely possible.” For what reason? The Baltic states, former provinces of the Soviet Union, comprise no threat whatsoever to Russia. The Russians have no reason whatsoever to attack the Baltic states. It was Russia that gave the Baltic states their independence. Just as it was Russia that gave Ukraine and Georgia their independence.
  • Imperial Washington is leveraging the reasonableness of the Russian government to put Russia in a propagandistic light. The Russian government has permitted itself to be put on the defensive and has given the attack to Washington.
  • Russia has not attacked anyone except the terrorist group ISIS. Allegedly, Washington is opposed to terrorism, but Washington has been using ISIS in an effort to overthrow the Syrian government with terrorism. Russia has put a halt to that. The question before us is whether the Russian government so desires to be accepted by the West that Putin sells out Syria to Washington/Israeli dismemberment in order to show that Russia is a good partner for the West.
  • If Russia doesn’t get over its affection for the West, Russia will lose its independence.
  • My understanding is that Russia has been resurrected as a Christian, morally principally country, perhaps the only one on earth. The question that the Russian people and their Russian government need, desperately, to ask themselves is: Do we want to be associated with the War Criminal West that disobeys not only its own laws, but also international laws?
  • The vast majority of the evil in the world resides in the West. It is the west with its lies and greed that has devastated millions of people in 7 countries during the new 21st century. This is the most threatening beginning of a new millennium in modern times.
  • Unsatisfied with its looting of the Third World, South America, Greece, Portugal, Latvia, Argentina, and now Brazil and Ukraine, the Western Capitalists have their sights set on Russia, China, India, and South Africa.
  • What a prize it would be to get Russia with all that vast expanse of Siberia that can be environmentally brutalized and destroyed for capitalist profits. The Russian government’s offering of free land in Siberia had better be limited to Russian citizens Otherwise, the land is likely to be bought up by the West, which will use its ownership of Russia to destroy the country.
  • The Russians and the Chinese are blinded by the fact that they lived for decades under oppressive and failed regimes. They look to the West as success. Their misreading of the West endangers their independence.
  • Neither Russia nor China seek conflict. It is a gratuitous and reckless act for Washington to send the message to Russia and China that they must choose vassalage or war.

Source: paulcraigroberts.org

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05.19.16 –    Small Business Owner Explains The Unintended Consequences Of Obamacare

  • The Affordable Care Act, affectionately called Obamacare, has been stacking up wins lately.
  • Over just the last few months we’ve shown the stunning developments that have taken place in the insurance industry as a result of Obamacare. Namely that insurance companies have begun a mass exodus from Obamacare markets because it is simply not profitable, and for those businesses that choose to remain, they have been forced to significantly increase premiums. Most recently, patients who purchases plans on the exchange have been getting turned down by doctors and hospitals who say they do not take Obamacare.
  • The impact on small business is something else we’ve discussed, most recently when a small business owner admitted to Hillary Clinton in a town hall event that her premiums had gone up $500 a month, which in turn made it difficult to cover the cost of insurance for her family, let alone think about offering it to her employees.
  • Lawmakers are well aware of their policy error, and on Wednesday yet another small business owner testified in front of the Senate committee on small business and entrepreneurship to explain what he has experienced as a result of congress rushing to get Obamacare passed.
  • Tom Kunkel, president and CEO of Maryland-based Full House Marketing and Print explained that he once hoped that Obamacare would have a favorable benefit to his business.
 “From a small business perspective, the ACA could have been a huge relief and benefit. I was reimbursing employees for their premiums, because this offered me as a small business a way to compete with larger companies who provided employer-sponsored health insurance plans.”
  • He later got a dose of reality when he was notified by his accountant of IRS Notice 2013-54, which prevents businesses from assisting employees with their individual market health insurance.
 “I was stunned. Mid-year, I had to tell my employees I could no longer reimburse them for health care and that they were essentially on their own. I had several employees who could not afford their premiums without my contribution.”

“One of my employees has cancer, and was not able to get his prescription refilled for over three weeks because of the new plan.”

  • He concluded by telling lawmakers that Obamacare has impacted his company’s ability to operate profitably, and is leading to less hiring, more expenses, and businesses will sometimes have to close their doors because of it.
“IRS Notice 2013-54 has essentially taken us back to the situation before the Affordable Care Act where a small business can not afford to offer health benefits to its employees. I feel the burden of many new initiatives as they affect my company’s ability to operate profitably and to hire and retain employees. Many of these initiatives often have unforeseen consequences and cause small businesses additional expenses and burdens that can lead to less hiring, more expenses, and sometimes lead to businesses closing their doors.
  • We can’t say we’re surprised at any of the testimony, because as is always the case, the more the central planners get involved, the more unintended consequences occur, hurting the very individuals they are intending to help.

Source: zerohedge.com

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05.19.16 –    ‘Terror more likely than tech failure’: 5 things we know so far about missing EgyptAir plane

  • An EgyptAir Airbus A320 with 66 on board went missing over the Mediterranean hours after it took off from Paris’s Charles de Gaulle Airport. There have been reports of debris and life vests being found. Here’s what is known about the disappeared MS804 so far.
    Follow LIVE UPDATES on search for EgyptAir flight missing over Mediterranean
  • 1. THE AIRCRAFT
    On MS804, EgyptAir operated an Airbus A320 – a narrow-body airliner, considered safe and reliable in the industry to serve short- or medium-haul destinations. According to the Airbus’ statement, this 13-year-old plane was delivered to EgyptAir in 2003 and has accumulated 48,000 flying hours in total.
  • Egyptian Aviation Minister Sherif Fathy told journalists the plane was in good technical condition and had passed all necessary safety checks.
  • In 2013, the missing A320 reportedly experienced engine failure, SkyNews Arabia said, citing an Egyptian civil aviation source. At that time, the aircraft was scheduled to fly from Cairo to Istanbul, but had to return for an emergency landing.
  • 2. THOSE ON BOARD
    On board the aircraft were 66 people, including 56 passengers – three of them children – and 10 crewmembers. The crew consisted of two pilots, five flight attendants and three security personnel. Among the passengers, EgyptAir listed 30 Egyptians, 15 French, two Iraqis and one citizen each from the UK, Belgium, Kuwait, Saudi Arabia, Sudan, Chad, Portugal, Algeria and Canada.
  • The airline insists the pilots were highly experienced. The captain had 6,275 flying hours, including 2,101 on the A320, while his first officer had a total of 2,766 flying hours.
  • According to Greece’s civil aviation authority, which has released a timeline of the plane’s journey over national airspace, “the pilot was in good spirits and thanked the [air traffic] controller in Greek” before radio contact with MS804 was lost.
  • 3. WHERE & WHEN MS804 WENT OFF RADAR SCREENS
    The EgyptAir A320 took off from Charles de Gaulle at 11:09 p.m. local time (2109 GMT) on Wednesday and was expected to arrive in Cairo by 3 a.m. on Thursday. A direct flight usually lasts around four hours.
  • According to the latest update from EgyptAir, Flight MS804 went off the radar above the Mediterranean about 280km (175 miles) from the Egyptian seacoast at 2:30 a.m. Cairo time (0030 GMT) at an altitude of 37,000 feet (11,300 meters). Greek authorities have declared a 40-mile (64km) no-fly zone over their part of the airspace in the vicinity of the search zone in the southern Mediterranean, a Greek diplomat said in Cairo. The zone was established, based on the location of the last signal coming from the missing plane.
  • Previous reports also suggested that the plane crashed 130 miles from the Greek island of Karpathos, according to AFP, citing an aviation source in Greece.
  • 4. TERRORIST ACT MORE LIKELY THAN TECHNICAL FAILURE
    Fathy, Egypt’s aviation minister, said that a terrorist attack “was more likely” to have taken down the missing EgyptAir flight than any other cause, but urged people not to draw any premature conclusions about the crash.
  • The director of the Russian Federal Security Service (FBS), Alexander Bortnikov, said his agency believes it was a terrorist attack that brought down the plane: “To our utmost regret, one more accident happened to an aircraft of the Egyptian airline. Apparently, this is a terrorist act that killed 66 nationals of 12 countries.”
  • An Australian civil aviation expert, Geoffrey Thomas, told RT that the security system at Charles de Gaulle was good but not impenetrable: “The one thing what the industry does fear is the ‘inside job’ when you have an airport worker who might be associated with some groups.”
  • “There’s always a possibility that something is smuggled on board.”
  • According to previous media reports, there have been serious security breaches in France’s Charles de Gaulle and Orly airports, when dozens of staff were on spy watch for their sympathies or links to Islamist organizations.
  • 5. POSSIBLE DEBRIS FOUND
    As the search and rescue operation was in full swing, media reports said possible debris have been found by a Greek frigate. “There have been finds southeast of Crete, inside the Cairo flight information region,” spokesman for Greek army general staff Vassilis Beletsiotis was quoted by AFP as saying.
    The objects reportedly were “plastic” and “colored red and white objects,” Reuters reported earlier, citing defense sources. They were detected some 370 km south of the Greek island of Crete, close to the area where a transponder signal was emitted earlier.
  • Greek state TV ERT also said that two “orange-colored” objects and also life vests were spotted in the same area.
  • Egypt, France and Greece have joined forces in scrambling military aircraft and ships for a search operation in the area

Source: rt.com

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05.19.16 –   Shame On The Supreme Court For Making A Mockery Of The First Amendment

“The vitality of civil and political institutions in our society depends on free discussion… It is only through free debate and free exchange of ideas that government remains responsive to the will of the people and peaceful change is effected. The right to speak freely and to promote diversity of ideas and programs is therefore one of the chief distinctions that sets us apart from totalitarian regimes.”—Justice William O. Douglas, Terminiello v. City of Chicago (1949)
Shame on the U.S. Supreme Court for making a mockery of the First Amendment.

  • All the justices had to do was right a 60-year wrong that made it illegal to exercise one’s First Amendment rights on the Supreme Court plaza.
  • It shouldn’t have been a big deal.
  • After all, this is the Court that has historically championed a robust First Amendment, no matter how controversial or politically incorrect.
  • Over the course of its 227-year history, the Supreme Court has defended the free speech rights of Ku Klux Klan cross-burners, Communist Party organizers, military imposters, Westboro Baptist Church members shouting gay slurs at military funerals, a teenager who burned a cross on the lawn of an African-American family, swastika-wearing Nazis marching through the predominantly Jewish town of Skokie, abortion protesters and sidewalk counselors in front of abortion clinics, flag burners, an anti-war activist arrested for wearing a jacket bearing the words “F#@k the Draft,” high-school students wearing black armbands to school in protest of the Vietnam War, a film producer who created and sold videotapes of dogfights, a movie theater that showed a sexually explicit film, and the Boy Scouts of America to exclude gay members, among others.
  • Basically, the Supreme Court has historically had no problem with radical and reactionary speech, false speech, hateful speech, racist speech on front lawns, offensive speech at funerals, anti-Semitic speech in parades, anti-abortion/pro-life speech in front of abortion clinics, inflammatory speech in a Chicago auditorium, political speech in a private California shopping mall, or offensive speech in a state courthouse.
  • So when activist Harold Hodge appealed to the U.S. Supreme Court to defend his right to stand on their government plaza and silently protest the treatment of African-Americans and Hispanics by police, it should have been a no-brainer, unanimous ruling in favor of hearing his case.
  • Unfortunately, the Supreme Court is not quite as keen on the idea of a robust First Amendment as it used to be, especially when that right is being exercised on the Court’s own front porch.
  • Not only did the Court refuse to hear Hodge’s appeal, but in doing so, it also upheld the 60-year-old law banning expressive activity on the Supreme Court plaza. Mind you, this was the same ban that a federal district court judge described as “unreasonable, substantially overbroad…irreconcilable with the First Amendment,” “plainly unconstitutional on its face” and “repugnant” to the Constitution.
  • Incredibly, one day after District Court Judge Beryl L. Howell issued her strongly worded opinion striking down the federal statute, the marshal for the Supreme Court—with the approval of Chief Justice John Roberts—issued even more strident regulations outlawing expressive activity on the grounds of the high court, including the plaza.
  • Talk about a double standard—a double standard upheld by a federal appeals court.
  • And what was the appeals court’s rationale for enforcing this ban on expressive activity on the Supreme Court plaza? “Allowing demonstrations directed at the Court, on the Court’s own front terrace, would tend to yield the…impression…of a Court engaged with — and potentially vulnerable to — outside entreaties by the public.”
  • Translation: The appellate court that issued that particular ruling in Hodge v. Talkin actually wants us to believe that the Court is so impressionable that the justices could be swayed by the sight of a single man standing alone and silent in a 20,000 square-foot space wearing a small sign on a day when the court was not in session.
  • What a load of tripe.
  • Of course the Supreme Court is not going to be swayed by you or me or Harold Hodge.
  • This ban on free speech in the Supreme Court plaza, enacted by Congress in 1949, stems from a desire to insulate government officials from those exercising their First Amendment rights, an altogether elitist mindset that views the government “elite” as different, set apart somehow, from the people they have been appointed to serve and represent.
  • No wonder interactions with politicians have become increasingly manufactured and distant in recent decades. The powers-that-be want us kept at a distance. Press conferences and televised speeches now largely take the place of face-to-face interaction with constituents. Elected officials keep voters at arms-length through the use of electronic meetings and ticketed events. And there has been an increased use of so-called “free speech zones,” designated areas for expressive activity used to corral and block protestors at political events from interacting with public officials. Both the Democratic and Republican parties have used “free speech zones” at various conventions to mute any and all criticism of their policies and likely will do so again this year.
  • We’re nearing the end of the road for free speech and freedom in general, folks.
  • With every passing day, we’re being moved further down the road towards a totalitarian society characterized by government censorship, violence, corruption, hypocrisy and intolerance, all packaged for our supposed benefit in the Orwellian doublespeak of national security, tolerance and so-called “government speech.”
  • Long gone are the days when advocates of free speech could prevail in a case such as Tinker v. Des Moines. Indeed, it’s been more than 50 years since 13-year-old Mary Beth Tinker was suspended for wearing a black armband to school in protest of the Vietnam War. In taking up her case, the U.S. Supreme Court declared that students do not “shed their constitutional rights to freedom of speech or expression at the schoolhouse gate.”
  • Were Tinker to make its way through the courts today, it would have to overcome the many hurdles being placed in the path of those attempting to voice sentiments that may be construed as unpopular, offensive, conspiratorial, violent, threatening or anti-government.
  • Indeed, the Supreme Court now has the effrontery to suggest that the government can discriminate freely against First Amendment activity that takes place within a government forum, justifying such censorship as “government speech.”
  • If it were just the courts suppressing free speech, that would be one thing to worry about, but First Amendment activities are being pummeled, punched, kicked, choked, chained and generally gagged all across the country. The reasons for such censorship vary widely from political correctness, safety concerns and bullying to national security and hate crimes but the end result remains the same: the complete eradication of what Benjamin Franklin referred to as the “principal pillar of a free government.”
  • If Americans are not able to peacefully assemble outside of the halls of government for expressive activity, the First Amendment has lost all meaning.
  • If we cannot stand silently outside of the Supreme Court or the Capitol or the White House, our ability to hold the government accountable for its actions is threatened, and so are the rights and liberties which we cherish as Americans.
  • Living in a so-called representative republic means that each person has the right to stand outside the halls of government and express his or her opinion on matters of state without fear of arrest.
  • That’s what the First Amendment is all about.
  • It gives every American the right to “petition the government for a redress of grievances.” It ensures, as Adam Newton and Ronald K.L. Collins report for the Five Freedoms Project, “that our leaders hear, even if they don’t listen to, the electorate. Though public officials may be indifferent, contrary, or silent participants in democratic discourse, at least the First Amendment commands their audience.”
  • Unfortunately, through a series of carefully crafted legislative steps, government officials—both elected and appointed—have managed to disembowel this fundamental freedom, rendering it with little more meaning than the right to file a lawsuit against government officials.
  • In the process, government officials have succeeded in insulating themselves from their constituents, making it increasingly difficult for average Americans to make themselves seen or heard by those who most need to hear what “we the people” have to say.
  • Indeed, while lobbyists mill in and out of the homes and offices of Congressmen, the American people are kept at a distance through free speech zones, electronic town hall meetings, and security barriers. And those who dare to breach the gap—even through silent forms of protest—are arrested for making their voices heard.
  • Clearly, the government has no interest in hearing what “we the people” have to say.
  • We are now only as free to speak as a government official may allow.
  • Free speech zones, bubble zones, trespass zones, anti-bullying legislation, zero tolerance policies, hate crime laws and a host of other legalistic maladies dreamed up by politicians and prosecutors have conspired to corrode our core freedoms.
  • As a result, we are no longer a nation of constitutional purists for whom the Bill of Rights serves as the ultimate authority. As I make clear in my book Battlefield America: The War on the American People, we have litigated and legislated our way into a new governmental framework where the dictates of petty bureaucrats carry greater weight than the inalienable rights of the citizenry.
  • Without the First Amendment, we are utterly helpless.
  • It’s not just about the right to speak freely, or pray freely, or assemble freely, or petition the government for a redress of grievances, or have a free press. The unspoken freedom enshrined in the First Amendment is the right to think freely and openly debate issues without being muzzled or treated like a criminal.
  • Just as surveillance has been shown to “stifle and smother dissent, keeping a populace cowed by fear,” government censorship gives rise to self-censorship, breeds compliance and makes independent thought all but impossible.
  • In the end, censorship and political correctness not only produce people that cannot speak for themselves but also people who cannot think for themselves. And a citizenry that can’t think for itself is a citizenry that will neither rebel against the government’s dictates nor revolt against the government’s tyranny.
  • The architects, engineers and lever-pullers who run the American police state want us to remain deaf, dumb and silent. They want our children raised on a vapid diet of utter nonsense, where common sense is in short supply and the only viewpoint that matters is the government’s.
  • We are becoming a nation of idiots, encouraged to spout political drivel and little else.
  • If George Orwell envisioned the future as a boot stamping on a human face, a fair representation of our present day might well be a muzzle on that same human face.

Source: zerohedge.com

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05.18.16 –    With ‘Recovery’ Disproved, There Is Every Need To Examine The Worst Case

  • There is a great deal that is wrong with mainstream economic commentary, starting with its unwavering devotion to orthodox economics and unshakable faith in their “stimulus.” No matter how little is actually stimulated there is never any doubt that the media will simultaneously forget the last one while lavishing praise on the next one. It is, however, the actual economic commentary itself that may be the most damaging. Because nothing works, every news story is printed from the shallowest, narrowest perspective. It is a grave disservice to the public and journalism.
  • As an example, on July 15, 2015, the Wall Street Journal published an articleon Industrial Production that wasn’t unique or atypical. If you read these kinds of stories you find them utterly devoid of differences, so this effort was entirely symptomatic. At the time, industrial production for June 2015 was estimated to have risen 0.3% month-over-month, ending a string of six consecutive M/M declines. That fact more than the degree of the rise was cheerfully reported as if meaningful.
 U.S. industrial production rose in June, a sign that the improving economy is helping the sector break out of a slump.

Industrial production, a measure of output in the manufacturing, utilities and mining sectors, rose a seasonally adjusted 0.3% from May, the Federal Reserve said Wednesday.

  • Even though the article noted that one month was nowhere near enough to overcome those prior declines, it didn’t matter because it was finally a plus sign conforming to the mainstream “narrative.”
 The pickup comes as other measures show improvement in the economy this spring, with employment continuing to climb and wages creeping up as the labor market tightens…

“Weakness in manufacturing appears to be past its peak,” wrote Jim O’Sullivan, chief U.S. economist for High Frequency Economics in a note to clients.

  • If you happen to peruse similar stories on Industrial Production today, you will find no notice of those prior assurances; no stories discussing how June 2015’s single month was not, in fact, significant at all. There aren’t even any mentions that June 2015 was subsequently revised to now show a decline. This is particularly relevant to the April 2016 estimate released this morning also providing a similar and likely premature huge sigh of relief.
  • All that is bad enough but that isn’t even my main point of contention. It is as I indicated earlier today, that revisions in IP were not limited to monthly variations but rather to rewrite the whole idea of the recovery. At that time, the Fed estimated IP had recovered to about 5% above the prior peak in 2007. Two benchmark revisions later now claim that IP in June 2015 was instead 1%below that prior peak. Economists were basing their claims for “transitory” weakness on not just the shakiness of monthly variation but more so on a recovery that increasingly figures never to have existed. That dramatic change seems worth noting somewhere, especially as it drastically alters all economic implications going forward in this same direction.
  • My emphasis on the IP subcomponent of the production of consumer goods really emphasizes this point since consumers are where this “overheating” idea intersects the supposition of “full employment.” In July 2015, the Federal Reserve figured that IP in consumer goods had “recovered” to 2% less than its prior cycle peak in 2007. The current benchmarks instead figure production levels last June were still almost 11% below last cycle. That is not a minor difference; at -2% you have a difficult time trying to argue “overheating” or “full employment”; at -11% you are deservedly laughed at while attempting to make the same case.
  • Mainstream economic commentary has been proceeding from false assumptions, which is really the point. With those prior benchmark estimates you may be somewhat concerned about weakness, but with the current set of IP numbers you are wholly unsurprised by it and how it would continue on the same track. Again, this is worth comprehensive exposition rather than determined silence and maybe intentional omission. It is the biggest story this century, as country after country falls into social disorder including our own, but the media sits silently stunned as to why anyone would question the economy or really economists.

ABOOK May 2016 IP Revisions

 

ABOOK May 2016 IP Revisions Cons Goods

  • The implications are no longer just about recession, though that remains as a primary risk. What this shows is an economy very much like the participation problem in labor, meaning that the Great Recession revealed economic potential much reduced by prior financialisms under the unrestrainedeurodollar (Alan Greenspan’s quarter point changes to the federal funds rate counted for nothing) of the 2000’s. What should be on the front page of especially the Wall Street Journal is an honest investigation trying to determine or at least raise questions about just how much the economy has been reduced; not more blind deference to the disciples of “transitory.”
  • I have used Milton Friedman’s plucking model to illustrate these implications before, and I think it is useful to do so here in this context. My own concern is not just that economic potential has been shriveled but also a growing sense that there is even more to it than that.

ABOOK May 2016 IP Revisions Pluck Normal

  • Economists at the Fed proceeded on the assumption of what you see above, namely that the Great Recession was a very nasty cycle but a cycle nonetheless. With monetary policy clearing up any financial impediments there was every expectation that the economy would soon rejoin its prior trend even if it took a little bit longer to do so (because of, it was proposed, the lingering after-effects of the panic). Like the IP revisions or the denominator in the unemployment rate, however, that isn’t what we actually find.

ABOOK May 2016 IP Revisions Pluck Question

  • Since it is 2016, now almost ten years into this “cycle” without recovery, it is quite reasonable to assume instead that it never was a cycle at all and that the economic baseline itself shifted.

ABOOK May 2016 IP Revisions Pluck Bend

  • That view would at least account for the economy having shrunk after the Great Recession, but it leaves unaccounted the possibility of what economic potential or trend might have been before it. Given the state of the global economy under the eurodollar standard in the mid-2000’s, we have every reason to believe that potential did not “bend” starting in 2008. In other words, the economic mirage of the middle 2000’s everywhere from the US housing bubble to the Chinese or Brazilian “miracles” was false prosperity that papered over growing global impoverishment. In that case, the stylized model of trend and cycle is more so this:

ABOOK May 2016 IP Revisions Pluck New

  • But I believe there is still another baseline scenario that also deserves consideration. While the Great Recession seems to have revealed the reduced economy and its shriveled foundation, there is still the possibility that the deep recession itself and the interaction with the lack of recovery further amplifiedthat depressive instinct; the baseline trend also bent in 2008 even after having been pushed downward before it.  It is the only way to account for what we already see in places like Brazil, where the “dollar” derived slowdown progressed from slow and steady growth to slow and steady contraction to now steady depression. It seems as if there is no bottom.

ABOOK May 2016 IP Revisions Pluck New Worst

  • This would propose that the Great Recession not only revealed the shrunken economy but frighteningly added its own weight to it.Unfortunately, it is an all-too-realistic scenario in a financialized economy that was once dependent upon solidly growing credit supply (which itself was dependent upon the unbroken geometric growth of credit-based “money”) for marginal expansion. As we find in Brazil, there really is no bottom in sight even though contraction has been in place for just about threeyears already!

ABOOK May 2016 IP Revisions Brazil IP

ABOOK May 2016 IP Revisions Brazil IP Trends

  • The only way that happens is if actual economic potential (meaning in the real economy as opposed to some number provided by BEA or Federal Reserve statistical models) follows the path I suggest above. Brazil is admittedly a severe and extreme example, but the outlines of the US labor market and other indications of US “demand” follow the same general idea. That would mean that recession cycles lead to a ratchet effect, where after each the economy only gets worse.

ABOOK May 2016 IP Revisions IP Consumer PontentialABOOK May 2016 IP Revisions IP Labor Potential

  • This scenario would recommend that the “debate” about US or global recession is actually a secondary consideration. More attention might better be paid to understanding the true nature of the past ten years than whether or not one month of seasonally-adjusted IP, before revisions, can be endlessly extrapolated into Xanadu. What the revisions show without argument is that the US economy is and has been in serious trouble all along – that an economy that suddenly leaves 15 million out of it is not an economy anywhere close to “normal.” Where it goes from here is absolutely up for debate, but that argument doesn’t start anywhere near “full employment” or “overheating.” It is left instead trying to figure only degrees of bad and worse.
  • To be clear, I am not proposing that the worst case is the base case. Rather, I am only suggesting that current circumstances and more so how the economy got this way do not rule it out. It should be seriously considered rather than still more universal mainstream ignominy of “unexpected” or “transitory.”

Source: zerohedge.com

 

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